How We Grew Our Side Project To $60,000 in Revenue in 6 Months

The idea was simple. As a mid-twenties male, you basically have three options to decorate your place: IKEA, Craigslist, or outrageously expensive furniture stores. We thought there was a need for a better option — something unique and stylish, but reasonably priced, and could be ordered online and shipped right to your door, hassle free.

With that, Spilled was born.

6 months and way too many late nights and weekends later, we broke the $60K revenue mark. There’ve been lots of missteps and ah-ha moments along the way. For anyone thinking about starting their own side project, I wanted to share some of those learnings. I hope it helps you avoid errors we made in the those critical first 6 months. And if you’re on the fence about taking the plunge, I hope our story will make it more approachable. Here’s what we’ve learned so far…

Product, sales and dead weight.

Business licenses, incorporation, founder roles, etc, these are all bullshit. Until you’ve started selling product, none of it matters.

A good way to think about a side project is that you have a fixed amount of hours to spend on it to get to real traction (read: sales) before you burn out and give up. Believe me this number is smaller than you think. Probably about 100 hours for most people. So if you spend an hour researching business licenses, 2 hours deciding who’s going to be CEO, and another 2 hours writing mission statements and business plans, you’ve just burned 5% of your runway. Was that worth it?

So challenge yourself: what’s the absolute minimum number of things you can do to get your first sale?

With Spilled, the steps were surprisingly few:

1. We called manufacturers on ThomasNet until we found one that would create single-unit samples. This was critical because it allowed us to get a physical incarnation of the product that we could photograph and put online at the lowest cost possible.
2. We sourced two designs — one from a designer on Designspiration and the other just Google Images + Photoshop (haggard, I know). Two was a good number because it halved our risk of failure simply for choosing a bad design, but still kept the investment low.
3. We got a $10 website from Big Cartel and a $10 domain name from GoDaddy. No need for a fancy .com domain name or expensive website template before you know if people even like your product.
4. The manufacturer sent samples, we photographed them, published to the site, and immediately turned 100% of focus to sales.

All in, our startup costs were $300. Everything from there we’ve been able to fund with revenue.

Your niche should define your product, not the other way around.

Focus is great for maximizing your chances of traction before burnout. But that’s not useful until you’ve formed your product idea. How do you decide what you’re going to sell and (more importantly) who you’re going to sell it to?

There’s a lot of writing out there on this topic so I’ll spare the space here and just share what worked for Spilled.

We went backwards from most startups, first deciding on a niche group of customers we wanted to sell to, and let that niche define our product.

We honed in on the sneakerhead/streetwear niche rather quickly for three key reasons: 1) extreme consumerism (our typical customer already buys lots of stuff online), 2) concentrated, highly-engaged online communities for easy viral distribution, and 3) my co-founder, Pedram, is part of the community and deeply understands the market.

Once we knew who our customer was, it became a immensely easier to deconstruct the market and define the product. Here’s some steps that were helpful for us and should work for most niches:

• What is your customer already buying lots of?

For us, this was shoes. But it could really be anything. Electronics, toiletries, clothing, housewares, etc.

• What’s something tangentially related, serving the same customer needs, but is different enough to not be crowded with competition yet?

For us — home decor. Everyone in our market has a home/apartment, but no home decor companies were making products that appealed to our customer.

• How can you make it ridiculously easy for your customer to say yes?

For us — the products needed to look and feel like the shoes/clothes they were already buying, both in aesthetic and distribution method. Limited releases, hand numbered certificates of authenticity, streetwear aesthetics, all sold online over PayPal (our website only started taking credit cards recently as our customers are already heavy eBay users with PayPal accounts).

Clearly defining your niche is probably the hardest thing for most startups to get right, but this is what worked for us. The good news is, if you’re disciplined about the first point above, you’ll have room for several iterations to get it right.

Saturate.

Once you’ve identified product, customer, and minimum path to sales, you’re in pretty good shape. But the next step is the critical difference between 0 and your first $10K.

You have to be EVERYWHERE for those early customers.

You should know your niche customer well enough that you can map out their day and where they’re spending their time so you can think through how to get in front of them constantly. A good rule is to pick 100 of those customers, and make sure they see you at least 10 times a day, every day, until they buy from you.

If you know your customer well, you wont need a big advertising budget to do this.

For Spilled, we were in their email inbox, responding to their Craigslist posts (more on this below), commenting on their Instagram photos, replying to their forum threads, getting posts into their Facebook newsfeeds, reaching out on Twitter, commenting on their favorite blogs, dropping retargeting pixels to show low-cost banner ads, the list goes on.

This is the part where you don’t sleep much.

Hustle gets you from 0 to 1. Hacking gets you scale.

By definition, starting a side project means you’re going to be stretched thin. You already have a full time day job and are probably running near 100% capacity. So you need to find ways to scale yourself as much as possible.

Here’s some hacks that helped us scale our hustle early on:

Craigslist — One of the best things about a side project is it gives you an awesome sandbox to take the competencies you pick up in your day job, and apply them to a new market in ways that can really over-index. My cofounders and I work in the internet industry, so there’s been a lot of interesting things that are commonplace there but totally new when applied to Spilled’s market.

One of the early ones was setting up a scraper to pull down every listing on Craigslist where people were selling or trading sneakers online. I think there were 10 or 15K of them nationally. We set up a program to email all of these people with a personal 1:1 looking email, complimenting their shoes and offering to trade for one of our rugs, with a link to view the product on our site. Most people just ended up clicking the link, and many actually bought or shared the rug. This was huge for kick-starting our viral flywheel. (PS this is easier than it sounds).

PR — Press is such a powerful tool if you can harness it, narrowing your outreach problem from tens of thousands of individual customers to just having to win over a handful of influential editors. Massive leverage.

With Spilled, our approach was to identify the 4–10 blogs in our niche with the biggest reach. Select a single editor/contributor at each, and obsess over building a relationship with them. You have to make them love you — send them free product, share all their articles, whatever it takes. As these relationships begin to take shape, it will apply a huge multiplier to your reach.

Viral — Another big lever for Spilled has been viral distribution. A lot of tactics work here, but the key thread across all is to really over-deliver and wow your early customers so they can’t help but talk about it. For Spilled, this played out in extreme attention to detail with our products, hand numbering and signing every piece, answering customer emails in the wee hours of the morning, and going above and beyond to make it right in cases where we didn’t deliver. Painful at times, but as Paul Graham pointed out, doing things that don’t scale is often what it takes to win over those critical first customers.

Cashflow, baby, cashflow.

In most cases, you’re not going to raise investment capital for a side project. So you need to think hard about how to structure your business model to be as lean as possible.

We took a cue from Kickstarter here, setting expectations with our customers up front that we don’t ship product until 2–3 weeks after it’s sold. Customers are okay with the policy because we over-deliver in other areas, and it allows us to pay our manufacturers with revenue instead of investment capital, which drastically reduces our risk on launching new products. This is what has enabled us to bootstrap the company on revenue alone, requiring no further investment beyond that original $300 it took to get the first samples and set up the website.

It’s all about the people.

Beyond all of the above, I think the single most important thing you can do for a side project is to find a good team. Even if it’s just you and one other person, having someone else as invested in the project as you are pays off in so many unexpected ways.

With Spilled, I have two kick-ass cofounders that help smooth out the workload, multiply the idea generating power, and keep me focused when I inevitably get discouraged. It’s hard to continue to pour energy into something when you’re not seeing traction or you hit a down cycle or roadblock. I think this is why most projects fizzle out and don’t go anywhere. Having a committed core team can be the key difference that enables you to power through those late nights and lost weekends it takes to get your project off the ground.

So, how’s Spilled doing today? We’ve been fortunate to continue growing on that same curve since those first 6 months of standing the business up. Today we’re excited to be in the process of closing our first national retail deals. So far, so good.

Update 2/1/2016: 2 yrs in, we just broke a quarter million in revenue, and increasing 50% YoY. Currently we’re testing out a new platform strategy that will 10x the business if it works. I’ll try to share another update later this year!

Update: We sold Spilled in July 2018. Since then, we’ve launch these new projects: Production Grower, Vapes All Day, and Ready Set Cam.

P.S. — If you found this article helpful, feel free to hit the recommend button (♡ icon below). I greatly appreciate it!