Is paint product a game changer?
IdeaPaint co-founder Jeff Avallon insisted his product has a real “wow factor” and that was supported by our experts, who felt the coating that turns any surface into a dry-erase whiteboard had great consumer upside.
The original concept for IdeaPaint was hatched nearly a decade ago by Avallon’s Babson College classmate John Goscha, who grew frustrated with the limitations of writing on large sheets of paper taped to walls in his dormitory (see original story here). Five years later, after a lengthy testing period and more than a few flops, a sellable product emerged and IdeaPaint was launched in 2008.
“It didn’t take us five years to develop a working product; it took us five years to develop a safe product,” said Avallon, who came onboard with co-founder Morgen Newman in 2006, shortly after Goscha – who has since left the company – had been told by a paint test lab his concept was impossible.
“We weren’t the only people to think of this idea, we were just the only people to commercialize it and make it marketable,” confessed Avallon, who added it had to compare with the “gold standard” of dry-erase surfaces, which is the porcelain-on-steel- whiteboards that are prevalent in most universities. “There are lots of complaints about whiteboards out there and we wanted to fix all those.”
Avallon said the Boston-area startup initially received four rounds of angel financing of roughly $1 million that came primarily from family, friends, professors and classmates.
Since launching, IdeaPaint has received two more rounds of financing: a $5 million Series A round from Boston-based venture capital firm Breakaway Ventures and a $3.25 million round from a large group of angel investors last March.
Avallon said the company’s main challenge over the next year is to raise awareness for the brand and continue to grow sales in a sustainable way.
“It hasn’t been that difficult for us to go and find interested customers. It’s been difficult for us to manage them and manage them in a scalable fashion,” he said. “We’re creating a market here and we think IdeaPaint has the potential to be a mass-market consumer brand at some point.”
TAKING IT TO THE EXPERTS
Zach Shulman, who teaches entrepreneurship at Cornell and is a managing partner at the Ithaca, New York-based Cayuga Venture Fund, thought IdeaPaint had the potential to be a “game changer,” but felt the pricetag was an impediment to the product being more widely adopted.
“How much does a big white board cost? If the margins are over 50-60 percent, then I would consider coming out with a lower-margin version aimed at kids’ rooms,” said Shulman, who thought that application could be “huge” for the business. “Parents would love it and the creativity it would give kids would be super.”
Shulman questioned whether customers could paint over the IdeaPaint surface if they ever grew tired of having writable walls. “You might not want your wall to be a white board forever,” he said. “If this point is true, they should make it crystal clear to their customers.”
Kindra Tatarsky, a partner at angel investor organization Golden Seeds‘ New York branch, thought it was a “terrific” idea and that IdeaPaint’s major challenge would be deciding what market to attack going forward: business-to-business or business-to-consumer.
“If they go B-to-B, the branding may be less important but that could also open up the market for competitors,” said Tatarsky, who added the consumer space was “very intriguing” and likely offered more opportunities. “I see many applications from home to school, and for a wide range of audiences, from children to adults.”
Despite her optimism, Tatarsky cautioned that IdeaPaint may face some doubting consumers, who have been disappointed with dry-erase coatings such as chalkboard paint. “Feedback on current similar products in the market has indicated that these type of paint on offerings do not work – they may face resistance as a result.”
Jeff Bussgang, a former entrepreneur and a venture capitalist at Boston-based Flybridge Capital Partners, thought IdeaPaint “fits beautifully with the modern, dynamic workplace,” but distribution and branding would be the business’s biggest challenges.
“It’s not easy to simply pick it up at the store and paint your walls,” said Bussgang, who agreed with Tatarsky that IdeaPaint needs to decide whether it will sell to businesses or directly to consumers through big-box retailers.
If they go the consumer route, Bussgang said it “may require them to change the packaging and simplify the product delivery process so that it can work in channels such as Staples and Costco.”
Either way Bussgang said IdeaPaint “feels like a product that makes enough common sense to simply sell itself.”
What do you think? Is IdeaPaint a “game changer?” Leave your comments below: