Nisa founder Elisha Watson’s step-by-step guide on the most important things to think of when trying to build an ethical brand.

Two years ago, I quit my job as a lawyer to start Nisa, an underwear brand that employs former refugees. I set up a garment manufacturing workshop with zero fashion or manufacturing experience and built a business along the way. Two years in, I want to share what I’ve learned about making the leap, and what it takes to start and maintain a social enterprise, in the hope that this will help guide fledgling entrepreneurs.

Step 1: You need a ‘why’

Setting up a business requires every bit of grit and hustle that you’ve ever possessed, so if you don’t have a strong ‘why’, it’ll be much harder to keep going through hard times. You need to work out exactly what you want to achieve with the business. Do you want to make a lot of money, or is your main goal to help people? Do you want your business to hire hundreds of people and go global, or do you want a low-key enterprise that lets you go surfing every day? If you know what you want, you’re already halfway there.

My ‘why’ was a concern for issues around asylum and migration. I’d lived in Germany for a few years in my early twenties and this was my first experience of living in a foreign country, not feeling like I belonged and struggling with the language, while being aware of my relative privilege to other ‘foreigners’ who, on the basis of their country of origin, were much less well-received.

While working as a lawyer in Wellington, I volunteered with the Red Cross as part of their resettlement programme which helps recently arrived refugees set up their lives in Wellington. The volunteer teams that supported newly arrived families often lavished them with love and support, but the families I met along the way were rarely able to build the ‘normal’ life they’d hoped for themselves.

A big piece of the puzzle that seemed to be missing was employment. A job is a reason to get up in the morning, a way to meet new people, a means of practising English and a path to independence, both financial and personal. It’s a way to feel like you’re contributing to a wider community. Wellington’s Pomegranate Kitchen had just started a social enterprise employing former refugees in their catering business, and I was really excited by that. Inspired, I thought about a skill that I shared with many former refugees that I could build a business around – sewing.

Sadly, Pomegranate Kitchen has now permanently shut its doors, but the number of people it’s inspired along the way is a testament to the fact that doing good in the world has a ripple effect far beyond what’s initially intended.

Step 2: Working out your ‘what’

It’s one thing to be motivated to start a business, but you’re going to need a really concrete plan of action to get other people on board. The ‘what’ – the goods or service that you sell – needs to be based on market research showing there’s a demand for it. In addition, you need to be excited about it and have the capacity to pull it off.

For me, the thinking behind making underwear went like this:

• Market research: I made an online survey and sent it to family and friends asking them what styles and colours of underwear they wore. It showed that around 80% of women wore cotton underwear most of the time. I saw a market opportunity here as cotton underwear is usually an ‘unloved’ item in most lingerie stores, relegated to the back corner, rather than something marketed as desirable and inspiring.
• Personal passion: I didn’t want to launch a fashion line. I’m not a fashion designer and have no desire to churn out new collections every few months. I also believe there’s enough second-hand clothing in the world. Underwear, on the other hand, is something I could justify making new.
• Capacity: I knew we’d be training our staff from scratch, and the idea of an ever-changing product line was quite overwhelming. I thought it would be more manageable to make a few select products that the team could master and train new staff on.

Step 3: Building your operations

Premises and equipment

You might only need to work from home in the beginning, but it definitely pays to have a plan for moving into an office space to get a bit of distance between your home and work. For us, since we were starting what was essentially a small factory, finding the right premises was really important. With the help of a commercial real estate agent and an understanding landlord, we found a premise on Kent Terrace in Wellington.

I also needed to teach myself how to make underwear, and work out what machines we’d need for that to happen. There are no YouTube tutorials for this kind of thing, so I started from a finished product (i.e. underwear from a shop) and reverse-engineered it, looking at how it had been sewn, and working backwards to figure out what kind of gear we’d need. With no fashion experience and little sewing knowledge, I ended up buying some equipment we didn’t need. Eventually, I hired a production manager to oversee product development and staff training when we had a bit more money, but it would have saved me a lot of grief if I’d taken that leap and brought in a professional earlier.

Getting some cash & building a team

Getting the right people on your team is one of the most significant decisions you make early on, and it can make or break your fledgling business.

I’d used up a decent chunk of my savings buying the machinery and paying for the underwear’s initial pattern work, but I needed more cash to build a team and move the enterprise forward. Crowdfunding seemed like a good option, but I felt that the campaign would be a lot more successful if people were backing a team and a product that already existed and they could see photos of. So I put the cart before the horse and started building the Nisa team, in the hope that we’d then get a cash injection from crowdfunding to make it all work.

I got Shannon Wray on board, a total marketing whizz I’d met at a Startup Weekend, and got in touch with the Red Cross for help to reach out to women from refugee backgrounds with sewing skills who were in need of work. We then made a short video introducing the team and launched our crowdfunding campaign. We ended up reaching our $10,000 target within three days, and went on to raise $20,000. We were in business.

When to quit your job

It’s a big question that many entrepreneurs struggle with. The answer? It depends on your appetite for risk, your financial circumstances and your vision for the business. Quitting your job may mean working for your business either unpaid, or paid well below minimum wage, for a number of years. It pays to be very honest about what this might mean for you and your family early on as there are enough pressures in running a business that having personal financial pressures on top of that might be one stressor too many.

When I quit my full-time job as a lawyer to get Nisa up and running, I actually found part time work somewhere else. It became apparent within a few days that working part-time wasn’t a good idea – my heart just wasn’t in it, and I wanted to see if Nisa would work sooner rather than later. My theory was that if I hedged my bets, worked elsewhere, and built Nisa slowly, I could drag out an unsuccessful idea for about five years. But if I gave it my all from day one, it would become obvious within about a year if it wouldn’t work (we’re still going strong two years later.)

That’s not to say the ‘slowly does it’ approach won’t work better for some people. I had lots of support around me, and I knew that if it went bust I could move in with my parents and I wouldn’t starve. If you don’t have those same fallbacks, taking a more risk-averse approach may work better for you. Another factor in favour of the ‘slowly does it’ approach is that businesses take time to build and develop a strong, loyal customer following, and sometimes no matter what you put into it, buying yourself time through having a job elsewhere might be best.

Step 4: Maintaining momentum

Once we were off the ground, the new challenge was growing Nisa into a sustainable business – one that had a life outside of me, one that could survive even if I was hit by a bus.

Running a business is a bit like a romantic relationship: everyone focuses on how you and your partner met, which in some ways is actually the easy bit. But you have to be in it for the long haul and enjoy the daily task of growing your business. When you’re no longer new and shiny, you need a quality product and sense of purpose to give customers a reason to care about what you do, continue to buy your products, and most importantly, tell their friends about.

I’ve been really surprised about the value of word of mouth since starting Nisa. Conversations between friends have huge value, whether that happens through someone posting about your brand on social media or chatting about it over brunch. However, people won’t talk about you if your product or its story doesn’t delight or surprise in some way that’s worth sharing. This is the key to maintaining a business.

Step 5: Deciding what a good ‘end’ looks like

Imagine that everything is going well – your business is thriving, it has a rhythm and culture you’ve helped to build, and is no longer solely reliant on you. One day you might no longer be a part of the business, either because you’ve keeled over at the ripe old age of 100, or because you decide that you want to start another business or career.

Regardless of what motivates your departure, it will happen and you need to plan for it, or you risk undermining a business you’ve worked so hard to build. Worst case scenario is that you want to move on but you can’t find anyone suitable to buy the business and/or find someone to replace you as CEO, meaning that you have to wind down an otherwise successful venture and make your awesome team redundant.

For us, the dream would be for one of our employees to be able to take over the business, with financial backing from our thousands of customers. This is part of the reason I am looking to do a capital raise in 2020 – to start that process of growth that would make Nisa stronger, more resilient, and able to flourish on its own. That’s what success looks like to me.

Read more: You’ll make mistakes, lots of them: Lessons from a social enterprise startup