Launching a new business is not easy, never mind bringing to market an entirely new product or service.
Joanna Parker could hardly believe that when she landed a deal for her new company, Yumble Kids, from Bethenny Frankel on Shark Tank. However, It was not just Shark Tank or Bethanny Frankel that made Yumble Kids successful. It was Parker’s foresight to test the market before going into full-on launch mode. That not only gave her a proof of concept but also the opportunity to get valuable feedback from her target audience.
“Yumble Kids was born out of my personal pain point. I have three young children and I had just found it extremely challenging, time-consuming, and never-ending to get healthy meals in front of them day after day,” said Parker.
Is the problem painful enough that the market will pay for a solution?
Although Parker felt there was an opportunity based on her own needs, she wanted to know for certain whether or not other parents would be willing to pay for a solution.
“I posted on a Facebook mommy group outside of my community of friends,” recalls Parker. “That was intentional, as I wanted to get a different perspective. I asked if anybody wanted me to cook their children a week’s worth of meals, and I was bombarded with, ‘yes, yes, yes!’ They didn’t know who I was and they didn’t know what I was cooking. They just knew that they didn’t want to do it anymore.”
By Parker reaching outside of her group of family and friends, she was able to know for certain whether her idea had any real validity. Our friends are our friends for a reason, they’re going to support us no matter how crazy an idea might seem. This is great for our ego but can cause us to overlook major red flags that we could otherwise avoid.
I recently unknowingly tested this concept on myself. I was sitting there one night with a friend and my two new puppies, I thought how great would it be if there was an entire network dedicated to content that is specifically produced for dogs. The shows would be developed using science and would serve as a way to help reduce anxiety and keep our furbabies entertained while we leave during the day.
If something like that was available today I would absolutely use it all the time, I don’t even care how much it cost.
My idea didn’t stop there, I was up all night dreaming up an entire ecosystem of products, content, shows and about a dozen other things I can’t recall anymore. I was literally so excited that by 5:00 am the next morning, I was jumping out of bed racing to get a concept deck created. I was going to start raising capital to create something amazing!
That’s when it happened.
I Googled “‘TV shows made for dogs,” low and behold there were several. And guess what? All of a sudden the problem didn’t seem that important or urgent anymore. I still to this day have never put any of the programs on.
What stuck with me was the fact that I convinced myself my idea solved a real problem and I failed to evaluate it more realistically. For example, the idea didn’t come to me because leaving my dogs home alone with no entertainment was a major stress in my life. I came up with the idea because I was talking about an existing show I had in development while my brand new puppies were sitting on my lap. Like most entrepreneurs, we can run with just about anything and before long you’ll find us abstractly taking over the world with our brilliant new idea.
Don’t use your own money
Did you know that only 2.2% of the $130 billion in VC funding went to female founders in 2018? For the love of entrepreneurship, ladies, please stop using your own money! If you have an idea, and your idea is good, go get funding. You’re probably not going to have a lot of luck going to the bank especially if the idea is in the concept phase. You have to get funding from wealthy individuals or venture capitalists. These people know what they’re getting themselves into and understand the risk. You’re already going to have enough pressure on you, the last thing you need is to be constantly worried about is the family member that gave you money.
Now I’m not saying this applies across the board, I self-funded my agency for a long time and was able to grow it to exceptional heights. I do feel this strategy positioned me particularly well when it did come time to raise capital. Honestly, when I first started my agency I had a completely different mindset and thought being self-funded put me in some elite category of success. However, if I could go back I would get funding and a lot of it. If you have never raised capital before, I would start getting in the habit of asking for money from investors as soon as possible. If nothing else, it will be a valuable practice.
Parker advises that more startups should be sharing their stories before raising capital, not less. She recommends that founders talk to as many people as possible to learn from the marketplace so you can validate your idea and create a better product.
“I think people get a little too secretive about their businesses, and they think talking a lot is risky,” explains Parker. “I think it’s actually the opposite. You can learn a lot from almost everyone you talk to. The more people you talk to, the more ideas you get, the more advice you get.”
It’s good to be lean, but don’t try to do everything yourself.
A challenge every entrepreneur faces is knowing when to do it yourself or if it’s better to delegate, especially in lean times. Parker revealed it was just her and husband running Yumble Kids for the first six months until they felt like they were forced to make a hire. They’re not the only ones doing everything themselves, Kathy Hannun, co-founder of geothermal heating and cooling company Dandelion Energy, says she also suffered from the tendency of trying to do everything herself. “One tip I would share as a female founder and CEO is to remember that it’s your job to structure the company so it can thrive. As much as it’s possible, try not to have things be dependent on you personally because then you’re empowering your organization to be successful beyond you,” advises Hannun.