Savvy Startup Guide – Startup Accelerator
Steps to Launching Your Own Green Home Business
Do you wish to start your own green home business? What are the main steps from having nothing to launching your startup company? What can seriously impact your progress? Based on our own experience and knowledge we came up with this checklist on what needs to be done to bring your green startup to life. Please do not hesitate to contact us if you would like to share your suggestions or you would like to know more details.
There are a few things to keep in mind before we proceed with the checklist. Be patient and do not expect immediate results, it can take up to a few years to reach success. Be prepared to invest both Money and a huge amount of your time in growing your home business. Reserve extra resources, e.g., time and money, in case of unforeseen events. Always schedule and track your progress; stick to the deadlines. Design several scenarios of how to proceed forward and define go-no-go conditions for each of those. Having backup is always great. Always stay energy-efficient and use as few resources as possible. Reuse and recycle whatever and whenever you can! There are many useful resources and help out there; do not hesitate to use them.
Here are the main steps required to launch your own startup company: the idea, state-of-the-art research, product viability research, making a minimum viable product (MVP), protecting your intellectual property (IP), cost analysis, the sales model, business registration, marketing and PR, and seed funding.
Like any other startup business, it starts with a passion and the idea. In our case, it was the passion to leave behind a better world. Actions speak louder than words, and only a few individuals decide to proceed forward with their ideas. With that being said, you have to take action with your ideas and maket hem happen. Your idea must be competitive, affordable, and sustainable. For us, it was GreenSert, the only pocket-sized sustainable cup, along with RecyClad, its biodegradable holder.
And trust us, it is not easy to develop your idea while having a full-time job, both professionally and personally. Be prepared to sacrifice your “couch time” and always be grateful to your family and friends who will support you on a constant basis.
Before you start to pitch your idea, you have to do plenty of state-of-the-art research. You want to find out if somebody has tried it before or at least make sure if there is anything out there that has a similar concept. Check if there are fundamental issues stopping you from implementing your idea. Thorough research will give you a good understanding of what the strong and the weak sides of your idea are that you will need to make note of. This first step is essential because you want your idea to be different, functional, and useful.
“If you have a physical product, 3D printing provides a very fast and cost-efficient way to make the prototypes.”
Product Viability Research
Once the state-of-the-art research is completed, you can start product viability research and pitch the idea within your inner circle, close friends and relatives. However, you have to understand that the results of the first pitch can be biased and misleading, so you need to take a second round on your research. You have to broaden your circle and approach potential customer and investors. One of the options is to do an online survey, which will also indicate who is actually going to like and use your product.
MVP is a development technique, in which your product is developed with sufficient features to satisfy early adopters. This approach is perfect for a startup company because it saves a lot of resources and allows very fast prototyping. The path from scratch paper design to an actual prototype is quite challenging and fun at the same time. For us, this was something completely new, and we were gaining new experience both as inventors and business owners. There is no better place for making your prototype than your own home. It is free and it has the required space for what you need to accomplish. Continuously brainstorm the idea to make the prototype better and better until you have a decent prototype.
If you have a physical product, 3D printing provides a very fast and cost-efficient way to make the prototypes. If you want to make sure you will not stretch your development budget, you can buy the least expensive DIY 3D printer. However, everything comes with its own price, and for you it could be the time you will have to spend to tune the 3D printer and fix all the hiccups (and you may have plenty of them!).
Making the prototype is not an easy task; it is better to divide the prototyping stage into several portions to save resources and expedite the design optimization. Once you have a good-looking prototype, you have to make sure it is compatible with the current industrial practices. In the end, you cannot make something if you do not have the right tools.
Protecting Your IP
The next step on the list is to protect your best asset which is your IP. You need to make sure your idea will not be violated or copied by others. At the same time, it will give you the freedom to share more detailed information with others. Filing a provisional application is the best option because it is the least expensive way to protect your idea and gives you plenty of time (One year) to explore the market. If the market accepts your idea, you can always file the patent before the provisional application expires.
This step is critical and you need to spend a lot of time taking into account all associated costs and minimizing the expenses. For starters, it is much easier to subcontract the execution of the idea to experts, who know how to make it in a proper way. From our side, we wanted to make sure Tech New Logica makes only high-quality products; that is why we wanted to partner with the best contract manufacturers. Discussions include the cost negotiation, obtaining and securing the lead time of the materials, minimum order quantity (MOQ), raw materials to use, etc. It is better to have the headache and fix all the issues now rather than later! In addition, we strongly believe that in order to achieve the highest quality product, the only way would be to partner with U.S. manufacturers. Product quality strongly impacts the company’s reputation, especially for a startup company like yours. Once you have the prices for the manufacturing, add the shipping costs, applicable fees and taxes, and packaging costs. Add extra for unforeseen costs; in the end you do not want to end up owing money.
Once you have all the costs associated with making your product, you have to define the price. A rule of thumb is that the retail price should be approximately four times the production costs, and the wholesale price should be twice the costs. For a startup company, those numbers can be higher, depending on the market readiness. Next, you have to decide how you are going to sell your products. Is it going to be business to customer, business to business, or both? You can sell your products online and/or in stores. You need to summarize all of the benefits and disadvantages and pick the best options for your product.
Now it is time to make your company official. We highly recommend you to register your company as a limited liability company (LLC) because it will be easier to track the expenses, it will protect your personal assets, and it provides you with more credibility. If you want to name your company other than yourself, you need to register a fictitious business name first. During the business registration period you will have to travel several times because there are many step-by-step procedures needed to be completed. We decide to get help and hired a registered agent for our company who assisted us with this task. All these steps were a must because you want to make sure you do everything properly and abide with the law. Once you complete all these steps, you obtain the Employer Identification Number (EIN). With the EIN, you can open a business account and apply for a business credit card. It is highly recommended to separate your personal assets from the company’s assets because it makes accounting and tax filing way easier.
“A rule of thumb is that the retail price should be approximately four times the production costs, and the wholesale price should be twice the costs.”
Marketing and PR
In this digital age, everybody needs a website to represent and market their company and product. Plastic and coffee cups are a major problem for both our health and environment, and we wanted people to be fully alerted on this issue. Therefore, we made our website full of information and videos about the environmental impact, provided the references to peer-reviewed publications, described in detail our own solution, etc. Most of the information is available online, and we tailored our website to be a one-stop destination for people to learn about the hazards hidden in a plain sight.
Next, you have to generate all the marketing materials for your products. You can try it yourself, but we highly recommend making professional photos and videos. In the end, you get what you pay for, and good-looking pictures and videos are the best assets for successful marketing. After you collected all of these materials, you can start doing outreach to the media. When we completed the materials from our end, we realized that a PR campaign is not something that we could handle ourselves. We were fortunate enough to find and work together with a great PR company who guided our every step on the way to come up with the best and most effective approach for us.
Once you have the good-looking story and all the numbers to make your case, start looking for seed funding. It can be small business support programs, e.g., EPA grants and SBIR/STTR, exhibitions and competitions, your personal outreach to potential investors, crowdfunding platforms, etc. This is essential if you want to have an actual product instead of the prototype without making prohibitively significant investments from your side. At the same time, you will get valuable feedback and suggestions for your products.
And now after all the blood, sweat and tears, you will be ready to launch your product to the public. Honest intentions and hard work should always pay off in the end. We started all of this from our home, and most importantly we are enjoying our journey and learning new things at the same time.