For much of last year, I worked at a four year old startup called O'BON. Their claim to fame is being purveyors of eco-friendly stationery products. Kind to the environment products like pencils made from recycled newspaper and notebooks with paper made from sugarcane waste. I was the jack of all trades for the company; doing a little bit of everything. My main focus was product photography, handling the company's social media, and warehouse logistics.
Unfortunately, O'BON closed up shop late last year. The main problem that undid the company was a severe lack of product production. People desperately wanted our products, but our production house in China screwed things up in royal fashion, and we just had NOTHING to sell for the longest time. That led to a dry up of capital, and finally, we had to close up shop.
The following is a list of things I've learned about starting a business while working for O'BON. Not to be taken as gospel; they are just my observations.
- If you are selling a product, MAKE SURE your production pipeline is supplying you adequately. Not having enough products to sell (or having chronic shortages) will doom your business no matter how much people are clamoring for it.
- Not having your accounting books in order from the start will just make a big mess of things later. At that point, fixing it would take enormous capital and cause huge headaches.
- Be consistent with your marketing message/plan. Have a theme and stick with it for a period. Revamping things month after month will only cause the marketing team to do unnecessary work.
- SALES, SALES, and SALES. That is one thing you should be doing everyday. At a small startup, that goes for the whole team. Marketing is done with their work for the day? Go make phone calls.
- Don’t underestimate the value of social media, even when you don’t see a tangible return (immediate or otherwise). A brand’s goodwill may not be quantifiable, but is very important in the thought space of the public. Because when shit hits the proverbial fan - watch your social media blow up with negativity (and you thought nobody thought you existed?).
- Have an understanding of your startup’s financials and cash flows. Otherwise, watch the company hemorrhage cash like no other.
- Don’t equate having money in the business account as actually having money.
- If you are a boss in a small startup, NEVER leave earlier than any employee. Absolutely NOTHING gets done after that if you do. You’re the leader, set the example.
- China plays by their own rules – work with them cautiously. It does not matter how ironclad your contract is or how many lawyers you have.
- Understand the point at which your company is no longer feasible (the proverbial writing on the wall), and then exit in a gracefully and quick manner. Dragging it on does a disservice to your employees.
- Interns are indeed the best way to get quality work done for little to no monetary investment. With so many college students desperate for “work experience”, you’d be stupid to not utilize them.
- How much you are paying your employees is directly related to the quality of their work (and other ancillary stuff like motivation, initiative, enthusiasm, etc.). It hasn’t got to be astronomical, but you are going to have a problem sooner or later (employee turnover!) if your employees can get a better salary being a barista.
- Taking people’s money and not delivering the product; plus spending that money and not having enough for refunds is the ultimate sin in doing business.
- Big box stores (Whole Foods, Target, etc.) are indeed solid revenue steams if you can get them to carry your products, but they will screw you over when it comes to returning items they don’t sell – guaranteed.
- Under delivering what is promised (or something completely different) might not be a kiss of death, but you’re going to have a really bad time.
- An employee (or two) that is detail oriented and pays attention (and gets to) the little things is paramount to a small company’s success.
- Because invariably there will be one employee (or two) that do great things on a macro level, but often leave small details unchecked.
- Don’t have enough money to pay rent? It’s time to move to a smaller space, put it on credit, or close down the business.
- Re-read number one.