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It takes more than a great idea to get a new company off the ground. Starting a business requires a solid grounding in business fundamentals. Access to capital is key. Supportive friends and family help. And above that, you have to be willing to step out and risk it all.

In the Beginning: An Idea is Born

Dominic Crapuchettes, MBA ’04, is betting his future on Wits & Wagers, the newest offering from North Star Games, a board game company he created in 2004 with Satish Pillalamarri, MBA ’04.

North Star Games is the fulfillment of a long-time dream for Crapuchettes, a guy who has always been very driven and motivated. As an undergraduate, he captained an Alaskan fishing boat during the summers, using what he earned during the long days and nights of fishing to pay for school. But all that time he had a dream job in his head. After graduating from college, Crapuchettes worked for a dot-com company and did some programming, but what he really wanted was to start his own company. He thought about starting a dot-com venture, but his true passion was for board games.

So he took a risk, deciding to return to business school to learn the skills he knew he’d need to start his own business. Crapuchettes came to the Smith School as a Dingman Scholar, which gives scholarships, mentoring, office space and expert assistance to budding entrepreneurs through the school’s renowned Dingman Center for Entrepreneurship. One of the first things on Crapuchettes’ to-do list was searching for potential prospects for a business partner. He found his match in Pillalamarri, who was smart, dedicated, ambitious, and a fellow games enthusiast. Together they took the first giant step: they developed and began marketing their very first game.

Unlike Crapuchettes, when Todd Wilson ’99 came to the Smith School, starting a company was the furthest thing from his mind. He majored in finance and expected to pursue a career on Wall Street. But an entrepreneurship class taught by Rudy Lamone, former dean and founder of the Dingman Center, was destined to set Wilson’s life on a different course.

“After taking Rudy’s class, I couldn’t stop thinking about the idea of starting my own business,” says Wilson. “My head was full of ideas of things I could try.” Most of those ideas never made it out of his head, and Wilson spent a number of years working for CSTV.com, the Web site of College Sports TV, with progressively more responsible and remunerative jobs.

But Wilson couldn’t shake the desire to start his own business, and he kept turning around possibilities in his head, looking for that one perfect idea that would capture his imagination. It came one day as he was shopping online for sports team clothing for his nieces and nephews, and realized that he would have to visit several different sites to purchase clothing from different teams.

In that moment, the idea for Baby Fans was born, and Wilson decided he was ready to take a risk on his idea. People thought Wilson and his wife Stacy were crazy, but they started small, purchasing clothing, setting up a Web site and packaging clothes in the evenings after coming home from work.

Crapuchettes also started out small. North Star Games printed just 2,500 copies of the game board and box for its first offering, a game called Cluzzle. Then Crapuchettes purchased all the components for the game, like sand timers, separately. He spent the next three months assembling each game by hand, often with the help of fellow Smith MBAs who were content to be paid in pizza and beer.

Early Days: Mistakes and Mishaps

Both Crapuchettes and Wilson encountered significant challenges in the early stages of their businesses. Wilson found that one of the biggest early hindrances for Baby Fans was his own lack of experience with baby clothing—which meant that some of his early merchandise picks were, well, less than ideal.

“Since we didn’t have our own kids to dress, we made a lot of mistakes in the stock we originally purchased. In fact, we still have some of those outfits,” Wilson admits ruefully. “Not understanding kids’ clothing from a parents’ perspective hurt us initially.”

And Wilson didn’t just have problems figuring out what to purchase. Sometimes he couldn’t get merchandise at all. Inventory is the name of the game for Baby Fans, and convincing manufacturers to sell small lots to the tiny new venture was an uphill battle for the growing company.

Crapuchettes ran into some similar roadblocks. On the one hand, he knew the gaming world inside out, and he was confident that Cluzzle would find an audience. On the other hand, before people could play his game they had to purchase it, and that meant he had to get it on store shelves. It was a task easier said than done, and Crapuchettes remembers ruefully that he focused his MBA education on the financial end of company-building: “Now I wish I had taken a few more marketing classes.”

Risks and Rewards

While Cluzzle was slowly getting out into the marketplace and achieving moderate success, Crapuchettes and Pillalamarri were busy designing another game: Wits & Wagers. They were convinced that this game would be their blockbuster, the game that would put their company on a sound financial footing and establish them as a player to be reckoned with in the gaming world.

And it seemed like many people in the industry agreed. Wits & Wagers won more industry awards during its first year in print than any other party game in history, including the Mensa Select award and Games magazine “Party Game of the Year” award.

But North Star Games had partnered with a larger company that was supposed to provide financing and marketing for North Star products. And when the larger company went out of business with $2.5 million in debt, North Star Games found itself with a hit product that, in effect, belonged to its partner’s creditors. Although retailers were asking for Wits & Wagers on a daily basis, North Star Games did not have access to thousands of copies of the game which languished in a warehouse in Chicago. Crapuchettes knew something had to be done.

“We were down to about $15,000 in our bank account,” recalls Crapuchettes. “We spent every penny of it buying back our inventory. I got out every credit card I had, increased the limit as high as they would let me, and put $40,000 on my personal credit cards to ransom the remainder of the games. At the same time, I wasn’t receiving a salary. So things looked pretty bleak.”

The 2006 holiday season represented an important turning point for the company’s fortunes. The game found a home on the shelves of 1,600 Target stores across the nation, and sales were good enough to keep the company solvent—and in Target stores—for another year.

Like Crapuchettes and Pillalamarri, Wilson also had to make significant sacrifices to get Baby Fans off the ground. After some discussion with wife Stacy, the pair decided to commit to the dream of Baby Fans by selling their house and “downsizing” their lifestyle—whatever it would take to get the company off the ground.

Wilson continued to work for other people during the day, turning his attention to the Web site at night. He spent his evenings packaging baby clothing, folding each outfit, meticulously wrapping it in tissue paper to complement the team colors and then boxing it by hand.

Inventory began to take over the couple’s now significantly smaller living space. During the holiday season, Wilson would press his wife and both their families and friends into folding, wrapping and boxing duties. “It was like living in the middle of a warehouse,” recalls Stacy Wilson.

For a long time, most orders came from people Wilson knew, and he remembers as a milestone moment the first day he received an order from a stranger. “My proudest moment was when we got our first order from someone we didn’t know,” laughs Wilson. “My in-laws were visiting and I screamed at the top of my lungs, I was so happy. I still remember the person’s name. And then the same person ordered from us a week later, and I thought ‘This is awesome!’”

Despite some early encouraging signs, Wilson knew that success wasn’t guaranteed. He slowly and carefully built the business over several years, all while working during the day. Wilson and his wife decided that when the company made a certain amount of money three months in a row, Wilson could quit his day job. It was just this past year, after several months of record profits, that Wilson finally came to the point where he could make Baby Fans his full-time gig.

A Little Help from My Friends

Both Crapuchettes and Wilson credit the Smith School, and their connections within the Smith community, for helping them make it through their company’s tough initial days.

Crapuchettes relied heavily on the resources of the Dingman Center for Entrepreneurship, which is one of the oldest entrepreneurship centers in the nation. “I had a lot of guidance from the Dingman Center on how to write a business plan and how to raise capital. Any time we’re trying to go back to capital markets to raise money, that’s all things I learned here,” says Crapuchettes.

The Dingman Center has had a central role in North Star Games’ ability to get funding. The company won the Dingman Center’s Cupid’s Cup competition the first year, which garnered it $10,000 plus needed exposure. In the competition’s second year, Crapuchettes was invited to speak, which introduced North Star Games to angel investors who invested another $100,000 in the company.

Wilson took his early inspiration from Lamone’s undergraduate entrepreneurship course, and one of the key things he learned, he says, was how to ask family and friends for money. But he’s also found that his alumni network has provided an important source of talent and expertise. One fellow Maryland alumna did all the design work for Baby Fans free of charge. Another Maryland alumnus is now working for Wilson.

Looking to the Future

So where do they go from here?

Wilson spoke to a class of Smith students recently about his experiences as an entrepreneur, and while he is excited about the future of Baby Fans he is also realistic about some of the challenges he sees just down the road.

“Our biggest challenge right now is that we’re growing so fast it’s tough to handle it all,” says Wilson.  “If we keep growing at this rate, we may find ourselves in trouble. It’s a tough time for us as we try to figure out what to do next. Our next expansion is going to be a warehouse. I learned a lot in school, but applying it and figuring out when to make decisions is difficult.” Wilson has found a ready ear and source of advice in Lamone, who is still active with the Dingman Center.

Crapuchettes is excited about his company’s prospects, especially if Wits & Wagers becomes the next board game blockbuster; that would give North Star Games the sound financial footing it needs to grow into a major international game company. Crapuchettes continues to develop innovative board games, but the biggest opportunities are in licensing the Wits & Wagers brand. North Star Games has licensed a video game version of Wits & Wagers for the Microsoft Xbox, is working with a production company to develop the game into a television game show, and is pursuing international licensing opportunities in Europe. 

So why do they do it? Why toss away a steady job with a stable income and health insurance for the chance to max out your credit cards, work terribly long hours and fill your home with merchandise? “I love knowing people are having fun playing my games,” says Crapuchettes. “And it’s very fulfilling to build something from the ground up.”

“It’s really rewarding for me to know that this company is something I created,” agrees Wilson.

Like Smith entrepreneurs who have come before them and Smith entrepreneurs who will come after them, Crapuchettes and Wilson hope that they can take North Star Games and Baby Fans to the next level, with help and support from the Smith community. It’s a risky proposition. But who knows? With a little luck, they just might become the next big thing.

I get e-mails all the time from people who have played Wits & Wagers telling me how much they like it. My favorite says “My dad never plays games, but he was watching us play, and then he came over and asked if he could get in on the next round.” I have so many letters that tell that same story. There must be a demographic of dads out there who won’t play any game but Wits & Wagers. ---Dominic Crapuchettes, MBA’04, North Star Games

I think we learn a lot more from our gift notes than from any market study. We have just as many Yankee-and-Red-Sox orders as we do for either team alone. The person sending the gift is a Red Sox fan but knows that the father of the baby is a Yankees fan, so he’ll send three Yankees items and one Red Sox item and the gift note says “I hope he makes the right choice.”---Todd Wilson ’99, Baby Fans

Baby Fans merchandise can be purchased at www.babyfans.com.
North Star Games merchandise can be purchased in your local Target or online at www.northstargames.com.

Start Up! Entrepreneurship at Smith

The Smith School gives every student the opportunity and support to create and enterprise from the ground up, through an entrepreneurship emphasis that is woven through every aspect of the program. Students can take classes in a wide variety of entrepreneurial subjects, “Pitch Dingman” on their great idea for a chance to win $500 in seed money, join a graduate or undergraduate entrepreneurship club, or take part in a host of co-curricular activities. The Entrepreneurship Fellows program gives students the chance to delve even more deeply into the world of new venture creation.

Read more about all of these programs on the Smith School Web site, www.rhsmith.umd.edu/entrepreneurship.