Innovation Trumps Recession

No one would argue that our economy tanked and people have been severely affected - both in their personal lives and in their business. But some companies have worked hard to recreate, redesign, refocus and review their current business practices and products to maintain cash flow, keep themselves competitive, and yes - even increase revenues and profits.

If you're an entrepreneur - or an aspiring entrepreneur - the number one rule of business still applies: Find a need and fill it. Here are some stories of innovative thinkers who did just that and are beating the odds by being open to changing directions. I found these inspiring stories in one of my favorite magazines: Fortune Small Business.

Johnny Dela Valdene & Travis Hollman
Founders of ViB in Dallas

The Problem: In 2008, Valdene and Hollman were running a toy company that sold $6 million in marshmallow shooters every year. At a trade fair in New York City they saw an attendee collapsing from what looked like a heart attack. Paramedics later told them that the man had in fact suffered an anxiety attack -- brought on by too many caffeinated energy drinks.

The Moment: They decided that the world needed the opposite of an energy drink: a relaxation drink made from soothing, natural ingredients. With the help of a food scientist they created a drink with theanine, an amino acid found in green tea; B vitamins; and L-threonine, a natural antidepressant. They enlisted six grad students to test the drink.

The Payoff: Three months later Valdene (now 42) and Hollman (40) launched ViB (pronounced Vibe). Today ViB sells through 68 West Coast distributors. Sales are expected to hit $5 million this year.

Innovation Tip: Don't hang on to your vision too tightly. Hollman planned to name the drink "Vacation in a Bottle." After being that told it wouldn't be legal to hand out glass bottle samples in most public places, they switched to cans. Then 7-Eleven told them they didn't want the drink in a can because it looked too much like an energy drink, so ViB adopted aluminum bottles.
"You have to be flexible," says Hollman. "You know what your outcome is. It's all the little things along the way that can change." -Jennifer Alsever

Joanna Van Vleck
Founder of Trunk Club in Oregon

The Problem: Van Vleck knew that many guys hated shopping for clothes in retail stores, so she decided to create a line of personal shopping outlets. She recruited investors to open retail storefronts across the country where men could go for personal shopping sessions. But when the market crashed in late 2008, her funding disappeared.

The Moment: When a potential investor in San Francisco asked Van Vleck to meet with him via Webcam, she initially balked at the idea. "I don't do Webcams," says Van Vleck, 25. But a lot of men she knew seemed to feel more comfortable talking on them, which suggested the Webcam as an ideal forum for personal shopping with men. Her consultants could select and mail clothes to a client based on his lifestyle, budget or career and then talk him through the garments as he modeled them on the Webcam. No retail stores or investors needed.

The Payoff: Van Vleck's 21 style consultants now work with 2,500 customers across the country. The company, Trunk Club, expects $2 million in sales this year.

Innovation Tip: Sometimes inexperience drives innovation. If Van Vleck had ever worked in the retail world, she would have known that merchandise is typically ordered in bulk up to six months in advance. By contrast, her business model is based on ordering small lots of clothing from wholesalers each week. "I didn't fall into the trap of 'We can't do that,'" she says. "We broke all the rules." -Jennifer Alsever

Mark Konjevod
Founder of WIN Products in New York City

The Problem: In 2000, Konjevod was running marathons and working as the business development director at Cox Enterprises. He noticed that his moisture-wicking running clothes were stinking up the house even after he washed them. No matter what the detergent or how much he used, a sweaty odor lingered.

The Moment: Konjevod started asking athlete friends if they had the same problem. The answer: an overwhelming yes. He used his connections to find an experienced chemist who mixed up a special concoction to fight lingering bacteria that get caught inside the high-tech fibers used in performance sporting apparel. In 2005, Konjevod sent the detergent to friends at the Olympic training center in Colorado Springs. The athletes loved it.

The Payoff: Konjevod's business, Win Products, posted $5 million in sales last year. Win detergent earned endorsements from the U.S. Olympic Training Centers and Nike, which now recommends the soap to callers on its toll-free consumer phone line. The detergent will be sold in 20,000 grocery stores this year.

Innovation Tip: Just because big companies dominate a market doesn't mean there isn't room for a niche product or service. Konjevod, 39, had no background in detergents or chemistry, but he decided he could compete with Procter & Gamble by selling through gyms and athletic stores and catering to the $15 billion performance fabrics market. -Jennifer Alsever

David and Stuart Pikoff
Games2U - Austin, TX

They want to see your kids spending more time outdoors... playing Halo, Guitar Hero 3 and laser tag. The brothers' two-year-old Austin company, Games2U, brings truck-mounted video game theaters and laser tag gear to birthday parties. Last year Games2U started selling franchises; the Pikoffs project revenues of $15 million to $20 million this year.

Games2U has signed up 38 franchisees to handle 113 territories in 16 states. New franchisees pay the Pikoffs a $35,000 fee up front and a 6% royalty on sales. For each territory, a franchisee must also buy a branded Games2U trailer or vehicle from the Pikoffs, bringing the startup cost to between $89,000 and $200,000. Each Games2U unit is outfitted with screens and video-game consoles that allow 12 to 24 gamers to compete at once. Clients typically pay a flat fee of $300 to $350 for a two-hour party appearance.

"I wouldn't be so bold as to say we're recession-proof," says David Pikoff, 42. "But franchisees are hearing that while people aren't purchasing big houses or cars, they won't cheat their kids out of a childhood memory for a few hundred bucks."

So, what needs have you noticed that people have? With passion, dedication, and focus, you can design an innovative business that gives you success - even in a recession.

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Doreen Rainey is a Life Coach and Speaker who helps her clients Get RADICAL! For a FREE 30 day membership to RadicalLifestyle.com or to subscribe to her bi-weekly newsletter, visit her website. Join Doreen in the Washington, DC area for the 2010 Get RADICAL Women's Conference featuring Jillian Michaels, Fitness Trainer from The Biggest Loser and Rhonda Britten, Emmy Winner Life Coach from Starting Over and Celebrity Fit Club.