Finding capital through loans to fund a company continues to be one of the biggest challenges a small business can face. Kabbage, an innovator in loans for small business can definitely help. They have provided $3.5B to 100,000 small business. An owner can get $150,000 in just a 10 minutes. One company where it made it difference was Dude Wipes. Here is how they did it as told by Ben Gran.
Toilet tissue is not most people’s idea of a glamorous business – but just like any industry, it offers opportunities to savvy entrepreneurs who know how to spot an underserved market. Sean Riley and a few of his friends decided to start a business called Dude Wipes, selling flushable wipes marketed to men, because they felt like it was a useful product that wasn’t being branded in a way that was relevant to the male demographic.
A few years later, their company has won a national award and has built an audience by partnering with a Mixed Martial Arts (MMA) fighter, a pro skateboarder, and a national music festival. Maybe toilet wipes are more “glamorous” than most people might expect?
We talked with Sean Riley from Dude Wipes (who is also a Kabbage customer) about his company’s founding, how they stand out from the competition in the fast-growing flushable wipes category, and what other small business owners can learn from their success.
How has being a Kabbage customer helped you to grow your business? Can you share details about what you used your Kabbage funds to buy?
We used Kabbage funds to launch our second product. Originally we came out with individually wrapped single wipes for guys on the go – to use at the office, at the club, outdoors, that was the pain point we saw, where someone might see our product and think, “I’m an active guy, I need this portable solution.” Then we quickly realized that we were going to need some capital to do our next product and take things to the next level. So we opened a line of Kabbage credit to make things a bit more comfortable – thanks to Kabbage, they were part of our success in launching our second product.
A lot of small businesses struggle to get loans from banks, and we found this to be true as well. You can’t get a loan from a bank unless you’ve been in business for 2 or more years, and you need to fill out 3 inches of paperwork, and provide the partners’ tax returns and all of these other steps. We were a brand new company, so we just couldn’t get a loan in the traditional way. And when we found out about Kabbage, we couldn’t believe how easy Kabbage was – we could apply online and get the money really quickly.
Do you think you might have had trouble finding external capital/investors/loans in part because people don’t believe that a personal care product like Dude Wipes can come from a small startup? (For example, most of the time at the grocery store, you only see flushable wipes from big companies – brands like Charmin, etc.
We talked to a few potential investors, and there was definitely some skepticism to it. We knew we had a good idea. We put in our own money and put in an order for an order of the individual wipes, and we knew we were taking a chance, and we might be flushing some money down the toilet, so to speak. We got some skepticism because there wasn’t another product just like it on the market. Investors want to know, “what are your sales?” Our sales at first probably weren’t interesting enough to investors. But in the long run, it’ll be better that we didn’t get early investors, so we can keep going “indie” so to speak. A product like Kabbage definitely helps companies get from one stage to another, so you don’t have to rely too heavily on investors or the traditional channels.
What advice would you offer to other startup founders and small business owners?
Don’t give up! We could have given up at several points. But the longer you stay with it and keep pushing, it will eventually work. When you look at the success stories of other businesses and other products, some things pop overnight, but some products take a while longer to get adopted. We still have plenty of places to go and other things to do.
The biggest thing is to stick with it, and believe in your idea. It’s just like shooting baskets in the gym; you keep shooting, you keep practicing, and more shots start going in. There’s that old saying, “The harder I work, the luckier I get” – that mentality is really important, especially when you’re learning a new industry. You might think “I’m just selling wipes,” but no, there’s a lot more to it, there’s a lot more to know about it!
Before we started this company, I used to work for a construction engineering firm doing cost estimates and sales, so this was a new industry for me. My co-founders and I weren’t experts at wipes at all when we started; now we’ve gotten stronger on the product side. Whatever market you’re in as a small business owner, there’s a whole unique learning curve and terminology and marketing knowledge, and you have to catch up on all of that; it’s like starting out at your first job right after college.
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