Why We Started a Family Business at Age 50-Plus
It seems that startups should be created by 20-somethings who incubate an idea in their dorm room, generate no revenue and then turn down billions to sell to Yahoo (YHOO) or Google (GOOG).
My new business concept came from my work as an interior designer. When doing projects in New York City I never could find furniture that fit my requirements. So I did what any self-respecting entrepreneur would do, I created my own pieces. They had a smaller profile, were able to multitask throughout the day and in most cases had storage built in. People kept asking where they could find this small space furniture and this became our brand, the Itsy Bitsy Ritzy Shop.
We researched the furniture category thoroughly and found what we considered to be a very broken model. For what might be the fourth largest purchase in a person's life, furniture was manufactured, distributed and sold in an incredibly inefficient way. What's more, what was available in the U.S. often was poor quality and poorly proportioned to fit increasingly smaller living spaces. We believed in our concept and saw a huge opportunity in the marketplace for both consumers and businesses.
Here's the way I looked at starting something new at my age. Providing a much-needed product alternative in the marketplace seemed exciting.
Invest in Your Values
I would rather invest in my family than in something abstract like the stock market. Equity investing means putting your capital and faith in management who probably has very different objectives than yours. If you are going to plunk down a few hundred thousand dollars on an investment, why not invest in yourself? It's a risk you can better control and has the possibility of creating something that has meaning and enduring value for the people you care about.
The idea of starting a family business appealed to me, too. My husband and I had worked together successfully in an advertising agency that we founded and ran together. Adding our son, another trusted partner into the mix, was a bonus.
The IBRshop has been in business about a year and a half. Our run rate is approaching 7 figures. But things have not always gone smoothly. We've learned and have shifted direction since we began.
What Went Wrong
- We thought we could market furniture to consumers online. This has proven to be a hard sell, as people want to see, touch and sit in their furniture before they buy it.
- We were too comprehensive in our product offering with too many SKUs.This made it less efficient for us to build and somewhat overwhelming for consumers.
- We over-engineered our designs. In many cases we were focused on quality when many people are more concerned with price.
- Packing and shipping individual products across the country has been time-consuming and expensive. With our line, you cannot just stick it in a box and send it UPS.
- We were undercapitalized. Having no money to advertise or have a retail presence has hurt.
What We Did Right
- We produce a product we're proud of in a way that's consistent with our values. IBRshop furniture is made in America using high quality materials and workmanship as well as a regard for the environment.
- We've built a brand. The fact that we have received lots of press in places like CNN, HGTV Remodels, Interior Design Product FIND and Apartment Therapy is a tribute to the fact that we have created interesting stories as well as interesting products. Our son has done a spectacular job getting us this PR.
- We've successfully pivoted from B2C to B2B. It didn't take long to figure out that building and delivering at scale would mean a more profitable business. Dealing with individual consumers was often a drain on our time and margins. Selling to small space hotels, vacation home communities, apartment developers and assisted living communities has been smart. Again, our son is helping to get us these deals in an unconventional, yet effective way.
- People we respect have validated our concept. This includes architects, designers, manufacturers and developers.
Would I do it again? Yes. Growing this business has been exciting and gratifying. It's a lot like giving birth. After a lot of pain and suffering, you're thrilled to watch your child flourish.