Many entrepreneurs start businesses out of their homes. For some, it’s a part-time endeavor. For others, it grows out of the living room or the garage and becomes a full-fledged, honest-to-goodness, hiring-lots-of-people, moneymaking enterprise.
Not too long ago, I met one such entrepreneur who started by selling her son’s old video games online and now has more than 100 employees and is doing over $25 million a year selling clothing and fashion accessories on eBay. Linda Lightman, a former New York attorney, got excited about selling online with an eBay store and jumped into the fashion business.
After she’d been through her closet and her son’s old video games, her friends started asking her to sell their clothes for them, and the word spread. In 2006, she had 20 employees and decided to move out of her living room, which she described as looking more like a small warehouse.
Today, Linda’s Stuff is in a 72,000-square-foot warehouse facility, doing a booming business online. It’s not uncommon for an entrepreneur to turn a hobby into a business, but Lightman was able to take her eBay hobby business and turn it into a multimillion-dollar enterprise.
In the beginning, like many entrepreneurs, Lightman wore all the hats. She photographed the merchandise, wrote the sales copy, filled the orders for shipping, did the accounting, and was her own customer service department. It didn’t take long for her to realize that she needed some help. Her first employee was a photographer.
She attributes her success to a fastidious attention to detail. She’s trying to duplicate the brick-and-mortar experience online to ensure her customers return again and again. In addition to a photography department that enables her to compete with some of the big retail clothing stores by putting her best foot forward, her employees are trained to answer fashion questions and create detailed descriptions of the things they offer.
She also has a staff of professional authenticators on staff to verify that the designer merchandise they sell is real—and not some knock-off.
She works very hard to make sure the people who consign merchandise with her are just as happy as her customers. This attention to detail helps keep both her customers and her consignors happy. As a result, Linda’s Stuff has a return rate of less than 10 percent.
When she started in business, she had a lot of customers who were just trying to be careful with what they spent. Today, people are looking at what she offers as a way to be green. “It’s cool to ‘rebuy,’ ‘reuse’ and ‘resell,’ and to say you scored great clothing for a fraction of the price,” she says.
Tamara Monosoff, author of The Mom Inventors Handbook and Secrets of Millionaire Moms, teaches budding inventors how to take their ideas for new products from their dining room table to market. Monosoff is the former Chief of Staff for the Office of Vocational and Adult Education in the U.S. Department of Education, Education Director for the President’s Commission on White House Fellowships, and Senior Communication Associate for the President’s Initiative on Race at the White House during the Clinton administration. She has written six books (including the two mentioned above) designed to help entrepreneurs.
Her focus has been to help home-based inventors find ways to develop their ideas into viable products and take them to market. She helps these business owners with everything from finding a fabricator to reaching out to the buyers at major retailers.
When I spoke with her, she offered some suggestions for entrepreneurs developing new products:
1. Keep it Simple. It’s always tempting to overcomplicate things. Keep your sales, marketing, production and business operations simple.
2. Get on Camera. Video is a powerful medium; she suggests you take advantage of it. What’s more, “Don’t be afraid to go on camera and show how your invention works,” she says. You’re likely the best person to do that.
3. Look for Smart Money. There are lots of options for capitalizing on your idea. Don’t be afraid to look at things like crowdfunding, friends and family, SBA microloans or online lenders to find the capital you might need. Don’t be discouraged if you get turned down at the bank. Look for the money source that makes the most sense for you and your business.
4. Celebrate the Wins. There’s nothing easy about starting a home-based business. And taking it to the next level isn’t any easier. It’s important to celebrate the wins—even the small wins.
Taking your home-based business and turning it into something bigger might not be the goal of everyone building a business from their home. But if that is what you want to do, the advice from Monosoff and Lightman can help you do it—or at the very least, help you build a growing and thriving business from your home.
