We hit a milestone this year.
It’s not a flashy milestone to most.
But it means the world to us, so we thought we’d pull the curtains back on our business model in order to share some truths about entrepreneurship and to celebrate.
This past month, we became cash-flow positive.
Wait, what does that mean?
Simply-put, being cash-flow positive means that our business is no longer a volunteer gig.
Yas! After 3.5 years we are (finally!) able to start paying ourselves.
It may be surprising, but this is a very common story. Most inventory-based businesses (like ours) reach cash-flow positive somewhere in the range of 3-5 years. Many don’t and are forced to pack it in.
This harsh reality is because inventory-based businesses start up with heavy inventory costs. It takes time to break out from those cycles financially. But last month, we did!
If it’s so tough to make money with inventory, why did we choose this model?
Ecommerce has a bit of a textbook success story which may sound familiar to you – Source some tshirts, print designs or trendy sayings on them (or Donald Trump’s face), and have them dropshipped to your customers. Businesses like this take work – all businesses do; but the up-front investment is avoided.
That’s just not our story.
Running a business is a marathon, not a sprint. If you're in it for the long haul it's so important to start up with a clear definition of what success looks like. For many entrepreneurs (this team included), success is a blend of getting paid, but also building community.
As you may recall, three and a half years ago when Mom Friends started we were inspired first and foremost by our mission to spread postpartum care and awareness across Canada. For better or worse, dropshipping tshirts just wasn't going to scratch that itch. Here is what does…
Our business is founded on connection and care. Thanks to our inventory-based model we get to play a first-hand role in both.
We are motivated by:
- Sourcing wholesale care products from local suppliers whenever we can, keeping money in our communities and supporting our local entrepreneur network.
- Hand-writing thoughtful message cards from our customers before we pack and ship across Canada.
- Countless front porch conversations with parents here in Ottawa who tell us that they received a kit mere months ago and now want to give one to an expecting loved one of their own.
Without carrying our own inventory we would miss each of these interactions, and more. Whether it’s a small shop, restaurant, or inventory-based ecommerce site; when you buy from an owner-operated business, you are supporting community with every purchase.
So we have worked hard, and we will continue to work hard.
But we are no longer putting in long, unpaid hours, fuelled only by our belief that more parents across Canada should feel supported during postpartum rest and recovery.
Trust me, it’s a great mission to be a part of. But today, we are sharing and celebrating this special accomplishment by buying each other a drink and making a toast with the money we have earned.
So, that’s all for now. A super businessy update. Thanks for following our journey, and for supporting new parents with postpartum care, always!
PS: We know that there are so many entrepreneurs out there who are in love with their mission like us, but who are struggling to reach the same milestone. If you’re in the thick of it and could use an understanding ear REACH OUT! It can be tough and lonely, and we know how lucky we are to be supported by each other as a team as well as businesses in our network. Don't go it alone!