Early to Rise

Early to Rise


Young entrepreneurs are banking on their tech savvy for startup success.


By Alexa Vaughn / Entrepreneur
  |   March 24, 2008

earlytoriseouyang.jpg

Four years ago, Donny Ouyang cracked open one of his dad’s old computer
science books and began learning HTML code and website techniques. 
This accidental discovery grew into a great entrepreneurial opportunity when he sold his first website less than a year later.

Now 16, Ouyang is making more than $6,500 a month as CEO of Kinkarso Tech–all while playing

basketball, piano and guitar in high school. That’s because his
business has advanced into SEO consulting and "flipping" unwanted
websites–that is, revamping and reselling sites for profit.

But
Ouyang isn’t alone. Six in every 10 teens want to be an entrepreneur,
and they can start e-businesses with little or no capital.

Caught in a Web of Advantages
"This trend of more teen businesses has a lot to do with the internet
giving easier access to the resources they need to develop their business ideas,"
says William Walstad, an economics professor at the University of
Nebraska, Lincoln.  A long-time advocate of youth entrepreneurial
training in schools, Walstad is the author of The Entrepreneur in Youth: An Untapped Resource for Economic Growth, Social Entrepreneurship, and Education.

"Today’s teens are more tech-savvy and, as a consequence, are at an advantage when it comes to finding those startup resources."

And
because online social networks  like Facebook and MySpace and other
technologies have become so integrated into teens’ lives, many discover
big online business ideas before seasoned entrepreneurs do.

earlytorisecook.jpg"Young
people have great advantages in business, especially when marketing to
their peers, because they relate to their demographic better," says
Catherine Cook, who co-founded social networking site MyYearbook.com when she was 15.  "You can’t expect someone who’s 40 years old to know what to do."

That’s
why Cook thinks investors at U.S. Venture Partners and First Round
Capital loaned her company a combined $4.1 million during its first
year of development.  Investors, however, need a lot more than a
business idea to bet on a teen business’ success, as both Cook and
Ouyang know.

"The bank gave me an investment loan
because I already had a good record for getting business online,"
Ouyang says, noting the $25,000 investment that allowed him to grow his
business significantly. "I hadn’t formed my company yet, but I had a
network of customers and the business proposal was there.  For the
website project I was trying to get capital for, I already had traffic,
revenue and proof that it was a unique idea that worked."

But some teen businesses grow to international proportions without investments like the ones Cook and Ouyang acquired. 

Simple
website building skills and a will to unlock his new iPhone for any
mobile phone carrier are what started 15-year-old Kyle Jourdan, creator
of FreeIt4Less.com, on an unexpected entrepreneurial adventure.

Before
Apple opened the iPhone to carriers besides AT&T, Jourdan purchased
a few licenses that gave him permission to use an unlocked iPhone.  He
sold extra licenses on eBay, and they went surprisingly fast to
customers from all over the world.

"We opened up the iPhone to people around the world because AT&T is
only available in the U.S.," Jourdan says. "So we ended up selling
licenses to people in over 150 countries."

After
starting the business last September, Jourdan adapted his business
model according to the iPhone’s software updates.  Now he’s selling the
actual unlocked iPhone on his website.

Jourdan knows that as
iPhone’s software issues diminish, so will the profits of his
business–but he’s not worried. He’s already made enough money to open
a restaurant franchise someday in his hometown of Syracuse, Utah.

Benefits Beyond the Tech Know-How
Besides being tech-savvy, teens have other inherent advantages when
starting a business.  One, Cook says, is that there is less overall
risk.

"You don’t have to worry about losing your home or
paying any other huge bills as long as you’re living at home," Cook
says.  "The worst thing that could happen if you try to start a
business as a teen is that you fail."

Another huge benefit of
being a teen running a business is that it’s an attractive story for
local and national news.  Cook, for instance, has been interviewed by CosmoGirl
and MTV as well as national newspapers and news shows.  Her story also
spiced up her application to Georgetown University, where she currently
studies business while running her business.  Cook considers being a
teen as so advantageous, that she’s afraid of being so old now–18.

It
took Ouyang a little longer to admit his real age to clients (who
thought he was 23 for the first three years). But after building a
solid reputation through his business, he finally admitted he was 16.

"I only lost one customer after I revealed my age, but most people were just impressed," Ouyang says.

>BackTrack<

Leave a Reply