Inspire

Elf on the Shelf's success secret: Ignore haters

Here's some advice to new entrepreneurs from the twin sisters who make The Elf on the Shelf: Never give up.

"A big lesson ... is that 'no' doesn't mean no," said Christa Pitts, the co-CEO of Creatively Classic Activities and Books who takes care of the business end of the company.

"We were told it was destined for the damaged goods bin," Pitts told CNBC's "Squawk Box" in December. "[Banks] weren't going to lend on elves."

"A lot people didn't want it. They didn't know what to do with it," said twin sister Chanda Bell, co-CEO on the creative side of their company.

But that didn't stop Pitts and Bell from turning The Elf on the Shelf into a holiday phenomenon that's now 10 years old.

"The Elf on the Shelf: A Birthday Tradition" authors Carol Aebersold (center), Chanda Bell (right) and business partner Christa Pitts pose at the Balloon Saloon on Oct. 23, 2013, in New York City.
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"The Elf on the Shelf: A Birthday Tradition" authors Carol Aebersold (center), Chanda Bell (right) and business partner Christa Pitts pose at the Balloon Saloon on Oct. 23, 2013, in New York City.

The idea started in 2005 as a self-published book, written by Bell and their mother, Carol Aebersold, about their family tradition of a visiting elf from Santa's workshop. It was then packaged with an elf doll.

Aebersold, a former music teacher, is a managing partner of the company and executive producer of the 2011 animated special "An Elf's Story." Before joining forces with her sister and mother, Pitts spent five years as host on the QVC shopping channel.

"When we were growing up as children, Santa used to send an elf to our home. And the elf used to watch during the day and report to Santa at night," said Bell, a former reading and English teacher. "Once an elf receives his name that's when it gets Christmas magic and comes to life."

[Spoiler alert: Kids are told they can't touch the elf because it'll lose its magic, leaving parents to secretly move the elf each night to a new location around the house.]

More than 8 million of Santa's little scouts have been sold. Over the years, the company has expanded The Elf on the Shelf franchise into other product lines. Bell said expanding the company correctly means "helping families create family moments."

While Bell declined to talk about entertaining buyout offers from larger toy companies, she said she'd at least take the calls.