How I Went From $35K In Debt To $40K/Mo With My Product Design Company
Hello! Who are you and what business did you start?
Hi! My name is Sam Birchenough and I am the founder of BRCHN Design House. We’ve developed an innovative & unique process to take physical products from idea to production. We mainly do this as a service for clients, but we are growing internal product development as well.
I started BDH in 2015 and made no money in the first six months. Zero, zilch! We have since worked on bringing 70+ products to market and now a monthly revenue ranging from $20,000 to $80,000.
What's your backstory and how did you come up with the idea?
I grew up taking things apart and building things. There’s nothing I loved more. My “plan” was to have a product design firm since the time I realized I wasn’t going to be a professional racecar driver.
I actually found a letter written to myself during my sophomore year of high school; along with some superfluous goals like having a house with a view & some race cars, I had it written that I would have an innovative product design business.
I was lucky enough to take college engineering classes in high school and add in marketing and entrepreneurship in college. During this time, the thing that had the biggest impact on me was an internship doing robot end of arm tool design for automated manufacturing.
The automation team I was working with was awesome and let me create real robot arm tools that went into production. This real world experience had so much more value to me than most of what I was learning in academia.
Shortly after college I created a branding business for a few reasons:
- I knew I didn’t want to work for someone else.
- I needed to make money.
- It wasn’t capital intensive to start.
- It gave me the opportunity to learn about all the facets of building a business.
I started this business knowing that it was a stepping stone to creating my design firm.
How did I go from a branding business to BRCHN Design House? Read on.
Take us through the process of building the first version of your product.
The traditional industrial design industry was long due for an upset, mostly in cause to vast advancements in the toolsets & technology we use.
My distaste for wasted time in the form of “billable hours” under the guise of things such as “moodboarding” is one of the things that prompted me to redefine the design process.
I took a clean slate approach to developing our general design & development process. How did this manifest?
- We take a top down approach, increasing in level of detail as we progress through digital & physical iterations.
- We skip moodboarding and sketching and go straight to 3D in CAD. Hardly much more work on our end, and a much better representation for the client to provide feedback on.
- We consider the end goal from the start (which is usually volume production), and design for manufacturing early on. This improves process efficiency and derisks the transition to volume manufacturing.
Your time is irreplaceable and you should spend it doing things that you feel passionate about. If you don’t give up, you can’t fail.
Describe the process of launching the business.
This is a (now) funny story. I had a client of my branding business who needed their product designed & prototyped. I was like “oh, perfect, I do that too!” They said “great, shoot us a proposal.”
Within a week, I created the business... tax structure, logo, website, bank account, the whole nine yards (well the essentials I could get done in a week anyway), and yes, of course the proposal too.
The CEO was happy (probably because I charged .001% of what I should have), and I was happy because this was the perfect opportunity to finally start my product design business.
Every entrepreneur seems to have a sob story & here’s mine. Before the ink was dry on the contract, the CEO and the main investor had a huge falling out. Poof, like that, my client was gone (it's not like I was in any sort of position to enforce a contract that totaled less than a decent lawyer makes in a few days). POOF.
Goodbye to my car at the time, goodbye to any food much beyond PB&J, goodbye to always paying rent on time. Hello to putting my head down and making things happen because I didn’t have a choice. Marketing projects, outreach, networking events, collaborations.. Six months of this, six months of no money… no, negative money.
I was $35,000 in debt. I didn’t tell anyone.
Finally I landed a deal with my first paying client. I somehow talked a startup into letting me design a product that held a tablet device just below eye level in movie theater seats for ADA compliance. Designing & prototyping this thing for (a little bit of) money was quite a realization. A few months later I was in the green.
That moment, I’ll never forget. The stress prior, I’ll never forget.
Since launch, what has worked to attract and retain customers?
Attract
I had no budget for marketing. To this day, I haven’t spent a penny on internet marketing. Here’s what I have done that’s worked:
The startup community in LA is vibrant, but mostly with software startups. Like many entrepreneurs, early on I attended all sorts of startup, tech, and networking events. I made friends with the organizers and somehow talked my way into having a booth at one such event.
Most “booths” were tables with a company's branding, some business cards, maybe some pens to hand out, and an intern standing behind the table. I showed up with 3D printers, a projector, and all sorts of cool hardware products. I stood out like a sore thumb, and this got me invited to present at numerous events moving forward.
I’m an introvert and didn’t love socializing but boy did I ever network like crazy. This led to YouTube collaborations with well known content creators, speaking engagements with industry giants, guest podcasts, and case studies from toolset vendors about how we were using their products. I continue this strategy to this day. The direct value of these initiatives is tough to quantify, but I know it greatly increases credibility & client confidence.
The third thing I did that drove customers was to really learn about SEO and create an SEO friendly website. To this day, I average ten inquiries a week just from traffic driven to my website from search engines.
Retain
This is simple. Under promise, over deliver. Every time. My goal with every client is to make it so there is no comparable alternative option. Easier said than done, I know. It has taken years to build a process and procure the right tool sets to offer the value we do.
What has this led to? Repeat clients, some 7x over. Single project deals converting to retainers. Numerous referrals. I cannot overstate the value of this premise.
How are you doing today and what does the future look like?
In short, great. I run no more than four projects at a time. These projects average $25k each monthly. Margins are 90% +. I would like more consistency with running at capacity.
I do not intend to scale as a service business. My five year goal is to run at capacity and eventually take over one, then two of those four “slots” for internal product development.
This leads to my longer-term goal. I want to move away from client work and exist as a launch platform to bring awesome hardware products to market, much like what Dyson does.
Through starting the business, have you learned anything particularly helpful or advantageous?
I’ve learned a few things from people whom I admire and I’ll share them here:
- If you don’t give up, you can’t fail.
This advice can be dangerous, it can drive you to insanity. Sometimes you should give up. Sometimes you shouldn’t give up for just a bit longer. I went through a lot by not giving up, but I’d be much less happy today if I had.
- If you’re really upset, wait till the next day to make decisions.
You will never regret making business decisions with less negative emotion or looking more professional because you took time to craft a more professional response to a negative situation.
What platform/tools do you use for your business?
As a design & engineering business, I use quite a few CAD related toolsets: Autodesk Fusion & NX for design, Keyshot for rendering, Preform & Bambustudio for 3D printing.
On the business side, I use Wave for accounting, payroll, and invoicing. I use G suite for email, meetings, and phone.
What have been the most influential books, podcasts, or other resources?
This will sound crazy but I’m not a huge movie watcher, reader, or podcast listener. I do learn a lot from YouTube. One book that has been helpful recently is “The Trusted Advisor.”
Advice for other entrepreneurs who want to get started or are just starting out?
Your time is irreplaceable and you should spend it doing things that you feel passionate about. When you find such a thing and embark on an entrepreneurial journey, if it’s anything like mine, it will be quite the roller coaster. Fight fight fight. As I said earlier, if you don’t give up, you can’t fail.
Zoom out on a regular basis and look at what you’re doing from a macro perspective. Make sure you’re spending these points in your life in the best way you see fit.
Mindset is everything. Do what you can to expand your mind. It’s amazing the levels and possibilities this unlocks.
Are you looking to hire for certain positions right now?
I’m not looking to hire for any positions in particular, but I’m always looking to work with truly exceptional people. In fact I’ll pay lots of money to work with truly exceptional people.
Where can we go to learn more?
If you have any questions or comments, drop a comment below!
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