The pleasure of walking into a home decorated in the easily identifiable minimalist and affordable style of Ikea is out-of-reach for many New Orleanians. The popular Swedish furniture retailer’s closest store is a five-hour drive away in Houston.
“In the past, this has created almost a ritual among New Orleans residents: Rent the truck and make that annual pilgrimage to Houston to get as much Ikea merchandise as possible and bring it back,” said Mehmet Ergelen, the founder and owner of Bluebag LLC.
With Bluebag, Ergelen has set out to fill the Ikea void for New Orleans residents. The 2-year-old company takes weekly orders from customers and delivers and, in some cases, installs the furniture. It also deals with the pesky issue of returning unwanted or defective products.
Later this month, Bluebag will unveil a design studio in the Lower Garden District, where New Orleanians can peruse Ikea furniture and place orders for items in the Houston store.
But Ergelen already has his sights set higher. He’s hoping to take the concept outside the Crescent City and into other markets too small to attract the Swedish retailer.
“We’re using the New Orleans model as a concept and looking at where else this idea can go,” Ergelen said.
To that end, Ergelen is participating in this week’s Big Idea Challenge, a competition that will award $50,000 to a New Orleans entrepreneur. Ergelen said he could use the money to perfect the New Orleans showroom, expand Bluebag’s 12-person staff and “polish the concept” for expansion.
Entrepreneurial Hub
The Big Idea Challenge is one of more than 75 events connected to New Orleans Entrepreneur Week, a weeklong celebration of entrepreneurship that began Saturday and ends Friday. The annual event — now in its fourth year — is produced by The Idea Village, a local nonprofit that nurtures entrepreneurial ventures.
In addition to seminars and workshops on business development, the week will include opportunities for pre-selected entrepreneurs to compete for monetary prizes and work with MBA students on plans to grow and expand their businesses.
“New Orleans is the perfect place to be championing innovation and entrepreneurship,” said David Kappos, undersecretary of Commerce for intellectual property and director of the U.S. Patent and Trademark Office. Kappos is one of five keynote speakers during the weeklong event. “It is a community that is adaptive, a city that has an incredibly positive brand. It’s a no-brainer that we would be coming to New Orleans next week.”
New Orleans has been trumpeted nationally over the past few years as a growing hub for entrepreneurial ventures. But Williamson said he hopes this year’s event will bring more locals to recognize the entrepreneurial community’s growth.
“The thing I’m most excited about is the engagement and specifically the local engagement in this entrepreneur season,” Williamson said.
“New Orleans has been getting national recognition for entrepreneurship. This year, we’re hoping to get the local community to see it too, that New Orleans can be a model for this.”
Francine Davis Ballard, founder and editorial director of Designer Social, plans to use the week to expand her network to include venture capitalists who can help her grow the nearly 3-year-old business into more of social platform online.
Designer Social operates a website and retail store on Magazine Street that buys and sells mostly preowned designer goods.
While she’s not expecting anyone to write the business a check during the week, Ballard says she hopes the week will help her perfect her pitch.
“The way I see it is this is more of an exercise for the real thing,” Ballard said. “We’re going to take it on a road show at some point. This allows us to do it in our own backyard.”
Chipping In
The week will culminate with the Big Idea Challenge. Designer Social and Bluebag will compete in the challenge along with 17 other ventures.
Each member of the crowd at the event, which will take place Friday at Manning’s restaurant, will be given a chip valued at $50. Through the course of the night as they visit with each business, people can decide which business to give their chip to. The businesses will be able to keep the money they collect, but the top three chip-getters will move onto a second round where they can pitch their ideas to a panel of judges that will award one business $50,000.
The process of letting those present decide which business to invest in is intended to mimic the popular, if controversial, practice of “crowd funding,” Williamson said.
Crowd funding is a practice that allows entrepreneurs to reach out, typically online, to Average Joe-investors who put up small amounts of money in exchange for some product or perk. Many entrepreneurs would like to see the practice expanded to allow them to give shares of their company to those investors as well, a move that could help them to quickly raise capital without having to compete for limited angel and venture capital dollars.
But such a practice would amount to selling shares in a manner is illegal under current Securities and Exchange Commission rules. Those rules say that only “accredited investors” can buy a stake in companies shelling out a large number of shares because they understand the risks.
Legislation is pending in Congress to change that requirement and allow crowd funding to proceed online with equity stakes available for investors.
There will be no such debate at entrepreneur week, but Williamson believes allowing people to choose to support a company with a $50 investment will help to tie them to that venture and help it to succeed, a point proponents of crowd funding also make.
“We think it allows you to engage a larger network,” Williamson said of the practice.