Smoothie operators

Smoothie operators

Kyle and Aaron Campos, 27 and 33
Buckeye, Ariz.

Lesson: If you must borrow from your friends and family, keep it formalSmoothie operators

The Campos family team: from left, Melissa and husband Kyle, Aaron and wife Estrella

In 2004 the brothers, both software engineers, quit their jobs in Santa Barbara and decamped to Buckeye, Ariz. After visiting relatives there earlier that year, Kyle had become convinced that the town was "filled with wide-open opportunities," especially compared with the software biz. "The tech sector was getting hit hard," says Aaron. "I didn’t have a good feeling."

Aaron and Kyle, neither of whom had run a business before, began
brainstorming about starting one together. Both had frequented a
smoothie joint in Santa Barbara, and they fell in love with the idea of
starting their own. They found an industry consultant online who helped
them write a business plan. Then they hired an experienced designer.
The Main Squeeze would be a 1,200-square-foot store with hardwood
floors and stainless-steel tables. And it would cost more than the
$130,000 they had saved.

That’s when they drew up a list of 40
friends and relatives they could solicit as investors. "We wanted it to
seem like we were offering them an authentic business opportunity,"
notes Kyle. For that they turned to CircleLending, a site that helps
informal borrowers create formal lending deals. The siblings spent $99
to set up a loan agreement, choosing an attractive interest rate (9%),
a repayment schedule they figured they could afford (either five or
seven years) and a $1,000 minimum. Four folks each lent them $1,000,
and another four each threw in $5,000. Last year the Campos brothers
whipped up a profitable $210,000 in sales, and they’ve been paying
their investors on schedule for close to two years. Says Kyle: "Not one
has complained."

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