Starting a business question from a blog reader
Corey Kossack is a Managing Partner at Game Change Ventures, focusing on partnering and consulting with startups in the areas of social media, consumer Internet and e-commerce. Corey is also an Operating Partner at Game Change Ventures' first Internet startup, Addoway, a social marketplace that helps you buy and sell with your friends and the people they know. Formerly Corey was one of the world's largest retailers on eBay, built a $1M company from scratch at age 23, has led multiple startups and received numerous awards for his entrepreneurial achievements.
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I began answering this question from one of my readers, and then just figured I might as well turn this into a blog post so others can benefit from it. The following question was asked:
Q: I was wondering if you would mind taking time and jotting down a few
pointers for me to follow in starting my own business. I've read
countless articles and books, but I still feel like it's best to get
the opinion of those who've really done it. I have a furniture line
that I was going to launch online to make some extra money (especially
with our real estate market being as slow as it is…ps i'm a Realtor
& Appraiser), I have the resources to vertically produce all parts
of my furniture because my family has done it for generations, and then
a lightbulb went off and I was like, I could do this as my business and
get rid of real estate! So now, instead of launching it online and
making a few quick bucks & risk people stealing my idea, I really
think I should make it into my own company & look towards the
future…but how do I do this? How do I protect my ideas & my
designs from people who might steal them? What else is huge that I
should look out for? I'll need to ask my family for inital investment
money to do all this but I feel like it's worth it. Thanks!
A: ok first things first… Stop worrying about people "stealing your idea". The truth is, most ideas are not "original" in the first place, and it takes a tremendous amount of drive, sweat, energy and money to actually turn an idea into an actual business, so not everyone in the world is out there to steal your idea. Plus, you will need help from countless others to turn your business into reality. Most people guard their business and their ideas, but when you do that, no one can help you! For example, if you didn't tell me what your business idea was, I couldn't give you any pointers.
Next, determine what type of business you want to open. You said you have the ability to create your own line of furniture, but where do you want to sell it…? Online, retail stores etc. Do you want to have your own retail store, or do you simply want to design the furniture and then have other people (major furniture stores) sell your stuff for you? You may discover that your strength lies in designing/producing your own furniture, as opposed to running a retail business. Example, Lions Gate Films produces good movies, but they don't have "Lions Gate Retail Stores" around the country, they sell they manufacture the products, sell them to large distributors, who then sell them to large retail chains and other online outlets. Something to think about….
Next, research like crazy. Find out what the furniture industry is up to in terms of sales… Is there room for growth in the market? Have furniture design companies been flourishing in recent years or closing up shop? Determining demand and market size is essential before you consider diving into anything.
When it comes to protecting your designs, ask a lawyer what you can do. If you have a one-of-a-kind product, you can patent it. You may even be able to patent a particular design, but the process can get expensive so make sure it is worth your while to do this, a lawyer will guide you…
My guess is you will end up being a design company, and will sell your stuff to retailers, who will then sell it for you, as opposed to you designing your own stuff, AND having the retail presence. But, the choice is completely yours, just research first.
The last thing, (and I tell everyone this), is to read "The E-Myth Revisited". If everyone understood the E-Myth concepts before they started their business, my guess is much fewer people would fail at making their business work. Best of luck!
Corey Kossack is one of eBay's "Top Sellers" through his eBay store, Koss DVD. He is also author of eBay Millionaire or Bust and creator of ProfitBuilderSoftware.com, an online software tool designed to reduce eBay fees and maximize profits for eBay sellers.