When Angela Marie Cody-Rouget served in the U.S. Air Force as a missile combat crew commander, she was entrusted with the keys to the country’s nuclear arms. If the leader of the free world could trust her with nukes, families could certainly trust the former Air Force Major with their cluttered homes. And Shark Tank investors could trust her with their money.
The founder of Major Organizers, formerly Major Mom, a professional organizing company in Greenwood Village, Colo., appeared in a special February 2016 episode of Shark Tank featuring all veteran entrepreneurs. Cody-Rouget asked the Sharks for $150,000 for 20% of her business, valuing it at one time current-year projected revenues of $500,000 (in 2015) and $250,000 for intellectual property.
Her IP includes a series of audio educational programs, webinars, books, and videos sold online http://majormom.biz/. Major Mom’s annual sales were north of $400,000 in 2014 and $550,000 in 2015. Revenues for 2016 are projected to increase to $675,000 blast to $1 million by 2017.
But alas none of the Sharks joined forces with her and shot down her franchising model. Cody-Rouget explains the secrets of getting a Shark Tank deal and how she’s on a mission to conquer the $7.6 billion home organizing industry.
Ho: What happened after Shark Tank?
Cody-Rouget: I did not secure a shark. But they have been very kind on social media and they were very confident in my ability. Not getting a deal helped me more than I could have imagined because it got people fired up. I truly feel like millions of people are cheering for us and spreading the word about Major Mom.
We received more than 250 emails from strangers telling us to keep up the good work and that they are waiting for Major Mom to come to their cities so they can hire us. Many of our friends, family and vendors shared with us that they cried that we did not get a deal. They believe in our brand and that fueled their energy to tell the world about Major Mom
Operation Shark Tank
Ho: How did you prepare for your appearance? What made it a success?
Cody-Rouget: I spent more than 70 hours creating, practicing and perfecting my pitch, and preparing my answers to every question imaginable based on what I saw after watching 55 episodes via YouTube.
I also read a book written by each shark, all but Mark Cuban. I could not find a book he had written, so I watched a documentary on him. I also pitched my business to several venture capitalists and angel investors during three grant competitions, which gave me the experience and comfort of answering questions about my numbers and expansion plans.
Ho: What can you teach others about your Shark Tank experience?
Cody-Rouget: It is imperative that you follow their checklists, guidelines, contracts and deadlines. I cannot believe how many entrepreneurs weed themselves out because they cannot attend to business details promptly. Following instructions throughout the process is part of the application process.
They received more than 40,000 applications for Season 7. They need entrepreneurs to stay within their guidelines or risk never getting invited to appear in the tank. If you make it all the way to the tank, you continue to follow instructions. Anyone there can send you home for being disrespectful, loud and rude.
The secret to a successful audition and appearance is to be excited, passionate and knowledgeable about your business and the numbers behind the business. Go way outside your comfort zone while still being authentic and make your pitch memorable, believable and fun.
A little secret among the entrepreneurs that made it on to the show would tell all future applicants to keep their audition video submissions to three minutes, not the 10 minutes they allow you to submit. This shows them you are concise and know what information is most important. Since the on-air pitch is on two minutes, it would be important to audition like you would pitch it to the Sharks.
Ho: How much did your sales and profits to increase after the Shark Tank appearance?
Cody-Rouget: Our online sales of educational organizing products went up by $250. So that was disappointing, but we did receive lots of leads. Totals from Shark Tank:
- 139 leads, mostly in Arizona and Colorado
- 69 in our service areas
- 18 new clients
- $16,752 in total sales from Shark Tank Sales
Six of the leads became virtual clients and we are already in the process of transforming their homes. We received 150 franchisee prospects and we are close to granting territory rights to our first three franchisees in Houston, Reno and Las Vegas. This will result in $40,000 in revenue.
Ho: What kinds of distribution deals did you score after being on Shark Tank?
Cody-Rouget: We have been approached by a very large home hardware chain to provide our services via their stores to help their customers implement and select organizing systems. This would create the need for us to franchise much more quickly to be able to roll out our services nationwide.
Since we have 32 employees in Colorado we are in negations to do a test market there. We also had many veterans and Americans promote our store and services on their website. The amazing power of social media has helped us secure more press, more clients and franchise prospects.
Operation Home Neat Home
Cody-Rouget launched Major Mom in 2006 with $13,500 from her retirement account. She also won several veteran-owned and woman-owned business pitch competitions, totaling $40,000 in grants. She used the money to hire branding experts, website developers, logo and business card designers and a chief financial officer.
Before this, she served in the U.S. Air Force for 13 years and attained the rank of major. She held roles as a captain, missile combat crew commander and space and missile officer. After her second child was born, she resigned to be a stay-at-home mom. She also invested in commercial and residential real estate for 10 years.
Ho: How did you come up with the idea for your business?
Cody-Rouget: As a full-time mom, I learned was how hard it was to maintain an orderly home with a baby and a toddler. I joined mommy groups and playgroups and witnessed how hectic and isolated stay-at-home parents can feel.
One day, my husband, Frederic, came home and saw me watching Peter Walsh on TLC’s “Clean Sweep” and playing with our two young children. Inspiration struck. He encouraged me to do something similar because I was also very good at organizing.
Ho: What problem were you seeking to solve?
Cody-Rouget: Chaos and disorder rob us all of our time (searching for things we know we own, but cannot find), money (duplicate purchases, storage rental, late fees), health (mold, mildew, dust) and safety (tripping, fire, blocked egress).
I started Major Mom to solve these issues through organizing systems and procedures and in doing so, create better lives for our clients. Major Mom believes that when you clear out the clutter, you allow room for peace, joy and opportunity to come into your life.
Ho: What made you think it could be a successful product and service?
Cody-Rouget: Through my experience with playgroups and mom’s groups, I felt called to help moms and their busy families. I wanted to make sure that everyone struggling with clutter and chaos had a company to call for help — Major Mom.
Originally, I contacted other professional organizers in the area. However, there were no other organizers that wanted to hire employees. I saw a need to create a company structure built on a team of organizing experts that not only successfully helped overwhelmed moms and families, but also offered earning potential for other moms with organizing talent.
Additionally, Major Mom® is a veteran-owned company. The trend in America to support veterans gives Major Mom a unique place in the organizing industry.
Major Mom’s ideal customer profile – busy, working moms:
- Works full-time either in or out of the home with one to four kids.
- Has an annual income range of $60,000 to $250,000.
- Is aware they have a problem and are ready for organizing services.
- Active in kid-centered activities: gym, church, sports, parks, shopping, libraries, parent-child classes, museums, play dates, etc.
- Manager of their household and can make decisions.
- Lives in a 1,200-3,200 square-foot home with a two-car garage.
- Does not have anyone in their support system to call for help.
- Understands and respects the importance of systems.
In addition to being focused on the working mom niche market, Major Mom® continues to keep their eye on developing splinter target markets: bachelors, single dads, college students away from home, recently divorced men and women and small business owners.
Ho: How much does it cost? What are your guarantees or assurances?
Cody-Rouget: Major Mom offers package-based pricing that costs between $68-$78 an hour, ranging from $288 for four hours of organizing services, to $2,888 for 46 hours of services. Major Mom also offers special pricing for 100+ hour projects and on regular ‘maintenance’ organizing services for clients needing to revisit and reorganize previously completed areas of their home.
Our Rules of Engagement for our Service Agreements specifies no refunds will be given once the work is complete. But we are dedicated to their project’s successful completion. We have a dedicated Client Care Specialist who handles any issues and oversees our service guarantee of “Doing what it takes to make it right.”
Major Mom also offers every client a ‘No Judgement’ promise, allowing clients to feel safe about opening their homes (and their hearts) to their Liberator.
Major Mom Academy
Cody-Rouget worked as a solopreneur for three years. In 2009, she partnered with Mandy Pinkston and launched the Major Mom Academy to train organizers, which she calls liberators.
To date, she’s trained more than 54 of them. The company has grown to 28 liberators in Denver and four in at a second location in Phoenix. Major Mom currently employs 16 and expects to quadruple its staff by the end of the year.
Ho: How are your employees trained?
Cody-Rouget: We have a seven-step screening process for all applicants. The final step of the screening process is the Major Mom Academy. We hire and train our Liberators in Denver Metro, Colorado Springs and Phoenix.
Highly-trained Liberators are a huge part of our brand promise. We created the Major Mom Academy which is 36 hours of online classroom style training and 24 hours of on-the-job training in real clients’ homes. The new hire must pass all phases of the academy and then spend three to six months as an apprentice before they are promoted to professional organizer status.
During their apprenticeship, they have three books on organizing they are required to read to teach them different solutions and ways to think about home environments. We then have two monthly training sessions, one in person during the day and one evening conference call.
Services provided by Major Mom Liberators include (but are not limited to):
- General home organizing (any and every room in the home)
- Home inventories
- Relocation services, including pre-packing and unpacking
- Garage, basement & storage space organization
- Time management services
- Paper management systems
- Car organizing
- Virtual organizing (via Skype or FaceTime)
Major Market Potential
Ho: What is the market for your service or product?
Cody-Rouget: Residential organizing services fall under the $27 billion personal services industry. Specifically, it is categorized under the “All Other Personal Services” sector of personal services. The Department of Labor defines “All Other Personal Services” as businesses primarily engaged in providing personal services “except personal care services, death care services, dry cleaning and laundry services, pet care services, photofinishing services, or parking space and valet parking services.”
This industry sector has had explosive growth. According to the Census Bureau, the “All Other Personal Services” sector had record sales of $5.6 billion in 2008 and grew to more than $6.2 billion in 2012. We would like to add to that growth significantly.
There also seems to be a direct correlation between the growth of the organizing products industry and the organizing services sector. According to Freedonia Group, the home organizing products industry has become a $7.6 billion industry, and it will grow to $9.4 billion by 2017.
The home organizing services industry has grown steadily since the formation of the National Association of Professional Organizers (NAPO) in 1983. In 2007, NAPO did a member survey and reported that their 4,000 members served 135,546 clients. Using a conservative growth rate of 1.7%, the number of clients served grew to 155,115 in 2015 and is projected to grow to 168,756 by 2020.
The average revenue per job was $1,500, which resulted in total revenue of $203,319,000. Projecting this revenue to 2015, using a conservative growth rate of $100 every three years on the average revenue per client, we arrived at $263,695,823. By 2020, we project industry revenues at $320,636,305. (These numbers do not include approximately 1,500 men and women that organize on the side or as a hobby. See Appendix for market size projections). By our calculations, we have only captured 0.17% of the national market.
Operation Business Growth
Cody-Rouget aims to sell five franchises and make $1 million in revenue by 2017. Over the next five years, she is gunning for 50 franchises and $10 million in revenue via franchise sales, product sales and services. Numerous investors approached her after Shark Tank and she’s currently in negotiations with one whom she’s known for more than four years.
Ho: What are you doing now to move your business forward and expand?
Cody-Rouget: Shark Tank has brought us so many leads for new clients and franchisees that we are still riding that huge wave of interest. However, as we prepare for more growth, we are building out our human resources and training team as well as an info-tech team.
We have doubled the number of our employees since the air date and to keep up with demand we have created a recruiting, screening, hiring and training machine.
Ho: What is your marketing strategy? How do you get new clients?
Cody-Rouget: We keep our marketing costs very low. We spend $50,000 a year on online marketing with our website, InfusionSoft Inbound marketing techniques and we treat our current client base like a gold mine. We also sponsor two women events per year to reach our target market — busy working moms.
We reach out to our clients two to three times a year with promotions, offers and fun updates with Send Out Cards. We gently ask for referrals and offer a free audio lesson of their choice for sharing us with their friends. We acquire new clients through word of mouth, referrals, website, social media, free PR, our workshops/webinars and online educational products on getting organized.
Our client acquisition cost is $160. The average revenues per client are $1,500 and the average lifetime value of one client is $7,500. In 2014, we organized 318 families and that generated $425,000 of gross revenues. One-third of those clients accounted for 50% of the annual revenues due to repeated use and 20% of our clients being on a subscription maintenance program.
Ho: How do you find business partners, instructors, salespeople, etc.? What qualities do you look for?
Cody-Rouget: Almost every employee in our company found us via our website as they were searching for a career in organizing. Many of our employees heard about us from current employees and joined our team. We have done very few job postings over the last eight years.
We did seem to have more success with LinkedIn than Craigslist. We also spread the work throughout the veteran community that we are looking for military spouses and veterans to join our team.
My business partner, Mandy Pinkston, also found me eight years ago via FaithfulOrganizers.com and she requested to mentor under me. But after we met, we decided to join forces and build a brand.
This story originally appeared in Forbes.com in March 2016.