Mommy Millionaire–The Crocs Patent; the Stuff Legends are Made Of

January 12, 2008

The Crocs Patent–The Stuff Legends Are Made Of

Visit www.mommymillionaire.com to learn more about Kim and join the Message Board there.This material is copyrighted by Kim Lavine and can not be reproduced or posted elsewhere on the web without written permission. Just what exactly is a patent worth? How Crocs shoes anticipated competition and created a strategy to head it off, is the stuff that legends are made of. I explain how in response to a question today from one of my readers Michelle, who asks:“Many companies like Crocs Shoes come up with an idea and put it on the market like you did, well what about the Crocs knockoffs? My question is how can a company that does the Crocs knockoffs get away with it? Do they have to pay the founding company? I would be one of those people who would be afraid of being sued. I could go on and on comparing items that we use everyday and that can be a long list.” I remember when I was just starting out, perhaps the scariest moments for me involved putting my ideas out there in the marketplace, worrying about somebody knocking them off. Since then I’ve learned that the idea is only 5% of a product’s success—and this may include the patent! The other 95% is sales and marketing. You can find a whole section in my book MOMMY MILLIONAIRE on patents, and I would suggest everyone read it to find out the absolute basics for going forward, including when to pay and attorney, and when not to. When it comes to patents, some of the best advice I’ve ever been given was that “Martha Stewart doesn’t own the patent on sheets and towels,” which is evidence that trademarks and brands, in my experience, can be more valuable than patents. In theory, a patent is only as valuable as your capacity to defend it in the marketplace, which usually means a lot of money spent paying lawyers. Unfortunately, you don’t usually have the revenues to support paying an attorney to defend your patent when you’re starting out, so it’s always been my advice to take your idea to the marketplace as hard and as fast as possible, so you can generate the revenues necessary to defend your patent. The United States Patent and Trademark Office anticipated this problem, allowing inventors to sue patent infringers for triple damages, which goes a long way to keep people from wanting to steal your idea, if they have to pay three times the money they make off of it to you in damages. www.USPTO.gov

Despite this, patents typically defend a narrow technical parameter, which a lot of competitors usually manage to find a way around. Crocs journey began in 2002 in a Canadian plastics company, when a Crocs founder discovered a version of the funny-looking shoes being used in day spas. In 2003, the founders of Crocs, after seeing initial success selling their unique and admittedly ugly shoes at boat shows—and after being rejected by venture capitalists in their attempts to raise start-up capital to take their idea big time—raised $5.2 million dollars from friends to fund their company! The first thing they did with that money was to buy up its suppliers and manufacturers of the unique resin that Croc shoes are made of, called Croslite. This same supplier also owned the design patent on the resin. Crocs began selling first to small shoe stores, then went into national distribution at Nordstrom and Dillards. To meet the need, Crocs founders employed contract manufacturers in China, Italy and Romania. In 2006, Crocs expanded overseas from Singapore to Austia.The people who founded Crocs had serious business backgrounds, including a President at a national branding company, an exec at a national sandwich chain, a hardware sales executive and a President of an electronics manufacturer. With a motto of “Think Huge,” and after selling only 1,000’s of pairs in 2002, they pooled extraordinary management talents to write a business plan that raised them $5 million for launch from friends and business associates alone. In Feb of  2006, Crocs raised an additional $239 million in the largest footwear IPO (Initial Public Offering) ever, valuing their market share at $1.09 billion. Yes, there are competitors nipping on their heals now, no doubt with some slightly different resin formulation for their shoes on which their patent is based, but they are the innovators with all of the market share and they have the resources to keep their competitors at a permanent disadvantage.

There are a couple of lessons here: 1. Why aren’t women’s companies getting this kind of money to fund start ups? Why do only a tiny percentage of women-owned companies generate revenues of  a million dollars or more annually? Why, though there is $20 Billion in Angel Capital every year for start-up businesses, does only 4% of it go to women-owned businesses, when 40% of all businesses in the US are owned by women?Is it just a lack of confidence that keeps us from formulating five million dollar business plans? Is it because there is still a attitude of male chauvinism in the business world that won’t see beyond our sexuality? Or is it that we haven’t given ourselves the permission to dream this big, and the tools to go after it? As a very inspiring woman I met this week told me, Molly McDonald of The Pink Fund, www.thepinkfund.org which provides financial aid to those suffering with breast cancer: “We don’t need brass balls, we need brass boobs.”

Brass Balls? Or Brass Boobs? Log on to www.mommymillionaire.com and visit our Message Board and click on that subject, where you can tell us why you think women haven’t pushed thier companies ahead into the million dollar zone. Kim is the President and Founder of Green Daisy, Inc—a lifestyle brand focused on balancing life with love ™–and the best selling author of Mommy Millionaire. Kim has appeared on The Today Show, Rachel Ray, NBC & ABC news, CNN, CNBC’s “The Big Idea” with Donny Deutsch, LifetimeTV.com, and has been featured in USA Today, Country Living, Guideposts, Women’s World, American Baby and on NPR and Oprah & Friends Radio Network. Kim is on a mission to empower people to follow their dreams, inspiring them with hope, honesty and faith. “Everything begins with a search for something better–a dream, an idea, the
courage to face a challenge, and the passion to get it done.
You can do it.
Believe in yourself.
Change the rules.
Join the revolution.”
From MOMMY MILLIONAIRE, by Kim Lavine

The Story of Tyler Perry–How Far Would You Go For a Dream?

January 12, 2008

Mommy Millionaire asks “How Far Will You Go For a Dream?”

 

Visit www.mommymillionaire.com to learn more about Kim.

 

Tyler Perry is a star, with a hot new movie (Why Did I Get Married?), a series on TV (House of  Payne), and a line-up of successful theater productions. But it wasn’t too long ago that his life could have been qualified as a complete failure by most people. His story is the testimony to how powerful a dream can be, and what kind of  heroic journey dreams can lead us on in an effort to realize them. Besides being an artistic hero, Tyler Perry is also a testimony to the power of recognizing an underserved niche in the marketplace, and going after that niche, regardless of how much opposition you can encounter. There are countless underserved niches in the market ready to be exploited, and only those who are visionary enough to see them, and courageous enough to follow their dreams to reach them, can lead us on to a wider understanding and greater opportunity. But getting there is no easy process for the leader who pushes us to that new frontier. As you’ll see from Tyler Perry’s story, being a leader often requires enduring hardship, risk and sacrifice beyond what any of us could anticipate. But as I like to say, there is no reward without risk, and the greater the risk, the greater the reward.

I remember the first time I heard of Tyler Perry. It was in 2002 and I was staying with family in Atlanta, where a very rough video was stuck into the VCR of a theater production Perry had recently staged in Atlanta, titled Medea Goes to Jail. I had never heard of Perry before, and looking at the almost amateur quality of the video I was watching I thought ‘who really cares!’ That is, until I started laughing hysterically. Perry was taking aim at his own social community and delivering biting commentary and politically-incorrect humor that was both shocking and hilarious. I couldn’t believe what I was seeing and I instantly thought this guy was a genius with brass balls who had the guts to say things no traditional studio or theater company would touch. The only city ready for this message at the time was Atlanta, which is increasingly becoming what I like to euphemistically refer to as “The Black New York,” where music moguls and creative artists come together to form a melting-pot of defining black culture. Even at this time, Perry’s personal story was legendary, even to the suburban white folk who were sitting around laughing hysterically at this grainy video. And everybody there regarded him with respect.

Perry was raised dirt-poor in New Orleans, where he was reportedly physically abused as a child. He undertook the exercise of writing letters to himself about the anger and pain he suffered as a child as a means to exorcise himself of these negative influences. These letters turned into his first play “I Know I’ve Been Saved.” After saving $12,000, he moved to Atlanta for the purpose of  staging it. But this isn’t a story of overnight success. Perry spent 6 full years in Atlanta, writing and staging productions, which all failed, leaving him homeless and penniless.

At the beginning, unable to afford traditional theaters, Perry staged his productions in unconventional venues that were linked to the black community, referred to as the “chitlin’ circuit,” and these people, outside of any traditional Hollywood or NY demographic, are what made him. His dedication to this core constituency has not wavered even today. Even though he’s become a Hollywood darling, Perry refuses to relinquish one iota of creative control over any of his projects, insuring that his vision of humorously commenting on this overlooked cultural niche remains true and unwatered down. It’s safe to bet that five years ago, nobody in Hollywood or NY could have been convinced of the financial viability of a homeless man staging acerbic plays about the foibles of  a marginalized black community in “chitlin’ circuit” venues. Since then, as of March 2005, Perry’s work has been reported to have earned him over $75 million. (Today’s most marginalized community—one falsely considered to be divested of power or
influence—is moms. I’m on my own journey to fix that.)

 

Visit www.mommymillionaire.com to learn more about Kim.

 

How far would you go for a dream? Would you spend your last dime and suffer homelessness? Join the discussion on the www.mommymillionaire.com message board. Do you have to lose everything in order to succeed? Do you know people who have given up on the brink of success because they gave into pressures from people and society that told them they were failures? You can also check out there my recent answers to questions from readers about trademarks, patents and profit margins.

Copyright 2007, Kim Lavine. This article can not be reproduced on the web or otherwise without the written permission of Kim Lavine.


Kim is the President and Founder of Green Daisy, Inc—a lifestyle brand focused on balancing life with love ™–and the best selling author of Mommy Millionaire.
http://www.mommymillionaire.com   

Kim has appeared on The Today Show, Rachel Ray, NBC & ABC news, CNN, CNBC’s “The Big Idea” with Donny Deutsch, NPR, Oprah & Friends Radio Network, LifetimeTV.com, and has been featured in USA Today, Country Living, Guideposts, Women’s World, and American Baby to name a few. Kim is on a mission to empower people to follow their dreams, inspiring them with hope, honesty and faith.

Kim’s book has been called by Publisher’s Weekly in a Starred Review: “A top-notch, how-to guide on launching a business. Lavine’s human and authoritative story make this one of the most engaging and useful resources available for readers hoping to convert their passion into a healthy company…a rare gem.” USA Today says ““Mommy Millionaire is loaded with resources for a fledgling business person…armed with a good idea and boundless energy.” Barbara De Angelis, PH.D.—#1 New York Times Bestselling Author says, “Mommy Millionaire is an inspiring gift and road map to success for anyone who’s ever had a dream.”

“Everything begins with a search for something better–a dream,
an idea, the courage to face a challenge, and the passion to get it done.
You can do it.
Believe in yourself.
Change the rules.
Join the revolution.”
From MOMMY MILLIONAIRE, by Kim Lavine