The
Entrepreneurs: Williams J. Boyers Jr., 39-year-old founder
of APS in
Tacoma, Washington and partner and co-founder Ray Henson, 39, who
helped Boyer with the technical aspects of the invention
The Product:
The digEplayer is a portable battery-operated in-flight
entertainment system that passengers place on their tray tables.
The 3-pound system, which holds 64 full-length movies and hours of
digital music, cartoons and TV sitcoms, is a less expensive
alternative to the traditional onboard in-flight systems that cost
as much as $1 million per plane to install. A licensing arrangement
with Twentieth Century Fox allows APS to reprogram the units every
60 days with new movies right before they go to video.
Startup:
$250,000, which paid for making a rough design of the unit
Content Continues Below
Sales: $1
million-plus in the first quarter of 2004
The Challenge:
negotiating the expensive product development and marketing costs
required to introduce a high-tech product to a market with
well-funded competitors
William J. Boyer Jr.'s high-tech business idea could
certainly be described as ambitious: He set out to persuade
airlines to ditch their traditional onboard entertainment systems
for his innovative alternative. Although in the early days he
lacked the requisite capital and technical expertise to get the
business off the ground, before long, his venture was soaring past
the million-dollar sales mark. Here's a closer look at how he
launched his big idea from conception to reality.
Steps to Success
1. Sell customers on
your product's benefits. Big customers are almost always
skeptical of new vendors with smaller businesses. But they will
listen if your product strikes them as unique and important. As
Boyer explains, his product met that criteria: "I knew my
product had two big benefits. Current in-flight entertainment
systems weigh in excess of 1,500 pounds [due to wiring, screens and
other components], a weight that requires about $100,000 of fuel
per year. The digEplayer only weighs 3 pounds per system. The
second benefit is that [if my] product fails, only one unit fails.
When current systems go out, no one can watch a show. [With
digEplayer], airlines can avoid unhappy customers on a long flight
when a system goes down."
2. Don't be
afraid to bring in a partner. Technical expertise is
expensive-especially with high-tech products, where you might need
a minimum of 10 redesigns before you get a product that meets your
needs. If you can't afford to spend that kind of money, another
option is to give up a part of the business to a partner with
technical expertise. In Boyer's case, he found Henson, his
technical expert, in the coffee shop Boyer owned. "I
originally got my idea in 2000, and I knew one of my customers had
worked at Intel and knew about electronics," says Boyer, who
launched the business in 2002. "I kept asking him questions
until, finally, Ray insisted I tell him what I was working on. Ray
liked the idea, and he agreed to work on the project for a share of
the business."
3. Find champions in
the market. It doesn't matter what your product
is-you'll have a tough time meeting the right people and
breaking into the market if you lack an inside connection pushing
for you. So do research to find people looking for a solution like
yours. Boyer's champion was Dave Palmer, Alaska Airlines'
managing director of marketing.
Boyer, who loves being around planes, was also working as a
baggage-handler at the time, so he knew of Palmer. Boyer got the
initial meeting because he had heard the managing director of
marketing was struggling with the $1 million cost of adding an
embedded entertainment system to each plane. So Boyer sent him a
letter with a money-saving solution that caught Palmer's eye:
Instead of spending $1 million per plane, Palmer could buy 40
digEplayer units for each plane (at a tenth of the cost of the
embedded system). The airline could then charge air travelers $10
each to use a unit in flight. "I've probably talked to
Dave Palmer 75 to 80 times," says Boyer, who is now courting
other airlines as well. "He made time for me every time I
wanted to see him."
Thanks to that commitment from Alaska Airlines, Boyer was able
to secure a licensing deal with a division of Twentieth Century Fox
called Fox in Flight. It helped, too, that the studio needed what
he offered-content sales outside of theaters. "I sent a letter
to Twentieth Century Fox asking if I could get an appointment for
content procurement," he says. One thing led to another, and
soon Boyer was on a plane to Los Angeles, where, he says,
"[the studio] went out of [its] way to get me the licenses for
the content. And they set up the license so I can get movies about
a month before they are generally available on video."
4. Take small
steps. You can try to limit your expenses for developing a
high-tech product, but they can still add up. To keep costs down,
be careful and move slowly to ensure you're spending money on a
product that will sell. "On my first call to Dave Palmer, I
started out with just a picture," says Boyer. "Then, when
Dave liked what he saw, I kept moving forward with better models
and prototypes. I had two mock-ups, a working model in a briefcase,
and two prototypes before we finalized our product. Plus, I
contacted Twentieth Century Fox after Alaska Airlines insisted I
have content, so my last prototype included movie programming from
Twentieth Century Fox and music programming [from] DMX
Music."
IN THE LIMELIGHTAugust is National Inventors' Month, and
it's a great time for inventors to showcase their products at
local libraries. Inventors' Month is sponsored by
Inventors'
Digest magazine, the
United Inventors Association, and the
Academy of Applied
Science. These groups prepare kits for libraries so they can
set up exhibits. So call your local library, and offer your product
as part of the display. To get publicity, contact your local paper,
and ask the editors to write about your display.
Lessons Learned
1. Show customers
your credibility. It's not enough that someone is
looking for a solution to a problem; customers must believe you can
actually get your product produced and marketed. Therefore,
first-time inventors should consider bringing in an experienced
partner or a team of advisors with significant market experience.
Ideal advisors for a high-tech product are engineers with relevant
experience at big companies or marketing or regional sales managers
for midsize or large firms. When someone experienced in the market
believes in you and your product, it adds credibility to your
project.
2. Ask, and you shall
receive. People in the market get bored with their jobs, so
an inventor with a new product can be an interesting project for
them. To get help, simply ask people for help, and then take their
advice. However, people will only help if you listen to them.
Inventors have a tendency to want to be in charge of their idea and
sometimes have trouble taking advice. You must get beyond that if
you want to succeed with a high-tech product.
3. Seek out
investors. High-tech innovations take a lot of money to
launch-more money than an inventor usually has. The secret to
finding investors is getting a credible response from a big
customer, which shows you're ready to launch your business.
Family friends and local investors are often willing to help fund
your idea once a big customer offers a positive response and
requests some definite action from you. Boyer, in fact, secured an
investment for product development from a wealthy acquaintance,
after he had both Alaska Airlines and Twentieth Century Fox
tentatively agreeing to proceed.
4. Don't miss
your window of opportunity. Your chances of success fade
dramatically once people think you've lost your steam. Your
champions might stay with you when momentum is on your side, but
don't expect them to stick around when it's gone.
Therefore, it's imperative that you keep getting results. You
need to have something to show-a new model, prototype or
package-every two or three months to stay at the top of your
game.
GET ON TV!The Electronic Retailing Association
(ERA)—which represents the people who promote products on TV,
such as infomercial company Guthy-Renker as well as the
home-shopping networks—is having its annual conference in Las
Vegas from September 26 to 29. The ERA Conference & Exposition
will feature the Invention Showcase, which gives inventors the
opportunity to attract attention from TV marketers looking for the
next hot product to sell. Some of these people may finance your
invention, and typically, buyers from home-shopping networks QVC,
HSN and ShopNBC show up, too. A booth costs $525 for the Invention
Showcase, and you must have a patent to display your product. For
more information, go to
www.retailing.org, click on "Meetings &
Programs," and then click on "Invention
Showcase."
Don Debelak is author of Entrepreneur magazine's
Start-Up Guide #1813, Bringing Your Product to Market(www.smallbizbooks.com), and host of inventor-help Web
site www.dondebelak.com.