One Mother’s Response to the High Cost of Daily Childcare
When Michele Hansen and her husband started planning for the birth of their daughter, they quickly realized that to afford daycare at $24,000 per year, they were going to need an additional income stream.
“Day care is more expensive than state college tuition in a majority of states, including the District of Columbia, where we lived,” said Hansen. “People are expected to come up with this chunk of money out of pocket. I don’t know how anyone does it.” While she and her husband could try to “crush it” at work, she believed they weren’t going to come up with an additional $24,000 through conventional means. That’s when they started talking about starting a business together.
She had a background in product development, and her husband was a developer. They knew that with their skills, they could create an online business with relatively limited upfront capital.
The first product they launched was an app called Open Nearby, which showed you the opening hours of stores nearby. At the time, in 2013, Google didn’t have this capability. Today, of course, we can see this information with any Google search. They incorporated seven days after their daughter was born, and launched it three months later.
“Open Nearby was a side project,” said Hansen, “It wasn’t a straight sprint from the second we realized we needed more money, to doing this. We weren’t that organized or efficient.”
Parenting Made Them More Focused
In fact, they became even more focused after their daughter was born. “When you have no control over most of your time, it becomes that much more important to make the most of that time you do have.” she recalls. Instead of spending time watching television, like they did when she was pregnant, they would work on the app.
It was while working on Open Nearby that Hansen and her husband uncovered an even greater need in the market for geocoding software to translate addresses into latitude and longitude coordinates. At the time, they were focused on one specific area (a country), and they were mapping all of their data in the app. She explains: “We had this app and it had about 5,000 stores in it. In order to display a map online, you have to have the latitude and longitude coordinates of these addresses. At the time, you could get 2,500 addresses free per day, or you could sign up for an enterprise contract and pay tens of thousands of dollars for many more addresses than we needed.” However, if you needed 5,000 addresses, you were above the 2,500 threshold, but below the enterprise tier. That’s when they realized the middle of the market was not being served.
Her husband found a way to create his own geocoder for the app, and as they talked to other developers in this space, they realized other people had the same problem. So they decided to release their geocoder as a product, and let other people pay for however many addresses they needed above 2,500.
“We launched in January 2014, and we had 1,000 users very quickly,” she says. “It was very clear to us that this was a problem that people wanted solved. From that first month, the product was cash flow positive. It wasn’t a lot of cash, but it was paying for its servers.”
From Side Hustle to Full Time Gig
For four years, Hansen and her husband worked daily on what would become Geocodio, for one to two hours a night. In late 2017, it has grown enough to become Hansen’s full time gig, and she left her job. “I never predicted it would become my full time job,” she explains. “If you look at our revenue line, it is a fairly smooth, upward line. We grew organically.”
Making the jump into Geocodio full time was necessitated by the product’s success. They had too much work to do. “We would have customers asking us questions during the work day and wanting to have calls with us,” she recalls, “it got to a point where we were hoping that people would be understanding and not expect a response immediately.”
Today, Hansen focuses on having jobs-to-be done interviews with users to build a better understanding of the market, see what they need, and understand what problems her users are trying to solve. “Without these interviews, I wouldn’t know what questions to ask of my data, or what questions to ask of the market in general.”
Like parenting, her entrepreneurship journey continues to be a work-in-progress, and she shared that she wasn’t prepared for the loneliness of working from home. Today, she organizes meetups to support fellow entrepreneurs and connect with other humans while focusing on Geocodio’s users and making her product more useful.
This article was originally published on Women@Forbes.