Plenty of parents say that they find inspiration in their kids. And many entrepreneurs have started a business sparked by the challenges and joys of parenthood. But few probably can claim to have found such a persistent entrepreneurial muse in their children as Addie Swartz.

Over the past 23 years, all of Swartz's businesses have shared an emotional taproot that you can trace directly to her two daughters, Chloe (19) and Aliza (23).

Aliza was a baby and Chloe not yet born when Swartz founded her first company, BrightIdeas, which sold children's educational software, in 1992. The girls were eight and 12 when their mom founded her second company, The Beacon Street Girls (BSG), a publisher of books and maker of products for girls ages nine to 13, in 2003. And her daughters were young adults two years ago when Swartz, 54, launched reacHIRE, which trains women looking to re-enter the workforce and connects them with employers. 

Here's how all three businesses drew their inspiration. 

A Bright Idea for Kids

After graduating from Stanford in 1982, Swartz first worked at Bain & Company in Boston, providing management consulting to Fortune 500 companies. There she met her husband, Joel Rosen, Chloe and Aliza's father, and currently an executive at Endurance International in Burlington, Mass. She went on to get her MBA from Kellogg (Northwestern) and then spent time managing consumer products at Disney, Reebok, and Lotus Development.

She launched BrightIdeas while on maternity leave from Lotus with Aliza in 1992. As a new mother, Swartz was intrigued by the challenge of teaching one's children. BrightIdeas, she notes, quoting the company's slogan, "was all about 'a brighter future at your child's fingertips' by using educational software to jumpstart a child's education."

Her distribution model offered mothers the chance to earn income by hosting parties, in the Tupperware style, at which they could demo and sell BrightIdeas software in their own homes.

Though she didn't know it at the time, two aspects of the BrightIdeas model--women building their tech skills and gaining employment flexibility--would manifest themselves in her idea for another startup, two decades later. 

At its peak, BrightIdeas software was being sold in 33 states. In 1996, Swartz sold the company (she won't disclose for how much) to a division of Pearson Education (Addison Wesley). She remained with the company for two more years. 

Something for the Tween Years

"I got the idea for [Beacon Street Girls]," Swartz says of her second startup, "when I could not easily explain to the girls why Abercrombie & Fitch had pictures of half-naked people on their walls." This was in 2003.  

As opposed to distributing its books for "tween" girls (ages nine to 13) as individual titles, BSG bundled the books inside bags and backpacks with accessories such as purses and trinkets. "That way, we wouldn't just be a series of books on a Barnes & Noble shelf," notes Swartz.

The books are an ongoing series about five seventh-grade girls "taking middle school by storm." While the stories deal with real themes--divorce, disease, dyslexia, adoption, peer pressure--they are age-appropriate and full of frivolities too, such as sports and shopping.  

By 2005, the first four books in the series had sold 46,000 copies. At that point, demand from traditional book channels compelled Swartz to "debundle" the books from the bags and sell them as individual titles. BSG had grown as a brand, to the point where the company was selling 50 side products related to the series--items like pillows, sleeping bags, spiral notebooks, and duffel bags for soccer gear.

Meanwhile, Swartz had raised $2.5 million in angel backing. The series and related products cracked more than 1,000 retailers nationwide, including indie booksellers, Borders, Barnes & Noble, and several specialty shops.  

Simon & Schuster took notice, buying the rights to the series in late 2007. The series now stands at 22 books, with more than 1 million copies sold.

This One Is for the Moms 

Swartz got the idea for reacHIRE while caring for Chloe, who'd had a severe concussion from a car accident in 2011. For one year, Swartz was again a stay-at-home mom. She observed all of the other stay-at-home moms in the Boston area. 

"I saw all these women around me who were extremely talented, who wanted to re-start their careers, but who couldn't figure out a way to get back in," she says. The challenge was matching their talent with employers eager to address the dearth of women in tech and management positions

As with BrightIdeas, where the in-home demos were a key to the sales, Swartz recognized that a certain "try before you buy" experience could make employers willing to audition candidates with resume gaps. 

Balancing all of these factors, Swartz launched reacHIRE in 2013 with a three-pronged program: First, reacHIRE selects from a large applicant pool a "cohort" of 15-20 women seeking specialized retraining. Second, after the retraining (50 hours over five weeks), the women receive a career consultation. Third, reacHIRE places the women in a paid, part-time (25 hours a week) assignment with a large employer. This step gives the employers that "try before you buy" period. 

So far, employers--companies such as Fidelity, EMC, and Boston Scientific--are buying. From reacHIRE's first three cohorts, 90 percent of the participants were placed in projects. Of these, 55 percent had their initial project extended, and 44 percent have transitioned into permanent roles. The next cohort (apply here) begins in March. 

Most of reacHIRE's revenues come from the employers, who pay reacHIRE for placements. A small revenue stream comes from fees for the training ($3,750 a person). Swartz points out that "it costs us more than double that to train them. We're not making money on the training. Maybe if we had 40 people in the class."

She believes the time will come where the fees won't be a part of the business model. "I foresee a time when corporations tell us they'd like to subsidize spots for it," she says.

Indeed, Intel's recent announcement of a $300-million diversity-hiring initiative is one strong indication that Swartz's sense of entrepreneurial timing is, once again, on point. Intel and other large technology companies have publicly proclaimed they plan to incorporate more women and underrepresented groups in their workforces as the industry has come under pressure to diversify. Swartz's company stands at the ready to help them address it.

Published on: Feb 17, 2015