From Idea to Business

How one person’s unique expertise was turned into a growing consumer product business without mortgaging their house.

Overview

Clients of Usey Solutions are varied in their needs, especially on their goals for starting a new business. Much of our guidance is around the timing, budget, focus, and order of activities to minimize a client’s nest egg before the new business gets traction.

Goal

A client with unique processing know-how wants to start a business to make the safest consumer products.

Assessment

A quick review with client revealed that while the markets were large, they were not well defined, and highly competitive. Funding to move forward was not significant but the founder had time, working space, and strong connections with consumer groups.

Approach

Because of the shortfall in capital, one of two approaches needed to be followed: 1) pursue investment, loans, equity partners, or additional funding immediately, or 2) take a longer, capital-light approach to moving the business forward.

The client chose to move forward without immediately focusing on raising funds. Therefore, the strategy recommended was 1) Only have minimal internal team, 2) Only do minimum initial production of a highly desirable safe product as proof of concept and for marketing, 3) Generate maximum free press by leveraging consumer groups and related press, 4) Seek licensees and/or partners for wider scale production and promotion, 5) In parallel, seek free or cheap money through readily available grants to further defer costs.

Results

Client was able to get significant press raising awareness of their unique products and of the need for them. They were able license their know-how to a limited number of manufacturers who were then able to make and advertise these superior products. With increased demand for their know-how and safer products, growing customer funding, transitional grant support, the client was able to successfully produce, market, and sell their own products and grow their business.

Conclusion

The approach to starting viable companies differs greatly depending on a client’s goals, financial means, timelines, available resources, product or service desirability, targeted markets, constraints (e.g., IP, legal), and many other factors. A systematic but quick approach must be developed hand-in-hand with the client to ensure that a lot of money and time is not wasted pursuing low probability success.