Shannon Whitehead launched Factory45, an accelerator program focused on supporting sustainable fashion companies, with the goal of combating what she calls "fast fashion." Factory45 works to get funding for companies focused on environmental sustainability and social responsibility, rather than exploiting cheap labor to produce their goods. Whitehead went behind the business plan with Business News Daily to discuss the growth of her accelerator and how she hopes to affect the fashion industry in the United States.
Business News Daily: In a nutshell, what service does your business provide?
Shannon Whitehead: Factory45 is an online accelerator program that takes sustainable apparel companies from idea to launch, without raising VC funding.
For example, I recently worked with Jesse Syswerda, who had been trying to launch her line of minimalist women's wear for three years. After coming through Factory45, she more than doubled her Kickstarter goal to raise over $20,000 so she could start production of her line.
BND: How long have you been in business?
Whitehead: Since June 2014.
BND: Did you start with a formal business plan? If not, how did you lay the groundwork for your business?
Whitehead: I didn't create a business plan. I never planned to pitch investors or apply for a small business loan, so it was much more valuable for me to simply take action and start executing. I laid the groundwork by taking a series of small steps each day. I knew the end goal, so it was simply a matter of completing the steps to get there.
BND: How did you finance your endeavors, both initially and as your business grew?
Whitehead: I bootstrapped a small amount of personal savings to get off the ground and grew organically from there. The first iteration of Factory45 required about $5,000 up front. A year later, I invested the majority of what I made in the first year ($30,000) to improve and grow the business in the second year. Factory45 is now a six-figure business, with a 540 percent growth rate from 2014 to 2015.
BND: Is your business today what you originally envisioned at the outset, or has it changed significantly over time?
Whitehead: It's definitely how I envisioned it. I've been very lucky to work with over 70 entrepreneurs who are all committed to changing the fashion industry. Back in 2010, when I was first starting out in sustainable fashion, very few people even knew what "sustainable fashion" meant. It's been amazing to see how that awareness is changing in a relatively short amount of time.
BND: What are some lessons you've learned? Is there anything you would've done differently?
Whitehead: I've become a lot better about being content with where the business is now and not focusing so much on where it "needs to be." Aspiration is valuable to any entrepreneur, but it's important to appreciate and give credit to the progress you've made — no matter how small or how young your business is. If you're always striving for something better, then you're missing out on how great the journey can be.
BND: What were the most important factors that contributed to your success?
Whitehead: I'm strategic about bootstrapping and deciding how much to invest back into the business, so organic growth has been really important. But I'm also not afraid to spend money to make money. I've hired a business strategist, a PR agency, graphic designers, a Web designer and other people who I know will be incredibly valuable to my business in the long run.
I've also been deliberate about how I build my audience and the way I market to my ideal target customer. Instead of looking at social media marketing as a popularity contest, I've been conscious about finding the right customer, rather than any Jane, Dick or Sally on the Internet. One of the biggest mistakes I see from new entrepreneurs, starting any type of business, is trying to cater their marketing efforts to everyone. You have to know who your customer is.
BND: What are the next steps you want to take as a business owner? How do you see yourself achieving those goals?
Whitehead: I'd like Factory45 to become the "gold standard" for apparel manufacturing in the United States. I've already had sew shops and factories tell me that the entrepreneurs who come through Factory45 are more successful and better-equipped than the average clients they work with. It's really exciting to build relationships with these factories and be able to refer high-potential companies to work with them. I'm passionate about creating jobs and expanding the American manufacturing movement.
In 2016, I hope to expand my reach to connect with more aspiring entrepreneurs who are looking to create clothing companies that are sustainably and ethically made in the USA. By helping these independent designers launch and grow, we are creating alternatives to "fast fashion" and helping to change the industry.
BND: What is your best advice to someone with a great business idea who is ready to give it a shot?
Whitehead: Don't be afraid to work a side job while you get off the ground. I know there's something glamorous about going all in and putting everything on the line, but you don't want bad financial planning to be the reason that you can't get your business off the ground.
I worked for six years as a bartender, through the launch of two companies, before I was ever able to live off of my business. There is a grit and growth of character that happens when you're hustling on the side to fund your dreams.