tello Perspectives: What it Takes to Start an LGBT-Focused Business

by Karen Frost

Tello Films was everywhere at ClexaCon, with representatives from tello participating in eight panels ranging from technical tutorials such as “Acting In and Directing Sex Scenes” and “Creating an Original Webseries” to a live taping of “Happy Wife, Happy Life” to a two-part workshop on pitching ideas in the entertainment industry. In the “Queer Lady Business” panel, CEO Christin Baker joined Rebecca Barrick and Sally Heaven of Fangirl Shirts, Ebone Bell of Tagg Magazine, and LaShawn McGhee of streaming service Revry in talking about how they started their business and what it takes to keep it going. Below, we share some of their insight—together with a little of our own analysis—because tello believes in supporting the creation of businesses by queer people, for queer people. If you can dream it, you can do it. 

Lesson #1: Identify market gaps, then blaze your own trail to fill them.

McGhee and her friends started Revry when they realized there were no LGBT-focused apps on AppleTV. Bell started Tagg when she realized that all the LGBT publications in the metro Washington, DC area focused only on white, gay men. Barrick and Heaven started Fangirl Shirts after Barrick heard “fangirl” used disparagingly. Baker started tello back when YouTube was first starting off and most of its “lesbian” material was salacious, titillating videos of two women kissing instead of quality, queer-produced content. In our community, many businesses start after their founders look around and realize that they can’t buy or see something that they, personally, want. There is a market gap. As fans and as consumers, we in the LGBT community have a natural sense for where market gaps are, and if the gap is large enough and profitable enough, entrepreneurs can fill them.  

Lesson #2: Pre-planning your business is like putting down a solid foundation for a house: it’s essential.

It’s relatively easy to form a business, whether in the form of a Limited Liability Company (LLC) or a Limited Liability Partnership (LLP). To register your business, the panelists recommended using LegalZoom or hiring a lawyer to ensure that the company meets legal criteria and that you as the owner have a good understanding of what is required of a business, such as tax reporting requirements (including the requirement for the company to pay sales taxes!). Before or after the company is registered, write a business plan. This business plan will act as a strategic and tactical roadmap, at least in the beginning, and keep the company on track. At the same time, recognize that the plan is likely to change with time as you learn more about the needs and consumption patterns of your customers. As your company matures, you’ll need to have the flexibility to discard business ideas that don’t work, and incorporate new ones that do. And always, when the company is composed of multiple people, communicate, communicate, communicate!   

Lesson #3: Most projects aren’t instantly profitable, so ease in when necessary. 

Baker didn’t work full-time for tello Films for the company’s first nine years. Barrick and Heaven hold full-time jobs in addition to Fangirl Shirts. Bell left her job and struggled financially for Tagg’s first few years. Sometimes, passion projects start out as side hobbies that then grow into solid businesses. As a very, very general rule, it takes about two to four years for a start-up to become profitable, and that’s with employees working full-time. Passion and determination are essential to running a business, but patience really is a virtue. If you can’t afford to leave your job full-time, do what you can during your off-work hours, and gradually work your way into your passion full-time. And if your passion never produces enough income to be a full-time gig, at least you’re doing what you love!        

Lesson #4: You can attract “pink dollars” from queer consumers who want to support LGBT-run businesses. You can also use the size of the LGBT community to attract advertising revenue.  

Many people in the LGBT community want to support LGBT-run businesses. Especially if a product is something that they would naturally buy anyway (clothing, food, movies, books, etc.), they have an incentive to choose a product from a queer-owned business over a product that doesn’t have ties to the LGBT community. At the same time, any product specifically marketed to the queer female community has to figure out how to find and then speak to its intended consumers. Queer women have a high bar as customers. They have tremendous brand loyalty, but first you have to convince them to buy your product. Additionally, business owners in certain fields can leverage the size of the LGBT community to attract advertisers, for example by pointing to a high number of followers for their company Twitter handle, likes on their Facebook page, or retweets. It’s normal for a company to have more “followers” than customers, so don’t discount using social media reach as a selling point when marketing your company.  

Lesson #5: There are an infinite number of “pies” (aka: work within the market to grow, don’t compete). 

Imagine Baker waving her arms, enthusiastically cajoling audience members, “There’s not one pie and we’re all trying to get a slice of it! There are an infinite number of pies! It is an abundant universe!” Whenever you think of the LGBT community as a customer base, think of this visual image. To shift the perspective of the metaphor slightly, if your company’s product is a “pie,” don’t think you have to convince your customers to eat only your pie and never acknowledge that other pies exist. Today’s customers like to eat all kinds of different pies. Of course the goal is to get them to eat your pie, but if they eat other pie, too, that doesn’t mean they’re brand disloyal, it just means they like variety.  

In today’s economy, many companies that cater to the same consumer base are not in direct competition, as they might have been in the past. It’s possible for consumers to buy shirts from multiple companies, for example, or to have subscriptions to multiple streaming services. By working together, LGBT-focused companies can create an amplifying effect that lifts everyone up. For example, Revry streams some of tello’s content, Fangirl Shirts sells some Riley Parra apparel, and Baker attended the panel wearing a shirt from Fangirls Shirts. Together, we can elevate each other. 

The overall lesson from the “Queer Lady Business” panel is that starting a business is easier than you think, but it takes tons of determination and hard work to make that business a success. Solid planning, flexibility in execution, and a good understanding of your customer base are key to setting up a company to succeed. By partnering with other LGBT-focused companies, you can increase exposure of your company and build networks. We here at tello support queer content creators and businesses, so if you start something, let us know! And always remember, there are infinite, infinite pies!