Last Spring, I invited my niece Molly and her husband, Ted Fienning, to SIBL to trace the meteoric rise of their new company Babiators, which, in less than a year, grew from an idea sketched on a napkin to a thriving enterprise. The audience's avid response to their nuts-and-bolts account of launching a startup in NYC inspired a series of talks by other successful metro-area entrepreneurs that will kick off in Fall 2102 as SIBL heads into its fourth StartUP! Business Plan Competition season. For now, I asked Ted to flesh out some of the points they made in their presentation.
Ted, you two move so fast that we'd better start with an update on Babiators' growth in the twelve weeks since your presentation at SIBL.
So glad you asked. Since our March 8 appearance at SIBL our "safe, durable, and awesome" sunglasses for kids from 1 to 3+ are on the shelves at 250 retailers. The Babiators brand has expanded to 17 countries. And we're fortunate to continue to receive fabulous coverage in over 50 media outlets, including The Huffington Post and CNBC during the same week in April. Remember when I cautioned, "don't quit your day job?" We're growing so quickly that since our talk at the library, our partner has left his corporate career to focus on Babiators full time. I'm now the only one of the four co-founders partners with a "day job" and we've sold over 35,000 pairs. We were on Ellen DeGeneres twice last month.
That reminds me. Babiators is run by two husband-wife teams who are co-founders. A perfect segue into the issue of choosing business partners. Elaborate, please.
For us, there are two crucial considerations in partner-choice. First, trust. Make sure you share the same values, and can depend on the fact that your temperaments as well as your ethics are aligned. After sharing our undergraduate years at Harvard College, and socializing together since graduation, we four knew we had that base covered. Equally important are complementary skills. Our partners, Carolyn and Matthew Guard, are both detailed-oriented, with a penchant for numbers. Quantitative skills, essentials for making financial projections and handling logistics are, frankly, not my strength. Molly and I are more jazzed by the client-facing aspects of the business, like marketing and sales. But there is a big caveat here. Even when, maybe especially when, you are close friends, it's absolutely essential to have a professionally drafted, air-tight legal partnership agreement.
A bit like a pre-nup?
Exactly. It's essential to retain the right of first refusal if one set of partners wants out. A good agreement gives all partners an incentive to work things out.
Even with your complementary abilities and interests, Babiators' partners aren't handling all aspects of the business, right?
No way! We put many important functions of our business — from source manufacturing and packaging, sales, order fulfillment, overseas freight and customs handling, website development, IP and other legal matters — in the hands of folks with the real expertise. It's worth every penny when you outsource to experienced professionals. At the outset, we used a chunk of our limited funds for market research. We hired a firm to survey what we considered our target market. This investment paid off in spades because we learned what was important to the parent consumers — like BPA-free, non-toxic products — and what irked them, too. Kids losing sunglasses was an issue, so we created our unique Lost and Found Guarantee feature. This research yielded us our safe-durable-awesome tag line and led to the right price point. So yes, we let the pros do what they do best, and what we have no interest or time to do. Good business and good balance, too.
Just identifying a range of vendors seems a job in itself. How do you know you're hiring quality?
We talk a lot to a lot of small business owners and entrepreneurs who are generous with referrals. Even with recommendations from trusted contacts we ask for references. Checking out a vendor's web presence is helpful too.
Molly couldn't say enough about the importance of PR to getting out the Babiators story.
Right! From our perspective, creative public relations beats costly advertising hands down. Our initial PR hire in Atlanta did not work out. We'd recommend looking for a PR professional from either coast. Being New York or L.A.-based equates to more connections. How's this for return on investment? Babiators is featured on Good Morning America and next day our sales peak nation-wide. Our PR firm has gotten us terrific seasonal/travel/kids off to camp media coverage for Babiators. So our advice to a startup up with limited funds: a good PR person is better value than advertising which requires big bucks.
My personal favorite is the thirty-something Molly featured in More, a magazine whose target demographic is, shall we say, the slightly more mature woman.
More Magazine has many readers who have bought or would buy Babiators. I have to add that the best PR is still a satisfied customer who recommends Babiators by word of mouth or posts photos of their adorable children in our glasses on our website.
Or becomes a Babiators gift-er. Can you recall the "aha!" moment when you realized that the birthday or shower gift packaging offered another opportunity to get out the word?
We knew the box was going to be a hit as soon as retailers got a look at it. To be totally honest, we put together the box to educate the consumer about sun safety and the durability of the glasses, but the packaging really took off as a way to wrap and gift Babiators as either a main or additional baby shower or birthday gift.
Before we close, Ted, can you recommend a few books or magazines that have fueled your entrepreneurial spirit?
Rich Dad, Poor Dad by Robert Kiyosaki: This book provides a philosophical mindset for thinking about money, business, goal setting, and personal growth. It's not a road map to riches, but it lays the foundation for an approach to escaping a salaried lifestyle. In fact, this book explains how not taking risk and learning about money is actually riskier than not taking action.
Four Hour Work Week by Tim Ferris: If you can get past the author's ego, this book is full of very practical tips for organizing ideas into a functioning, money-making business.
Here are three powerful tools to help startups find vendors to which they can outsource business functions.
1. Reference USA - a comprenensive online directory of domestic companies. Be creative in searching. Go to U.S. Businesses → Custom Search → Business Type → Keyword/SIC/NAICS.
- For sales agents, search under MANUFACTURERS-AGENTS & REPRESENTATIVES
- For web site developers search under WEBSITE DESIGN SERVICE
- For market research, search under MARKET RESEARCH & ANALYSIS; MARKETING CONSULTANTS; MARKETING PROGRAMS & SERVICES; PUBLIC OPINION ANALYSTS
- For logistics, search under MAIL ORDER FULFILLMENT SERVICE; EXPORTERS MAIL ORDER & CATALOG SHIPPING; FREIGHT BROKERS & AGENTS; AIR CARGO SERVICE; CUSTOMS BROKERS; CUSTOMS CONSULTANTS.
2. Panjiva, a global directory of suppliers and factories, worldwide. Helps you identify where your competitors are sourcing product.
3. O'Dwyer's Directory of Public Relations Firms. The title says it all.
Can't make it to the Library? Search these websites from office or home.