Friends since second grade, Nick Nguyen and Kyle Pham started talking about owning a business together in high school. At that time, they thought they might do T-shirts or graphic design featuring a different designer each month.

Though the idea would eventually evolve into a subscription box company featuring 3D printed products, owning a business together seemed like a natural fit for the two men. With a similar work ethic and different strengths, they’ve created what Kyle calls an ideal, collaborative partnership.

Fast forward a few years to the spring of 2015 when they were college freshmen – Nguyen at University of California, Irvine majoring in computer science and Pham at the University of Southern California double majoring in cognitive science and philosophy, politics and law – and the idea for CubeForme began to take shape. By the summer of 2015, they solidified their business model, using the subscription model’s ease of entry, versatility and ongoing revenue to support their plan.

The basic premise was that CubeForme’s monthly subscription box would feature a different designer like Luis Picarzo or Steve Dakh each month, and the box would contain items in a particular category like art, gadgets, games or accessories. The designer would provide the 3D designs for that month’s assortment, and CubeForme would manufacture the items in-house using their own 3D printer.

With the idea fleshed out, in the fall of 2015, Nguyen and Pham started a Kickstarter campaign to raise $5,000 of initial capital to fund their business. Though the Kickstarter campaign only raised $3,018 of their total goal, and thus not successful, Nguyen and Pham were not deterred. The pair forged ahead, creating CubeForme with their own funds and learning and growing along the way.

We’ve been following CubeForme since those early days, and we had the opportunity to speak with co-founder Pham to find out more about the company, how it has evolved and what’s next for this California-based start-up. They were gracious enough to share their plan, as well as lessons they’ve learned along the way.

Subscription Insider: Why 3D printing?

Kyle Pham: The initial pull was because 3D printing was new, and there were many creative possibilities. We were looking at all these 3D objects online, so 3D printing really stood out to us, and it reflected our idea of showcasing different designers. 3D printing is just a manufacturing process, and we’re potentially capitalizing on the very cool products that come from it.

A 3D printing subscription also allows for very technical and personalized prototypes. We saw it as this outlet for people to be creative and inventive. Also, there weren’t any other companies doing this.

SI: Why did you start with crowdfunding as an original source of revenue?

KP: It was mostly a way to get publicity and to develop an initial customer base.

SI: What did you learn from the crowdfunding experiment?

KP: It is very important to communicate with your backers every step of the way, and do a lot of outreach to get their thoughts and feedback, making sure it is going well on their end and improving it to the best of your ability.

The difficulty that we ran into with crowdfunding is that it is a bit hard to sell a subscription box through that platform, because the products differ each month and we’re trying to sell an experience that hasn’t happened yet. That helped us to more clearly illustrate the box and our products later down the line.

We also learned that it is very difficult dealing with shipping. We thought we could offer international shipping, but that was not economically feasible. Ultimately, we decided to include the shipping cost in the subscription box price. A lot of people were drawn in by the price of $10, and were turned off when they had to pay an additional $5 for shipping. Now the box and shipping are bundled together at $15 a month.

SI: Were you at all discouraged you didn’t reach your funding goal?

KP: There is definitely a sense of discouragement because we didn’t reach our goal of $5,000, but we saw, as the campaign was ramping down, it wasn’t the end of the world. We still had people who backed the campaign and were interested in our company. We were able to capitalize on their interest, get their emails and work with them after the fact as far as pushing out our product. We did not regret it in any way.

SI: What were your initial costs for starting the business?

KP: We purchased a 3D printer for $1,000 prior to the crowdfunding campaign. It was one of the bigger and faster printers for that price point. There weren’t a lot of initial costs except for that, but it took time to build the printer. We could rent a lot of the tools that we needed. Except for the printer, our biggest cost was time.

SI: How did you finance CubeForme initially, and how will you finance the company going forward?

KP: The printer was purchased with our own funds. Though there has been a decent amount of revenue, everything we build is paid for out of pocket.

SI: Tell us about your company and business model now. How has it changed since you first started?

KP:  The biggest change is that we’ve added a marketplace. In addition to the month-to-month purchases that come with the subscription boxes, we have an on-demand 3D printing creation marketplace, so orders can come through that any time and that’s extra revenue. The idea behind that is that, even when we’re featuring a designer for a particular month, we continue our partnership with them. We take objects from that month’s box, and we make them available for individual product orders later.

SI: Why did you choose a subscription model for your business?

KP: The subscription model works really well for us in three regards.

1. There wasn’t yet a subscription box with 3D printed creations in it, so right away that provided us with a unique angle for entering the market.
2. The model allows us to showcase different designers and a different type of 3D printing product each month which helps us in pushing our vision of helping designers and really giving people a full picture of what 3D printing can do. It also allows us to get new designs to add to our collection, so we always have something fresh and new and don’t get stagnant.
3. Another beneficial element of the subscription model is the ongoing revenue.

SI: If the subscription model was not available to you, would you have been able to start your business when you did?

KP:  That’s a really interesting question. I don’t know what we would have done if we didn’t have the subscription model, because it was such a big element of what we were thinking about. It provided us with a unique angle that we are the first 3D printed product subscription box. It would have taken some unknowable amount of time to have thought of something else.

SI: Who is your target market?

KP: That’s difficult to answer; that’s something we’re working on now. Although we have had customers interested in 3D printing specifically, our goal is to serve a broader audience. We have to find people on an individual basis, so we are pushing out unique gadgets, trinkets and little sculptures. Ideally, with each product that comes each month, different kinds of people will be attracted to it and be integrated into our growing community and customer base. We’re working to create our own demographic.

SI: Tell us about your subscription offerings.

KP: We based our subscription plans off of LootCrate. We have four plans, one-, three-, six- and twelve-month plans, with discounts for longer commitments. People can also do a month at a time, and they can purchase items from the marketplace.

SI: Do subscribers have any choices or have any input into the subscription box they’ll get in a given month? For example, do you ask for a user profile, preferences or any customized information?

KP: So far, it has been a set assortment selected by our team, but we communicate closely with our customers to get a sense of what they’re interested in. Because we’re pretty new, we’re still gauging what kinds of products are more popular. Hopefully, down the line, we can offer more customized curation and personalization.

SI: How did you select your price point?

KP: We wanted to keep it cheap, so it would be accessible to people to try out 3D printing. 3D printing costs a bit of money just to get the initial printer, but the materials are relatively cheap, and it takes to print each item. [Editor’s note: Products are printed as each order comes in. A small “low poly” sculpture can take five hours to print.]

SI: How do you process customer payments?

KP: Most payments are processed using Stripe. PayPal is also a payment option.

SI: How do you choose designers and products each month?

KP: That’s done on an individual basis, finding people who represent a cool kind of design style. With our first designer, we had very interactive toys. Our second one was very art-based, and our third one did 3D printed clocks, so more along the lines of gadgets. We try to find designers who have great designs that would fit well into a themed box. We recently started working with My Mini Factory, a 3D design site. They’ll be pushing out designers for us to work with.

SI: Is anyone else offering a 3D printing subscription box?

KP: There are 3D printing subscription boxes meant for people with 3D printers, so giving them materials or designs to work with, but I believe ours is still the only one that is already-printed products. Theirs are more of a do-it-yourself kind of experience, and ours is purely products.

SI: What are your plans for CubeForme for the remainder of 2016? What are you hoping to accomplish?

KP: It is pretty-open ended. We have a broad goal to grow it to see how big CubeForme can get and to start being profitable. We want to scale upward in terms of having more printers. Fine-tune some of the little things we have to spend a lot of time on like painting each box and putting everything in by hand. It would be nice to eliminate that. We’d also like to get more customers and capitalize on opportunities along the way. We don’t have specific numbers in mind.

SI: What marketing tactics have been the most useful to you?

KP: With our early stage of start-up, we consider these first couple of months as a testing period to gauge interest with the boxes and solidify processes on our end. I am working on capitalizing on social media, like Instagram. We don’t want to just get people to follow us, but to find designers and explore relevant companies to collaborate with.

We are holding giveaways to get our product out to people and get them hooked on 3D printing and subscriptions. We are definitely trying to market on an individual level by taking the time to personally email or contact people as opposed to just blasting our message out there. We’re also using PR, offering discounts, engaging with potential customers and partners, and building our brand.

[Editor’s note: You can find CubeForme on Facebook, Twitter, Instagram and YouTube.]

SI: What do you know now that you wish you’d know when you started?

KP: I’m very much the go getter with a “push something out there” attitude, but it is very important to sit down and make sure you do the most amount of

research possible regarding development and business decisions. A direct example of this is that I should have researched shipping more to know that shipping internationally was not feasible.

Also, I should have really started pushing social media before the company launched. Other companies have started their presence on Instagram or their blog before they started their companies to gain an immediate following.

SI: What lessons have you learned along the way?

KP: The big thing I’ve learned as a start-up is the importance of taking initiative. If there is something possible or a good opportunity, you should try to use it. There are a lot of competitions you can enter, resources you can use, and people you can ask for help. I’ve learned it is always more beneficial to try to reach out to them. Participate in a competition, and take steps forward in building the company and getting closer to your goals.

SI: What advice would you offer other start-ups interested in trying a similar product or service?

KP: Talk to people who are relevant to your industry or whatever you want your box to be about, or just entrepreneurs in general because they offer a lot of lessons and stories of their own that I think are very beneficial as you are molding your company. Focusing on your image and making sure you are creating something distinct are also important.

Insider Take:

Since the first time we heard about CubeForme, we’ve been impressed with their ingenuity and creativity. Not only did these fearless college students dive right into the business world without looking back, but they utilized the subscription model to springboard into a passion project. They have been willing to learn from others and tweak their business along the way.

In terms of marketing, we like CubeForme’s individualized approach and the personal contacts. We recommend to them – and to other start-ups – to have a more clearly defined target market at the outset though. This gives companies a starting point. For companies who may appeal to different types of audiences, it is OK to have multiple target markets.

We’d start with defining the primary market (e.g., our product is mostly likely to appeal to X) and then branch out into subsidiary markets. For example, the New York Times recently designed an email newsletter specifically to target college students, a group that isn’t their typical demographic.

Another area for potential improvement is setting some concrete goals for the remainder of the year. CubeForme is still in its testing and tweaking phase, but it is still good to set goals or benchmarks it hopes to hit in terms of the number of subscribers and revenue goals. If they want to seek investment capital down the road, potential investors will want to see a more tangible plan for the future.

Aside from narrowing their target market and solidifying goals for 2016, we think CubeForme has gotten off to a good start. CubeForme graciously offered their insight and advice for other subscription box start-ups. Here are 13 lessons subscription box start-up CubeForme shared with us:

1. Choose a product that is unique or in a category that has fewer players. CubeForme chose a product that no one else was offering, giving it a competitive advantage.

2. Crowdfunding may not be a workable funding mechanism for subscription boxes with offerings that change each month. Customers want to know what to expect and are less likely to commit until they get a sense for the types of products they’ll receive each month.

3. Crowdfunding is about more than just raising working capital for a new business. It can increase a new company’s exposure, help it build an initial customer base and expand the company’s online presence.

4. Communicate with supporters every step of the way. Do one-on-one outreach to get candid feedback from customers. Take their advice to heart and make improvements to the best of your ability.

5. Use the early stages of the company to gauge the appeal of your products with potential customers and to improve internal processes. Learn which products are the most popular with customers.

6. In addition to calculating costs, look beyond hard costs to consider the time involved in creating, packaging and marketing your product.

7. Consider supplemental products or services you can offer to create revenue streams beyond subscription revenue. In CubeForme’s case, they created an online marketplace to showcase 3D printed products that had been or will be part of the monthly subscription boxes.

8. Do as much research as possible when developing your company and as you make business decisions. You may save yourself some hard lessons – and money – along the way.

9. Start marketing your product via social media before the company officially launches. This will help you develop relationships and partnerships and build a customer base early on.

10. Opt for more engaging one-on-one customer marketing (e.g., personal contact, giveaways, etc.), and less on marketing to the masses.

11. Talk to relevant people in your industry including potential partners and customers, and ask other entrepreneurs to share their stories.

12. Focus on your image to build a brand that reflects your vision.

13. Don’t be afraid to take the initiative in identifying possibilities and opportunities.