FinanceCamp: Katharine Paterson of So To Company

FinanceCamp: Katharine Paterson of So To Company

Katharine Paterson is the director of So To Company Ltd, which produces safer alternatives to traditional products for babies. The company's product, Karekot is a safe and simple alternative to a barred cot and is already gaining attention. Katharine caught up with BQ to talk about working on a start-up business and taking part in Pitch Black, a pitching challenge at FinanceCamp North East which was held in June.

Describe your business (or idea) in no more than 100 words...

So To Company Ltd is concerned with the design and development of innovative safety-led products for the global baby market. The company’s first product, karekot, has been inspired by the Company Director, following the experience of her own baby daughter sustaining minor injuries in a traditional wooden ‘barred cot’.  Karekot is a crib, cot and toddler bed combined, it is soft-sided, breathable, washable, and has a patented drop-side mechanism.  Its design has systematically addressed all the hazards presented by a traditional wooden barred cot, eliminating the need for cot bumpers and bed guards.

 

If your business is technical or specialist, how would you describe it to your grandma?

It’s a specialist business as in all babies are special (and grandma would know this!)  and should, as of right, be safe whilst sleeping in their cots. The design is simple and effective without technical wizardry.

 

What stage is your businessproduct at just now?

I’m currently securing costs for production and, when a next stage investment comes in, am ready to go!  In short, branding is confirmed, five full size prototypes have been developed, UK, French, German and Irish patents secured, UK trade mark is secured and karekot is community design registered.  An initial website has been developed, negotiations with retailers and manufacturers are underway, I’ve been a finalist in the 2012 Baby and Products Association ‘Innovation and Concept Awards’, I achieved success in Start-up Britain ‘Pitch to John Lewis’ 2012 competition, I was a finalist in the 2013 Rattles to Riches baby show competition, and I was short-listed 23rd out of more than 970 entries to Virgin Media Pitch to Rich competition in 2015.  In addition I secured a top 50 place in the IP 100 League 2015 and parents are asking when they can buy.

 

What prompted you to attend FinanceCamp?

I need to secure further investment having accessed venture capital, small grants and my ownfamily’s resources.  As I’m not yet trading, and there is a debt in the business, it is proving exceptionally difficult to find a willing investor, even though all the feedback I have received on karekot has been extremely positive.  I was hoping to meet some new investors at Finance Camp and secure that vital piece of funding.

 

How have you calculated the amount of investment that you’re seeking?

Yes, its £220k to get karekot on to the market.

 

What are the biggest challenges you face when trying to finance your business?

As stated earlier, the stage I am at is the problem with debt in the business and the fact that I am not yet trading.  In addition I work in paid employment to pay the mortgage so I can only focus on the business in the evenings and weekends. It’s really frustrating but the positive feedback and encouragement keeps me going.

 

How will you benefit from attending FinanceCamp and taking part in Pitch Black?

I was asked at lunchtime on the day if I wanted to take part in Pitch Black.  To be honest I didn’t really like the idea of lights going out if people didn’t like your pitch(!), but that was a misunderstanding thankfully, and the lights going out merely indicated time left in the three minute pitch – and this was the problem for me in that I’d practised a five minute pitch for the investor meetings and didn’t manage to refine it down to the three minutes when doing Pitch Black.  Still, in hindsight, I’m really glad I put myself through it- I would have been kicking myself if I’d said ‘no’ –and now we have the chance to pitch to potential investors in London so some investment may come of it yet!

 

Who has been important to getting your business to the stage it is now?

I’ve managed to work with some fantastic people over the course of the last six years, many of whom have given their time for free.  Of note are the Product Group, who helped with the initial design, Charlie Caffyn designs whose experience of the nursery product sector has been invaluable, Steve Bailey of Also This Ltd, who has helped with product refinement and Stacy Marshall of Creative Textiles, who is an amazing fabric specialist, highly regarded in the nursery sector and who always finds solutions rather than giving up on problems.

 

If you secure finance, where do you see your company in five years’ time?

Financial forecasts for 2021 indicate generating a profit of over £7 million.  I’m excited about the business and my ambition is to grow the business around the karekot brand extending into furniture ranges, bedding and different stylisation of karekot itself.  By year 3 it is anticipated that export sales will be healthy and growing.  The US market has significant potential following the ban on the manufacture and sale of drop-side cots in 2011 due to the numbers of injuries and deaths attributed to them.  Karekot is currently patent pending in the US but within five years the patent will hopefully have been secured.  Demand from retailers and online buyers will be substantial.  The company will be seen as a market leader for innovative safe cots.

 

What advice would you give to other entrepreneurs in your situation?

It’s got to be GO FOR IT!! If you have a passion, see a niche, see a problem that needs solving then follow your intuition. I should say that I am not trained as a designer, nor do I see myself as someone who is particularly creative, I just saw a massive problem with traditional wooden barred cots, which I could not believe had not been addressed before, and I went for it! It still amazes me to this day that I did, but I have absolutely no regrets!

I have to say that if you already have experience in your chosen business then that would make things so much easier. For me it has been a hard slog- it’s taken me six years to develop karekot . Having no experience of product design, the nursery sector, intellectual property protection, securing finance and then running a business was, and still is, a massive learning curve. I was fortunate to encounter lots of more experienced people who proffered lots of advice. However, whilst well-meaning, this was often contradictory and forced me to better tune into my intuition. In addition, it’s true to say that women are still the main carers for their children and I was no exception, finding myself juggling paid employment (enabling me to keep a roof over our heads) with being, in effect, a single mum (my husband works away) and finding that the only time I had for me and my new business venture was post 9 pm. Being someone who needs their sleep, (and I do need my sleep!) this creates a massive frustration for me of lack of time and money! However the excitement I feel around karekot and the really positive feedback I get from nursery experts, parents and parents to be, ensures that I keep on going and have learnt to thrive on little sleep!