When is customer feedback misleading and counterproductive? When are biodegradable materials more environmentally harmful and not less? When might failing-fast just lead to failure? Solo entrepreneur and founder of Fort Boards, August Graube, was nudged into entrepreneurship after being laid off. Years later he is more fulfilled than before because he successfully built and sells a unique product. August shares his thoughts on pricing, strategy, selling to buyers versus, maintaining a positive outlook, and when breaking from convention makes sense.
Fort Boards with August Graube
Eric: Can you do me a favor and tell the audience a little bit about Fort Boards and the product, the genesis of where it came from?
August: Yes. My company creates toys and really trying to create the toys that are ever engaging foster creativity. Our first product was Fort Boards, which is a fort building kit for kids and with a single pack of Fort Boards kids can create anything from castles, to cars, to houses, to rocket ship, even a giant squid. So pretty much anything that can imagine can be built with Fort Boards. It is kind of like Lego expanded up to life size. Then as a company, I am just a one-man operation for product design, product management, to production management, to marketing and sales I do wear all hats there. I launched Fort Boards about six years ago and about three years ago I launched a second brand called Blaster Boards, which is essentially the same product, same boards and connectors that make up the original product but adds in spinning targets and so it is marketed towards the crowd that loves Nerf and people that would have Nerf bunkers for their Nerf battles. So that is the overview of the product and company.
Eric: August, you take a different approach than a lot of manufacturers. Can you share what that looks like?
August: Yes. I would say in learning about the toy industry and going through this process, most toy companies kind of work on the aspect of they nobody knows what is going to be success or failure and so, most toy companies throw six to eight products at a wall per year and just see what sticks and one or two of those will be the cash count as will fail. As is solo entrepreneur, you just do not have the ability to do that kind of thing and so you have to spend a lot more time in development to make sure the product is going to be success and that it is going to be sort of evergreen as well. I put in a lot of time and effort in developing this product to give it the best chance of success in the market and I think because of that extra effort it has been able to win a lot of awards and shown itself is being very unique out in marketplace.
Eric: Is it almost fair to say that you are not really, at least at this stage you are not sort of a proponent of the idea of failing fast?
August: I think there are a lot of aspects where in entrepreneurship what are you do need to fail fast. I think in this particular arena, I mean, when you are doing injection molded toys, the production costs are so steep. I mean, the tooling for these things is like new car expensive and so there is no way to fail cheaply there. So in that sense you have to put a lot of time in the design because there is not– it is not like software. There is version 1.0, 1.1, 1.2, like you are carving stuff and steel and so has to be right. So in the sense of the product design, category, you really need to spend your time doing it well. That being said, there is a lot of other parts of the entrepreneurship journey that you can spend a lot less time on and it should not be perfect. Your logo and your mission statement and business plan and stuff like that, all that is going to be become a irrelevant pretty quickly and change rapidly. So those are the things that you do not need to spend a ton of time on it, you can try and fail quickly in those areas.
Eric: Can you describe your background? I think you had spent some time or spent a number of years in product management, product development, is that fair?
August: I actually bounced around quite a bit. My career started in design of large-scale Boeing prototypes. So full scale mockups of the new airplanes interiors that Boeing was coming out with. That was really fun job and that is sort of where I learned the design side of things. Then from there did more project management work in creative industries so like museum exhibits, I was project manager for designing and fabricating and installing museum exhibits all around the country. My schooling was sort of a hybrid that I made myself that I call design management at the University of Washington and that was, I noticed that there was industrial design programs at U-Dub where people can learn how to design products really well, but and all of them ultimately wanted to launch these products to the market but they just had zero idea of how to do that. Then there is the business school where all these kids were starting their own companies, but just had terrible ideas like t-shirt companies and stuff like that. I kind of wanted to shoot for something in between there and created design management so I could learn both how to design products but also how to negotiate contracts and how to market products and stuff like that. So that was my initial schooling and so I would say in general like I cannot do anything very well. I am a jack of all trades and master of none, so that is kind of my background.
Eric: Sorry, I am laughing in the background because it sounds a lot like me and a lot of other people I have talked to. Tell me a bit about what makes the products different. You kind of describe them as full size Legos or almost the Nerf equivalent of a full size Lego, but could you give us a little bit on that?
August: Yes. Just to describe the products in general it consists of just two parts and one is about an eight by eight inch board, a flat piece of plastic that has connection points along it. So those boards connect together on their edges and creative living hinge and so you can create working doors and windows shutters and stuff like that and you can kind of create any angle you want out of that. Then the second part is a connector that connects in different places along two boards to create a rigid angle. So with just as two pieces you can create six different rigid angles, which allows you to create kind of anything you would want to build. So how it is different from what is on the market is there is a couple of fort building kits out there currently and one is made up of large cardboard panels that link together and one of the problems with those is that these panels are so big that kids can really only create kind of blocky forts. So it does not allow them to get very creative. They can do cars or castles or anything like that. The other problem is the material and well, I love the cardboard is recyclable after going through this process and learning how large and complex and carbon intensive the entire process is for creating any sort of physical product regardless of what it is made out of. I have realized that recyclability of the product at the end does not really have much impact on the total carbon footprint. So anyway, cardboard is great again, but I think the longer somebody can use a toy, the less and less its carbon footprint is and that is kind of the best way to make a product green. So Fort Boards was designed to be passed down from sibling to sibling, just like Lego is. So kids just use this over and over and over again and does not get disposed of. In that sense, it is very different from the cardboard products out there.
The other sets that are out there for fort building kits are kind of like small plastic tubes that can be inserted into wiffle balls which act as the joints for those tubes. These are really well priced for the toy market at like forty dollars which makes them sell well, but I do not– they just do not get a ton of use from the kids in the sense of, it is kind of hard to be creative with something like that. I kind of equate it to picture a house being constructed when it is a timber frame. If you see that house from the outside or you are walking inside the house and taking a tour when it is just all timber structure and does not have walls up yet, it is hard to visualize the place, it is hard to visualize what the rooms are going to be like because you are looking through each of these walls. It is kind of building with a structure like small tubes and wiffle balls. It is kind of the same way and we are asking kids to be creative in a way that would be very difficult to visualize as you are building it. So Fort Boards’ parts are solid and similar to bricks like Lego and you can see what your building as you are building it and that allows kids to be a lot more creative as their building.
Eric: It sounds like you have done quite a bit of testing with kids or at least maybe your own or focus groups or something like that. Is that fair? How are you getting all this feedback?
August: Actually not. So that was the most irregular part of my design process when designing this, was that the parts are so big, the eight inch by eight inch parts and there is so many in a pack that when doing costing on what it would take to 3D print all of this to do user testing. It would have been upwards of ten grand or so, and just doing the tooling for it is like thirty, forty grand and so it did not make a lot of sense because 3D printed parts are often very brittle. I knew that if I was testing a ten thousand dollar brittle kit with kids, it was just going to shatter. I was going to be hovering over them until I am like, oh, you cannot do that, you cannot do that and I did not foresee a really good learning process there and much information being gained from children testing as I was developing the product. I just had to spend a lot of time and go through a lot of design iterations and passing by a lot of other industrial designers to see what their thoughts were, until I felt confident enough to make the jump and do the production tooling. It was an extreme gamble for me and luckily it turned out because I did zero product testing with kids beforehand.
Eric: That is exactly the opposite of what I expected you to say, but I am happy you said it nonetheless. What was the genesis of the idea that you have two kids, right?
August: Yes, the genesis I actually just had– my wife and I just had her first kid three months ago. I did not have kids that time but had two nieces and so spent a lot of time playing with them and got a lot of ideas from them of how this could work. The genesis was when I was working at the Museum Exhibit company and I was managing a children’s exhibit that we are doing here in Seattle and part of it was a building part of the exhibit where we made these large boards cut from a computer, like plywood boards, kind of like large Lincoln Logs but two dimensional. So we did children testing with that and I just saw how much fun kids had playing with something full scale like a full scale building material. Seeing that I felt like, there should be a product out there like this. So that is where the genesis came from and I spent the next six months or so, in my spare time sketching out ideas of what this could or should look like. Eventually I got laid off in the company. I think about six months or a year later. Well, it was a shock and hurt in the first day that it happened, like the next day I woke up and wait, this is my chance to finally develop and launch this product. Because before you have a steady income and you are like, yes, I do not really want to take the gamble to do it and this was sort of the kick out of the nest that I needed to finally decide to do this full time. I got a call and three, six months into that process for my former boss asking me to come back and because their fortunes it sort of turned back around as a company. So that was my chance to sort of quit and go back again, but I knew that I would never launched this product if I did that and so I just decided to continue going down this route. It was a very long process. I initially very naively estimated that I could get something to market in six months time. It took close to three years. I think it was about a year and a half in the product design phase and then a year and a half of developing, getting the production setup and supply chain and warehousing and then of course marketing and launching it, so it was, yes, it was a long arduous process full of self-doubt and wrong turns. After a hundred and sixty-five design iterations it all turned out and worked well.
Eric: Only a hundred sixty-five?
August: I am developing a new product right now and it is that like a hundred and eighty-three design iterations. So it is, I have realized that is just sort of my process.
Eric: Are you a perfectionist?
August: I would not say so, I do not think, perfections the evil of good enough that are the enemy of good enough. I just know how much money it takes to both launch this from the tooling standpoint, but also the amount of time and material and energy and money from the marketing standpoint of getting all your marketing materials and so from that standpoint, I really cannot afford for these things to fail. I guess on the design side, I am pretty close to a perfectionist.
Eric: Would you describe yourself as a creative person?
August: I would in certain senses. I think I always I keep a note folder in my phone of random business ideas and so anytime that anything pops up regardless of how ridiculous it is and I know of. Or whatever like I just write it down there and that is sort of spurs the creativity from the business-minded standpoint for me. I think I am relatively artistic and engineering wise creative but there are certain aspects where I am just horribly uncreated. Like if you put down like a white sheet of paper in front of me and tell me to draw something, I will sit there and stare at for thirty minutes and not know what to do. I am not really all that artistically creative in that sense, so yes, creative from I guess more of the engineering and usability side of things rather than visually aesthetically good creative sense.
Eric: You have mentioned a couple of things specifically in Fort Boards are on the website about interaction or how it helps kids with special needs. Can you touch on that a bit?
August: Yes. So that was something that was not really in my thoughts as designing it, but it was something that came up after it was launched and early on I started hearing from parents who had children with special needs and I realized that this is one area of the toy market that does not get a lot of attention and there just are not a ton of toys out there that cater to kids with special needs. With Fort Boards the parts clip together with a snap fit and you use your thumb and four fingers to clip these parts together and that repetitive sort of precise clipping action is great to help kids with develop small motor skills. I think still my most rewarding piece of feedback I have ever gotten today was from a parent of the child with special needs and she had mentioned that her son, Dylan, had autism and they had a very difficult time of communicating him, with him just in the very even basic senses of communicating with him. She wrote a long email to me and said that there were days when Dylan built the fort with Fort Boards and some days those forts had doors and windows and other days they did not have doors and windows and that is when they knew if he was having a bad day and he wanted to be on his own, or if he was having a better day and wanted human interaction. That was a really big step for them as a family to be able to communicate in that way with their son, Dylan. So that story still gets me and so I love it when I hear examples of that of parents with children with special needs and how this helps them in those senses.
Eric: That is really cool. Have you directed some of your efforts toward parents of kids with special needs or is it just sort of happenstance that people are picking it up and discovering it?
August: It is more happenstance. It is something that I sort of think about in the back of my mind as I am designing new products, but I think there is so many facets that I try to hit with the new product about any new product on the usability and entertainment value and sort of the evergreen qualities of it, that there is already have a list of way to many criteria to include sort of this the special needs category in there, but I know that if I hit all the criteria that have already laid out that it is going to be a great toy for special needs for children with special needs. In that sense, I think I am always sort of designing around that.
Eric: Who is your ideal customer? From the family perspective, the individual kid, male or female, who do you think is going to be the child that gets the most out of the toys?
August: Yes. So for this product there is the difference between the customer and then the users. The sort of the challenging thing is with marketing is that you are going at it from two angles with toys and one is the angle of children cries and mommy buys. So you are either advertising to the kid and hoping that they tell the parents or you are advertising to the parents, hoping that they think it is right for their kids. With of course, information that you can glean from Amazon and email programs like MailChimp and Google analytics and Facebook, there is a ton of data you can get on your customers. There is not a lot of information you can get about the end users which are the kids that are using it. I have pulled customers to try to understand more about them and their families and their kids and of course, having a lot of customer service interaction over the years with families as well. So I have a couple of personas that I have made for Fort Boards that help me narrow in on who my customers are and who the users are.
As far as the customers are concerned, my average customer is a mom who is about 40 years old has a 7 year old and a 10 year old child, they have a household income about $133,000 and there if you– like more specifically that the marketing segments that they are in or fast track families in the landed gentry social group. Then the young accumulators’ life stage group. So kind of going into those details and having detailed personas for both the kids and the parents helps me focus on who they are and what I should be designing around and marketing towards because it is always easy to sort of to chase any sort of design rabbit hole down a path just because you can do it does not mean you should and similarly with marketing. So this kind of helps me stay focused.
Eric: Other than obviously, I think the story from Dylan or about Dylan, what else is surprised you about the way that the toys are being used or the products being used?
August: One thing that is always, I mean, it surprise me, it does not surprise me is I have gotten a lot of feedback on how much dad’s love using my products and being always, of course, dad age but now a dad, I have always loved building with stuff. Building toys are my favorite as a kid and you know this as an adult, all enjoy playing with Legos on occasion. Any time, I have the opportunity to build something. When I was at Boeing, I was building full scale prototypes of airplanes, and it is just a really fun process for me and so to hear the dads love building with Fort Boards too is both surprising and not. I think one of the funniest pieces of feedback I have gotten is Fort Board is in a lot of children’s museums because they often have build areas in their museums. One of the first museums that took on Fort Boards would like reach out a few months later with the comment of, we have never had such engaged dads. It is pretty funny because I can imagine at these museums your dads– you are finally our parents in general or kind of finally getting a bit of a break and probably sit in the side of the room as their kids go wild and can sit and check out on their phones for a little bit. Fort Boards there right in the mix.
Eric: I am thinking of myself and I would probably be down there with him and trying to say, yes. Well, no do it this way or try this. So I can see myself for sure.
August: Touch on one other thing there too. The other surprising bit of feedback that I have gotten is, I have seen this in person and heard it from parents is sort of how Fort Boards is has been a learning tool for kids. It is kind of with learning skills it is that are hard to teach and quantify and it is so things like spatial reasoning and creativity and structural engineering. The structural engineering thing has been the most interesting thing to watch as I watch kids play with it. Fort Boards like any building material is that you cannot build an unlimited span, across an unlimited span without it falling apart or breaking apart. It is designed to do that because for safety reasons, you do not want things that have so much tension in them that they fly off and hit someone in the eye. So you have to design parts that pop apart with enough force so that kids cannot climb off and fall, fall off structures and stuff like that. With that, kids will build a house with a roof and the first time they do it the roof will cave in. You will see them, like at first when I saw this, when I first launched a product I would then get in there with the kids and teach them like okay, this is what you need to do to have a roof that is going to stay up. Then after a while I just started sitting back and not interfering with it and they would get it on their own. The roof would fall in the first time and they would realize like, oh, this is what I have to do differently and just naturally that experimentation in the trial and error kids have and it would, you can see like they are unknowingly starting to learn structural engineering and that was really a fun thing to see happen.
Eric: Yes, I was laughing and to myself thinking, yes, you are creating engineers. You should be shamed for that by the way, but no. At the beginning you mentioned your nieces and you have talked about Dylan and dads and what have you. At first I thought Fort Board was really just a boy’s toy but that does not necessarily sound like it is the case. Am I on point there?
August: I really want to create toy that was gender-neutral because I think the more studies that come out about how boys and girls develop as they grow up. They develop differently only because we sort of put societal pressures unknowingly on them. So I do not think that there is much studies that I have seen that show that girls are less inclined to be engineers or architects or anything like that. I wanted to make sure that this toy was not trying to be just for boys in that sense and always marketing it towards boys and girls. Picking colors that are right for boys and girls because at the end of the day, I wanted this toy, I only had nieces at the time when I was developing and I wanted them to be able to play with this toy and enjoy it. Part of the reason for that was that I grew up in the countryside in Oregon but both, this is more acceptable back in this time period but also because it is countryside. I could go out and explore all day long and then as long as that is home by dinner was fine and that sense of sort of being able to explore your own world and create your own world outdoors was I think really formative for me as a kid and sort of shaped a lot about who I am as an adult and my creativity. Now I live in Seattle and my niece’s live here in Seattle as well. So being in the city, you do not really have that opportunity and especially in this day and age of everybody worried about child abduction even though it is not, statistically it is not really a thing. Kids just are not able to go explore around the neighborhoods on their own and often times with helicopter parents are not even able to explore their own yards on their own. I wanted Fort Boards to be a way for kids to be able to create their own universes still and create their own private spaces and to be able to fly the moon on their own or sail across the high seas and have those kind of adventures that I think are so important for kids to have.
Eric: Yes, I think I grew up in that neighborhood where I was when the running joke with my friends and I was always get home by the time the street lights come on because that is when you start getting in trouble. So I know what you mean when you are just kind of you wandered around forever and more able to experience everything in the area and things have certainly changed. Let us shift gears for sec. If you could identify one thing that you really love about being an entrepreneur, what would that be?
August: I mean if you would asked me that six months ago, I would say being able to sort of do your own creative process and define that and wear different hats like I love learning about new aspects of business and really sort of deep diving in those independently and learn about all aspects of the business. I really enjoy that kind of activity. Now that I have an infant daughter, I would say my answer is the schedule flexibility is probably the thing I enjoy the most and that is not to say, it is not time consuming and I have gotten the business to a point to where it is not very time consuming. It can be as time consuming as I want it to be, but it sort of is streamline on the e-commerce side of things so that can kind of keep chugging along and I can put as much time or as little time as I want into developing new products. So I would say, now the most rewarding thing is the schedule flexibility in my day-to-day and week-to-week.
Eric: So let us flip it the other direction. What are the things that bother you the most or you are not fond of or I should say least fond of?
August: There is a couple things and there is– well, I loved learning about new parts of the business. There are always parts of the business that I just despise doing and you dread having to work on. Then I think that is the case with any career regardless of entrepreneurship or not, so we all have here, our crap we got to deal with. So it is things like the bookkeeping sides of things and some of the marketing aspects I do not enjoy. The other thing is just the extreme amount of risk and the financial risk basically. For my toys which are higher price point items, they sell the best during Christmas time because that is what most people spend a lot of money on a toy. It is sixty to seventy percent of my sales come during the holiday season. I spend January through October, just biting my nails being like, oh, my God, I am failing, this is awful. The sales are so little, like this is what am I doing with my life. Then November, December rolls around and I feel like I am Scrooge McDuck swimming in my bank vault of coins. So it is really a lot of highs and lows and you really do not know what your year is going to be like until December thirty-first, and that is took a long time. I am getting more used to that kind of financial risk, but it is, I mean, you watch your bank account through the year just go way up and then way down and go back and forth. So it is always very risky in that sense. So that is one of the harder parts of entrepreneurship for me.
Eric: I am sitting over here trying not to laugh out loud about the image of Scrooge McDuck. That one priceless. I am going to pull away from the question for a minute because the highs and low sound so significant. How do you balance that out? Are not you have supporters? You have mentioned your wife, are there other mentors you interact with, other entrepreneurs. What is your support team or your support group look like?
August: Yes. My biggest support is been my family. My entire family is just been so helpful from you just, of course, emotional support and encouragement during the low periods, but financially help me launch it and just like every little task they have been trying to help with along the way, so I have been incredibly grateful for that. Then as far as mentorship I have just been trying to, when I was launching the product and after it was launched and learning all aspects of e-commerce, I just tried to reach out to as many people as I could, and go to as many meet-up groups as I could, to learn as much as I could about all the different facets of the business that I had no idea about. So I was able to meet a few mentors through that and when I was in the design stage, I had a mentor that was a local engineer that designed printer parts and he helped me so much with the designing for manufacturing and what to expect from manufacturers and contracts with manufacturers and all that, so that really made the manufacturing process a lot smoother than it would have been. Since then launching the product I have had a couple of mentors in the e-commerce space that are experts on White Label e-commerce, which is essentially taking generic products and putting your own brand on it and selling it on Amazon and other sites. That is been fantastic to really understand how nuance e-commerce is and how to optimize e-commerce and it is very different from what I am doing in selling, but it was extremely good to understand the level you can and should go to optimize e-commerce operations. Since then met another local entrepreneur who is had a huge amount of success both in e-commerce realm and then the wholesale aspects of her business and then even was funded on Shark Tank and so, all of these people have been extremely generous with their time and advice and I really would have had– either would not have been able to launch the product without them or would have had a much rockier start that I have had. So it is been, I mean, the entrepreneur journey in general is a very lonely one and so it can be a really positive mental boost to hear from these other people’s experiences.
Eric: So you mentioned your family were investors. Did you start all this on your own? Was it bootstraped? Did you reach out for other investors? Where does the funding come from or where did most of it come from?
August: Yes. It just bootstrapped the company and I just had– I was confident that this could be a good product. I was not confident in my ability to execute the launch and how it would be received by the public and you just do not know what you do not know. So I did not want to take money from investors from that reason. It would have felt like not being honest with them. I would have felt like I would really have to oversell it. I started with my own money and then the family loaned me some as well. I have just kept it at that the whole time.
When I first started it I did a– I think everyone that starts this journey wants to be as big as quickly as possible, as big and as successful as possible. So I did a big push into wholesale. So that was a really expensive learning process that just brought zero fruit for the most part. So I had at that point a team of four of us that were working full time on Fort Boards. So that was the most capital intensive portion of the business. Since I have put the kibosh on wholesale and realize that this is at least the current product line-up is not a wholesale friendly and it is just not optimized for that, but it is great at e-commerce then I just brought it down to myself working on it and so it is been a successful company for a single person at this point. The idea I think is to eventually have product lines that can go back to the wholesale realm, but for now and when I do that I might have to look for investors, but at this point I can just run it still being bootstrapped.
Eric: You mentioned wholesaling. I am kind of curious. How are you getting the word out there? How do customers find you?
August: I would say the most successful, I mean, of course the highest percentage as far as highest converting customers out there are always from word of mouth and so I put a lot of energy into good customer service to make sure everybody has a good positive experience with Fort Boards and if they have any assistance they need that a provider right away. So it is sending like I got a lot of spare parts and whatnot if people lose them and yes, I put a lot of effort into that to make sure that word of mouth which is the most powerful thing is always positive. I would say the majority of people that have not heard about Fort Boards and do not know anyone with Fort Boards, they probably hear about it from the PR side of things and it is been featured Fort Boards and Blaster Boards have been featured in everywhere from CNN to Trend Hunters to, let us see, what are the other ones. On to pull up the list, but it is gotten a lot of press both local news and some national level news and just because people love building with forts and it makes for an very engaging story and just seem kids play with forts it is visually very impactful too. So PR is been pretty easy to get and is of course very successful and driving traffic in and helping with SEO. Yes, I would say that is where most people are learning about Fort Boards.
Eric: What do you think the best piece of advice is that you have received?
August: I think if this question is for people that are looking to start their own thing, I think one of the most eye opening things for me when I was launching this product and understood as I launched it was that PR and marketing process takes as long if not longer than the product development process. Since I spent so long in the product development side of things, I think the average person before me included before launching something things like, oh, you design it, you build it, and they will come. It is, of course, not like that and you have to drive traffic in. Understanding that you either have to gain an audience during your design process, however that looks like of building up an audience so you can launch it to them, by showing your process and getting people excited about it or understanding that it is going to be a long time after the products developed it, you are going to be ready to launch that. So making sure you are in a financial situation to be able to account for that.
Eric: Looking back, what would you do differently? If you could talk to yourself on day one, the day that you got laid off. What would you say?
August: I think the thing I would give myself– the advice I would give myself was to talk to more people in the toy industry early on. I just did not– I had a good sense of business sense of entrepreneurship. I just did not have a very good sense of the toy industry and I thought that my decent business sense would be enough. I have learned through this process that every industry is so very different as far as what works sales and marketing wise and product wise and you every industry just has extremely specific needs in order to be successful in it. Just talking to more people that are hands-on in that industry and selling similar products to similar sales channels and understanding what those sales channels are like and their needs that is, I think the advice I would give myself and it would have saved me certainly a lot of time and money.
Eric: So I have one last question and I usually end up with this one. What is next? What do we expect or what should we expect coming from you and the next six months, year, five years?
August: The next thing is I am expanding the Blaster Boards’ line. So that is the Nerf related line that kids same as Fort Boards that kids can build large forts, but in the Nerf case, it is the market is bunker. Honestly, it is the same product and kids just end up building forts with it and love it. The funny thing is that they kind of do not really use their Nerf blasters with it that much and just end up building forts with it, which is awesome. So I love that. It is just a lot easier to market towards the Nerf crowd because you have a very specific targeted market there and with forts everybody loves forts. There is no way you can saturate a market like that. How do you target everyone at once and but with Nerf you can targeted very successfully and kids have just been eating it up. I am working to expand that product line further and I cannot talk about what exactly that is yet, but it is getting closer to I would say I am three-quarters of the way through the design process right now, and I am pretty excited about how things are going there. I would expect that to be launched in sometime in the next year.
Eric: So if you are three quarters way through that that is what iteration number one hundred twenty-three then?
August: Well, three quarters way through this particular product design process. So right now I am at a, I think a hundred eighty three designs in and I think will probably get up to in the 200s before it is all done. This one I will actually be able to kid test with so I am sure I will be getting a lot of information with that and be changing a lot from that feedback. Yes, I am expecting to be as engaging and fun always for kids as Fort Boards and Blaster Boards are, so, yes, I am excited for it.
Eric: So I have to amend one thing. I said I had only two more questions, but let me ask one more instead. If you are talking to an entrepreneur, somebody in a similar market or the identical market is you but does not have a competing product. You have said you should talk to other people in the market. Is there anything else you would convey or anything else you tell them that they must really focus their time and attention on?
August: Yes, I would say– so in general there is so much entrepreneurial information out there and it is really hard to screen out. Like what is valid versus not for your specific product and in market. Digital entrepreneurs have very different needs than those are creating physical products. My advice for someone creating a physical product in this same toy industry would be or similar industry would be to really understand the price points of similar products in their industry and really understanding those things before you get too far into the product design. Anything can sell any price point and you will find a million examples of expensive products, but it takes a really long time and a lot of money to build a brand and especially one that sells successfully sells premium products. So regardless of how revolutionary your product is or will be customers are always going to be comparing it to products that currently exist in the market. Specific products usually sell very well within specific price ranges. So when you are designing and launch your product, you need to know what that price range is you are designing for and learn what your specific costs will be and that is not just production costs, but how products are priced within your industry. At least the toy industry has like a general rule of a multiple of production costs as far as equating what the final MSRP should be. How many times what your production costs are, that is what your final MSRP should be for the product because that is going to make sure that you take into account all of your overhead costs so you can be profitable at the end of the day.
So I think that would be my biggest set of advice just to make sure that you are able to hit the price point that is going to work well for your specific product because so many great products fizzle just because design decisions were made early on that lead to very high final costs, which kill sales.
Eric: Got it. August, thanks so much. I really appreciate your time. Thanks. I really have to say this has been informative the whole conversation or point about Dylan, the fact that dads are as interested in this makes me feel like I would not be the only nerd sitting out there trying to build a fort at my age. Thanks so much for your time!
August: Thanks so much for having me, Eric. I really appreciate it.