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First Person: In the thick of a startup

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Wednesday, February 01, 2006

In the thick of it

Everyone says your life will change when you start a business. For once, everyone is right.

By Greg Netzer

If you’ve read this magazine regularly for the past 10 years, you’ve likely seen my name attached to reports on Oregon businesses, particularly small ones, whose prospects I’ve tried to gauge with something approaching precision. For much of that time I’ve also worked for the Oregon Entrepreneurs Forum, a nonprofit whose mission is to help startups succeed. All of which is to say that I’ve spent a lot of time over the past decade thinking about how companies can start, grow and prosper.

OBM 02-06_09_0001new.jpgSo I should have known what I was getting into when my wife and I decided to start a family business.

Do you like chocolate? Of course you do. Everyone I know does. This is good for my wife, Sarah Hart, because she’s a chocolatier. She’s so good — our daughter calls her “an artist who’s found her medium” — that in mid-2004 she decided to start an artisan confection business. Alma Chocolate LLC, named after Sarah’s grandmother and the Spanish word for “soul,” was soon testing the market with small batches of truffles, toffee and molded figures she gilds with edible gold leaf. We held a holiday sale that December for friends and acquaintances, hoping to cover costs; when we sold 300% of our goal, we realized we might be onto something.

To market to a larger audience, we opened a ooth at the Portland Farmers Market on Saturday mornings on the Portland State University campus. Sarah worked part time for a public relations firm, and I worked full time at OEF, so production occurred at night. Friday nights we packaged the goods; Sarah would leave for PSU at 6 a.m. Saturday. After cleanup and breakdown, our weekends shrank to Sunday afternoons. Family time at night all but disappeared. We didn’t see many friends, either. And I won’t even go into how lax our housekeeping became.

Still, Alma gained loyal fans, and we were soon hampered by our inability to meet demand. We needed to increase capacity beyond our state-licensed home kitchen if the company was going to grow. And that’s when our 8-year-old son, Owen, and I stumbled onto a vacant storefront in Northeast Portland.

We’d wanted a commercial kitchen, not a retail space, but we ran the numbers and gut-checked the idea with dozens of customers and friends, and heard the same answer repeatedly: a perfect location. Next thing I knew it was October and we were signing bank papers, negotiating a lease and ordering kitchen equipment.

Then the fun began.

The City of Portland’s permitting process, true to its reputation, was confounding. The sanitation inspector mandated four extra sinks to accommodate our manufacturing process; the environmental bureau said that since we were adding four sinks, we’d incurred a sewer load charge of $2,300. Seating for customers? That’s a $10 per square foot transportation charge. In one memorable two-hour stretch, Sarah was told our budget would have to absorb $18,000 in extra fees and equipment.

Building out the kitchen tested my patience and character. The contractors did such poor work that I had to redo much of it. The plumbers broke the water main and failed inspection four times. To make the space presentable for a reprise of the holiday sale, I worked nights and weekends at the space for weeks.

Meanwhile, Sarah quit her job to work full time on Alma, feverishly running between the bank, the city, and the restaurant supply, making chocolate when she could. I couldn’t remember the last time our family had eaten dinner together. Owen began calling my cell phone to say good night. Sarah and I spoke to one another in clipped, tense sentences.

Yet what happens to your life when you start a business is that it grows in unexpected ways. Yes, our cupboards went bare from neglect. Yes, we made entirely too many mistakes.But our children, despite the changes they were enduring, bragged about Alma to anyone who would listen. Dozens of friends offered help. We fell into bed at night — exhausted, but energized.

Does it matter that we didn’t get done in time, or that we had to move production equipment back to our house? Does it matter that our sewer line collapsed five days before our holiday orders were due? No. What matters is that the orders came in: On the first weekend in December, we held the holiday sale in the store anyway. Customers loved the “in progress” feel of the space. And they bought chocolate — lots of it, enough to surpass our ambitious goal of 270% of 2004’s sales (taking the sting out of the plumber’s bill). And they told us they eagerly anticipated our grand opening, which is just in time for Valentine’s Day.

And us? We’re excited, too. It hasn’t been easy, but suddenly our little company has repeat clients, increasing revenue and growth potential. We’re still not quite sure what lies ahead, but we’re hopeful that it’ll be easier to handle than another sewer load charge.


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