The Unemployed Life

Lemonade Maker: April McCray, from Real Estate to Cardboard Houses

April McCray

Two years ago, April McCray, 38, got the feeling it was time to change careers. She’d been helping sell homes for a real estate developer in Palm Springs, California, but the market was fizzling and sales were getting scarce. She and her husband took their savings and started Color Me House, which makes cardboard forts for kids. She talked to Recessionwire about how she came up with the idea, why they moved in with his parents, and how she got her toys into Costco.

Did you quit your job or were you laid off?
My job pretty much quit itself. The builders were letting everyone go. People weren’t closing. I knew in three months there would be nothing left to be made. I’d left the office and was looking for a new place to go, but everywhere I went there was nothing. I knew that I was not a desired commodity any more and I was going to have to recreate yourself.

So how did Color Me House start?
I’ve always been a very creative person. I have young kids and they’re a great source of inspiration in our lives. My youngest one was four, and we were making forts again. My older kids were saying, Hey mom, let’s make him a spaceship, lets make this other kind of fort—and a lightbulb went off. Let’s see if we can bring forts to kids in a way that’s easier than finding a refrigerator box.

The real gift to out business becoming profitable the first year was the Costco sale.

Did you start it right away?
We probably played with the idea for several months before doing anything. And then,  driving down the road one day to the grocery store, there was this building I passed all the time, but this time it stood out. It had a sign on the front that said, “Corrugated.” I said “Oh gosh, that’s where I’m going.” I showed them my drawings and said, “Can this happen?”

We launched the business and put all of our savings into it and then realized that it was going to take more money and time to get this company noticed. So I traded my brand-new home for my cardboard houses. We rented it out and moved into my husband’s parents’ home to save money. We gained a lot of clarity in that move. I knew that everyone loved the product when we showed it to them. I knew there was something great about it and I wasn’t going to give up.

How much did you invest in the business?
$100,000.

That’s a lot of money.
There was a lot involved, there was artwork.You can’t order just a couple of items—we had to place a very large order and warehouse them. But at the same time as we launched our business, the home market dumped and there was this black cloud in the sky. The economy looked very weak. Here we were launching ourselves into the world. It was very scary.

How much do the forts retail for?
$39.99.

That sounds really reasonable. Did you factor the recession into the price?
We were going to enter the market with a higher price. But all those winds of change came through and we decided we were going to need to have something that people didn’t think twice about. That didn’t pinch pocketbooks. And we wanted to offer something that was inspirational in the midst of everything that was happening.

What lessons did you learn that could help other aspiring entrepreneurs?
I think that the most important thing if I had it to do all over again is I would not give up my day job. I’m a very energetic person and I make big moves when I’m inspired. I would not recommend that to everyone. You need to play it safe when you are starting a business. You need to have a backup plan, you need a plan b. You need to be willing to give it time.

Did you start out selling your product online?
First we launched with small retailers, then we started the website. The real gift to out business becoming profitable the first year was the Costco sale.

How did that come about?
Well, I consulted with some biz friends who are very smart and said, “I want to present to Costco. How do to get their attention?” They said I needed to send them the emotion of my business in a nutshell. It’s got to hit them. I prepared a postcard that was very visual, it was bright and warm, it had pictures of the product, it had pictures of kids with the products.And apparently it worked. They called back a month later and said we want to see your stuff. We launched in every Costco for back to school this year.

So when are you moving out of your mother-in-law’s house?
We are still here but we are about to make a transition. We’re celebrating one year in business and we’re very happy.

Tags: business, family, kids, Lemonade Makers, new entrepreneurs