Most people think that starting a business is a complex proposition. Dynamic entrepreneurs with big plans and lots of resources are the type who start businesses. They have special training, brilliant ideas, unique strategies, and a cadre of sophisticated advisers at their beck and call. Most people don’t think that regular folks with ordinary ideas and limited resources can make much happen. Boy, would they be surprised at the way the real world works.
This book is all about regular people who start small businesses in ordinary ways. As you read the stories in this book you’ll see that my story is similar to the way many others have started. What can you do with a thousand dollars? people often ask when I tell them that’s all the money I had to start Subway. Of the many entrepreneurs I meet every year, more than a third of them started their first businesses with less than $10,000 and some of them with far less than $1,000. But the amount of money doesn’t really matter, as you’ll see in the stories that follow. In this chapter I’ll quickly introduce you to several of these “regular folks,” then in the next fourteen chapters I’ll introduce you to more of these same kinds of people in greater depth. More than the money, getting started is what it’s all about, and all of these microentrepreneurs will tell you that it’s better to start small than never start at all.
Jeremy Weiner, for example, never hesitated to start small. He was suffering from boredom in the summer of 1995 between his sophomore and junior years in college. He attended Babson College in Wellesley, near Boston, well known for its entrepreneurial program, but he spent the summer at home in California. He was supposed to be working at two different brokerage firms in Beverly Hills, preparing to become an investment banker after graduation. By midsummer, however, he discovered that he hated the business. With several weeks remaining before returning to Babson, Jeremy quit both of his jobs. For a couple of days he hung out on a friend’s boat, but then the reality of his empty bank account struck him, and he decided he better earn some money before he returned east to school.
Jeremy learned to make money when he was just ten years old. In the fourth grade, with an Apple 2GS computer that his parents purchased for him, and a software program called Print shop, he started his first business. “I was just a kid, but I figured out how to make banners,” he says. “When my mom took me to the mall I sold banners to the retailers. Five bucks a page! It was great revenue. I’d be lying to you if I told you I knew what I was doing.”
As a high school student he and a friend worked in concessions at a movie theater frequented by Hollywood stars. “We saw an opportunity to sell more popcorn and drinks if we had a cart to push through the theaters,” says Jeremy. “We noticed that the stars weren’t standing in line to buy stuff, and a lot of other people didn’t want to stand in long lines, either. They’d just go into the theater and sit down. So my friend and I convinced the manager to let us start a cart. We sold a lot more popcorn that way.”
They also added handsomely to their earnings!
“The tip money was really good,” says Jeremy.
However, the theater’s managers soon put an end to the cart because it created more work for them. “Even though we were selling more food and drinks, the managers didn’t like it because the cart was another register that they had to close out at the end of the night. We didn’t have any say in the matter, they just told us to stop. I should have known then that I’d never want to work in a corporation. Bureaucracy isn’t something that I could ever get used to.”
In his sophomore year at Babson College, Jeremy started a student directory, for which he sold advertising. If there was one thing he could do well, it was sell. That’s why he pounced on an opportunity to sell ad space in those remaining weeks of his summer boredom. One day he visited his former high school, just to say hello, and to rib the principal about a B that he thought should have been an A. While he was there, he got an idea. He noticed that the school needed covers for the students’ textbooks. He asked the principal if he could provide the covers, and the principal agreed. He contacted three other area schools and asked if they needed covers. They all said yes. Then he contacted local businesses who wanted to reach the school market. Within a couple of weeks—with no investment other than gas money and phone calls—he raised $10,000 in ad revenue! Printing the book covers for all four schools cost $1,000. “With $9,000 net,” says Jeremy, “I still had a week to spend on the beach before I had to go to school.”
At first, Jeremy had no plans of repeating the book cover gig, at least not by himself. He did it to make money. He made the money. End of story. However, the next summer he explained to his brother, Brian, and a friend, Michael Gleeson, how they could continue operating the business. He taught them how to contact schools and sell advertising. While the guys got busy, Jeremy accepted a summer job working directly with the president of a toy company in Boston. He thought it was an ideal opportunity to learn about running a business. By midsummer, Brian and Mike had signed up fifty schools, but they had spent little time generating sales. So Jeremy took a leave of absence from the toy company to sell the advertising.
With only a few weeks remaining in the summer, Jeremy worked the phones and through sheer persistence sold a major deal to JanSport, the leading manufacturer of backpacks. The company bought the front cover for $24,999. Two additional spots on the back cover netted another $13,800, and included a recruitment ad purchased by the Los Angeles Police Department. With gross sales of $38,800, Jeremy anticipated earning a modest profit, but it didn’t work out that way. Instead of purchasing covers for five schools he purchased for fifty schools. The printing bill jumped to $30,000. With delivery costs, phone bills, and miscellaneous expenses, the summer enterprise lost $2,700!
Undaunted by the loss, Jeremy and Gleeson teamed up in a senior field studies course about entrepreneurship and wrote a business plan for what they now called Cover-It. Their primary motivation for writing the plan was not only to operate the business, but to compete for the prestigious John H. Muller, Jr., Business Plan Award, which included a $5,000 prize, and Babson’s Student Initiative Award, worth $1,000. In spite of tough competition, including more than 100 submissions for the Muller award, the entrepreneurial pair won both awards in April 1997. They split the $6,000, which more than covered their losses from the previous summer.
Following graduation from Babson amidst a flurry of media articles about his successes, Jeremy was offered numerous jobs. However, he turned them all down. He decided to pursue his future with Cover-It. At first, his partner was going to join him, but at the last minute he decided not to. He turned over his interest in Cover-It to Jeremy, who set up shop in a printer’s office in Boston and went to work. JanSport renewed its contract for $70,000, and the L.A. Police Department renewed, too. Jeremy expanded the number of schools in his distribution network from a mere 50 to 16,000, reaching 12 million students in kindergarten through twelfth grade. How he accomplished those numbers is a trade secret. “One of the toughest things about this business,” he explains, “is to sign up schools.” Once the selling season ended, and Jeremy distributed the book covers, he ended up with approximately $30,000.
By the next year, he expanded Cover-It’s distribution to 26 million students (distribution would eventually climb to 30 million). Instead of printing one cover for all the schools in his network, he printed five, creating five front covers to sell instead of one. By 1999, with ten employees, three offices—Boston, Chicago, and Los Angeles—and distribution in all fifty states, Cover-It exceeded $1 million in sales. Jeremy projected that his year 2000 gross revenue would exceed $2 million.
At age twenty-four, Jeremy says he’s still figuring out how to run his business. “Every month,” he says, “there are thousands of challenges.” But given the choice of working for someone else, or owning your own business, Jeremy says there is no choice—especially when you can start small and finish big.
Paulette Ensign of San Diego, California, is another microentrepreneur who started a business with almost no money invested. She taught string instruments in public elementary schools in New York and Connecticut. In 1981, with a master’s degree, she was earning just shy of $18,000 annually. After ten years, she decided she