This post comes from good friends of mine who recently designed, manufactured, and are now marketing an educational board game that helps children learn to read. Through this article and a few more to come, they will share with you their experiences running a business.
Have you ever had an intriguing business idea?
How many times has an entrepreneurial idea come to you that for whatever reason you decided not to pursue it? This must have happened to us one hundred times before we decided to develop Er-u-di-tion, an educational board game to jump-start the road to reading through exposure to sight words. In this and a few subsequent posts we will share our experiences with developing a product and bringing it to market. We will also provide some tips and tools that we found useful in our entrepreneurial adventure.
Genesis of our sight words game
Our adventure began when our son, Connor, was in kindergarten and we were helping him learn sight words. Since recognizing these high frequency words was part of his school’s curriculum, we began using index cards, but Connor lost interest within a couple minutes. We started using “sight words for food,” where Connor needed to identify a sight word to earn his meal (don’t worry, we didn’t starve our child). We knew there had to be a better way to teach children these high frequency words. During a family game night the answer came to us; we would create a board game in a community setting and use sight word recognition for players to advance in the game.
Solicit Feedback early and often
Throughout our project, beginning within days of its inception, we solicited feedback and assistance from friends and family members. We found that people we knew were able to provide, or work with us so we could perform, many of the services we needed. This has been extremely beneficial in a variety of ways. By reaching out to our social network, we:
- Worked with our niece to illustrate the game board, cards and box–saving over $1,000. She did a great job, as you can see here:
- Worked with two friends (DR being one of them) to develop and optimize our website–saving hundreds of dollars
- Learned of a shipping company through our brother that gave us a significantly lower shipping quote than others we had received–saving over $2,000
We are not suggesting to wear out your welcome by asking for favors, but rather to ask for contacts, advice and guidance. We were able to perform many tasks that were foreign to us by drawing from others’ experience.
Make sure everybody involved is on-board
Before spending much time and money, honestly evaluate if you are committed and able to see your project through. In a perfect world, this assessment is a robust business plan (if you are obtaining 3rd party financing such a plan will likely be necessary). In reality though, some entrepreneurs lack the skills to create a detailed business plan and it may not be cost effective to pay for one.
If you decide to go without a formal business plan, you should still assess the resources needed. At a minimum, estimate both the time and money your project will require to give your product or service a chance to succeed. During this process, expect the unexpected and factor that into your analysis. You should come up with your best estimate and then add approximately 50%. Our initial estimates of both time and money were short by about 50%. Make sure that you could accept overruns like this.
Once you are comfortable with the estimate of time and money required consider how you will devote the time and where you will get the money. Also, think about what your life will be like if you go forward with your project. Will you be stressed out and strapped for cash? What toll will the project take on your family? Keep in mind that most successful entrepreneurs worked nights and weekends and pinched pennies for a while before they enjoyed a successful business.
Protect your personal assets
Once you decide you are “all in” on an entrepreneurial idea, it is time to protect your personal assets from the worst case scenario. While this step is more important for some, virtually every entrepreneur’s product or service carries some risk of legal liability. By forming a corporate shield, this potential legal liability and related obligation to pay damages is generally limited to the corporation and its assets. If you choose to operate without a “shield” many, if not all, of your assets are in potential jeopardy.
There are a variety of entity types that provide personal protection. When analyzing our options we found that a matrix of pros and cons of sole proprietorships, C-corporations, S-Corporations, and LLCs s was very useful. Weigh the options and choose the structure that is best for you. We chose to form a limited liability corporation (LLC).
You can check out their game and even buy it online by visiting their sight words game product page.