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HBS Start-up: Safe at Home

Have you been concerned about safety in your Cambridge rental apartment? Do the emails from Steven Catalano at the Harvard University Police Department make you want to double-check your locks? If so you are in luck: two former HBSers have combined their educations and entrepreneurial spirit to improve home security for city-dwelling renters across the country.

The product is called SimpliSafe, and it is a home security option that is specifically designed for renters who have little incentive to install an expensive and permanent alarm system. The basic product includes wireless door, window and motion sensors that can be installed quickly with removable adhesive backing, as well as a base station and a keychain remote. If a motion sensor is set off, the base station will wail an 85-decibel siren and send a call to SimpliSafe’s Emergency Dispatch Center outside of NYC, which will have the local police speeding to your door unless you turn the system off.

Current Cambridge-based user Abbie Dutterer is thrilled with the product: “Having one of the major companies come in and install a system would have taken forever-and in an old building-it would have been a lot of aggravation for us as well. For a fraction of the price, I have a system that is very reliable, expandable, and has the functions that I need.”

SimpliSafe founders Chad and Eleanor Laurans ’06 hope that this will turn out to be a disruptive technology, changing the way people think about home security in a temporary abode. “The current market is unable to serve our target segment, the apartment renter. People in rental apartments are twice as likely to have a home invasion as someone in the suburbs, but the existing industry doesn’t want them as customers.”

The idea came to Chad and Eleanor at HBS when three of their friends’ apartments were broken into around the same time in Cambridge. These victims looked into security systems, but they were all too expensive to justify for a rental apartment. The pair entered a business plan for SimpliSafe into the HBS business plan competition, became semi-finalists, and launched the product not long after graduation.

In order to maintain control of the company, Chad and Eleanor have raised very limited financing (one friends-and-family round, and then an angel investor round), and are tightly controlling their budget and expanding slowly.

“The downside to raising limited funding is that you can’t experiment as much, and throw money at various marketing efforts. However, the benefit is that I am very hands on and cost conscious, and we were able to become profitable almost immediately after launching” explains Chad, who had worked in venture capital before HBS.

SimpliSafe is growing 50 to 100% each quarter this year, and is sold and marketed primarily online.

After working on their start-up for more than three years now, Chad and Eleanor have plenty of advice for the HBS entrepreneur.

“If you want to start your own business, first find a sugar mamma,” jokes Eleanor, who still maintains a full-time job in consulting while Chad is dedicated to the business. More seriously, however, they both heavily emphasize writing business plans, talking to professors, and leveraging class assignments.

“I knew I wanted to start a business after HBS,” remembers Chad, “and so I must have written at least four or five business plans throughout my time there. I obviously only followed through on SimpliSafe, but fleshing out ideas is a really helpful process.”

Chad and Eleanor also consulted several professors, and used class projects as opportunities to flesh out ideas for the company. “Consumer Marketing was incredibly helpful,” Eleanor explained. “I used it to work on marketing ideas for SimpliSafe.”

Choosing entrepreneurship straight out of business school is an uncommon path for HBSers. Although more than half of HBS graduates end up starting a business at some point in their careers, only approximately 5% do so right after graduation.

“I thought a lot about working in industry first to get some operating experience,” admits Chad. “But working at a big company does not always give you experience that is relevant for a start-up. In a big company, there is a guy for everything-in a start-up, you’re the guy and that’s it. It’s a totally different job.” With a three-month old daughter in tow, the couple also pointed to the difficulty of starting a business after spending too much time in an industry with job security.

“If you don’t do it right away, I think it gets much harder to leave the safety and security of a corporate job,” Eleanor asserted. With recruiting season heating up on the one hand and the business plan competition coming up on the other, it is a tradeoff that current students are becoming increasingly aware of.

For further information on SimpliSafe, you can visit the company’s website at www.simplisafe.com.

November 23, 2009
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