LLC

The Realization

Sorry for not posting more frequently, I’ve been very busy at my part time job teaching ESL this week. But I did want to share a big decision I’ve made this week.

Since I came up with the BeddyBye idea I’ve read a lot about entrepreneurship. All the advice suggests that you ask yourself how involved do you want to be. Do you see yourself running the day to day operations of the business, or would you rather develop the concept and then sell it?

For a long time I was certain that I would want to run the day to day operations – work with manufacturers, run the website, organize the shipping and inventory, and improve marketing. However, when I think about how much is involved with manufacturing it is overwhelming. There is a reason why so few people enter the manufacturing business, or sell their ideas to an established business- the start up costs are so high for an individual entrepreneur. I realized that I don’t want that to be my full time job.

I have decided to take a month long break from BeddyBye and then I will focus on selling the idea. I think the best option is to get a provisional patent and then sell the idea with the website domain and the LLC. I want to see my dream realized, but when I’m honest with myself, I recognize that I don’t have the energy, drive, or money to handle the manufacturing hurdle. In other words, I would like someone with the experience and resources to take over.

But don’t feel bad for me. I don’t look at this as a failure or as settling. When I set out on the HeSo project my goal was to take my dreams and ambitions more seriously. My goal was not to focus all my attention on one idea. So if I am able to downsize the BeddyBye project, teach ESL (which I love), and work on my exciting next project (which I will write about in the next month or so) I will be true to my HeSo.

A Failing Course of Action?

While I was getting swept up in the excitement of my LLC approval, and having a successful focus group, I forgot about the lingering manufacturing costs.

My current design for the BeddyBye has a plastic infrastructure, a urethane foam covering, as well as a custom fitted sheet. The plastic and foam both need to be made with a mold. Molds are great if you have tens of thousands of dollars lying around and you know that you’ll be selling huge quantities, but the upfront costs make it almost prohibitive for anyone who’s starting out.

So far the cheapest quote for making the mold for the plastic component (JUST the mold – not even the finished product) was around $8,000. Yesterday I got the upsetting news that the molds for the foam (who knew foam needed a mold?) would be $3,000. The kicker is that on top of the mold cost, the cost per unit (if I’m ordering 100 at a time) is $45 each! And that’s just for the foam. There’s no telling how much the plastic units and the fitted sheets will cost. The upfront manufacturing costs will most likely be around $14,000. Even if I forget about the upfront costs, it will  cost about $120 for each baby bed to be made once I have the molds. A hefty number especially when market research indicates that I need to keep the price under $100. With these numbers it’s impossible to ever turn a profit.

This is when I think: Why couldn’t I come up with an easier product? or better yet, Why couldn’t I just be happy with a regular job?

So far I’ve invested $3,500 in this project. That’s nothing compared to my emotional and time investment. At this point I fear “escalation of commitment to a failing course of action.” In other words, am I holding on to an impossible dream just because I made an initial investment? Should I get out before I risk even more?

NOOOOO! That’s the whole point of this blog. I wanted to make the struggle public to hold myself accountable. Otherwise, I would have given up the second I first thought of BeddyBye. When I started the HeSo project I knew it wouldn’t be easy. I was leaving a secure, easy job for the horrifying thrill of following my intuition, believing in myself, and taking risks. Just as a difficult workout makes the heart grow stronger, I believe making difficult decisions will make my HeSo stronger!

Stay tuned for some of the solutions I have brewing!

Success is almost totally dependent upon drive and persistence. The extra energy required to make another effort or try another approach is the secret of winning.

Denis Waitley

I’m a Limited Liability!

Yesterday I got a thick envelope from the New York State Department telling me whether or not my LLC filing was accepted. It brought me right back to senior year of high school, waiting to hear back from the colleges I applied to. I ripped it open, and there in courier font it said “I hereby certify, that BeddyBye, LLC a New York Limited Liability Company filed Articles of Organization blah blah blah.” Yea it’s official!  I just need to advertise the formation of my LLC in trade journals for a few weeks and then it’s really official.

My prototype is also taking shape. I’m up to my third version, and it’s really starting to look unique and functional. My awesome friend, Pam, offered up her house to host a focus group with new moms. Only one mom was able to come, but seeing her baby sleeping in the BeddyBye was priceless. Plus the feedback I got was really useful. I’m looking forward to making the adjustments and presenting it to more moms (and babies).

If you know any new moms in the New York City area who would like to give their input on a new, groundbreaking, amazing baby product,  let me know!

Follow up on my new career!

So I’m sure you’ve been sitting on the edge of your seat waiting to hear about my next business step. A few weeks ago I mentioned that I had a great idea for a new product. I thought I should let you in on what I’ve been doing since then.

Alex Eben Meyer

by Alex Eben Meyer

  • I bought the domain name. Unfortunately, someone already owned the original name I wanted. I was able to email the owner and he was willing to sell it for $1,750!!! Can you believe it? I decided to tweak the name a little and register with Active-Domain.com   for $4 a year. However, most other resellers are a lot more reasonable so if you’re interested in buying a domain name that’s already taken you can find the contact info for every domain owner at Whois.com .
  • I’m filling out the paperwork to form an LLC. After talking to a few small business owners I learned that it’s necessary to separate your personal finances from the business. If there is any potential that you’ll be sued, and let’s face it in this day in age you can get sued for anything, your personal finances will be safe. If your company goes bankrupt, your personal savings won’t be in jeopardy. I certainly don’t want my couch to be repossessed. Where would I write my blog posts!
  • I signed up for a free small business owner course at Queen’s community college. NYC.gov is a great resource for free advice.
  • I ordered foam and I’m busy making the prototype. Working with it has caused me to completely revamp the original idea. If you have an idea for a product I would really suggest trying to make it first – no matter how much you think about it, or draw the designs you can’t foresee the actual design flaws until you’re holding it in your hands.
  • I’m sharing my idea with with my target audience. I’ve gotten lots of great suggestions for marketing and design improvements. Everyone has said they would buy it, so that has been really encouraging!
  • I’m blogging about it. Making it public has held me accountable and pushes me forward. Almost everyday someone who’s read my post about finding my future career has asked, “so, ahh, what’s goin’ on with that?” It’s super motivating!
  • I've been so busy my kitchen's a disaster.