Today’s featured Indiana startup business is HauntedFlower.com, a startup that sells (not flowers that are haunted) licensed t-shirts to nerds everywhere via the magic of the Internet. What is cool about that you ask? The startup is run by two people (husband and wife), out of their home, using super efficient order fulfillment – which means they don’t keep their basement and garage stocked with t-shirts – and they project doing $2 million in sales this year. Sounds pretty damned cool to me.
Tell us about your startup…your words…whatever you want to say.
I like to remind myself that in 2007 I stated that nobody would ever want to buy a t-shirt online. It is a great reminder to be open minded and flexible, and the try things that don’t always aline with common sense. I still eat those words today, and enjoy every minute of it. We currently sell about 200 tees per day to customers all over the US. I am very excited about facing the new challenges of international markets and continuing to take market-share from other major online players. Haunted Flower was started in the “two-bedroom” of a tiny two bedroom apartment with about $300, and that is the only investment and/or seed money received to this day. We hope to have revenues of $2 million in 2011, and we see business continuing to grow exponentially in the future as online shopping becomes even more popular than it is today.
How did you come up with concept for your business, and how/when did the business model for that concept become clear?
The concept came when I was still working as a store manager for a national chain with shops in malls across the country. I was something of a turn-around expert and I was moved around a lot to stores that needed a shot in the arm. This meant my wife had to look for new work and start at the bottom of the ladder at least once a year, we moved about every nine months back then. I had the idea to start an eBay business buying things on clearance sales and reselling them out of our home.
The actual business model we use today only became clear in the last 12 months. The concept and mission was always simple, to get products our customers want into their hands. Building the product pipeline
around that involved a lot of trial and error. We used to ship everything out of our garage, at one point we bought a house that was more like a warehouse than a home, it had five bedrooms. We used four for storage and one for sleeping. When processing thousands to t-shirt products became unrealistic we took a turn towards automation.
Today the vendors actually package and ship our merchandise to a fulfillment center that packs and ships orders to customers. As owners we rarely even see the product. Customer service, inventory management including ordering and returs, web design, product design and general store management are all outsourced now. By the end of last year we completed a framework for the product pipeline that will remain completely scalable for as long as we can increase sales.
What made you first believe that starting a business is right for you (i.e. as opposed to working for someone else)?
Great question, I am not sure what the answer is. Unlike most employees turned entrepreneurs I was very happy at my job. I loved what I did in retail management, and I liked my supervisors and the corporate structure for the most part. I think that is why I took a very corporate management approach to my own company, and other business owners I know have commented that they believe it really contributed to the success of my business. There is something to be said for the discipline and accountability you have to learn as an employee. For example, I work out of the home. I could spend all day in my pajamas. Yet I have developed a bit of a dress code that I call the “Tight Pants Theory”. When I get up in the morning I get dressed as though I was still going to work for a company with a dress code. I don’t put on a suit and tie, but I wear respectable, clean khakis and a clean, comfortable shirt. I put on shoes that are similar to what I used to wear in my store before I enter my office. I enforce this dress code until I have completed the most crucial tasks of the day which usually takes about 3 or 4 hours, then I allow myself to change into shorts, sweatpants, pajamas, whatever. The motivation is that the dress code is a little less comfortable and forces me to treat my time seriously. I found quickly if I stay in sweat pants all day I am not half as productive..
What challenges have you encountered?
Most of them were internal to be honest. The hardest thing is still to operate in the grey area, making decisions and taking action when you don’t know for sure if you will be right. Every time I commit to a major purchase of inventory there is a chance customers just wont like it, or that they wont want to pay what I charge. I think you have to be an optimist without fooling yourself, and that can be a hard line to walk. Externally there are few challenges that can compare, we live in a world where information and opportunity abound if you have the courage to pursue it.
What sacrifices have you made to start your business?
To be honest, I found that the sacrifices to work for someone else were far greater. When I finally left my retail management job in Dec 2008 (which coincided with stock market crash and the economic crisis, scary times) I was amazed. I went from working 44 – 60 hours per week in someone else’s store in 2008 to working 3 -4 hour days in my house on my own business with financial rewards triple those of my previous job. I think it comes from what I did before I started my company. I put myself heart and soul into building my employer’s brand and balance sheet, and I worked myself to death doing it. I swear I still act like a 40 year old twenty-something. With that kind of work ethic and self discipline I found starting and running a company much simpler.
In your opinion, what makes Indiana a great place to start your business?
The people here. The last two places I lived were Ohio and Michigan, near Detroit. The economic pain the country has gone through has hit those places and the people who live there very hard. It is difficult to be optimistic and forward-thinking in those areas, and it is hard to find people who can motivate and inspire you. Indiana and Hamilton County specifically do not seem as effected, and you can find bright, successful people here to help inspire and motivate you to succeed. Environment is important, even working from home doesn’t protect you if all you hear when you step outside is negative negative negative. That is one reason I don’t watch the news or read the newspaper, I just talk to people and the people here in Indiana have a great work ethic, great values and great overall perspective. It is a fantastic atmosphere to be a part of as an entrepreneur.
If you could give an entrepreneur looking to start a business one piece of advice…what would it be?
Sell your product. There will be plenty of time to make business cards, register for sales tax, design a logo, website, so on. Just start selling your product or service on eBay, craigslist, Facebook, door to door, whatever channel suits your idea, get those first twenty sales/clients/whatever before you even think about something else. If you can’t sell the product, all those other things will be a waste of time anyway, and the sooner you find out if your product will sell the sooner you can move forward confident you have made the right decision in becoming an entrepreneur.
PS If I could give two pieces of advice, the second piece would be a reading list:
- Rich Dad Poor Dad
- The 4 Hour Work Week
- Ready, Fire Aim
Stat Sheet: Haunted Flower, LLC
- Business Name: Haunted Flower, LLC
- Website: www.hauntedflower.com
- Facebook Fan Page (if applicable): facebook.com/hauntedflower (10000+ fans!)
- Twitter Account (if applicable):@haunted_flower
- Your title at the business: Daniel Wagner, Founder
- When was the business founded: 2007
- Business Description in 140 characters or less: Haunted Flower specializes in officially licensed novelty apparel, especially t-shirts for men and women, teen through adult. We carry high quality professionally printed tees that make fantastic gifts.