Welcome to your Startup Masterclass
This Startup Masterclass is your first step to success.
I'm so pleased you've decided to join me for this jam-packed Masterclass for Startups.
What I share over the next 45 odd minutes is stuff most miss, which is why many fail.
See you inside!
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Below you'll find the full transcript of the Startup Masterclass.
Want to start your own business? Awesome, then you’re in the right place. I’ve been helping people, just like you start a business for some 30 years, and I’ve learnt a thing or two from helping them and in my own business adventures.
Whatever your business dream, this Startup Masterclass will save you the heartache, stress, and costs of getting it wrong.
Hi, I’m Judy Celmins, co-designer of the Thriveable Pathway©.
And today, I’m going to show you an easy-to-follow Fast-Track along that Pathway.
You’ll discover the 7 Steps that will turn your Bright Idea into a viable Business Case.
Plus, as a bonus, I’ll share a technique I developed that will give you a clear view of how much money your new idea will make. This was the source of much frustration for me. You know, I paid accountants and business experts who said they knew how to do this. But all of them based it on a guess…. Wow, that’s just insane. But that’s what most start-ups, even the big tech dreams, are based on.
Those guesses can lead you astray. It doesn’t matter how big your dream. You need a clear picture – even if you don’t need investors. You have to know how and where the income is coming from. If you’re about to resign from a job, no matter how much you hate it. It’s paying your bills. If you give up too early, only to struggle, the stress alone will do you in.
The Thriveable Pathway© is a methodical approach to identifying the need and building your unique story and purpose. Then you identify if there are enough people interested in your business to make money.
So many start-ups just want to dive straight in. They and their friends love the idea. So why not just take the plunge, get ahead of the pack … Ready, Fire, Aim … right? And while I agree with the sentiment, no one would recommend you rush in without doing your homework.
Before you jump over the cliff, what you need is to have your purpose clearly defined. Your businesses reason for being. A strong point of difference. And you have to be able to communicate it clearly. Tell the story in a way that brings people with you. I can’t remember a single one of the start-ups I’ve talked to, that could do that. As soon as I ask, what it is you do? They start rattling off a list of features. That will never motivate people to buy. As a customer, your features list doesn’t tell me WHY I need to buy from you… But I’ll talk more about that later…
Your idea is just the starting point. This Pathway will challenge your thinking and energise you to make it even better. That’s the business that stands the test of time.
Passion alone will not make a business a success. And that’s where I see way too many start-ups fail. They’re stubborn - so emotionally committed to their brainchild that no amount of advice or suggestions will stop them. And I totally get it! But passion is not enough.
Now, to get the most out of your time with me today… make sure you’ve downloaded my Challenge Question Workbook - you’ll find a link on this page above the video.
Asking questions is how to challenge what you know or think you know.
The aim of the Workbook, is to use it as a reality check of your current beliefs & assumptions.
Assumptions are one of the most dangerous things you can base any decision on. Because an assumption is a guess. It’s not fact. And what might be accepted as a fact today, could actually be based on an old assumption. Or customer attitudes and needs have changed, and what used to be right, is no longer. That’s why you have to constantly ask the right questions.
I love the story of the hearing aid. The industry secured the market by saying all hearing aids had to be prescribed & fitted by a specialist. They tried to control the market. They assumed no one could touch them. But then someone came along who questioned that. And asked, why do they need to be called hearing aids? Why can’t they be multimedia devices? It was only the name that was protected. They kept questioning, and now the new players have expanded the market and given the traditional model a massive wake-up call.
A benefit of asking Challenge-Questions can be taking you out of your comfort zone. Going off on tangents you hadn’t thought of, but most likely a better opportunity as a match for your capabilities.
You need to be curious - bring out that 5-year-old self that drove your parents crazy with “Why is the sky blue? Mummy. Asking questions has been drilled out of us, from school and well-meaning parents who replied, “Not now!” So much so that we stopped asking - because we might feel embarrassed and dumb, thinking we should know that.
Have you ever seen a new product or service and said to yourself… ohh, that is so obvious…
Entrepreneurs who change our world are relentlessly curious. They ask simple, naïve questions in everyday life, and it’s why their innovations seem blindingly obvious afterwards. It’s not rocket science, but the result of childlike nagging, asking WHY?
Now you might not have ambitions of being a world-changing entrepreneur. But you still have to be different - and it’s constantly asking the naïve questions that will keep you ahead and growing. For example, like a guy I’m currently working with. I challenged him to improve the industry-standard quoting system. The current system is time-consuming, so you have to charge higher rates to customers to cover the time and cost of quoting. By asking questions, he was able to come up with better ideas he can now test.
You will never survive by just offering the same as everyone else. That just leads to price wars. And competitors that see the opportunity you closed your mind to.
By the end of this Startup Masterclass, you’ll be looking at your idea differently. You’ll be able to tell people the pain you solve. And that’s critical - because people don’t buy without a need, a pain they need fixing.
Just by asking.. WHY is it always done this way? WHAT IF I did it differently? And HOW can I make it happen?
And you keep asking those questions, it doesn’t stop. Because when you do, that’s when you open the doors to competitors who do it better.
For example, I used to run a market research call centre. And once a month in our team meetings, we challenged everything we did. That saw us introducing techniques that the rest of the industry took a decade to catch up on.
But no idea is brilliant at the start. Your idea is the seed to creating a better one. It’s a starting point. And that’s often where start-ups get lost. They become fixated by their first idea. The key is to take your original idea and build on it. Creativity experts will tell you to keep evolving your idea and the Third Thought is the one you take time to explore. That’s because the first idea is the easy one. It flashed into your head, so someone else has probably thought of it as well. So don’t stop, keep challenging, and asking and asking… the right idea is there. Now that’s all well and good in theory, but it’s the doing that gets the best of us stuck. So that’s where the first part of this Pathway comes in. It challenges you. It finds obstacles you have to work around… it’s all designed to get you to create a better idea focused on your ideal customer.
Along this Pathway, you’ll be constantly reviewing where you are. That’s why it’s essential to write everything down as it comes to you or as you discover new knowledge.
This is about documenting as much as you currently know about your Bright Idea.
What are the Big Picture trends in your category? What’s going on in the culture and economy that supports your idea. It might be what sparked your thinking in the first place.
Write down your Target Market – everything you know about them. For example, do you service a specific geographic location? What does their household look like? Their age group, how many in the home, etc The more you know about them, the easier it will be to develop a product or service that meets their needs.
Next, think about that target – When and How would they use your idea? Use your imagination on how it fits into their world. Remember, your idea has to support customers. It needs to make their life better in some way. So the more you know about them, the easier it will be to find that key motivation to get them excited.
What obstacles are customers currently facing? Understanding this is important when it comes to communicating your idea.
What’s your point of difference? Tie this back to your target’s goal for needing your product. No point in being the same as competitors. If someone asks you why they should do business with you, saying you’re better or cheaper isn’t good enough. You need a much stronger differentiation than that.
What’s your superpower? This plays into your strengths to create the idea in the first place. But some ideas might need other capabilities that can open doors to partnerships and collaboration.
Step 2 of our Startup Masterclass is where you set about challenging your current knowledge and beliefs from Step 1… by asking the first of our Challenge-Questions … WHY? What made you think of going into business in the first place? Do you think you can do it better? Why is it always done this way? The level of questioning depends on your business idea. If you’ve invented a new gadget or you have a new tech tool, it might take more indepth questioning. But I strongly believe in its power for any business. That’s the difference from being just another plumber, or restaurant, even accountant. The industry doesn’t matter, it’s your ability to ask questions, to challenge the way it’s always done, that makes the difference. So I encourage you to do this at every step of your business journey. Make it a habit.
Why should you be stuck without a bed if I’ve got an extra air mattress? That’s one of the original questions the founders of Airbnb asked. Of course, that wasn’t the only question. It opened up many more, and that’s the beauty of questioning. You keep going. And more questions will present themselves.
If you’re working for someone else, and let’s say you reckon you can do it better. Those reasons are the starting point of your Why. I mean what’s the point of opening a business that’s just the same as everyone else?
Head to page 4 of the Workbook, and jot down your Why.
WHAT IF I could hire a movie, watch it whenever I like, and never pay late fees? That might sound strange to you if you never experienced hiring a DVD. But in the days before streaming, an idea like that would have sounded like science fiction.
WHAT IF people could stay in someone’s house and not an expensive hotel? That’s one of the questions AirBnB asked.
WHAT IF you could stalk old school friends online? … well, OK, there are better uses for Facebook!
The point is that instead of leaving the WHY question hanging, you push on with imagining a solution.
Which is a way of generating new ideas, or improving on your original brainwave. Like I mentioned earlier, your first idea is never the best. So keep drilling down, a fantastic idea is just under the covers.
And it’s critical you keep an open mind.
Your idea must solve a REAL-WORLD problem that’s relatable to your potential customers.
I want to quickly share one more tip for coming up with new ideas …
One of the most common techniques used by ideation experts is COMBINING.
Taking two totally different elements and mashing them together.
Here’s what I mean as actual examples …
Take a mattress manufacturer.
Change the business model to Direct-To-Consumer
And you have
Or a winery making a nice wine…
Selling via their mailing list OR get up early, on the only two days they open per year.
The result …
A cult following…with people waiting years to even get on the list!
Ford & Volkswagen blended their traditional super-powers
To form innovative ARGO - the world’s first electric, driverless car
Giving an unproductive team more time off …
Actually improved productivity
When consumers need to reduce waste with handmade cosmetics
you get Lush
And with consumers frustrated at needing a pile of different batteries
for different tools
in came Ryobi, with just ONE battery
The list is endless - So here’s my challenge to you. Pick one aspect of what your industry does that is either time consuming or cumbersome. Let’s pick on quoting for jobs - that’s a common one for many of my clients. There will be a standard way it’s done in your industry. But is that what your customers want? Is it the best use of your time? What technology could you use to make it easier for both you and customers? Turn them into What If questions. What If customers had a easier way to get quotes? What If I could save hours building quotes? This is a great example of using the Combining method to create something new.
You would need to test any idea on customers before you spend money on rolling out a new system. So keep an open-mind, remain flexible, and constantly question.
As your mind is buzzing with possibilities, fill in your WHAT IF questions on page 5 of your Workbook. What you’re creating are your Points of Difference.
Time to go online for some desk research. This is all about researching everything you can about the industry your idea fits into. Just to clarify, this is equally as important for those of you that are offering a trade or local service.
It’s just like playing a detective game. Start searching online for your idea, or others providing the same service. Get creative with your searching, check out podcasts, YouTube, blogs, industry newsletters, forums. You’re looking for anything that can help feed your knowledge. One of my clients discovered a new trend in the US, which he was able to tweak to fit his local market.
And with one of my own ideas, it didn’t take long to find other businesses with similar thinking. Not that it stopped me. I reviewed what they were doing and looked for how I could do it differently. If you find someone else doing something similar that doesn’t service in your country, for example, you can learn from them. Follow them on social… just keep digging and learning. That’s what another of my clients did. She found an example she loved - it gave her so many ideas, she just needed to make them her own. Giving it her unique personality.
The point is, the more you know, the easier it will be to shape your offering.
And if you discover a direct competitor in your market, it’s better to know and understand them before you open your doors.
Having a competitor is often a good thing. They prove there’s a market, but you don’t want to offer the same thing. So keep questioning and drilling to find your point of difference.
What you’re doing in this step is building your competitor knowledge. And this is critical to any business success. You must know who else is addressing a need. So often, I hear from my clients. “I don’t have any competitors, no one does exactly what I do”. Everyone has a competitor. If there is a customer need, then that need is being fulfilled somehow. It’s your job to discover how that need is currently being serviced.
Clayton Christensen was a famous economist and business advisor. I recently read one of his books, where he shared the story of one of his clients who made margarine. His initial research was to look at the need for margarine. What need did it satisfy for customers? His findings were that most people used it to moisten bread. So then he asked what other products could be used for the same purpose.
From that, he came up with a list like mayonnaise, avocado, of course butter, olive oil and cream cheese. The point is, if margarine didn’t exist, people would satisfy their needs in another way. So, all those products are actually competitors – even if they’re not the same product.
Understanding what people have to go through to currently satisfy their needs is gold for your marketing.
For some trades their biggest competitor is the DIY market. And that could be the largest area for growth by converting some of them to your services. It expands the market. Your What If question becomes – What If I was able to attract 10 % more customers who currently don’t use a ?… you fill in the blank… Then by understanding customers pain and making their life better, you can ask. What If I solved their (insert the pain)?
As part of your marketing strategy, you could develop a specific campaign on converting them.
Armed with all this information, you need to document and review it. The aim is to identify the missing opportunities that you can satisfy. And the best tool for doing that is a SWOT analysis.
Which stands for Strengths, Opportunities, Weaknesses, and Threats.
What you’re seeing on-screen now is a template I developed. There’s a link on this video page. Again, if you’re watching on YouTube head to the link in the description.
I’ve broken it into two parts. The first is called Competitor Analysis. This is something you fill in for each competitor. If you have many of them, just pick the ones that will have the most impact on your business.
You’re documenting their Strengths & Weaknesses – this is critical information that you can use to develop Opportunities for your own business.
The idea is to give you a clear picture of where your business fits in the market compared to your competitors.
Once you’ve done that, move on to the Tab, Your Business SWOT.
OK the first thing you’ll notice is that you have more boxes to fill in. You need to review your Strengths and Weaknesses. But within Opportunities, you draw from the knowledge you gained with your competitor notes.
Once you’ve done that, consider your Threats. These can come from new competitors, new technology, government influences such as law changes, personal illness, or environmental factors, like natural disasters.
Once you’ve identified a Threat – write a short statement underneath, on how you plan to manage the Threat.
Now before we move on, go back to what you wrote in Step 1 about the problem you solve and the target.
Do you think you’re still on target… do your original assumptions, beliefs, and knowledge still hold up?
Great if they do so far! OR have you modified it … or even completely replaced your Bright Idea after asking the Challenge-Questions of WHY? and WHAT-IF? And seeing a hidden new Opportunity you hadn’t even considered before.
Either way, you’ve already ahead of the game in de-risking your Start-up journey.
Step 5 is gathering some honest feedback.
Many will tell you not to ask family & friends, but that’s because most ask in the wrong way.
It’s not that they’ll lie to you, it’s just that they could either deflate you because they don’t share your passion at this stage. OR they’re over-encouraging.
It’s not their intention, but they can give you a false picture of whether your idea is viable.
This is a difficult section for me to present generically. What questions you ask at this stage depend on your business type. And how innovative it is. So I’ll share a couple of typical starters for you.
If you join me for my Ultimate Start-up Package, I’ll write these specifically for your needs.
OK, the first point I want to get across is that none of us knows what the future holds.
So when you ask someone if they would buy or use your idea if it was available, they’re only guessing…
Based only on what THEY know today.
One of the biggest mistakes in market research is asking the question “how likely are you to use X…in the future?”
I have seen that so many times, and I shudder.
Because if you’re basing your idea on the fact that a few people said… “ohh looks good, yay I’ll give it a go”.
Then chances are you’re in for a harsh reality-check when you go to market.
What you NEED to do instead is find out what their problem is…
and what are they doing now to solve it?
If anything … maybe they’re just complaining and putting up with it because there’s no other choice.
That’s what Uber did.
If they‘d said in market research “Would you get in a private car instead of a licensed taxi?”…
most of us would shout NO … our stranger-danger antenna would raise red-flags.
BUT suppose you were talking about their current negatives with taxis and how that affects their daily lives and well-being. In that case, you’re gaining insights into the real need.
When your solution addresses that need, you’re starting to see the market potential for your Bright Idea.
And that’s why you CAN ask your family & friends - IF you have a casual conversation about the challenges they face TODAY … whatever pain your idea addresses.
If your new business is a trade of some kind, be it a plumber, mechanic, handyman, etc. What annoys them with their current providers? As an example, we recently had new carpet laid. The doors had to be removed, and at the end of the job they were left leaning against a wall. They all needed shortening. But it was left as MY problem. How good would it have been for the carpet company to have, firstly let me know that would happen, and secondly offered a service to fix it. Instead, I was just left with it. That’s an opportunity. They are gems of insight for your new business. That’s why asking questions that unearth the problems is so powerful. Were they satisfied or disappointed with the service they had?
You might identify something you didn’t know about before. So make sure you add that to your SWOT analysis from the previous step.
OK… we’re almost there, as we arrive at Step 6 of our Startup Masterclass.
And ask the final Challenge-Question, HOW?
There needs to be a practical and cost-effective way to make your Bright Idea a reality.
The best way to develop the How of your What If, is to take it apart in bite-size chunks.
The complexity of this step depends on what your idea is. But as a summary, you need feedback from those that it affects. If you are solving a customer problem, then you need to check that it does. Pretty basic.
You could approach your target and offer them your service for either free or lower cost, in return for honest feedback. Have a conversation with them. Yes, you can have a list of questions as a guide, but when you dig a bit deeper, you unearth more details. I have other videos on my YouTube channel that discuss market research techniques. Look for the link on this video page.
Depending on the complexity, keep experimenting and evolving as you Test and Learn each time.
Remember, you’re not looking for perfection but progress.
And once more, go to your Workbook, page 6 this time … this is something that won’t be answered in one quick look. Some of your What If questions will be complex and may take time to resolve. But as you learn, write down your findings. Keeping track is an important element to getting it right and solving customer problems.
While all this homework is really important, it’s nothing if you can’t bring others along on your journey. So this is your big moment. As we arrive at Step 7 and where the magic happens.
Step 7 of the Startup Masterclass is all about Telling the Story of your idea … Why it’s needed …
your innovative point of difference or What If solution … and How you’ll make it happen.
Your Bright Idea must be grounded in a real-life customer need … but you also have to clearly communicate your new solution. It doesn’t matter whether your idea is the next Uber, or a new local business. Communication is key … and if you can’t clearly tell the story of the idea and its need at this stage, then you’re setting yourself up for disappointment.
You might have seen the TV show Shark Tank … One of the biggest things the sharks look for is someone who can communicate and tell their business story. Who’s not only passionate but understands the market need.
Because, they know that’s what it takes to succeed in business. You’ll never have a successful business if it doesn’t tell a story - one that excites people to give it a try. That’s when they tell their friends how wonderful you are, and that’s marketing that money can’t buy.
Don’t fall into the trap I talked about earlier of rambling off a list of features when talking about what you do. This is a big step – and why we’ve dedicated a full chapter to it in our book.
Don’t expect to bang it out in a hurry. Plan it, sleep on it and look at it again with fresh eyes. Does it excite you? What’s the emotion? If you can get someone else to read it, ask them if it makes them feel something. Keep tweaking until you are happy.
It takes time, and it’s not easy. But challenge yourself to add emotion into everything you write - a feeling that your audience will respond to. And if you aren’t confident about your ability to do this yourself, then map out what you want to say and contact a professional copywriter. If you can’t find one locally, there’s always Upwork or Fiverr. You need to find someone who can capture your message and turn it into engaging copy.
Can you make money from your idea?
If your head’s not totally spinning yet, I want to share our new Market Potential Calculator© with you.
Can you imagine for a moment, having a clear view of when and how much income you’ll make from your new business, before you even start? It really is the holy-grail of business forecasting. Now that would be impossible, given we don’t have a crystal ball. But it IS possible to guesstimate those figures on data you gather from searching online, and running it through a series of eliminations.
Remember the example I shared earlier when a business advisor and my accountant told me to guess. That’s like buying a lottery ticket and praying that’s your path to riches. Well, that’s never been good enough for me.
Without this tool, knowing how much your business will make when you first open your door, is tough. And although we can’t guarantee the results - If you are honest with yourself and don’t overestimate, it will give you a better idea of the business income potential.
I recently did an exercise for one of my mentees. Once we’d run through the Market Potential Calculator, well, let’s just say there was no way she had a business. But all was not lost. We just tweaked the target market. Which meant changing the marketing message.
If she had not done that, and persisted with her original narrow target, her story would have been a very different one. Yes, she could have learnt her lessons the hard way and tweaked it later - but time is money. Plus, sending the wrong message can damage an early start-up.
The Calculator walks you through step-by-step, analysing the total audience your product or service will appeal to.
For example, suppose you’re providing services to homeowners. In that case, you take the total number of householders in the location you are servicing.
Now it’s apparent that you can’t get to that many people. So out of those householders, estimate who are likely to engage your services. If your target is working couples, then your local government stats can give you the number of households that have both adults working, for example. You can break down the age-groups of children in the household… if any. If your customers are likely to be older people, then you can break it down by age-group.
What you’re doing is starting with the largest potential market and drilling down… and down… and down. Using the competitor analysis, you did earlier. You have to divide the market between them. Let’s say 10,000 households could use your service. But you’ve identified 9 existing competitors, including yourself, which means 10 businesses are servicing that need. Just a simple division tells you that 10,000 is being divided by 10. If all things are equal, you have a one-tenth share of 10,000 which is 1,000 customers. But then you have to consider factors like those that like to do it themselves rather than employ you. And then you need to know the average household spend for your service.
I did an exercise recently were I looked into spending on prepared food. Using Statistics New Zealand I found out that the average household spends $27 in every $100 spent on prepared food. Then I learnt the average grocery spend per household is $200. That means the average household spends $54 a week. But that money gets split between many outlets, cafés, restaurants, takeaways. It would be impossible to say your new restaurant will get all that share. Even if there isn’t anyone else doing exactly the same thing.
OK, so back to drilling down your market potential. Now you need to consider customer lifecycles.
For example, the standard marketing bell-curve says 2.5% of the target population are termed Super-Active. They’re the first to line up and buy the latest thing. Followed by the Pro-Active group which is 13.5% of the population. That’s a total of 16% that are happy to give you a go first - to be the guinea pigs. They’re the early-adopters. Now, they might be your only customers for the first months. How long that cycle takes is rubbery, and depends on how well you harness that market, the number of testimonials you generate etc.
Next are the Early Followers close on the heels of the early adopters, but they’re cautious. They like to be on the edge but with a railing supporting them. They form 34% of the market.
Then come the Late Followers. Who also take up 34% of the bell-curve. They’ll only give you a go when you’ve ironed out the bugs. When they start seeing online reviews - the social proof. Even then, to swing them over you rely on them having either a bad experience with a competitor, or you offer some sort of major enticement. The balance of 16% fall into the Laggards segment. They are very difficult to swing around. And at this stage of your business, just don’t play a part.
Let’s go back to my new restaurant example, and a story of how some customers’ minds work. OK, so Amy & Simon have a date night once a week. They go to a local restaurant strip, offering a variety of cuisines to choose from. They never make a booking - they just wander down the street looking for something that appeals to them. They see this new restaurant. Stop, check out the menu on the board out the front. “oh, that’s new, looks like a nice menu.” But they keep walking - and force of habit, which is never to be understimated – brings them to the same place as last time. They most likely fall into either the Early Follower or the Late Follower segments. Let’s try a new scenario. To launch your restaurant, you offer something like ‘your partner is free’. The idea is to get people trialling you. Amy & Simon are walking past - now the conversation is… “oh, that’s new, look at how busy they are, must be good and the menu looks nice.” They walk in and you greet them with a smile. In that example, I would classify them as Early Followers. But as a businesss, you shortened the trial time. All because you understood how people make decisions.
68% of people want someone else to be the guinea pig. In the example above Amy and Simon felt comfortable because others were.
All these calculations are critical for projecting your income and managing your expenses. But as I demonstrated with our date night couple, it helps you develop your marketing strategy.
Yes, it’s complex - which is why I developed the Market Potential Calculator©.
This automatically calculates your income, which then feeds your cash-flow forecast. I’ve talked to a few accountants. Most don’t bother doing cash-flow forecasting. Which I have to say fascinates me. But I think I’ve worked out why. They don’t know how to project - they guess. And given a guess is not based on any facts or data, then I can understand why they don’t like them. A guess is useless. It’s of no value to you at all.
Of course, the numbers you enter into the Calculator are estimates, but they come from hard data. In most cases, you’re using numbers from your area’s Census. You DO have to make some calculated guesstimates. But the Calculator is primarily designed to challenge your assumptions with logic.
Your data-driven cash-flow will project when you can buy new tools or technology. When you can engage staff. It will factor in seasonal fluctuations. Without it, you risk running out of money. That’s what happened to one of my mentees. She did no market analysis, borrowed money based on her friends telling her how much they loved the idea. She did reasonably well, considering. She gained a following and sold products. But her undoing was her lack of planning on how to manage the flowing in and out of cash. She had no funds to bring in new stock with a new season. No stock, no customers. And she couldn’t repay her loan. She had no choice but to go back to work to pay the bills.
Running your own business is one of the most rewarding of life’s adventures. But it’s not easy, and it’s not a way of working less. On the contrary, you’ll more likely work longer hours, for less money, especially at the beginning. But starting with a solid foundation will give you something to grow on.
Good luck on your adventure, Judy