Friday, January 19, 2018
By Colin McIntosh, Founder & CEO
Update: the acquisition fell through / never existed / just hasn’t happened yet.
It’s been a rough week. First, we don’t get included on Built in Colorado’s list of 50 CO Startups to Watch in 2018 despite S&G having existed for weeks, and now our fictional exit plan just imploded. Building a company is going to be harder than anticipated. (May 2018 edit: we built it!)
In all seriousness, today actually marks 3 months since Sheets & Giggles' incorporation date (October 19, 2017). I thought it might be worthwhile to take you through a few things that we’ve done in our first 90-ish days to get started as a company. If you ever want to do your own thing, it might come in handy. Hopefully, it’s also an entertaining read.
If you haven’t yet, sign up for our email list here so you'll know when we finally turn all of this hard work into 100%, ultra-soft eucalyptus bed sheets. If you sign up, you’ll help guide our product design and development, but we won’t shell you with emails (e.g., we purposefully / lazily haven’t emailed anyone that signed up last week).
So, here are 10 basic steps to starting a business (and underneath each one, what we actually did) –
You’ll want to create your core strategies from day one, before you do anything else: a 1- or 2-page high-level business plan to share, a detailed go-to-market plan, 18-month financial forecasts, a Kickstarter / Indiegogo plan if a preorder campaign is in the cards for your product, a short- and long-term product roadmap, and a few other miscellaneous docs.
What we did: A 2-page business plan, a brand identity map, a (probably wildly inaccurate) 18-month forecast, a marketing plan that more closely resembles a stream of consciousness, a Google Doc with a bunch of product ideas, and an Indiegogo outline. Hey, it’s a start.
Will you be a solo founder? A co-founder? What skills do you have, and which do you need? There are ways and services to meet co-founders online, but you may want to stay within your network for such an important person (/people).
You can’t do it all alone, so you’ll also likely hire a few initial team members and consultancies, depending on your funding level.
What we did: Solo founder for now, with help from overworked, unpaid interns and underworked, overpaid partner agencies. (We pay our interns, relax.)
VentureBeat has a good checklist of everything you’ll need to take care of, either with an attorney or with LegalZoom: incorporation, IP, equity, hiring, fundraising prep, privacy policies, etc.
You’ll want to create templates you can use over time for NDAs, contractor and employee agreements, and agency partnerships. You’ll also want to file any trademarks that you feel are necessary to protect your brand and business (LegalZoom is very affordable and appropriate for any early ™ work).
What we did: Pretty much this, with some wrinkles. We have awesome attorneys who look out for Sheets & Giggles™. Thanks guys <3
First, ask yourself a few important questions: how much money do you need over the next 12 - 18 months, and why? What will you spend it on? Again, why? Are you being overly optimistic? (You are. Everyone always is.)
There are a bunch of ways to raise money early on: bootstrapping with your savings, a friends & family angel round (said friends & family should be accredited investors), convertible notes, crowdfunding (Kickstarter / Indiegogo), seed-stage funds, AngelList, an incubator or accelerator, an ICO if you’re into decentralized applications and ungodly regulatory risk, and now even capital-as-a-service from Social Capital (they seem great).
^Those links will do a better job explaining anything you’re interested in than I could.
What we’re doing: We recognized early on that fabrics manufacturers require relatively large minimum order quantities, and that eucalyptus bedding is still in its infancy in terms of market adoption, so we’ll need a good amount of capital to get going. More than we’ve raised from our angel investors, and way more than I have in my savings account.
Like many physical product companies, we’ll rely on pre-orders from our May Indiegogo campaign to fund our initial inventory and truly launch the company. (That is, we’re relying on you. So we may be in trouble.)
Crowdfunding has the added benefit of showing non-angel investors that you can generate demand for your company’s offerings. You’ll want to show some initial success in key metrics like market traction, customer acquisition costs, conversion rates, and customer lifetime values.
The major drawback of crowdfunding is that pre-orders are also seen as a liability – you have to fulfill them, preferably on time, on budget, and according to customers’ expectations.
I stressed myself out writing this section.
Opening a small business bank account and credit line is fun. You have to prove you’re responsible, discuss how you’ll build a sustainable business, and deposit an initial capital investment. You should open a business credit card with good rewards on common expenditures like travel, digital marketing, shipping, and other startup costs.
What we did: Immediately spent way too much money on company swag like branded stickers, slippers, eye masks, and pajamas.
Once you have your brand identity mapped out (core value props, org values, purchasing factors, brand archetype, etc.), you’ll want to bring it to life with a suitable logo.
If you don’t have any graphic design friends (and if you do, make sure you pay them for their work – they’re professionals), you can use services like 99designs (moderately expensive, better quality) and Fiverr (super cheap, but fast) to source your logos.
What we did: Hired a Russian calligraphy & lettering artist we found in a New Yorker article to come up with varying forms of our logo. Artem is super talented, and he might be in Denver later this year to grab a beer with us. Would definitely recommend working with him. Side note: it’s apparently really hard to send money to Russia.
Working on it. This one will probably be an entire series of blog posts in and of itself.
Get your website ready to go. There are SEO and website design agencies that can help you get started, or you can fumble through it yourself.
What we did: We used Shopify to design and launch SheetsGiggles.com, which is a domain I impulse-bought late one night last year on GoDaddy.
What we’re doing: Cease exercising entirely, lament starting a company over the holidays, bum Boulder office space off friends (thanks flytedesk!), and sleep only when absolutely necessary (ironic).
I think we’ll classify this post in the “boring, but hopefully useful” category. If you got something out of it, sign up for email updates or email me directly at firstname.lastname@example.org if you want to drop me a note or question.
Leave a comment below to tell me if I’m missing something crucial like step #10 (in which case… we’ll get right on that).