PURPLE BLAB

At this point, I was about 60k in the hole. Maybe more. I was losing count. And numbers were never my strongsuit.

Could I have spent less on press materials? Yes.

Could we have tried to negotiate better terms with our vendors – i.e. don’t pay half up front but maybe 1/4? Maybe. But I didn’t and I didn’t quite know how either. In hindsight, everything is 20/20.

The problem was, there was only so much money left. I needed more. A lot more. I still had 20k for the rest of the inventory. I had the monthly retainer to Whisper PR. There was marketing, business cards (forget fancy ones I once treated myself to when I needed personal cards), letterhead, mailing cards, events, delivery costs (for sending products to editors, celebs, etc.).

Oh, did I mention that in the contract with the main retailer, I committed to visiting each and every store (that meant all 62 in the UK and 14 in the US) to train the staff and do P.A.s (public appearances)? That’s gonna leave a mark!

Ugh. P.O.S. displays (point of sale). Apparently, it was our job to provide them. At the time, I hadn’t a clue that these things need to be module so you can add to them as you grow. And I didn’t know that there were specific vendors. I went to an acrylic artist to design something that mimicked the shape of our box – curvy, sexy – in purple. The prototype was $1,000 and each one would be $100. Didn’t seem so bad – until I thought about the 62 stores in the UK!

Every day I turned around and found a new expense rearing its ugly head.  I’d show you the invoices but they make me too sick.

I didn’t feel badly or awkward asking people for money. I had an actual business with potential and two really respected retail chains supporting the brand. I just didn’t know how – or how much and when I got money, how much of the company’s equity do you give away.

An investment banker friend started talking about “valuations” (i.e. how much the company is worth – based on revenue; I would have said nothing but based on potential, who knows… millions?!?!). When you get a valuation, the investment represents a percent of it. So if there was a $100 valuation and I got $10, someone would own 10% of the company.

I needed a business plan (I actually thought I could sit in front of some kind of super wealthy business person, share my dream, and walk away with a check. What? Why not? And I got Marc Cuban’s email address from someone who used to work for him and actually sent him a note about the investment. Guess who never replied?

I quickly found out that it wouldn’t happen that way. Bottom line: Todd and I needed reinforcement.

Next chapter: Business plan and finding dough.

Mwah!

Karen

Purple Lab Creatrix

Tags: Beauty, Business Plan, Hoodia, huge lips skinny hips, Lip gloss, Lip Plumper, Purple Lab

This entry was posted on Monday, July 13th, 2009 at 7:34 pm and is filed under Purple Lab Behind the Scenes. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.