If there is one thing that cancer can teach us, it’s that life is never fair. Fairness is rather a commodity that seems to only be true when playing board games. Fairness for sure plays no roll in entrepreneurship or starting a business, and pays absolutely no part in start up financing.
No matter what you are working on, it will always cost more than you think to finish the job. When we decided to start CareAline as a business, we had no idea about how to bring a medical product to market. Our naïveté had its pros and cons – we decided to actually do it (pro), it was going to take waaaayyyy longer than we expected to get out there (con).
We jumped in with two feet when we launched in 2012. We had been to one conference, we had people swarming us – telling us that they needed these desperately – and we were sure that we would start to sign hospital wide contracts within months. We had something everyone needed, and we just assumed that they would buy it.
Then reality set it very quickly. The world of hospitals doesn’t quite work that way. We realized that it was going to take a lot longer to get through to these hospital purchasing departments than we thought. There were hurdles and obstacles of all sorts standing in our way, but we knew that we had to push past them.
One thing that we now know we were pretty clueless on, was how much money it was going to take. We had made projections, and thought through the numbers as best we could, but we really had no clue as to what the sales process was going to look like. Needless to say, we pretty grossly underestimated how much capital we needed to get the company up, running, and stable.
The past year we have been running things without any incoming capital – running solely off the revenue of selling product. For the most part, we’ve been keeping up – albeit just barely – and have been able to keep things running. Then, this summer, things started to shift. We started to get more hospitals wanting to do trials, and we had two major hospital wide contracts start ordering product; with 3 others lining up. Bulk orders were becoming frequent, and we didn’t have enough inventory to keep up. We placed a production order and sold it before it even came off the line. Now, faced with the outstanding hospital invoices (they have 30 days to pay post shipment – and it’s hospitals, so 30 may mean 60), and no incoming capital, we were left with nearly empty shelves, and not enough funds to place another bulk order.
We started to search for a small line of credit with a bank. Banks want three years of PROFITS in order to loan the money (so much for small business support from the local and federal government; by the way, we are fully made in the USA (Fall River, MA at Precision Sportswear, Inc to be precise, still no help), and with only months of profits under our belts, they weren’t going to offer us anything. We looked at a local growth capital company, and while they offered us a small loan, the terms weren’t anything that would work with our company. Frustrated and flustered, we faced the facts – we were going to have to think outside the box when it came to financing.
While we are working to do all that thinking, and trying to use our creative minds to whip up some capital, we have had some of the most stressful weeks trying to get by. Some days it feels like no matter how hard we work, no matter how much good our work does, and no matter how much we grow; we can’t catch a break. While I’m sure this is a plight of almost all start up companies, it doesn’t make our current situation any less stressful or frustrating.
One of the worst moments was when I was standing in the grocery section of Walmart, in the middle of a small town outside Dallas, looking at ingredients for dinner. I was trying to decide if we could afford to buy the bag of onions for $1.95 or if I needed to buy just a single onion for $0.98. That single dollar felt like a hundred that day. And because it was for food to feed our family, it felt like I was failing to support my family.
Our financial struggles are not over yet, and we are working hard to get through the growth phase of our business. But we are pushing forward and working hard to think about how we can keep CareAline growing and thriving no matter the struggles we face. And while business may not be fair, when you are passionate about what you are doing, and know you are helping real people with real problems, nothing can keep you from pushing through.