The momentum a company builds in its first few weeks can signify its potential to soar — or, alternatively, the inevitability of its failure. That’s why contests like the Shopify Build-a-Business Competition are so great: They can predict the success of a startup early and help companies identify the weaknesses in their business models before they officially launch.
Of the 100,000 competing startups in the Shopify competition, five received winning titles:
- GameKlip, a real controller for smartphone games
- GoldieBlox, a children’s book series and construction toy
- Fresh-Tops, a high-end fashion store
- Canadian Icons, an online museum and shop
- SkinnyMe Tea, an all-natural detox and weight-loss product
What do these online businesses have in common? And what can you replicate with the money you have?
More than you think.
The founders of these five startups share their experiences and explain what steps you can take to launch your own business online.
1. Decide and Do
All five of these entrepreneurs discovered a problem that needed a solution. Instead of letting their ideas slip through their fingers, they decided to create solutions. Ryan French, founder of GameKlip, was frustrated with the controls on his smartphone.
“I set out looking for a solution to a problem I had, instead of looking for a product to sell,” he says.
For SkinnyMe Tea Founder Gretta van Riel, a business idea came to her in sleep. “When I woke up, I knew that I had a great idea,” she says. “I started building my business literally the same day.”
When Debbie Sterling first started Goldie Blox, advisers told her to ditch the idea of a toy entirely and just do an app. She decided to stick with a physical toy because she felt the tactile experience of building things was a better way to introduce mechanical engineering principles to girls. “Screen play alone just doesn’t do it justice,” she says.
2. Test and Test Again
A big reason why so many entrepreneurs fail is because they invest lots of time and money in their products before evaluating whether there is a market for them. The winners of the Shopify contest all tested their products extensively before making them available to consumers.
Sterling met with neuroscientists and teachers and visited more than 40 homes and three schools to study the difference in learning styles between boys and girls. Before she approached her manufacturer, Sterling designed the Goldie Blox toy in her living room using parts she bought at the hardware store.
When first starting out, Sterling kept her ideas to herself because she didn’t want anyone to steal her concept. But when a friend asked if she wanted to be an inventor or an entrepreneur, she reconsidered her tactics. An inventor works alone in a lab, but an entrepreneur needs to inspire and be inspired by others.
Decide if you’re an entrepreneur or an inventor
Decide if you’re an entrepreneur or an inventor,” Sterling says. “I probably spent a total of $250 on the prototypes. It’s important to prototype everything beforehand and then test the prototype on your target demographic.”
Fresh-Tops assumed fancy packaging would increase sales. They quickly — and expensively — discovered that it’s better to focus on fast delivery and high-quality products rather than packaging, which eats up profits. “Keep experimenting until you find something that works. Be versatile and flexible, and you’ll learn and grow as you go along,” founder Nella Chunky says.
French, of GameKlip, stayed up all night bending plastic until he arrived at an efficient and presentable design. He then posted a video of his prototype and started pre-orders. He realized there actually was a demand for his creation and used the pre-orders to fund his first batch of plastic.
3. Ace the Manufacturing Process
GameKlips’ manufacturing motto is to keep things local. To find a manufacturer, French searched Google and found an injection molding company right across the street from a restaurant he frequented.
“Try searching for a rapid prototyping shop in your area,” he says. “Most will have connections with companies that can handle the manufacturing when you’re ready. It costs a little more to manufacture things here instead of overseas, the added convenience of being able to drive over and talk to people is incredibly valuable.”
For Fresh-Tops, finding a manufacturer was all about networking. “Getting to know people in my industry played a huge role in developing my company,” Chunky says. “We found all our manufacturers through referrals from personal relationships.” It’s important to get involved with the market of your specific products. So if you’re in the fashion industry, go to every runway show, magazine release party and shopping event that you can.
Canadian Icons founder Aaron Slipacoff searched for a place where he could add value to the manufacturing process. He quickly learned that customer service was the answer.
“We decided to offer the best possible service to our customers,” he says. This meant overnight shipping in Canada and 90-minute delivery within 30 miles of their office. They also decided to offer a full return policy, no questions asked and no postage required. It was a risky strategy, but ultimately worth it for their company.
4. Find Untapped Resources
Using social media and finding mentors aided the Shopify winners immeasurably
Using social media and finding mentors aided the Shopify winners immeasurably in their paths to success.
SkinnyMe Tea used Instagram — on which the company has more than 180,000 followers — almost exclusively to build its brand. “We don’t just talk about the product, we talk about everything in the health industry and emphasize our product as a part of a healthy lifestyle, not a ‘just another diet,’” van Riel says.
GameKlips used forums to learn about customers’ experiences with shipping and fulfillment. “The amount of information stored on forums is incredible,” French says. For shipping, GameKlips uses ShipStation, an app that automatically pulls orders from the online store and creates shipping labels. Before finding this app, shipping was a huge headache, and French was manually copying and pasting addresses into the U.S. Postal Service website. Now, he says, “I click one button and the invoices come out of one printer and the shipping labels come out of another. The order processing efficiency still amazes me.”
Sterling tapped into entrepreneurship organizations and her personal network to bring Goldie Blox to the market. The biggest was StartingBloc, a social entrepreneurship fellowship program. She then got involved with Pacific Community Ventures, who connected her with a pro-bono adviser, Sam Allen (founder of ScanCafe), who has been instrumental to her business. Later, Sterling was able to pitch Goldie Blox on the main stage of the Social Capital Markets conference, making great contacts in the social innovation space.
5. Create Big PR Wins
Canadian Icons developed its public relations approach right away. It wanted high search engine optimization links and mentions in respected publications to drive traffic and build brand identity. The company hired a firm to help with PR and received positive media mentions in Canada as a result.
In addition, Canadian Icons curated a collection of high-quality content. They wrote stories about Canadian icons like the canoe, the snowshoe and the Group of Seven. Then, Slipacoff approached national cultural organizations and got them on board.
“Once I had these great partners and stories in place, I presented an idea to some iconic brands, suggesting that Canadian Icons would be the most authentic Canadian place online to tell their brand stories and offer iconic Canadian products in a new way,” he says. “For brands like Canada Goose and Manitobah Mukluks, it was clear early on that they got it.”
French was an active member on Reddit and Android forums like XDA Developers long before he started GameKlip, and he used his reputation in those communities to his advantage. When he launched the company, members of both online communities helped spread the word about his product. “I couldn’t have done it without them,” French says. Since then, GameKlip has been featured on websites like Gizmodo, ABC News and Ask Men.
French didn’t have to make any pitches or hire a marketing firm to get those mentions — they all picked up his story on their own.
Goldie Blox’s PR win happened months before the company even launched. The product was still in the earliest prototyping stage, but Sterling created a blog to share the stories of building it. Writers for The Atlantic and TechCrunch found the blog, and Goldie Blox gave them the exclusive story for its launch, which created a ton of buzz for the brand. But the biggest PR win came when the website Upworthy posted its Kickstarter video about a month after the campaign had ended. It instantly went viral, spiking to almost a million views within a few days. Goldie Blox had so many orders, they sold out of their first shipment and had to push back the delivery date.
Whether you’re just starting a company or you’ve already launched, there’s a lot you can learn from these startups and their stunning growth. Not every one of their steps will work for you, but some will. Never be afraid to try your idea — or enter a contest like Shopify’s — because the only way to know if a company will succeed is to give it a chance.