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8 Founders on the Turning Points that Changed their Business…

This story appears in the March 2017 issue of Startups. Subscribe »

Every entrepreneur has the moment — that time when hard work finally pays off, when a long-desired opportunity presents itself and the entrepreneur has to decide how to react.

Related: 8 Great Entrepreneurial Success Stories

The moment can be stressful, and for good reason. It can be a turning point for any business, but only if it’s seized properly. And as the eight founders here can attest, it isn’t always clear what the right move is. Success takes guts. It takes sweat. It takes a lot of hard work — first to have reached the moment, and then to prepare for what happens next.

Will you grab the opportunity when it hits?


Go where the buyers are

Roshini Raj, M.D., co-founder of TULA, New York City

Roshini Raj

Photograph by Chris DeLorenzo

 

TULA Could have launched like any skincare line — with its own website, a presence on e-commerce giants like Amazon, and a lot of marketing dollars. But one of its three cofounders, Dan Reich, had an idea: He’d previously worked with the team that launched QVC’s e-commerce site, and he knew the network wanted to try launching a brand from scratch online. Maybe TULA could be that brand.

TULA offered. QVC said yes, but there was a catch: For one full year, the company could sell only through QVC.com. TULA wouldn’t even have its own site. That was a risk, but the cofounders thought it was worth taking. They’d plug directly into QVC’s loyal audience, rather than have to build their own.

The test began and the startup sprang to work. Co-founder Roshini Raj, a gastroenterologist who’s a regular on Dr. Oz and other TV shows, worked her contacts to book herself several spots. TULA’s CEO, Julia Straus, reached out to bloggers and influencers. Within a few months, sales were continuing to grow, and QVC polled its website users to see which new brand deserved a shot to go on the air. TULA won, and soon after, Raj was pitching QVC’s TV audience on TULA’s $49 day/night cream.

“My role was to teach and explain.”
— Roshini Raj, TULA

“Before then, I had never sold a thing in my life, but I quickly learned that my role was to teach and explain, and the sales would come from the strength of the products, not me,” Raj says. The cream sold out in less than nine minutes.

TULA co-founders now knew they had a winning idea and didn’t waste any time prepping for a post-QVC life. Soon after the year-long exclusivity deal expired, they launched a website, expanded from four to 11 products and set out to raise more funding.

And Straus came away with a big insight into how to make a product pop. “If you package and sell your product for a TV audience,” she says, “the same principles work on a digital audience. And if you want to learn how it’s done, just watch QVC for several hours.” — Matt Villano


Hit the right influencers

Ben Jacobsen, owner of Jacobsen Salt Co., Portland, Ore.

Ben Jacobsen

Ben Jacobsen’s salt crystals are works of art.
Photograph (C) John Clark

 

After closing his mobile app company, Ben Jacobsen went looking for a new venture. He was inspired by Oregon’s food culture, which heavily valued local foods, and spotted opportunity: Nobody made local salt. So he spent two and half years learning to source and package salt, then began selling his artisan product for $5.50 per pound.

He knew the average foodie wasn’t going to pay $11 for a two-pound bag of his unknown salt — not at first, at least — so he courted big-name chefs. One of the first to bite was Portland chef Gregory Gourdet (a popular Top Chef competitor), whom Jacobsen connected with through a mutual friend. Other chefs caught wind of Jacobsen’s Oregon salt, right at the time Portland was becoming a national sensation for its foodstuffs.

That’s what led to Jacobsen’s big break. In July 2013, celebrity chef April Bloomfield was on The Tonight Show, and host Jimmy Fallon asked her to name her favorite salt (because, you know, Jimmy Fallon). She said it was Jacobsen’s; the next day, the salt-maker’s website crashed due to high demand.

Jacobsen used the boost to expand in both directions — with chefs (he now has direct supply accounts with 500 chefs across the country, including Michelin-star winners) and, finally, to consumers (Jacobsen Salt is in Williams-Sonoma and has added lower-cost products like salted caramels and spicy honey). Demand is high: He harvests 18,000 pounds of salt a month. — Matt McCue


Sell your story

Tara Reed, CEO of Kollecto, Detroit

Tara Reed, CEO

Photograph (C) Jesse Chehak

 

Many founders wonder, Will my company succeed, or will it lead me to success somewhere else? As Tara Reed knows, the answer to that question can create hard choices — like whether to trade a product you love for new opportunities.

Reed’s path began when she built a mobile app called Kollecto, which helped users shop for art. But rather than rock the art world, the app gained recognition for another reason: Reed didn’t know a lick of code but created the app anyway. That earned her a TEDx talk on helping others build apps without code, and that led to consulting work and an app-building boot camp.

Reed decided to roll with it: Her skill set seemed to have more growth potential than Kollecto. The app is now on hiatus. “When people ask me for advice, I tell them, ‘Get going,’” she says. “Chances are, you’ll have something wrong, but you won’t know until you test those assumptions with actions.” — Kate Rockwood


Make a social media scene

Augustin Paluel-Marmont, co-founder of Michel et Augustin, Brooklyn and Paris

 Augustin Paluel-Marmont

Photograph (C) Donald Milne

 

In January 2015, the French cookie sensation Michel et Augustin began its U.S. expansion. Things moved slowly, with its wares stocked at a few New York stores. But that spring, a Starbucks employee purchased a small packet of the company’s cookies from a cheese shop in Manhattan, and apparently passed a compliment on to headquarters. Not long after, an assistant to Starbucks’ then-CEO, Howard Schultz, placed a call to Michel et Augustin: Could they send samples of some specific flavors in time for a Monday tasting? A caper rapidly unfolded. The requested cookies weren’t stocked in America, and weren’t guaranteed to arrive in one piece or on time if they were shipped from France, so two Paris staffers were lined up to fly halfway around the world and hand-deliver the samples.

Related: 6 Stories of Super Successes Who Overcame Failure

Then Augustin Paluel-Marmont, the company’s CEO, cofounder and partial namesake, concocted a social media plan. In the States, Michel et Augustin meant nothing — yet — but in France, it’s a household name with an active online tribe. It enlisted its followers to tweet and Instagram photos of themselves enjoying Michel et Augustin products with Starbucks coffee, using the hashtag #allezhowarduncafe. (Loose translation: “Howard, let’s go have a coffee.”) Hundreds did so while the brand’s Seattle-bound ambassadors live-chronicled their journey. Schultz’s wife somehow came across the campaign and alerted her husband. A week later, the cookies made their debut in 26 Starbucks outlets in Manhattan. Within six months, they had gone nationwide. — Jeff Chu



Do what it takes

Elizabeth Stein, founder of Purely Elizabeth, Boulder, Colo.

Elizabeth Stein

Photograph courtesy of Purely Elizabeth

 

Back in 2009, Elizabeth Stein was a nutrition counselor in New York City. But she had a little side hustle called Purely Elizabeth, selling natural, gluten-free baking mixes. The response was encouraging, but nothing to change careers over. That fall, for example, she took 40 bags of her mix to sell at the race expo for the Westchester Triathlon. She sold out almost immediately. Fun!

A week after the expo, though, things got serious. A reporter at DailyCandy, the once popular (now defunct) shopping newsletter, emailed Stein. The writer had come across a Facebook post about Stein’s baking mix and wanted to do a story about it. The article in the next day’s newsletter described Stein’s mixes as a healthy and tasty alternative to carb-and-sugar-packed muffin mixes — and within three hours, Stein had more than 1,200 orders. To fulfill them, she tapped her savings to overnight ingredients from a supplier in Oregon to her mother’s house in the Philadelphia suburbs. Stein and her friends spent two and a half weeks mixing and shipping.

“If our product wasn’t unique, we would have never gotten recognition.” — Elizabeth Stein, Purely Elizabeth

After that, Stein dove into growing Purely Elizabeth. She developed new products, and eventually moved to Boulder, Colo., where a natural-food-product scene had emerged. In her first year in business, she had roughly $250,000 in revenue; in 2016, nearly $12 million. Sure, she admits, that first hit with DailyCandy was lucky. But, she says, “if our product wasn’t innovative and completely unique to anything in the market at the time, we never would have gotten recognition in the first place.” — Matt Villano


Adjust on the fly

Cyrus Schenck, cofounder and CEO of Renoun, Burlington, Vt.

Cyrus Schenck, cofounder and CEO

Photograph © Bobby Fisher

 

In 2011, Cyrus Schenck and some pals were driving home from a weekend ski trip in Vermont. They were all engineering students, and, as engineering students tend to do, they started musing on how to improve everything around them. One said that skis should be built on engineering principles. True, the rest said.

Soon after, in his material sciences class, Schenck learned about a rare class of soft materials that harden when force is applied. He thought back to the conversation in the car: Could this material create a ski that was soft in powder but stiff in icy conditions? The guys made a sample and ran some tests, and were blown away by the results. In their ability to adapt to different types of snow on a mountain, the skis were 300 percent better than anything on the market. Schenck was sold; he decided to build a ski company called Renoun.

The 2015-2016 ski season was Renoun’s first real one on the market. Schenck had done what he thought he should do, landing his skis in a couple of ski shops. But after visiting one undercover, he realized his strategy was rife with problems. “The sales reps had no clue how to explain our technology,” he says. So he decided to sell exclusively through his own site. “That would change the economics entirely: With retail, I needed to sell 20,000 units just to break even. Now my margins would be much higher.”

By the end of 2016, Renoun had its first profitable year. “Now when people say to sell through shops, I say, ‘No thanks,’” Schenck says. He had engineered a better way. — Clint Carter


Ask for help

Neka Pasquale, founder of Urban Remedy, Richmond, Calif.

Neka Pasquale

Photograph (C) Kristen Gerbert

 

In 2010, Neka Pasquale, an acupuncturist by trade, was peddling chia shakes, cashew milk and low-glycemic cleanse juices made from green vegetables to her clients in the Bay Area. Before she knew it, she was moving $250,000 worth of organic liquids under her brand, Urban Remedy. But as the side gig grew, she found her needs were outstripping the options available in local commercial kitchens.

One problem: Pasquale needed about $50,000 to rent a large kitchen and start producing at scale. But with no experience in finance or business, she felt poorly equipped to write a business plan. So she asked Henry Wong, a family friend, for help. Wong, a technology-industry attorney who had experience assisting startups, was happy to — and the timing was perfect. A month after that first meeting with Pasquale, he was interviewing for a job with VC firm Science, Inc., in Los Angeles, and mentioned her idea to some of the partners there. They were interested — so interested that a month later they invested $1 million in Urban Remedy.

The windfall allowed Pasquale to set up production in a 1,600-square-foot kitchen in San Rafael, Calif. More opportunity followed. In 2012, a mutual friend introduced Pasquale to model Cindy Crawford, who happened to be an Urban Remedy fan. Pasquale thought Crawford would be a perfect brand ambassador, so she offered her a small amount of equity in the company in exchange for helping out. Crawford said yes. Since then, the company has closed two additional rounds of funding at $5 million apiece and now bottles 110,000 juices per month in a new 22,000-square-foot space.

“It just goes to show you that it pays to know the right people,” Pasquale says. “You never know when someone is going to be the contact that changes everything.” — Matt Villano


Go for the big stage

Carolyn and Bob Harrington, co-founders of Maty’s Healthy Products, Pittsford, N.Y.

Carolyn Harrington

Carolyn Harrington
Photograph (C) Heather McKay

 

The married founders of Maty’s Healthy Products, Carolyn and Bob Harrington, had been developing nonmedicated cough syrup for kids. In 2009, they decided the product was ready for market. And they wanted to go big, debuting it at the Natural Products Expo West show. As one of the largest natural food and natural product expos in the country, the annual trade show in Anaheim, Calif., has helped launch businesses such as Lärabar, Suja, and KIND. “We really wanted to see if this idea was viable and figured there was no better place to do it,” Carolyn says.

The Harringtons forked over $3,000 to purchase one-third of a booth at the show. Their timing couldn’t have been better. A year earlier, the U.S. Food and Drug Administration had warned that over-the-counter cough and cold medicines should not be given to children younger than 2 years old. That news further opened the door for products such as Maty’s cough syrup to be marketed as a safe alternative.

Related: The World-Changing Power of Sharing Your Story

By the time the three-day show was over, the couple had commitments to sell Maty’s cough syrup in more than 3,000 stores nationwide. Those commitments eventually turned into $600,000 in revenue for the startup company in its first year. Today Maty’s wares are sold in 20,000 stores nationwide, including CVS, Target, Kroger and Walmart. “If we had picked a different show to attend,” Bob says, “I’m not sure where we’d be today.” — Matt Villano


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