18 Millionaires Who Started With Nothing

Millionaires Who Started With Nothing

Santa Pretender Makes $1 Million A Year

Byron Reese Story

Byron Reese Started his company, SantaMail.org, which sells fully personalized letters from Santa Claus all across North America (they’re even postmarked from North Pole, Alaska, to give them an authentic feeling). Reese sold 10,000 letters in 2001, his first year in business. Though holiday sales have increased every subsequent year, he still looked for ways to expand his offering. Now, parents can order birthday cards for their children from Santa as well. The strategy pushed 2005 sales to $1 million.

Still, the key to Reese’s success is organization. After realizing he and his staff didn’t want to pull the marathon 36-hour shifts they did the first year, he looked to outside vendors to help with the yearly rush. He also deals with any problems as soon as the rush is over, and then starts planning for the next year. By February, he’s up and running. "The temptation is to not start working until you get close to that season, and we’ve made that mistake in the past," says Reese, 37. "Things always take a lot longer than you think they’re going to take. We find it much better to work steadily."

"When I was a child, my parents would give us letters from Santa. My mom died three and a half years ago, and I wanted to do this to honor her," says Byron. "I entered it with low expectations, but we sold 10,000 the first year." The magic of Christmas is a serious trust to Byron, so he implemented a rigorous quality-control program that has multiple people (his elves) checking each letter, ensuring complete accuracy on each one, as well as on a birthday card from Santa and the post-Christmas ‘Greetings from Hawaii’ postcard from a tanned, beach-bound Santa.

Byron’s childhood Christmas memories include installing 200 strings of Christmas lights and decorating dozens of Christmas cookies each year. He loves the look on the postman’s face when he goes to buy 40,000 Santa stamps at the post office each Christmas. What’s next on this Christmas devotee’s agenda?

"Someday I hope to deliver coolers of snow to people in hot climates."

Being Organized Can Make You $100000 Richer

Lisa Zaslow Story

It was both an interest in and a knack for organizing that inspired Lisa Zaslow to forgo the daily grind of an office job to start her professional organizing business. Officially founding Gotham Organizers in 2000, this New York City dweller had a background in HR and consulting. While on vacation at a friend’s home in 1999, she went looking for a napkin in one of the cabinets. "It was just a mess, with candles, Christmas ornaments, Easter things, soup tureens . . . and I rooted around and finally found a napkin. I looked around and said, I have to organize this," recalls Zaslow, 40. "As I was [organizing a cabinet] on this beautiful, sunny day, a hundred yards from the beach, I realized maybe this was the work that I was meant to do."

The more Zaslow learned about organizing, the more she liked it. She got in touch with her local NAPO chapter to learn more about the business side of it and started organizing for friends and family free of charge just to grow her skills. "I knew I liked organizing when it was my agenda, but I really wasn’t sure if I would like it when it was [for] somebody else," she notes.

This is an important distinction to make in the startup phase of any organization business. According to Izsak, "There’s a big difference between organizing for yourself and your family, and organizing for everyone else. Many people are not [conscious of that]." Because professional organizing is such a customized business, it’s important for entrepreneurs to really find that right solution for each customer. Though Izsak notes that the proliferation of home makeover shows has certainly raised the profile of professional organizers, "They [also] perpetuate the notion that organizers come in, clean up, and [that] everything is OK." On the contrary, he says, professional organizers must work closely with clients to help them achieve their own ways of organizing.

Though it’s not as personal as a therapy session, Izsak has observed the sentimentality that people often have about their things. "We’re dealing with hoarders," he says. "They have psychological issues that are impairing their ability to make a decision." That explains all the boxes in the corner–people hang onto things because they can’t decide what to keep and what to let go of. A professional organizer needs a keen eye for detail and a good ear for listening to his or her client’s specific needs.

Zaslow’s HR skills certainly helped her tune into her clients’ needs. "There’s often a lot of shame [about being disorganized]," she says. "But once they let you into their home, they’re really grateful to talk about it to someone who’s not judgmental." A unique challenge of this business is getting people who are perpetually disorganized to keep appointments with her, so Zaslow confirms and reconfirms with clients before each meeting.
She was doing HR consulting and organizing on the side until 2002, when she decided to go full time with the organizing. Her profile grew rapidly after an appearance on HGTV’s Mission: Organization. After hearing in her local NAPO meeting that producers were looking for organizers, she submitted a few proposals. She was chosen, and the half-hour show profiled how she organized the home of one of her clients–a young, single guy in the city. After that, Zaslow positioned herself as the go-to organization expert for local media and has gained massive exposure that way.

Zaslow, like many professional organizers, charges by the hour– although the amount varies per job. Izsak agrees that fees vary widely, depending on an organizer’s level of experience as well as the nature of the job, although he points out that many charge between $50 and $200 per hour.

Even with her company growing and sales projected to hit $100,000, Zaslow still finds time to teach professional organizing to other aspiring entrepreneurs at an adult-education organization, The Learning Annex, in her area. It’s her passion, after all. "[There’s] an immediate sense of results," she says. "It’s a dramatic change both visually and in your life."

Millionaires Who Started With Nothing, Part I

Sanjay Parekh and Rob Friedman story

Believe it or not, IP intelligence technology provider Digital Envoy Inc. was spawned from two serious sweet-tooths. Sanjay Parekh, 31, started buying candy from Costco and reselling it to his telecom co-workers when he struck up a friendship with Rob Friedman, 38, general counsel at the company and an Atomic Fireball enthusiast. Soon, their friendship moved beyond candy cravings, and they were bouncing around business ideas.

Parekh made an interesting discovery when visiting the FedEx and Ikea websites in 1999: both prompted him to enter what country he was in. "I thought that was kind of stupid," he recalls, and the extra step slowed down his home dial-up session. "So I architected a solution to that problem using IP addresses." Friedman agreed that the technology–which provides general information about an online user, such as the city, local demographics and type of internet connection being used, based only on the IP address–would help businesses. They launched Digital Envoy Inc. in 1999, bringing along senior finance manager and co-worker Dennis Maicon, 40.

Filing fees for corporate documents cost $100, and Friedman drew up all the legal drafts. An article on the Red Herring website about their business led to their very first client, Advertising.com (now owned by AOL). Since they worked from their homes, Friedman quips, "I negotiated that deal in my bedroom." They also hired an intern and Friedman’s cousin to do programming work in the beginning.

After moving into an office in 2000, they hired three more employees. Friedman found $10 chairs, and opted for modular desk setups rather than expensive cubicles. In their newest office, they have cubicles, bought inexpensively from the office’s previous tenant. When it comes to traveling to trade shows and to see customers, they’ve also found ways to save their Norcross, Georgia, company money, using slightly out-of-the-way but much cheaper flight options.

Digital Envoy now works with many major ad networks and sites, and estimates last year sales at less than $10 million. The company’s latest product, IP Inspector Fraud Analyst, allows companies to fight identity fraud by verifying user identity in real time. They are also combating fraud with a product that analyzes whether an e-mail is really a phishing attack. Digital Envoy continues to grow, but in many ways remains the same. Says Parekh, "One of the philosophies we’ve always had is to do more with less people."

Millionaires Who Started Out With Nothing, Part II

Tara Krapes Story

Tara Krapes, 33, has a business that made at least $2.5 million in sales by the end of 2004. Not bad, considering she began her company in 2002 with $1,050 from her own savings.

Vesta Executive Housing, based in Cincinnati and named for the Roman goddess of hearth and home, offers executives temporary housing for 30 days or more. Krapes has relationships with 42 top-notch apartment complexes in the area. When a client comes to Vesta, Krapes either has space ready for them, or, more often than not, she has to lease a new apartment for 12 months and hope that after her tenant leaves, she can fill it quickly. She almost always does—she currently has zero vacancies.

It seems impossible that she could have funded this business—with 12 employees and a second office in Lexington, Kentucky—with a paltry grand. Until you learn how she did it.

It helped that Krapes had experience in her field already. All she needed was one customer to begin, she figured. Once she found one, she signed a lease at an upscale apartment complex and paid the first month’s rent—$1,050. From then on, whenever she worked with any client, she always asked for the money upfront.

Krapes would invest the money back into her business by purchasing furniture and other necessities for the living quarters or her company. And the more apartments she would rent from a complex, the cheaper the rent and the more revenue her company could pocket.

But most important, by coming up with a formula that allowed her to always get her money first, she says, "We avoided cash flow problems. From that $1,050, we’ve been able to grow very fast. We’ve never had any debt or loans." Krapes quickly took on two partners, Paul Pelnar, 39, and Joel Makela, 30, friends and colleagues who both had experience that she didn’t. They were also able to contribute some other items, like computer equipment, but no money.

"Eighty-five percent of people get their money from savings or the three F’s: family, friends and fools," says Sutton Landry, director of Northern Kentucky University’s Small Business Development Center in Highland Heights, Kentucky. "For the [others], some kind of bank loan is involved. Very few people get VC funding or angel funding."

If you’re wondering what the "slam-dunk qualifications" are for getting a big bank loan, Landry reels some of them off: "Typically, it’s someone who is between the ages of 35 and 50, college-educated, and who has a net worth of a quarter of a million dollars—plus a Beacon [credit] score of 700-plus—with a business plan. It almost doesn’t matter how good the business plan is, as long as they have one. Ideally, they’re going into a business where they have five to 10 years of experience—half of it in management. Most banks will look at that type of profile, do the credit scoring, and say ‘Yeah, these people would rather die than not pay a loan back.’"

But what if you’re 26, utterly broke, and wishing you had gotten an MBA instead of a degree in American folklore? Landry says if your credit is halfway decent, you might be able to find somebody to cosign a loan—and "you’ll need a business plan, a good business plan," he says.

Beyond that, you’re simply going to have to rely on that can-do spirit. "Starting your own business involves sacrifice," says Landry. "Unfortunately, we’re not a society that’s much interested in sacrifice. But on a practical side, that’s how most startup businesses begin. They start part time, and they’re constantly re-investing money into the business. It’s the same model that a lot of immigrants have when they come to this country, where people work three jobs to build the savings they need. But instead of getting a second job, you’re running your business in the evenings and on weekends."

Krapes echoes that thought. She had one serious cash crunch when she discovered how few people need housing during the end-of-the-year holidays: "We didn’t pay ourselves for a few months."

Millionaires Who Started Out With Nothing, Part III

Joe Bushey Story

Company name: POS World Inc.
Location: Atlanta
Estimated annual sales volume: $10.8 million
Description: Point-of-sale online retailer

This IT manager for a concessions management company loved working in the POS field, but was so burnt out by the intense work hours that his doctor recommended a career change. One day, while reading a catalog with reseller pricing for receipt printers, cash drawers, bar-code scanners and other POS items, Bushey realized that not only was the markup outrageous, but also that there was nowhere to purchase POS hardware online. His vision: to create an online marketplace offering fair pricing on these items to the end user. "I wanted to be the Dell of POS," says Bushey.

"I didn’t have a dime to spare," says Bushey, who continued at his full-time job while starting POS World in 1999 in his off time at home. "It was a virtually no-cost startup." Early on, he focused on establishing vendor relationships and developing a website. His brother Jim moved into his apartment to handle website maintenance.

One investment–a high-end Nortel phone system with voice mail–presented a professional image to callers, even though Bushey was handling calls for every department. It seemed to work–in 2001, when the Los Alamos National Laboratory’s hard drives containing sensitive material went missing, they contacted POS World for recommendations on item-tracking technology. "I realized then we really had a presence," says Bushey, who moved to an office and hired his first nonfamily employees in 2000.

Most customers do business through POSWorld.com, but they can also visit the office or call in. Customers include many Fortune 100 companies, the Federal Reserve Board, Lockheed Martin and the U.S. court system. POS World is expanding into auto ID, warehouse operations and the biomedical field, and will partner with Microsoft to sell retail-management software in combination with the company’s hardware.

How To Get $750 For A Five Dollar Item On EBay

Randall Pinson Story

When Randall Pinson took a full-time job as manager of a cell phone store during college, he expected to earn some extra money for school. He didn’t expect to learn how to start an online retail business that would ultimately support him and his family.

Pinson, 29, had only vaguely heard of eBay in the spring of 2000, when his boss asked him to try to sell some phones on the website. So he followed the step-by-step instructions on eBay.com and listed a shipment of phones for sale. Less than an hour later, a woman in New York offered to buy 15 of the phones for $125 each, making Pinson’s employer $100 in profit on each phone.

The 400 percent markup the store earned got Pinson’s attention. He started selling cell phones and accessories on eBay himself on a part-time basis, and in 2002, he quit his job at the cell phone store and started his own online business using his last paycheck and a $2,000 American Express line of credit. By his college graduation a few months later, he was earning close to $60,000 a year selling on eBay.

Always aiming for a 50 percent markup on his sales, Pinson (eBay User ID: rocket-auctions) occasionally does much better. "My most profitable eBay sale was a piece of telecom equipment I bought for $5 without really knowing what it was. I sold it for $750."

Five years after starting, Pinson says confidently, "Anyone can make a living on eBay." His company, Rocket Auctions, based in Farmington, Utah, generated $400,000 in sales in 2005, with 2006 projections of $500,000.

To bring in that kind of money, Pinson has one full-time employee who handles the day-to-day logistics of inventory management and shipping the 400 or so items that are sold in completed auctions from the company’s warehouse each week.

A Person Who Sold Over A Billion Dollars Worth Of Stuff Tells How He Did It.

Ron Popeil Story

Seven years ago, entrepreneur Ron Popeil, the silver-tongued inventor of such iconic products as the Pocket Fisherman and the Food Dehydrator, introduced the Showtime Rotisserie BBQ.

Marketed in the seductive TV infomercial format he pioneered, Popeil demonstrated the durability, versatility, and appeal of the oven — a contraption equally adept at producing a "scrumptious, flavorful rib roast" as it was a "mouthwatering pork-loin roast" — before a rapt studio audience (and at-home insomniacs).

After prepping a chicken and placing it in the oven, Popeil delivered his next legendary tagline. Like most of his pitches, it blended pithy salesmanship and utter simplicity. And almost immediately, the catchphrase — "Just set it and forget it" — entered the pop-culture vernacular.

Indeed, the compact countertop oven (purchased for four easy payments of $39.95, plus tax and shipping) turned into the biggest hit in Popeil’s hugely successful home-gadget empire. Since the launch, Popeil says he’s sold about 7 million Showtime ovens, generating nearly $1 billion in revenue. "People just love it to such a degree that strangers walk up to me and tell me, ‘I love my rotisserie,’" he says.

If ever there were an entrepreneur who defined unbridled passion, Popeil is it. Fueled by a salesman’s gift of gab and the innate ability to create broadly appealing products that reinvent or improve upon household products, Popeil has transformed his raw zeal for inventing into one of the most successful entrepreneurial ventures in recent memory.

For more than 40 years, Popeil has sliced, diced, and sold a collection of quirky, unforgettable items (among them, the Buttoneer, Smokeless Ashtray, Mr. Microphone, and the Ronco compilation albums such as Disco Daze and Disco Nites), all of which he estimates has pushed his net worth to "more than $100 million."

In August, the 70-year-old Popeil announced that he had sold Ronco, the Chatworth (Calif.) company that made him a household name, to Fi-Tek VII, a Denver-based holding company, for $55 million. As a result of the acquisition, Ronco became a publicly traded company listed on Nasdaq Over-the-Counter (OTC) Bulletin Board. The newly formulated Ronco retains first right of refusal over any new Popeil inventions.

"We liked the strength of the brand that Ron had built in 40-plus years," says Emerson Martin, managing director at Sanders Morris Harris, the Houston financial services holding company that brokered the deal. It has a grand old name, but one that is not fully exploited in the retail market place." Martin, who also sits on Ronco’s new board of directors, says that one of the new management team’s main goals is to increase its retail sales.

According to Popeil, the deal frees him up to spend more time with his two youngest daughters (ages 4 and 6) and, he says, "It allows me to work on what I really enjoy, the inventing of new consumer products."

He is already at work on what he expects will be his next blockbuster — a turkey fryer that he plans to launch early next year. Ever the salesman, he explains: "Nobody has created a fryer that is safe to use. I’m in the process of exhaustive testing. We’re talking a turkey fryer that can be used for chicken and fish, and it fries up tempura. It will compete with anything that fries food in the marketplace."

"Ron is one of a kind," says Len Green, CEO of the Green Group, and a professor of entrepreneurship at Babson College in Wellesley, Mass. "He is different from the rest because he not only invents, but he sells. Most entrepreneurs come up with a concept and then give it to others to manufacture or sell. He’s his own best salesman."

Born to a family of inventor-marketers, Popeil had a hardscrabble childhood. For a time, he and his brother were alone when his parents divorced. At 3 years old, he lived in a New York foster home before his grandparents brought him to live with them in Florida. At 16, he went to work for his father, selling his products at Woolworth’s and on the Chicago fair circuit in the 1950s.

Popeil learned the art of the sale during this period. His time with consumers helped him understand what products would click, what features worked, and which ones didn’t. He did so well, he says, that his weekly take from his percentage of sales at Woolworth’s eventually eclipsed the store managers’ monthly salary. So he decided to go out on his own.

Popeil made himself into the entrepreneur for the dawning Media Age. In the 1950s, he began advertising on TV, a move that decades later would later help him usher in the era of the infomercial. One of his first stand-alone commercials was for his Ronco Spray Gun, a gun-shaped garden-hose nozzle with a chamber in the handle for tablets of soap, wax, weed killer, fertilizer, and insecticide. The 60-second spot on a Tampa TV station cost him $550.

"Going on TV allowed me to reach tens of millions of people, and I could make more money then standing for 8 to 12 hours at Woolworth’s," he says.

While many entrepreneurs have come up with a best seller, few have created a whole business around that item, let alone come up with more than one success. Popeil has done both — many times over. "I have an innate talent," he says. "I used to think it was luck, but after one success after another, I realized that I know what is needed in the marketplace. Most people don’t understand the market. Most people have no clue. All they know is ‘I got an idea, and I need a patent.’"

For example, Popeil came up with Showtime after noticing the popularity of store-bought rotisserie chicken. Years earlier, he created GLH (Good Looking Hair) — aerosol spray-on "hair" — after he noticed a thin patch on his own head.

A hands-on micromanager, Popeil begins his day with a 6:30 a.m. workout, then tinkers in what he calls his testing facility: his Beverly Hills kitchen and garage. He shops at discount warehouse Costco for most of his supplies. He’s never hired a marketing team, and says he puts his touch on everything from the packaging to the infomercial sets.

Popeil’s uncanny products are matched perhaps only by his exuberant pitches. For instance, that of the Inside-the-Shell Electric Egg Scrambler: "Gets rid of those slimy egg whites in your scrambled eggs." The GLH infomercial — "Nine different colors…I use it all the time" — made Entertainment Weekly’s list of TV’s 100 best moments.

His TV statements — "But wait, there’s more," "Price so low," and "Operators are standing by" — have made Popeil and his products synonymous with TV marketing. Popeil insists his catchphrases are unscripted, but says he recognizes when he’s uttered a zinger. Then he puts the phrase into heavy rotation.

Over the years, however, a few bumps in the road have cropped up. Popeil has had some notable misses, such as a home glass-froster and a compact trash-can that converted into a stool. In 1987, Ronco went bankrupt after it couldn’t cover a bank loan. About two years later, Popeil bought his company back and made his big return to TV, re-introducing the hot-selling Food Dehydrator in 1990. His one regret: not inventing Velcro.

Popeil says his recipe for success is simple and extends to entrepreneurs of all kinds. "If you have that passion, it is conveyed through marketing," he says. "People see it. I get up before them and show them something new and wonderful."

But, he, adds: "I don’t know if I could sell insurance. It’s something that I didn’t create. When I create something, I believe in it, and I am very passionate about it." Operators are standing by.

Doctor Makes $25 Millions Selling … Toothbrushes

Puneet Nanda Story

Puneet Nanda was like many parents: He couldn’t get his five-year-old daughter to brush her teeth properly. But unlike most parents, Nanda is a toothbrush manufacturer with an irrepressible entrepreneurial drive. Knowing that his daughter was fascinated by her sneakers with flashing lights, he ripped the lights out of her shoes and put them on a toothbrush. That didn’t work, so "I went to Disneyland that evening and bought everything that lit up," says Nanda, now 38. The second prototype was more successful. His daughter brushed for a good two minutes before asking: "Dad, will this ever stop, or should I brush my teeth off?"

Bingo. Nanda added a timer so the light would blink for exactly a minute, and the Fire Fly toothbrush was born. The brightly colored Fire Fly — the newest version sports a see-through handle showing off a tiny toy and a bunch of floating glitter — is making a name for Dr. Fresh, Nanda’s Buena Park (Calif.) company and his medical school nickname. In 2004, Nanda got the original Fire Fly into Target, and by 2005 it was bringing in 20% of the 50-employee company’s $25 million revenues.

Nanda, who holds 58 patents, is seizing on the success of the Fire Fly to create other dental products with flashing lights. "I’m building brand equity," says Nanda. "If I have to do something I have to do it the best." He already has a foothold with more conventional wares, such as private-label dental floss sold nationally in Walgreens and Target stores.

Nanda’s path to dental success hasn’t been easy. The New Delhi native left medical school to join the family toothbrush business in 1989, after his father had a heart attack. Two years later he began hawking toothbrushes to Russians who’d come to India looking for products to sell back home. Nanda moved to Russia in 1993, leaving his wife and son in India and selling toothbrushes out of a warehouse. He soon felt unsafe doing a cash business in Russia and returned to India for 18 months before heading to New York. Having little luck in New York, he tried Los Angeles, where he landed a $180,000 contract with a 99 cents store. "I’d never seen that big of a deal," says Nanda, who then moved his family to L.A.

Nanda knew he needed something clever to grow in an industry dominated by heavyweights such as Colgate-Palmolive and Procter & Gamble. The Fire Fly may do the trick. It initially flopped at Walgreens, so Nanda began selling it directly to dentists he met at conferences. "The flashing light encourages kids to brush a little longer," says San Francisco pediatric dentist Bergen James, who gives it to her patients. "It gets children to brush, and it gets them excited about it."

The positive feedback from dentists encouraged Nanda to recommit to direct sales. He hired 40 women in India to call dental offices in the U.S. and pitch the Fire Fly. And he kept knocking at Target’s door, a company he’d been pitching since 2001. Once Target took it, Walgreens was willing to give the Fire Fly another try.

Nanda now spends more than half his time ginning up new ideas. Next up: mouthwash and toothpaste with kid-friendly add-ons. If all goes well, that may turn Dr. Fresh into a big company with a lot of flash.

Homebusiness Millionaires – Laura Dahl

Laura Dahl Story

2006 Projected Sales: $1 million

After earning a master’s degree at New York City’s Fashion Institute of Technology, Dahl worked for couture designers like Anne Bowen, who creates high-ticket beaded sensations with semiprecious stones. On a whim, Dahl bought some beads to adorn her "wife-beater"-a tank-top undershirt. After receiving scores of compliments and gauging the interest of friends who worked for Vogue and In Style, Dahl started Wifebeader with the shirt on her back in 2003.

Dahl created eight different designs with the help of a beader from Anne Bowen. "I’d be on my couch, in front of the TV with a needle and thread," recalls Dahl. After selling out several trunk shows during her research period, Dahl approached boutiques and took orders on every single visit. "They liked that it’s all handmade," explains Dahl. "We use the finest stones and beads from all over the world."

When Bloomingdale’s picked up her first collection, Dahl wanted to "pop a bottle of champagne and say, ‘We’ve done it–we’ve captured New York and the country!’" But she’s hesitant to say that she’s made it. "It’s my personality to always want more and not be satisfied."

Dahl has expanded to 12 silhouettes, new fabrics and a customized Build Your Own Beader option. Wifebeaders are carried in 130 boutiques across the U.S., London, Puerto Rico and Paris; Fred Segal bought her fall 2005 collection; and Dahl is the Sundance Film Festival’s exclusive gift-bag designer, for which she’s launching a higher-end line, Laura Dahl.

Homebusiness Millionaires: Jennifer Gonzales and John Gonzales

Jennifer Gonzales and John Gonzales Story

Company name: Procharms Inc.
Location: Sacramento, California
Estimated sales: $2.5 million
Description: Sports charm wholesaler

Courting period: When Jennifer Gonzales’ husband, John, gave her an Italian charm bracelet for Valentine’s Day in 2002, Jennifer–a huge Sacramento Kings fan–searched in vain for a Kings charm before deciding to create one herself. Jennifer visited the Team Store at Arco Arena (home of the Kings) to ask about licensing, and a helpful employee called Kings’ co-owner Gavin Maloof and let Jennifer leave a message. She was stunned when Maloof returned her call and directed her to someone at Arco, eventually leading to a $7,000 order.

Sports nut: After talking to local jewelry-makers and suppliers and doing many hours of online research, Jennifer found a company that could manufacture the charms and was a licensee for Major League Baseball, the NBA, NFL, NHL and professional players associations. Jennifer recruited her first rep–a charm-store business owner–and collected a 20 percent deposit from interested charm retailers. The deposit, in addition to maxed-out credit cards, paid for ProCharms’ first shipment.

Domestic charm: Jennifer and John set up a work space in their living room and placed shelves on the wall for the charms. "Everyone who knew us thought we were crazy," says Jennifer. But in addition to the advantage of keeping costs low, operating from home also allowed the mother of three to stay close to her children throughout the workday, with the eventual assistance of a nanny. After four months, they moved into a small office and began hiring employees. John handles ordering, inventory and product development, while Jennifer oversees everything as president.

Team spirit: ProCharms now sells to charm retailers, e-tailers and approximately 20 professional sports teams/venues. The company has also done very well expanding into the collegiate sports market, counting 65 college bookstores as customers. New products include a silver-toned, Tiffany-style heart bracelet; cell phone charms; and leather cuff bracelets, all with team logos.

Hats Off To This Business Woman

Fiona Markowitz Story

At a birthday party 14 years ago, Fiona Markowitz, 40, rolled up paper bags into hats and let her children paint them for fun. Encouraged by party attendees who were wowed by her creativity, she and her husband Steve, 45, took a chance at making it a business. Now Party Hats Entertainment offers pre-made hats and many decor options, such as feathers, buttons, beads, silk flowers and more.

Fiona credits some of their success to The Special Event, a yearly international conference and expo for event specialists that she began attending seven years ago. "That’s where I learned who the [event] industry people were, what their greatest needs were and what we’d be able to accomplish with [our business]," she recalls.

The Markowitzes honed their business skills while learning about the preparation and psychology that go into planning events. "We try to understand who’s going to be there and what the needs are," says Fiona. Initially, there was resistance from event planners who thought the idea wouldn’t appeal to adults, but the Markowitzes began sponsoring hat-decorating events at the conventions they attended. Says Steve, "Once those event planners saw the energy and realized that it’s for [all] cultures, all ages and both genders, it sold 10 times over."

Party Hats has been hired around the country for events of all sizes and purposes. Requested themes are tied into the service. Customers can also throw a Party Hats event on their own with the company’s Party in a Box product. The business, with projected 2006 sales over $1 million, isn’t just about hats, however. The Markowitzes have made flip-flops, gloves and handbags, all of which can be pre-decorated on request. The latest product: Pimp Your Tux, which gives men the chance to decorate some tuxedo pieces.

"People say, ‘This is the best thing ever,’" says Fiona. "Our best source of work is the people who spread that message to others."

Fishing Lures Go High-Tech Chris Podlewski And Michael Armbruster Story

After working long hours doing contract engineering for space systems, Podlewski looked forward to relaxing with friends on the open water. But with the cost of live bait on top of another $60 to gas up the boat, his hobby was also a bit pricey. That’s when Podlewski came up with the idea for an artificial lure, designed to attract fish as well as live bait.

His day job eventually brought him to New York. There, Podlewski tried to make a business out of his artificial lure but could never get past the prototype stage — until he met Michael Armbruster, an engineer for a consumer-products company in Buffalo, N.Y. The pair started Bikini Lures and is just now bringing their innovative fishing aid, a reusable electronic product that mimics the sound of live bait, to market.

Q: How did you and Chris meet?

A: We met in July, 2003, through mutual friends. Chris was looking for a job. He’s a contract electrical engineer, and I was working for a local consumer-products company, so he was looking for a job at that company. First, we started talking on the phone. We didn’t know this at the time, but we were both adopted from the same orphanage in Korea.

When we started talking, we had no idea. I thought I was talking to a Podlewski, and he thought he was talking to an Armbruster. When we met, all of a sudden we were like, "Were you adopted?" That’s where we just kind of hit it off.

Q: Did you both fish frequently?

A: Growing up in Long Island, I used to fish when I was younger. As I grew up, in college and high school, I had all these miscellaneous activities, so I didn’t have time to devote to fishing, but Chris got really interested in fishing when he was doing contract engineering in Florida.

Q: Did you plan to go into business together?

A: We first started off as friends. We didn’t really think about starting a business together. He [had] the concept down in Florida. He tried to do something with it with various other people, and he wasn’t successful.

When he met me, that’s exactly where my background was, in consumer products from conceptualization to the finished product on the shelves. He definitely has an edge with R&D, having worked [on space systems]. He has an electrical engineering background, combined with fishing. We met in July, we started talking about it in the fall of 2003, and then we went and started a corporation in December, 2003.

Q: What was the biggest challenge in making this?

A: Our recharge circuit is what makes it powerful. We’ve been approached by other lure manufacturers, and they all said the same thing: "We thought of this idea, it’s not a noble idea." The thing that’s noble is that we were able to do this idea.

There are electronic lures out there. There are electronic lures that have lights, one or two LEDs, and there are electronic lures that have a little speaker inside that buzzes. The reason why a recharge circuit is so critical is when you’re putting a microcomputer inside a lure, it’s not cheap. The other electronic lures out there are either disposable, meaning once the battery runs out, you have nothing but a plastic body left.

The other option is that there are a few lures out there that have batteries [you can replace] instead of two- to three-button cell batteries. But everyone who fishes knows that once you compromise the seal, electronics and water don’t go well. Because our integrated recharge circuit is inside, enclosed, you don’t have to compromise the seal or open up the lure — everything is 100% sealed inside the body.

Q: How do you recharge it?

A: The product comes with recharge cables, and you have many options. Consumers connect the 9-volt battery to the clip, the other side has two cables — a red and black cable that they connect to the lip and to the tail end of the lure. The tail has a hook on it, and the lip is where you put the line.

Q: So, after a day of fishing, consumers are able to go home and plug it in?

A: Absolutely. Our lure can be used for more than 12 continuous hours, but that’s all we’re claiming because we want to be conservative, especially if we start changing the programming and it starts reducing the battery time.

TV Show Fan Finds A Unique Niche To Profit From Other Fans

Georgett Blau Story

Linda O’Brien and her 16-year-old daughter, Tess, are devoted fans of Sex and the City. They watched it religiously during its initial TV run, and now relive all the Cosmo-fueled moments on DVD. So it should come as no surprise that on their first trip to New York, the Australian duo have forgone some of the usual hotspots for a different type of sightseeing experience: The Sex and the City Tour.

Creator Georgette Blau introduced the tour a month after the September 11 terrorist attacks, hoping to give a boost to businesses in the same neighborhoods where much of the show was shot. Since then, the three-hour tour, which runs twice a day, has been a sellout.

Visitors from all over the world, most of whom learn about the tour online, eagerly shell out $37 a ticket for a chance to photograph themselves on the stoop of the building where Carrie, the series’ central character, lived and to buy the girls’ favorite cup cakes from the Magnolia Bakery.

You would think that the business of showing homes, parks, restaurants, and other real-life locations from TV shows and movies would be a given. Glance at a newsstand today, and it’s clear that the fascination with celebrity culture only continues to grow. But when Blau moved to New York in 1998, a 24-year-old Skidmore College graduate and newly minted editor at Prentice Hall, she was star-struck and keen to indulge her passion.

What she couldn’t find, however, was a tour that could show her famous New York movie and TV landmarks. Often walking past the apartment building featured in The Jeffersons, she came up with an idea. "Imagine my surprise when I couldn’t find a single tour," Blau says.

So, in 1999, with $3,000 from her savings, she started what initially was a weekend hobby — the Scene on TV Tour, starring Blau as tour guide. Soon after, she renamed it the Manhattan TV & Movie Show, with tourists paying $15 to see sites from hit TV shows and movies.

Like many entrepreneurs, Blau identified a way to turn her passion into a business capitalizing on the passions of others who share her enthusiasm for the big and small screens. The pool of potential customers is deep. In 2005, New York welcomed 17.2 million tourists, each spending an average of $190 per day, according to NYC & Company, the city’s official marketing and tourism organization.

Blau realized early on that she had stumbled upon a potentially great business idea. New York is one of the most-filmed cities in the world, where many of prime-time hits are based. Of course, it would almost seem like a no-brainer, considering that Hollywood has had tours of movie stars’ homes for years, and Hawaii has its own movie tour featuring locations in Kauai from Raiders of the Lost Ark, Jurassic Park, and other blockbusters. Even California’s Monterrey has a own movie tour that includes a scene featured in Marilyn Monroe’s Clash By Night.

Blau’s company, On Location Tours, now runs four tours — the Manhattan TV and Movie Tour, the Central Park Movie Tour, The Sex and the City Tour, and The Sopranos Tour.

But it was tough going initially for Blau, who barely made $400 during the weekends showing visitors places such as the building from The Nanny on the Upper East Side, the Lower East Side police precinct from NYPD Blue, the Soup Nazi from Seinfeld, and the Jacqueline Kennedy-Onassis High School on 46th Street from Fame. She continued her day job as an editor.

But as the popularity of the bus tour increased, Blau began stepping up her marketing and PR efforts — handing out brochures at the Museum of Television & Radio and other tourist-stomping grounds, establishing a Web site, generating as much word-of-mouth buzz as possible.

Real success came to Blau when she quit her job as an editor and started a tour based on The Sopranos in March, 2001. The HBO mobster sensation was in its third season, and media interest was at its peak. When Blau started the tour, which features various spots filmed in New Jersey, it generated a major buzz, including a spot on the Today show. The tourists went crazy, and Blau was easily filling up the two buses’ 100 seats, even though the tour ran on Sundays.

She later launched The Sex in the City Tour, which has also been a tremendous success. Now 31, with five full-time employees and 18 part-timers, Blau brings in more than $1 million in revenue each year. With a full-fledged operation on her hands, she eventually decided to hang up her tour-guide hat and hire others.

In March, 2005, she advertised on Craigslist to hire guides for The Sopranos and Sex in the City tours. The response was stunning — 300 people showed up for the interviews, which lasted two weeks. "We’re in New York, so we had to pick from beautiful struggling actresses to standup comedians," Blau says.

For the comedians or actresses, the tour is a great forum to practice their craft. Lisa Perlman, a tour guide on the Sex and the City bus, is a standup comic at The Gotham Comedy Club. And it shows. She keeps the tourists entertained and well-humored during the three-hour tour.

"The bus is just like the club — you’re never quite sure how the audience reacts to my jokes, and it’s great practice," says Lisa, who peppers her banter with knowledgeable tidbits about New York architecture and questions like: "Are there any shoppers in this bus, or alcoholics, or virgins, anyone?"

The O’Briens can barely contain their squeals of delight as tour guide Perlman fields the question — "which one among you is a Carrie, a Charlotte, a Samantha, a Miranda?" — the show’s four main characters. Daughter Tess admits that her friends from Down Under have often referred to her as a Charlotte, the well-bred, eternally optimistic brunette.

The tour’s fanatical fans are nearly all women. Once, Blau recalls, actor Kyle MacLachlan, who played the role of Trey McDougal, was buying cupcakes at the Magnolia Bakery — one of the tour hot spots — and was surprised to see a horde of women rushing toward him. "I thought they’d get his autograph," Blau says. But to her surprise, the women all went up to him wagging their fingers and shaking their heads at how poorly his character treated wife Charlotte in the show.

The success of The Sopranos Tour taught Blau the need to constantly update her tours to attract young tourists. So, while You’ve Got Mail, the Tom Hanks and Meg Ryan romantic comedy filmed on the Upper West Side, was part of the tour until just two months ago, it has now been replaced with a stop at Rice to Riches, the rice-pudding store that makes an appearance in the Will Smith’s Hitch. Of course, the classics like Breakfast at Tiffany’s and the house from Wait Until Dark are always shown, as is the Empire Diner from Woody Allen’s Manhattan.

Next up, Blau plans to start a tour in Washington, D.C., within the next few months that will show the sites from movies and TV shows filmed there. Fans of The West Wing and Commander in Chief needn’t wait too long before their own "on-location" experiences.

Getting Rich Off A Simple Idea

Ron Lando Story

Lando’s six-year-old, six-person company, with headquarters in Tiburon, Calif., had a breakout year in 2005, generating more than $5 million in U.S. sales and another $2 million overseas. CliC glasses have been spotted recently on CSI, Nip/Tuck, Will & Grace, Freedomland, and the Rolling Stones, who donned CliC reading glasses and sunglasses when last year’s tour brought them to San Francisco.

Which means Lando, 52, who looks like Paul McCartney (he plays guitar in a ’60s Brit-rock cover band, the Whining Bullies), is living a distinctly American dream: The one where you wake up one morning with an idea so simple, so right-, uh, over-your-nose obvious, you can’t believe nobody ever thought of it before. You arm yourself every which way with patents. You take your invention to market. Voila, you’re rich.

Of course, a lot can go wrong between ah-hah! and ka-ching!

Someday Lando may go head-to-head with a well-heeled copycat. He has, after all, no secret ingredient. Lando – a 20-year industry veteran who previously worked for his father’s eyewear-design company – came up with the idea after just a week of focused fiddling. The only part missing was the fastener. "I was originally thinking about a hook or a snap," he says. He even considered Velcro. Regular magnets wouldn’t work because they’d have to be as big as silver dollars. Then someone showed him a powerful neodymium magnet, which had just come on the market, and the whole thing snapped into place.

To protect himself, Lando went to Steve Schneider, director of the Sawyer Center in Santa Rosa, a SBA-sponsored resource center for California inventors. Schneider did a patent search (the coast was clear), introduced Lando to a patent agent and patent lawyers, and showed him how to file for trademark protection, all at no cost. (Ultimately, Lando says, he spent about $250,000 on fees, lawyers, and other startup costs.)

In March 2000, Lando took a suitcase full of prototype goggles to the Ski Industry Association trade show in Las Vegas and came back with a sheaf of orders, including one for $100,000 from a national sporting goods chain. Suddenly Lando was in business, even though he had yet to secure a manufacturer.

"I immediately flew overseas," says Lando, "brought them my prototype, and said, ‘Make this for me.’ "

Originally Lando focused on ski goggles. Then Harley-Davidson proposed a licensing deal, and he moved into motorcycle goggles. In 2003 Lando had the bright idea of expanding into reading glasses; now they account for two-thirds of his business. The latest: sunglasses – a nearly $2 billion market.

"Everybody tells me that will be bigger than readers," Lando gushes. (He’s staying away for now from prescription frames, which he views as a boutique business.)

Whether Lando can hang on long enough to reap the full benefit remains to be seen. What’s clear is that he’s willing to risk everything to maintain absolute control. Lando manufactures up to 360,000 units a month at a factory in Taiwan and prepacks for quick shipment by the dozen from a warehouse in San Francisco. He’s cautious ("Whenever you act quickly, for some reason you make mistakes"), and he’s not greedy ("I’m very comfortable right now with my size"). His salespeople are all independent reps he’s known for years. He has no PR machine, no marketing staff, and no ad budget in the U.S.

"I’ve got basically one product," he says. "You want it or you don’t. And we’re the only people who have the product."

For now, anyway. But despite the risks, Lando doesn’t listen to those who encourage him to sell his business before it gets snatched away.

"It’s like my own baby," he says. "Nobody tells you how to raise your kid. This is my patent, and I’m going to do what I want to do. Somebody wants to give me 50 million bucks, I’ll pull the pin. But I ain’t pulling the pin for five million or ten million bucks." Lando fiddles with his glasses. He straightens his shoulders and puffs out his chest. "I’m doing everything right," he says. "Shame on me if I screw this up."

Test-Driving Your Dream Job

Brian Kruth Story

Just one year ago, David Ryan was an international banker with HSBC. He had done stints in Bahrain, China, Taiwan, Hong Kong, Turkey, and London over the course of 17 years. However, by the time Ryan had landed in New York City two and a half years ago, he says, "the buzz for me was gone." Exciting as a two-decade spin around the globe once was, Ryan says, his chosen profession was simply, "not as exciting as it had been."

Ryan entered into what he calls, "a pretty long period of reflection" regarding his career path and future. Like many suffering from job ennui, Ryan was ready to do something new, the question was how to do it. Having nursed a lifelong love of dogs, Ryan realized that he was interested in potentially moving in that direction but was unsure of how exactly he could turn his passion into a sustainable career.
Enter a two-year-old Portland (Ore.)-based company called Vocation Vacations, a business that gives people the opportunity to "test drive" their dream jobs. Creating temporary but intense mentor/apprenticeship experiences, Vocation Vacations enlists professionals from a variety of fields — everything from winemakers and makeup artists to architects and sword makers — and pairs them with people who fantasize about leaving their day jobs and want spend a few days in a profession that they had previously thought beyond their reach.

Last April, Ryan signed up to do a two-and-a-half-day vocation working with a doggie day-care provider in Massachusetts. The following month, he spent three days working with a dog trainer in Oregon. Fairly quickly, Ryan figured out that he preferred training to day care and was confident that he could start his own business in the field.

Moreover, Ryan says the experience helped him to realize that he didn’t have to abandon the skills he developed as a banker. Rather, he says: "It became obvious to me that there were a lot of kennels and trainers that were very good with animals, but business was not their specialty."

In June, Ryan resigned from HSBC and enrolled in a dog-training school in Missouri for five months to get certified. In January, he launched Beyond Dog Training in Rye, N. H. "It really sounds weird," he says. "But that two- to three-day experience has really been a lynchpin."

Vocation Vacations was started by Brian Kurth in 2004 after he made the leap from unhappy employee to dream-job entrepreneur. At the time, Kurth says he was burnt out working for Ameritech in Chicago and logging in three hour commutes.

"I didn’t hate corporate life, or my job or my boss," he says. "But I hated the lifestyle. I wanted to do something more fulfilling. I was tired of going to dinner parties [where] people would talk about their exciting lives as architects or photographers and I worked at the phone company. People’s heads hit their spaghetti plates when I told them. Nobody cared, and neither did I."

So in 2000, Kurth quit his job. In quick succession, he worked for a dot-com, got laid off when the economy imploded, and then sold his house and spent six months driving across the country, eventually settling in Portland. That city didn’t have much in the way of industry and was in the midst of a recession, so he ended up working on a vineyard doing product marketing and sales for a family winery. Kurth found that there was something immeasurably rewarding about stepping outside of his routine and trying something new. Inspired, he came up with the concept and business plan for Vocation Vacations.

The idea is relatively simple. Participants pay anywhere from a few hundred dollars to a few thousand (transportation, lodging, etc., aren’t included) to experience life as, say, a chocolatier, a fashion designer, or a race-car driver. The time spent immersed in their fantasy job allows them to get a 360-degree perspective without the risk of quitting their own jobs or investing heavily in a new career.

Laura Thomas says she’s "miserable" in her job as a business-operations developer for a government contractor in Alexandria, Va. "My boss knows I’m not happy, and he’s looking for something else [for me at the company], but there isn’t a lot of opportunity for growth."

Not quite ready to quit altogether, Thomas recently took a turn through Vocation Vacations, shadowing a hotel concierge and a hotel general manager for two days. "It was really great. I got to be completely immersed in the environment. I got to see the good, the bad, and the ugly." And best of all, she says: "I really got to see it firsthand before taking the plunge and quitting my job."

Kurth, something of a dream-job rainmaker, has created a niche industry built on the hopes and aspirations of people like Thomas. Catering to the unhappily employed, Kurth has discovered an untapped market. Indeed, according to a survey by the Conference Board, a management and marketplace information nonprofit agency based in New York, less than half of all Americans say they’re satisfied with their jobs. Taken in 2002, the survey reveals the highest level of discontent since they first conducted the study in 1995 — with job satisfaction dropping from 60.9% then to 47.2% presently.

To date, Vocations Vacations has placed hundreds of people in the U.S. and Britain in occupations ranging from brewmaster and art-gallery director to music producer and cattle rancher. "We’re on our way to thousands," says Kurth. The company has doubled the number of its available mentors to 500, with another 40 to 50 new possibilities in the works in such fields as Broadway producer, meteorologist, and zookeeper.

Kurth attributes much of his success to listening to prospective clients and addressing their areas of interest with relevant mentors and programs. Recently, there has been a growing demand and interest in marine biology, aquarium managers, and voiceovers. However, Kurth says there’s a limit to the types of career vocations he will pursue. For instance, he says he recently turned down an offer from a pornography producer who wanted to become a mentor.

Kurth himself is expanding his own dream. He just signed a deal with Warner Books for a how-to vocational lifestyle book. On April 27, the Travel Channel is debuting a new series based on his "vocationers" called This Job’s a Trip, chronicling the vacationing adventures of his clients. Kurth is also working on what he calls "ancillary products," such as DVDs, T-shirts, and a possible magazine. He says his expansion is all based on the "vacationing" lifestyle — no longer daydreaming but living the dream.

Just ask David Ryan, who has had to hire additional trainers for his fast-growing business. "I get a lot of broad smiles when I tell people that I went from a million-a-year banker to a dog guy," he says. No doubt he’s smiling back, all the way to the bank.

Online Logo Creating Business Is Booming

Morgan Lynch Story

Sarah Hawley, a 10-year public-relations veteran, was moving from a job at a large agency to launch her own business, Mockingbird PR, out of her home in Gilbert, Ariz. She soon discovered that her experience bringing in clients wasn’t enough. Appearances mattered too.

"Freelancing without a logo or Web site or identity really hurt me going up against agencies or even small boutique firms," she says. "If I went to pitch business to someone, I would give them my proposal. But if they wanted to check me out, there was no image to put in front of them. I had to do something to be more professional. I was committed, but I looked like someone just doing it on the side."

It was time to get a logo. More than just printing up business cards, a logo can create the kind of brand identity that becomes instantly recognizable to customers and also communicates that this is a serious business. Hawley analyzed a few different logo vendors and decided upon Logoworks.com, a five-year-old online provider of logo services for small businesses based in Lindon, Utah.

"I liked that their designers were spread out [across the country]," she says. "So none of the designs looked the same, and they weren’t influencing each other." She also liked the ease of the process and the turnaround time. But most importantly, she really liked the cost. Hawley chose the firm’s Platinum Package, which gave her 10 designs to choose from and unlimited revisions for $600 — a fraction of the cost of getting a logo from an agency, which can start at $5,000.

But until recently, distinctive, well-designed logos were the province of large companies. Extremely costly and time-consuming to produce, they were for the most part out of reach of small businesses. Logoworks was launched specifically to address the needs of small businesses and offer them high-quality logo design solutions at an affordable price.

The company got its start when Morgan Lynch, Logoworks’ CEO, was working in software development for an insurance company. He was in charge of rebranding the company, and found the experience frustrating and expensive. "We ended up spending a lot of money on agencies, designers, etc.," he says. "Hundreds of thousands of dollars and a few years later…they came up with [something] I thought was O.K., [but] I wasn’t really excited about it."

In 2001, after investing millions in building software and a design platform to do what he calls the heavy lifting, Lynch launched Logoworks.com. "We took a lot of the processes — the meetings, the relaying of information between what businesses were looking for and graphic designers, what images they wanted, what colors — and put it all online," says Lynch. "It’s very efficient and eliminates the inefficiencies in the real world — and we can do it at a fraction of the cost."

It works like this: Customers fill out an online form providing information that will be incorporated into the designs, such as color and style preferences, type of business or product, and how the logo will be used. Next, they choose from among package options, with prices ranging from $299 to $1,499. The packages are based on number of designs, as well as the option to create stationery and Web sites.

Based on these selections, initial design concepts are made and returned within three days. Next comes the revision process, and then the design is finalized. Although the process is Web-based, at every step along the way a customer can consult with his or her personal-account manager.

Logoworks.com is another example of how the Internet is dramatically changing the landscape for small businesses. In this case, it allows them to have a logo worthy of a multinational corporation at a reasonable cost. "Small businesses are waking up and saying they too can have a great brand," says Lynch. "Ten to 15 years ago, it would have been cost prohibitive and unattainable for [them]. They can look like a national chain even if the business is only two people working out of their home."

To date, Lynch says the company has come up with 45,000 logos. While the company doesn’t disclose sales figures, Lynch says the firm’s sales have increased 100% each year since its launch five years ago. While the majority of the company’s clients are based in the U.S., Lynch says that about 10% to 20% of their business comes from overseas businesses that want a Western marketing look. Currently the company is plowing profits back into more R&D and software development to expand their capabilities and offerings.

Last year, the company got some bad publicity when a couple of its designers were accused of stealing others’ logos. Following the accusation, Logoworks.com issued a statement saying it has fired the designers and taken steps to ensure such a situation wouldn’t be repeated in the future.

Still, the company says 98% of their customers are satisfied with their experience. In her case, Sarah Hawley says the decision to get a logo really kicked her business up a notch. "I had a client in Atlanta, and they were skeptical about how committed I was," she says. "Once I put a logo in front of them, it registered with them that this was not some fly-by-night thing — it was a full-time job. I was able to show them a professional image, and they’re now a full-time client.

Moreover, Hawley recently returned to Logoworks to have them design her stationery letterhead. Clearly, first impressions for a small business can make a big impact on the bottom line.

Making Millions Cleaning Other People Garages

Marc Shuman Stor

GarageTek was a no-brainer when Shuman founded it in 2000. He got the idea when he and his father, with whom he outfitted department store interiors, designed and built a set of slotted wall panels with moveable shelves for a retail client. When several of his employees began using the panel systems to organize their own garages and basements, Shuman realized he had a potential hit on his hands. And the timing seemed perfect: The housing market was heating up, garages were getting bigger, and closet organizers were all the rage. Shuman decided to sell the display business and open GarageTek.

Rather than simply selling the panels at home-improvement stores, Shuman decided to build a garage-makeover business. GarageTek would perform in-home consultations, then design and install the systems–complete with shelves, cabinets, bike racks, and work benches. Homeowners, Shuman figured, were likely to pay a premium for the service. The biggest risk was competition. After all, anyone could have the same idea. But if Shuman could establish a foothold in markets around the country, GarageTek had a better chance of survival. Franchising seemed like the best way to pull off such an ambitious expansion.

In early 2001, Shuman placed an ad soliciting franchisees in The Wall Street Journal, and phone calls poured in. His attorney advised him to choose carefully. But Shuman, eager to get started, approved anyone with a business background, a $25,000 franchise fee, and $200,000–which, according to Shuman’s calculations, was enough to purchase supplies, buy newspaper ads, and turn a profit within 18 months. Each franchise would pay GarageTek 8 percent of annual sales, a portion of which would help fund national advertising campaigns. In exchange, they received three days of basic training and a manual written by Shuman. "If they had the money and they had a strong sales and marketing background, we felt they were qualified," Shuman says.

At first, everything seemed to go according to plan. In the first half of 2001, GarageTek franchises opened in Connecticut, New Jersey, and New York. By 2003, 57 franchises had sprung up in 33 states, and annual revenue at the corporate office was on track to top $12 million. That summer, however, Shuman began to realize that while many franchises were thriving, 15 were struggling.

He and his team moved quickly to correct their mistakes. The first step was to create more stringent criteria for new franchisees. To pass the initial screening, candidates now need a net worth of $1 million, with at least $250,000 in liquid assets; their proposed territories must boast at least 250,000 single-family homes, occupied by owners. They’re also required to run the franchises themselves. GarageTek also decided to administer a 350-question personality test, looking for candidates with traits similar to GarageTek’s top performers, who tend to be enterprising and not overly accommodating–a sign of independence. Finally, all candidates fly to New York to meet with Shuman and his corporate team. To identify problems early on, he installed software that enables him to track each franchise’s financial performance.

So far, the strategy seems to be working. In 2005, GarageTek’s sales jumped 33 percent, to $20 million, even though the company had 21 fewer franchises than in 2004. Now that he has a streamlined system in place, Shuman plans to add 55 new franchises during the next few years, for a total of 100. But he admits that he has more to learn. "We’re not, by any stretch, done," he says.

How To Make $25000 A Month Using Sail As Billboard

Troy Sears Story

After 10 years managing his family’s pest-control business, Troy Sears was antsy. An avid sailor and San Diego native, he had always dreamed of ditching the family trade, buying a few boats, and putting them out to charter. But Hydricks Pest Control provided a steady life, and Sears, the father of three, feared the risks that would come with branching out on his own. "I was making a good living for my family, and that was a lot to give up," says Sears. "But I just didn’t enjoy what I was doing day in and day out."

A member of San Diego Yacht Club, Sears knew the two prized 80-foot America’s Cup boats docked there would be perfect for the kind of venture he had in mind, but he also knew getting his hands on them would be tough. "It’s like a golfer who dreams of playing Augusta," Sears says of Abracadabra, a former America’s Cup competitor, and Stars and Stripes, which won the Cup in 1988. "No one could get on these boats."

The boats are tailor-made for specific waters, and until they are retired, remain in the hands of America’s Cup teams. Design and construction reportedly runs upwards of $10 million.

But when the Swiss won the Cup in 2003, the race would shift back to Europe, and Sears knew the boats would finally be put on the market. Once the race moves to new waters, their value drops, and the vessels are usually sold off to the highest bidder. Recognizing the opportunity, Sears sold his pest-control company, bought both boats, and founded Next Level Sailing.

Sears says "a lot of crazy, fortuitous things" in his life contributed to his success with the new business. Thanks to a three-year stint on Wall Street after college, he has maintained relationships with a few New York investors, one of whom signed on as a silent partner when Sears needed help financing the purchase of the boats. Though Sears won’t disclose the sticker price, estimates run from $300,000 to $500,000 each.

Initially, he was only able to take out groups of six or less until he got the boats approved for passenger excursions by the U.S. Coast Guard — something that had never been done on a modern carbon-fiber vessel. But the head usher at Sears’ church happened to be a retired Coast Guard captain who used to train inspectors, and he helped get the ball rolling on the inspection process.

"It was expensive and a lot of trips to Washington," Sears says. But as a sailing enthusiast, he admits testing and examining the boats so intricately was an education in the technical aspects of the craft that he had never considered before. "Pursuing this was fascinating," Sears says. "I enjoyed putting all the time and energy into it."

After nearly a year of refinements, the boats were approved to take on more than six passengers at a time, and Next Level was finally poised to make some real money. Sears now takes up to 20 passengers per sail — and, yes, everyone gets a chance to steer the boat out on the water.

At $99 per person for a two-hour sail (or $1,980 to rent the whole boat for four hours, for up to 20 passengers), it’s not exactly a bargain. But Sears says his upscale recreational outfit works because it’s unique and makes use of San Diego’s recently revamped waterfront, including a string of new hotels, a floating museum, and the San Diego Padres new baseball stadium, Petco Park. His clientele is split between tourists and executives, who often book a sail as a team-building exercise for groups of employees. "It’s cheaper than a round of golf," Sears says.

But even in the early days, when he could only take out a handful of passengers, Next Level found itself in the national spotlight, garnering months of free publicity that proved to be a boon. Producers of MTV’s long-running reality show, The Real World, approached him about having its San Diego cast work for Next Level during the taping of the show last year.

Friends warned Sears about the show’s reputation for housing unmotivated party-animal types, but with his company still in a fledgling stage, he figured the publicity benefits outweighed the risks. "It’s a numbers game," says Sears, who was banking on the producers’ promise of millions of viewers each week.

The viewers turned out: The Real World: San Diego landed in the Nielsen Top 10 for cable programming each week it was on air, and despite a near-mutiny among the cast, which debated quitting at one point, Next Level was flooded with inquiries. After the first few episodes aired in January, 2004, Sears had requests for reservations from 43 U.S. states and eight foreign countries.

With two 11-story masts, the multimillion-dollar yachts are attention-getters in and of themselves. When the aircraft carrier SS Reagan docked in San Diego this summer, Sears wanted to personally welcome the Navy fleet, so he made a 35×63-foot American flag and hung it between the masts. CNN featured the flag and an interview with Sears in their coverage of the event. "Sometimes just doing a good thing generates publicity," he says.

CBS uses blimp shots of the boats on the way to commercial breaks during broadcasts of San Diego Chargers football games, and the Travel Channel shot an entire segment on the boats as part of the special series, Maria Shriver’s California. "She thought the boats would be a great way to show San Diego," says Sears, who says he did nothing to solicit the network’s business.

Aside from passenger fees, the boats also generate about $25,000 a month from ads on their massive sails. Sears is working to obtain a liquor license for the boats and has plans to acquire Abracadabra’s sister ship.

With little traditional marketing, Next Level’s growth has come largely through word-of-mouth, which Sears attributes to the one thing he demands of his 25-member crew — "make sure every passenger has a good time." For Sears, it has been a high-seas adventure.

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