Aaron Strout:     

Hi, my name is Aaron Strout. Welcome to the We Show.

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Aaron Strout:    

Thank you for joining us on the We Show today. My name is Aaron Strout, and I’m the VP of marketing for Mzinga, a leading provider of workplace and customer community solutions.  This podcast is one in a series and can be found on the WeAreSmarter.org site, Mzinga.com, and iTunes under "We Are Smarter."

Lyn Townshend:         
Hi, Aaron.

Aaron Strout: 
Lyn, you have a fascinating story, and I think a story that a lot of people are going to be really interested in when they read the book, and ideally when they listen to this podcast. Why don’t you tell us a little bit about your background and the story that is mentioned in the book, and it’s how you came upon this great invention called The Strock. And then, we can go into our next question.

Lyn Townshend:         
Okay. One thing, Aaron, it’s actually Best Buddy Pet Products –

Aaron Strout: 
Oh, I’m sorry. I left out the “Pet.” That’s important to get that right, isn’t it?

Lyn Townshend:         
Right, it’s for pets. Initially, it was about November of 2005, and I have a little dog named Buddy. He’s a little bichon maltese mix, so he’s a little 12-pound white fluff ball. He’s just my little pride and joy. He was out in the yard, and I think he just nicked one of his paws on a twig or something in the yard. It was nothing serious. He came in; his paw was a little bloody, so I cleaned it up and it really was a surface wound. I didn’t think much of it. It didn’t even need bandaging. Nothing was wrong with it.

But as dogs tend to do, he started to lick at it and then became a little bit obsessed with licking on the wound. I knew that if he continued doing that, it was going lead up to an infection, and then we were going to need some medical care with it. I know from past experience that the only thing that the veterinarians use to prevent animals from licking at their legs or their paws is the lampshade cone collar. It’s called the Elizabethan collar. That fits around his neck, and it’s a big cone shape. It actually blocks him from his entire body. I know –

Aaron Strout: 
That’s got to be kind of embarrassing for a pet to have to wear one of those, right?

Lyn Townshend:         
It is embarrassing for the pet, it’s embarrassing for the pet owner, and it really kind of scares the dogs because it blocks their peripheral vision. Instinctually, that’s how dogs protect themselves. They rely on that peripheral vision to see predators coming at them – back to their basic wolf instinct. I know it’s not comfortable, and even though they say that dogs can drink water and eat and do normal things in it, I’ve seen Buddy in it before when he got neutered and that’s not the case. He’s not comfortable. He’s not drinking his water and doing his normal things.

So instead of taking him to the vet and waiting for it to get infected, I was sitting there looking at him and trying to figure out how I was going to fix this. It was a little bit cooler at the time, so he does wear a little sweater. I thought of the idea of just sewing a sock – one of my cut-up socks – into his sweater and covering one leg, so I did that and it worked perfectly. He stopped licking his foot. It healed. You know, it was beginning to heal. He just ignored the fact that his foot was covered. It was no longer a problem.

Interestingly enough, at that same time I was watching TV that night while I was actually sewing that sock into his sweater, and I saw a commercial for the addition to the upcoming show called The American Inventor. I was sitting there, and I was looking at Buddy. And I was looking at this sweater, and I thought, “I’ll bet every pet owner would love to have something like this available.” So I decided to go for it. I changed the design. And instead of sewing a sock to sweaters, I did it to a piece of underwear elastic, because I realized in the summer, a sweater was not going to be an appropriate piece of clothing for any dog because it’ll be too hot.

I took five different sizes of socks and cut them up to extra small, all the way up to extra large. The auditions were December 1 in Denver, so I took the day off from work. I was working at IBM at the time. I took a day off and went down and auditioned. I found out in January of 2006 that I was getting called back for Round 2, which was going to be in Los Angeles. So they flew Buddy and I out to Los Angeles for the second round of the auditions, so I was basically the top 250 people out of about 20,000 people nationwide that had auditioned.

From there, it was very exciting. I didn’t win. I didn’t get beyond Round 2, but the four judges that I spoke with gave me some great input and ideas and told me I actually had a viable idea and product that could come to market, but it needed to be polished up quite a bit. You know, I had a primitive prototype of a sock and a piece of underwear elastic.

So I came back home, very excited and very fired up about it, and started talking to Buddy’s veterinarian. She suggested that I make it waterproof because then it would be more practical for use in covering bandages and casts and other injuries that could happen to dogs. So, that’s exactly what I did. I didn’t even know how to sew, so I actually borrowed my neighbor who I know sews. She went out with me and we bought a sewing machine, and she taught me how to sew just The Strock. To this day, that’s all I know how to sew. I sat down, and I started making them. I started knocking on doors of the veterinarians, and they were all so excited about it that they would buy every bit of inventory I had on the spot. And then I had to go home and spend time making more, so I realized quickly that wasn’t going to work. I decided to take the big leap of faith, and I quit my IBM job and decided to form a company around The Strock. And that’s where Best Buddy Pet Products came to be. I named it Best Buddy – of course for my dog, Buddy – but I think everybody’s dog is their best buddy. It’s a universal name that all dog owners can relate to.

Aaron Strout: 
Right.

Lyn Townshend:         
Then I had to start finding manufacturing. I couldn’t keep up with the demand, and there were other things now all of a sudden that I learned needed to be addressed when you start a company.

Aaron Strout: 
So at this point, you decided to go out and look for some financing. And like many people out there, you realized it’s not that easy to get a business loan?

Lyn Townshend:         
Right. Exactly, because I knew I needed bulk inventory, and I didn’t have the money for bulk inventory. I did go down to my bank that I’ve always used, and I had created a business plan. Spent a month doing that with all of the things that are included in a business plan: your vision, your projections, things like that. I had some past credit problems, and I was definitely not a candidate for a small-business loan from the Small Business Association. And the bank wouldn’t give me any kind of financing due to the past problems. It was a hard lesson learned, but it’s a work in progress to clean all that up.

Interestingly enough, later on that night, around that same time, I saw on ABC Nightly News with Elizabeth Vargas, there was a new people-to-people lending forum called Prosper.com. I listened to the news segment and I thought, “Well, that sounds like something I might be able to use.” I got on the Internet and I started investigating it, and it’s a place where people with all kinds of credit ratings can still have a fair shot at getting financing. You have to create a profile, sort of a summary of what it is you’re doing and what you need money for. You place an amount out there of what you want, and you put an interest rate according to the credit score, or grade as they call it, that they give you. They do that through a series of about four or five days this whole process takes to sign up. They come back to you with a credit grade, and then from there you decide how much you want to borrow and what interest rate you would have to have the money –

Aaron Strout: 
So in some ways it’s sort of – for people unfamiliar with Prosper – and I think you’ve done a great job, Lyn, describing it. It’s a little bit like an eBay or a market peer-to-peer for people to be able to kind of name what they’re looking for – so the loan amount – and then other people to be able to meet the need with a particular rate based on what your rating is, to say, “Like eBay, I trust you. You look like you have a good rating.” “I don’t trust you. Maybe I won’t do business with you,” or whatever.

Lyn Townshend:         
Yes, very similar. Very similar, and the lenders that are out there have additional information at their disposal, where they could see my past credit history and that there were some glitches in it and some blemishes. I had to address those items in the forums. There’s discussion forums out there, and also some of the lenders would send an email to me and say, “We see this out there. Can you explain it?” So you have to be very honest, and you have to be very –

Aaron Strout: 
I was going to say, nothing like exposing yourself to the world, right?

Lyn Townshend:         
Exactly what it was. I mean it was wide open, and of course I didn’t learn that until I was in. You know, I was in already and now I had to see it through because I really wanted to get this company going. I had to answer a lot of hard questions about why there were blemishes and what I’m doing to fix it. I had to tell them the plan that I’m working to get everything better, and that I had been turned down by the bank, but yet I’m fixing everything and I’m not a high risk. The money would be paid back in full, on schedule. And really, it was a case of getting some people to start championing my cause.

Each request out there lasts 10 days, so in 10 days, you’re either funded or you’re not. Now it can happen earlier than 10 days, but if it goes 10 days and it’s not funded, you have to start all over again.

Aaron Strout:  Now did you get to meet, or sort of get to know, through email and these discussion forums, some of these lenders? Did you establish a little bit of a relationship with them?

Lyn Townshend:         
I joined a group, because in reading the research while I was out there, you have a better chance if you join a group. You can do individual loans – and it still is an individual loan – however, I joined a group called Business Owners Cooperative and therefore, there’s a group leader there. And the group leader then called me on the phone, and we discussed my profile. He kind of gave me pointers, and it added to the credibility of what I was asking for. It seemed to carry a little more weight if you’re part of a group than individual loans.

Aaron Strout: 
Yeah, that’s what I’ve heard.

Lyn Townshend:         
Yeah, and it did. I got the group leader on board with me, and then there was one lender in particular named Penelope that happens to have a golden retriever and is part of golden retriever rescue work. [She was] very interested in my pet product, and she really hopped on board and started championing my cause as well. It touched a nerve with her, which definitely helped. She’s very well known in that community and is respected with her judgment. I talked to her on the phone as well, so now I suddenly had two personal contacts that I was actually speaking with on the phone, and they were giving me pointers and advice on what to do to get a loan completed, or funded.

The first loan was $25,000. I didn’t get that. Then I went down a little bit lower, but I had the interest rate wrong, so there went 20 days because now I’m – the first one didn’t work in 10 days, the second one didn’t work in ten days, so I was on my third try. It was $9,500 at 12.75 percent, and that’s the one that ultimately got funded.

Aaron Strout: 
The thing that’s amazing is if you think back – so just to recap your story a little bit: One, you get the idea for going on the inventor show watching TV. You were able to research it. You were able to then find out about Prosper.com on the TV, go in and research it and then talk to people you had never met before, connect to them on the forums and then ultimately on the phone. The net result was a loan from several different people versus a traditional bank. It’s hard to believe if you think about even 10, 15 years ago, these types of things happening. It’s amazing how far we’ve come in that regard.

Lyn Townshend:         
Oh, it was absolutely an amazing blessing and miracle, as far as I’m concerned, that I even heard about it, and then found it on the Internet and was able to actually pursue it. Because it took 77 lenders total to fully fund my loan, so there were 77 different people out there that don’t know me and were willing to put some of their own money towards my cause. Part of it is, again, I had to be honest and open, but they also wanted to know – I had to break down how I was going to spend that $9,500.

Some of it is they had to approve of that, so in a way I was asking for their approval of, “How are you going to spend this money?” They wanted to make sure that I wasn’t going to take $9,500 and go do something frivolous with it, that I had specific goals in mind: how much money was going to go towards things like inventory, building a website, things like that that needed to be done for this company. I had to convince them that yes, their money was safe in my hands – “This is what I’m going to use it for” – and then ultimately they decided to go ahead and put a bid. To me, that’s just an amazing community forum because like I said, it’s 77 people that don’t know me. And I was honest and open enough that they did see through that; they did see through the writing that I seemed like a genuine person, and they backed it. I was very fortunate that I got it funded.

Aaron Strout: 
That’s a wonderful story. I guess my final question for you is: Given your product and the fact that Best Buddy Pet Products really has a feel-good story to it – I mean, it’s helping our pets – we love our pets – and it’s really providing a product for them that saves them some of the anguish, as we talked about earlier, of having to go through the Elizabethan collar. My guess says that you’ve met a lot of people through your site, through your product, through your interactions. Talk about that type of community. Do these people reach out to you and talk about new business ideas, or ways that you could improve your product and things like that?

Lyn Townshend:         
Sure. Initially I was knocking on doors of the veterinarians, and that wasn’t working as well as I had hoped because they’re busy. Obviously, my prime customer is veterinarians, because I want them to have something to use as an alternative to the Elizabethan collar. When only one or two legs have been hurt, a dog really doesn’t need to have his entire body blocked. Through the website, I’d sell these products. They’re individual units. That’s another great point for my product, is you can buy them one at a time. I don’t insist people buy a set of four because, again, the idea is to help heal one or two legs that have been hurt. So, I only sell them individually, in case people just want one. Sometimes that’s all they need, versus the Elizabethan collar, which they do run a little bit expensive and it blocks the whole body. Through the website, it’s out there; that’s the only shopping arena I have. I don’t have a brick-and-mortar store or anything like that physically that people can come and buy these.

Aaron Strout: 
Thank you again for joining us. This is a fascinating story, and I think really highlights not only a nice success story that you like to hear about, but how community really is becoming more and more important in our lives, both you and being able to reach out to the community, the Prosper.com experience, and then ultimately your community that has helped you; the veterinarians, the people that have helped you improve your product.

For those listening today, Lyn Townshend of Best Buddy Pet Products. She’s the founder and owner. We thank you for joining us today, Lyn.

Lyn Townshend:         
Thank you very much, Aaron. It was my pleasure.

We appreciate you listening in to this series of the We Show podcasts. To find other podcasts like this, you can check out WeAreSmarter.org, Mzinga.com, and also iTunes under "We Are Smarter."

Thanks so much for joining us. We look forward to seeing you next week.

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