Monday, May 26, 2008

declare your craft!

All the posts on this blog so far have focused on the business and environmental impact of craft, but what about the fun part?

Yup, that's Britney Spears. In cross stitch. Or as the rebels like to say, xstitch. I invite you to...

In addition to "normal" crafts, like stitching up tasteful pullovers from Vogue Knitting, I am fascinated by what happens when you cross-stitch photos of people and animals. Sometime in college I discovered a computer program that turns photos into cross-stitch patterns. The results are uber-creepy and weirdly fascinating:

I mean, some grandmothers love their progeny so much, they still adore them when they see these creepy pixellated versions of their beloved. It's heartwarming.

In 2001, when I first encountered these photo transformation programs, I had a quiet fascination with Britney Spears. Remember the "Oops I Did It Again" era? Before Kevin and the two babies and the rehab and the shears? Yeah, she was hot and had her act together:

Britney and I are both 1981 babies, so it was interesting to watch the media treatment of her as we both came into our own as women. At the same time she was bursting onto the scene, when we were both 17, I had my first real boyfriend and identified with someone who held a lot of power because of a sexuality that she did not quite understand.

The swiftness of the story the media told about Britney -- from Lolita to barely legal to sloppy seconds -- unnerved me. In two years they took her from virginal treat to used-up tart. And now, several years later, Britney is a highly troubled and perpetually bloated-looking mother of two. I still feel like an attractive young woman but who knows, maybe I'm past my prime too! But I digress..

It became imperative that I cross stitch Britney. After purchasing 34 colors of DMC embroidery floss and investing the better part of a winter break, the following "art work" emerged. Cross stitch Britney is photographed in my bedroom on an unusual cloudy day in San Francisco.

Inspired by awesome blogs like Radical Cross Stitch, I've been thinking about picking up an embroidery needle again. There's a lot of incredible political cross stitch out there -- here's one great example and see this xstitch photo archive for more:

Truth be told, when I look into my heart to see what I want to stitch, it always seems to come back to photos of celebrity girls who somehow embody a quality or lifestyle I'm consciously ashamed to admire. The Britney love has died. Who would I cross stitch today? Hands down, it would have to be Lauren Conrad:

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Monday, May 19, 2008

Shareholders: Community building through finance

We're used to putting our money where our mouth is when it comes to consumption, but what about finance? The Wall Street Journal ran an article exactly a month ago on Susan Gibbs and Martha's Vineyard Fiber Farm:
(Her blog is the source of this goat picture, and believe me when I say there are many more ridiculously cute animal photos where that came from!)

This Etsy seller keeps her goat farm going by selling shares in each season's "yarn harvest." How does it work? Each supporter pays $125 for a share upfront, which goes toward buying hay and feed for the animals (as well as keeping the human caretakers afloat, presumably!). At shearing time, the farmer divvies up the yarn to each shareholder. This system is known as Community Supported Agriculture, or CSA. This type of organization is recognized by the US government and promoted by the USDA.

What fascinated me about this story is the use of Etsy as a financing tool. Most people use Etsy as a marketplace - a place to sell something that already exists. All responsibility for buying supplies falls to the seller (though some sellers manage this risk by not making multiples of an item until an order is placed). CSAs have historically been used to help farmers manage risk by lining up buyers before the season starts. Also, shareholders are only entitled to a certain percentage of the harvest - so if a crop suffers, due to poor weather or what have you, the farmer isn't the only one to suffer. (Likewise, if the crop is stellar, shareholders get a share of the benefits.)

Small-scale crafty makers do not generally have access to this type of risk sharing. What I keep being struck by is how capital-intensive a lot of the goods on Etsy are. "Capital intensive" just means you need to pay a lot of money upfront to make these goods. Sewing machines, woodworking tools... handmade stuff typically requires some pretty expensive tools. (Vintage, of course, requires little upfront spending or skill - that's why vintage sellers multiply like ragweed on Etsy, with no disrespect intended to the vintage sellers with great taste who I love on the site.)

CSAs are a great risk-reducing institution for farmers. What type of institution could be imagined for small-scale makers? Maybe the best way to reduce risks for crafty small business people is to think about reducing personal risks. For example, focusing on finding an affordable way to provide healthcare for the self-employed -- something a nation that prides itself on being so entrepreneurial should have figured out ages ago.

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Friday, May 16, 2008

Beyond Dad and MasterCard

I am back from a vacation in beautiful Sweden and ready to get back to work!

Awhile ago, I promised to share resources for crafty entrepreneurs looking for loans to grow their business. Outside of credit cards and family and friends, what can an etsy seller or other small business person do to find financing?

1. Banks. Okay, duh. I mention the obvious because, if you qualify for a small business loan from a bank, you are likely to get a lower interest rate than you will from other sources. You can also have the flexibility of a line of credit, which functions like a personal credit card -- unlimited borrowing up to a given credit limit -- but with a much lower interest rate. It's definitely an option worth exploring. Many community organizations offer free classes to help you put together a business plan and otherwise navigate the process of filling out a loan application.

2. Friends and family, formalized. A new crop of web-based businesses match borrowers and lenders while sidestepping traditional banks. Sites like Virgin Money allow you to tap resources from the people you know. You can set an interest rate from 0% (you borrow $1000 from Aunt Mabel, and pay her back $1000) to whatever interest rate the borrower and seller negotiate. What value does the website offer? Virgin Money and its competitors handle legal and tax documentation for the loan and electronically transfer the funds.

The greatest value these sites provide is that they do the ugly work of making sure loans get repaid. Today, many grandparents earn 3% interest on their CDs while their responsible grandkids pay 9% on a car loan. It doesn't make a lot of sense. Wouldn't it be better if grandparents made the loan so a better interest rate for both parties (say, 6%) could be negotiated? The reason this doesn't happen in real life is that it's difficult for the average person to structure a legal contract, and not always socially appropriate to do so -- which makes the loan a big risk for lenders. Sites like this are basically stepping up to be the bad guy, if necessary. This is an exciting development for eliminating missed opportunities among family and friends.

3. Loans from strangers. In addition to sites that connect you with friends and family, many other sites will connect you with strangers as a source of loans. These are known as "person to person" lending sites. Prominent lending sites include Prosper and Zopa. These sites allow you to post a profile describing how you will use the money and some information on your credit history. These profiles are anonymous and visible to anyone. Strangers (as well as family and friends, if you like) bid on the loans in a eBay type of auction. People can contribute anywhere from $50 to the full amount you request.

It's a brand-new market that's gained a fair amount of steam. Prosper alone has funded over 20,000 loans to date with a total value of $137.3 million dollars.

And on the crafty front, my girl Willo, an illustrator and web designer who makes the cutest onesies I've ever seen, shared a link to a crafters group on Prosper. It seems that this group hasn't seen any loans among the members yet. It's an interesting glimpse though at a way craft lovers can lend to crafty business owners.

From standard to Web 2.0 sources of loans, I think these are all valid options to explore for anyone seeking a small business loan. If you try one, let me know how it works!

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