Entrepreneurial

Is it time for do-gooder to cash out?

TOMS Shoes founder Blake Mycoskie created his Santa Monica, California-based company as a vehicle for giving away shoes to needy children, but should the Texas entrepreneur be looking ahead to selling the company and using the money to pursue other philanthropic goals?

TOMS, an abbreviation of “Tomorrow’s Shoes,” is based on a simple concept: for each pair of shoes sold, a pair is donated. Mycoskie, 33, conceived his “One-for-One” business model on a trip to Argentina, when as a volunteer on a shoe drive, he witnessed how a simple pair of shoes could change a child’s life (read original story here).

“Many of the kids’ feet I saw were really badly cut up and infected and just really gross, for lack of a better word,” said Mycoskie, who also noticed how much trouble the non-profit organization he was helping had in getting the right size shoes for the kids, as they were completely reliant on donations. “It dawned on me that instead of looking at this as a charity thing, which is what they were doing, why not look at it from a business perspective and create a business where you sell a pair of shoes and give a pair.”

In the first year Mycoskie sold 10,000 pairs of his South American-inspired canvas espadrilles, which retail for $45. Conversely that meant he was able to give away the same amount to kids in Argentina. Mycoskie refused to give specific revenue figures, but said it’s easy to extrapolate his overall minimum revenues since his 2006 launch – based on 400,000 giveaways at an average cost of $45 – as roughly $18 million.

THE PITCH

To date, TOMS has been entirely bootstrapped by Mycoskie, who would prefer to keep it that way. He said the orders are still essentially processed as they come in, allowing him to carry little in the way of inventory.

The only real way out: Entrepreneurship

Robert Wolcott (left) and Michael Lippitz

– Robert C. Wolcott is the founder and executive director of the Kellogg Innovation Network at Northwestern University. Michael J. Lippitz is the senior research fellow at the Center for Research in Technology & Innovation at Kellogg and a consultant to the federal government. Their book, “Grow From Within: Mastering Corporate Entrepreneurship and Innovation” launched in October. The views expressed are their own. –

The news the U.S. economy grew at a 5.6 percent pace in the fourth quarter – the best showing in years – is tempered by the fact it was fueled by government-supported spending and revving of depleted inventories.

How can America again create quality growth? Though growth appears around the corner, many fear it’s based on governments worldwide flooding markets with liquidity and public spending. To address a crisis born partly of excessive private debt, we’re writing public IOUs to the future. But public largess only buys us time. Eventually, the future will come calling.

A business ripe for the picking?

Selena Cuffe is hoping to leverage the upcoming World Cup of soccer to promote the wines and stories of black-owned South African vineyards.

The idea for Los Angeles-based Heritage Link Brands began fermenting after Cuffe attended a wine festival in Soweto and met the owner of a local winery – Seven Sisters – who was struggling to get her wines distributed (read original story here).

“She shared with me that South Africa had a $3 billion wine industry and of that less than 2 percent is owned by black South Africans, who are 85 percent of the population,” said Cuffe.

Gay entrepreneur wins battle with Citibank

When entrepreneur Jason Goldberg found out Citibank had deactivated his business account, he did what most people would do: He called, he inquired, he listened. Then he took his fight online.

The tussle resulted in a revised policy at Citi, but also raised a more serious question of free speech – the basis of the First Amendment.

Goldberg’s account was deactivated last week after a review of his gay social networking site – fabulis.com – classified it as “porn.”

The mother-in-law stress test

– Jeff Bussgang is a General Partner at Flybridge Capital Partners, an early-stage venture capital firm in Boston. This post originally appeared on Bussgang’s blog www.seeingbothsides.com. The views expressed are his own. –

I’ll never forget my first marketing class at business school. Our professor peered at us with an intense glare as he pushed back on our standard “chip shot” comments. At one point in the class he asked the guy next to me to opine on the case we were discussing, which involved launching a new consumer product. “Well,” my neighbor answered confidently, “I think it will be a hit because I can see my mother-in-law buying it.”

“I see,” replied my professor dryly and then turned to the class with a withering look on his face, “Steve appears to have fallen into that fatal trap of ‘Mother-In-Law Market Research’; believing this new product will be a hit just because his mother-in-law likes it. Instead, let’s look at the data, shall we?”

Entrepreneur designs own bailout package

A. G. Newmyer said slapping the slogan “Too Big To Fail” on the front of a pair of men’s underpants was not meant to mock the government bailout packages extended to the financial and automotive sectors.

“I did not do it in any way related to making a political statement of any kind,” said Newmyer, a longtime Washington, D.C. political consultant, who conceived of his risque idea last Thanksgiving and founded Silly Underwear LLC shortly thereafter. “As all of the discussion about too big to fail started to mushroom during the recent economic tsunami, I just kept thinking about the expression and it just occurred to me as a whimsical idea to put it on a pair of underpants and see what happens.”

The underwear retails for $20 and is primarily sold online at SillyUnderwear.com. Newmyer’s story first appeared in a Wall Street Journal blog, after which he said sales increased dramatically. However Newmyer refrained from releasing any sales figures.

Entrepreneur needs to prove golf gizmo works

Tom Cannon has created an intriguing golf gadget, but if he wants to find a market for his product, the former NASA rocket scientist needs some hard data to prove BonusYards can help golfers add more distance to their drives, said experts.

The Maryland, Virginia entrepreneur hit on the idea after reading a story that detailed how a 45-degree angle – between the club and the ground – is the optimum angle for golfers to address the ball before teeing off (read original story here). The article suggested practicing in front of a square box, but Cannon thought there had to be a better solution. He went into his basement workshop and attached a carpenter’s level to a golf club that indicated when he was standing at the proper angle to the ball. The problem was the level was too big and heavy and it didn’t stay on the club.

Cannon eventually found a manufacturer in China and built a level that was small and light enough that he could fashion to a club, without it adversely affecting his swing. The plastic device resembles a child’s toy ring, with a flat coin-sized head that encases a bubble level that clips onto the top of the club, or grip, and includes markings to show when the club is properly aligned at a 45-degree angle.

Getting word out, scale are obstacles for software startup

A couple years ago, while working for a large engineering consulting firm, Kristen Carney was hired to complete what she thought was a straightforward analysis: directly connect two roads that were currently joined by an intermediary road. More than 100 hours later and thousands of dollars over budget, a frustrated Carney felt there had to be an easier solution.

The Austin, Texas entrepreneur complained about her ordeal to friend and software whiz Anthony Morales, who offered to design a program that could drastically reduce the time it took her to gather and format her data. Morales’s software worked so well, they founded Cubit Planning, a Web-based platform that provides cut-and-paste ready environmental data.

“A lot of people say, ‘Hey, you’ve lived my nightmare,’” said Carney, who launched Cubit last year with just $2,000. She said their open-source technology operates in similar fashion to that used by stock websites. “They go out and they grab information from a bunch of different resources and they compile it nicely for you, so you can make a decision based on that data. That’s what we do, but for environmental engineers.”

High-end water filters a tough sell

Manuel Desrochers and his sister, Noemie, are the founders of Aquaovo, a Montreal, Canada-based startup that designs unique water filters, aimed at reducing the environmental hazard from billions of plastic water bottles filling up landfills (see original story here).

Their trademarked Ovopur unit is a 23-pound ceramic egg-shaped apparatus that holds 11 liters (2.9 gallons) of water and uses the combination of gravity and a glass filter cartridge to purify ordinary tap water.

“Our target market is really 30-50-year-old young professionals, who really like the design of it and they’re thrilled to hear that it’s actually functional,” said Noemie (read her journal here), who added they raised the price for the filters from $560 to $660 after their first six months in business. “We really came to this price thinking this clientele is willing to pay for quality, so they’ll spend around $700 for the Ovopur.”

Pet startup needs to get more social (media)

Entrepreneurs Tina Cannon and Christi Scovel have developed a great way to connect pet owners with veterinarians, but they need to get much more involved in social media in order to get people flocking to their website (PetsMD.com), said experts.

Cannon, an accountant by trade, got the idea for their website a couple years ago (see original story here) while witnessing friend Scovel, a veterinarian, answer phone calls around the clock from desperate pet owners trying to book appointments, or just seeking information about their pets’ maladies. Cannon jokingly suggested there should be a website to handle this, freeing up vets like Scovel to enjoy an evening out.

Cannon said 175 million vet appointments are made annually in the U.S. and “they’re all done by the telephone,” she said, adding: “nobody is offering online integrated booking. We’re the first and we’re either crazy or smart.”

  •