“We turn ordinary people into world-class entrepreneurs.” – Fred Cary
You feel ready to leave your 9 to 5 job and put an entrepreneur cape on, but there are so many questions you don’t know the answer to? No worries, we asked the CEO of IdeaPros, Fred Cary, everything you need to know to become a world-class entrepreneur.
Can IdeaPros Make Me A Successful Entrepreneur?
“I can’t make you, your product, or anybody else successful. That’s your job.” – Fred Cary
As an entrepreneur, you should care about your capabilities and never quit attitude. We can give you the tools and the advantage, but it is on you to use them to your benefit. Being an entrepreneur is a lot of work and not much glory. If you can’t find that die-hard mindset in you, maybe you are still not ready for the entrepreneurial journey.
How Much Control Do Most Investors Look For And Do They Have To Be On The Company Board?
These are critical questions, and you should think about them from day one.
- What are you going to do when you get to launch?
- Where will you find the capital and team members?
- Where will you manufacture and store your product?
Depending on the phase you are at, the answer to these questions is different.
In the beginning, the people who are most likely to invest are friends and family and typically they don’t want to sit on the board. They are passive investors that will do a straight equity deal with you.
When you start looking for more sophisticated investors, they usually use a convertible debt instrument where you promise to pay the money back with interest over a certain period. The person who holds it has the right to convert that debt into equity. Meaning they will wait to see if they should get a piece of your company or their money back with interest.
How Does the Process For Pricing A Product Look Like?
“Price it so you can get a hell of a lot of money with huge margins.” – Fred Cary
Depending on the industry, margins vary. In the beauty industry, margins are much higher than in the food industry, for example. If you plan to sell directly you need to figure out what your all-in cost is. Take production, shipping, storage, returns, import fees, and logistics costs, and double them. If you are selling through wholesalers, the end price has to be four times the production price.
What Are The Rules When You Are Trademarking A Company Name?
You can have the same name as another company as long as it is not very famous and isn’t in the same class as you. There could be several companies with the same name. The trademark office takes care of the class and the possibility to confuse consumers, which they want to avoid.
“You can happily co-exist with the same names as long as you’re in different classes.” – Fred Cary
What Do You Look For In A Company and What Do You Consider A Great Idea?
I look for individuals who are ready to roll up their sleeves and make it happen. That’s more important than the product.
“You want people that you can trust that when you’re in the trenches together, they’re going to do what it takes.” – Fred Cary
The next thing I look for is a product or service that serves a need. Is it something with an appeal and a hole in the sector that we can fit in? Most great ideas aren’t great when they first come out, but they solve a problem. With the right entrepreneurial spirit, you will get there.
“I don’t look for somebody who’s going to send me a product with a big bow ribbon and ready to go to market. I’m looking for somebody that found something that needs to be solved, and they think that they have the opportunity to solve it.” – Fred Cary
What Should Entrepreneurs Do Before Investing Money Into Developing Their Idea?
You need to understand the competition, the size of the market, price points, target audience, what makes them purchase, and how much they are ready to pay before you invest. Do your research.
What’s The Recommended Selling Strategy Once You Have A Reliable Prototype?
The elasticity of your pricing point depends on the market and the competitive environment. There’s no exact pricing strategy for any particular product. You have to understand the market. Consumer research and surveys will help you see who your customers are and how much they are ready to pay. This data will allow you to increase the price point once you focus on what people want and not what you think they want.
When Do You Start Crowdfunding Or Letting Investors Know About An App?
Crowdfunding for an app is complicated. For the most part, it is equity rather than buying the app in advance. People advance money so you can build your product.
“People are not going to give you advanced money in a regular crowdfunding environment, but there’s equity crowdfunding.” – Fred Cary
In any type of crowdfunding, there is about a 20% chance of raising money. You need to work with someone who only does crowdfunding, has data, and knows what people are interested in. It is all about marketing, strategy, and understanding what people respond to. You can’t make it happen by yourself. Also, the price will be less than when you sell retail because its role is to get you the capital necessary to finish your projects.
How Do You Approach Following Up With Potential Distributors After You’ve Pitched Your Product?
Try to avoid a restraining order, but be persistent. The worst thing that can happen is that they say “no”. Send a follow-up email and ask for a meeting. If they don’t respond, be blunt about it. The quicker you get the answer, the sooner you can ask someone else.
“Build relationships, not connections. If you see them as people, not numbers and resources, they will be more likely to support you.” – Tessa Ashford
The “Idea Pros” at IdeaPros have the resources, experience, and tools to help you at this step or any step in the entrepreneurial journey.
We partner with entrepreneurs at any stage and who are ready to invest their ideas. Apply for an interview and let’s explore partnering together.