In 2004, I started 2 Virtues Inc. to bring my inventions, Swaddleaze and Blankeaze to market.
I spent money like a rock star.
Out of the gate, I spent:
- $15,000 on a website with a custom shopping cart that didn’t work
- $2,000 for a logo that looked more like a Kama Sutra position than a symbol of safe sleepwear for infants.
- $1,300 on stationery and business cards
- $2,000 on a merchant account setup and monthly fees
- $1,000 on PR leads from ProfNet
- $12,000 on a publicist
- $17,000 on advertising in Pregnancy Magazine
- $4,000 on Google AdWords
I spent $54,000 and that didn’t even include product manufacturing. Who did I think I was? Kimora Lee Simmons?
A lot has changed since then and Chris Guillebeau’s article titled “The Case for the $100 Business” got me thinking.
If I started 2 Virtues now, I’d do things so differently. I could start a business for under $1000 by doing these five things:
1. Skip the Website:
I’d scrap the website with custom shopping cart by creating a WordPress self-hosted blog with Thesis premium theme and hook it up to UltraCart. Of course UltraCart is only for those selling products or services, and even then, it’s not necessary. You could just as easily list your products and services with links to your PayPal account. Oh, and if you haven’t registered a domain name yet, you can do it at Namecheap for like $10.
2. Hire a Freelancer:
Instead of hiring a “big company” to create a logo, I’d find a freelancer on Elance, oDesk or by word of mouth. Freelancers typically charge $60-$90 per hour. Then, I’d prepare ahead of time to make it quick and easy for my freelance graphic designer to nail it within an hour or two. I would:
- Scour magazines, websites and mail for examples of logos that I like
- Choose a basic color scheme (2-4 colors) and get the hex color numbers from The Hex Hub. (The colors I use for The Mogul Mom are #ed1068, #ffffff and #000000.)
- Do a rough sketch of your logo idea and diagram which colors should go where. It doesn’t matter if you have no drawing skills, just do the best you can. My sketches are always hilarious but get the idea across, as Shannon Whealy of Turnaround Design can attest.
- Ask the graphic designer to create my logo in both high resolution and low resolution so it could be used in print (business cards, brochures, etc) and online (email, websites, etc).
I’d “Do It Yourself” as many things as I could. Here are just a few of the things I could do very easily:
- Create a business letterhead using Google Docs. Very simply, I could import my logo and create a footer with my company information, including linkable website and email address.
- Buy the Get Famous eBook for $37, sign up for HARO and begin pitching the media on my own.
- Create an RSS feed using Feedburner so my blog posts are automatically delivered to readers who sign up.
- Link my RSS feed to Twitterfeed so my blog posts are uploaded to Twitter and visible to my followers
- Choose 3-5 keywords and SEO the heck out of my site by using Thesis’s awesome title tags, meta description and meta tags for both pages and posts. Reading 50 SEO Secrets for Mom Entrepreneurs ($39) and Double Mule’s Thesis Tutorial “SEO for Everyone” will kick my SEO up even more. Who needs AdWords when you’ve got Thesis? Not me. (Another great SEO tool to use if you don’t have the Thesis theme? Scribe SEO.)
- Set up Google Analytics on my site so I can track who’s visiting, what they’re reading, who referred them and more.
Cost: $76 if you purchase the two books I mentioned.
4. Become a Social Butterfly:
I’d start networking on blogs and social media sites like Twitter, Facebook and LinkedIn to build interest in my new site and develop the reputation as a knowledgeable, helpful person in my field. I might also:
- Write guest posts and do interviews on blogs
- Hold a Twitter giveaway when I launched a new product
- Answer a question on LinkedIn so I could share helpful information and establish myself as an expert in my field
5. Free Stuff:
I’d use as many free services as possible until my business warranted paid services. Just some of the cool companies I’d use to grow my business without spending a cent:
- Outright: organize your small business finances all in one place
- PicMonkey: powerful and fun photo editing tools
- Dropbox: file storage
- A Weber: build a relationship with your subscribers with auto responders that welcome and educate them.
- Mail Chimp: create awesome email marketing campaigns with loads of customization and integration options.
- Survey Monkey: the simple way to create surveys and learn more about your customers.
- Clicky: the coolest real-time web analytics that lets you monitor, analyze and react to your site’s traffic in real time.
- High Rise: an easy way to track your contacts, leads and deals
- Writeboard: shareable web-based text documents that let you save every edit, roll back to any version, and easily compare changes either solo or in collaboration with others.
Total Cost of My New Business: $953
Using these products, services and tips would have saved me $52, 346.
Wow. That is a ton of money. I could have funded my first production run with that cash. And if I had my products manufactured in China from the get-go, I could have funded my first two production runs with that cash.
Hindsight is 20/20, but I’m not one to live in the past or kick myself about things I can’t change. I’m not a coulda, shoulda, woulda kind of person. I believe what Maya Angelou says:
“I don’t know if I continue, even today, always liking myself. But what I learned to do many years ago was to forgive myself. It is very important for every human being to forgive herself or himself because if you live, you will make mistakes- it is inevitable. But once you do and you see the mistake, then you forgive yourself and say, ‘Well, if I’d known better I’d have done better,’ that’s all. If we don’t do that we never grow, we never learn, and sure as hell we should never teach.”
So, instead of beating myself up about the financial mistakes I made five years ago, I hope to teach you how to avoid them. And maybe someday, if I ever start another business, I’ll do better now that I know better.
How much did you spend on your start up? What would you do differently or more affordably? Did I forget anything?