Many of us have heard that small business is the backbone of our economy. Mega-corporations like Walmart and Apple started off as small businesses. Some people are dissuaded to start one. They turn to statistics that say “most new businesses will fail within three years” to justify their reason for not starting one.
Starting a business is simple. It begins with an idea, some paperwork, and a storefront and/or website. However, creating a successful company is not as easy, but it can be easier when the business model is based on a simple idea. Here are five successful businesses that started with a simple idea.
Lori Cheek, the founder and CEO of Cheekd.com, started as an architect. After working 15 years in the industry, Lori abandoned the career to immerse herself in the tech world.
She was forced to get extremely creative about funding the business since she was living on her savings.
To offset her expenses, Lori managed to make $75,000 by selling designer clothes on eBay, walking dogs, doing focus groups, secret shopping, and selling her stuff on Craigslist.
She no longer wanted to build structures but rather build relationships. So, Cheekd was born. It is a dating app that makes missed connections obsolete. The app connects people in real time rather than virtual time, which allows people to begin meeting in person before continuing online.
Her biggest break came when she got accepted to be a contestant on ABC’s Shark Tank. While her idea was shot down by all five Sharks, she left them with a message. “Trust that you will all see me again,” she said. Within 48 hours after the episode, about 50 investors wanted to invest in her business.
The New York Times has called Cheekd, “the next generation of online dating.” She has been featured in The Huffington Post, Inc Magazine, and TEDx. Cheek’d has customers in 47 states and 28 countries.
Marty Buckholt started Air Ad Promotions in 1989.
One day, he was looking through Entrepreneur magazine and came across an ad of an advertising balloon. He pitched the idea to his roommate, agreeing that he would fund the venture and his roommate would use his sales skills to start generating income.
A couple of weeks later, his roommate found a job and opted out of the partnership, leaving Marty with an advertising balloon and $3,000 less in his bank account.
When Air Ad Promotions started, cash flow was the biggest challenge. In their startup days, credit cards and lines of credit were scarce. So, besides the profits of the business, bootstrapping was the only option. However, with patience and relentlessness, Air Ad Promotions was able to make $100,000 in revenue within their first year.
Marty attributes his success to anticipating the needs of his customers. He admits that he is still figuring things out after being in business for 25 years. However, the company now generates over 6 million dollars in yearly revenue.
Fundrise started with a simple question: “Why can’t everyone invest in real estate?” The founders, who were also real estate developers, had an idea to buy a debilitated building and convert it to a mixed-use retail and restaurant space.
Their most difficult challenge was raising capital. When they went out to search for funding sources, their prospective banks did not see the opportunity in the project. Fortunately, the founders were able to bootstrap the business for the first three years.
Despite being denied by banks, they persisted after receiving validation from the local people in nearby communities.
They earned $12,000 in their first year of business and it has continued to grow each year thereafter. Last year, the business received $35 million from a Series A round led by Renren, a Chinese tech company.
Fundrise has now over 50,000 members who have invested in 55 projects across the country and has received over 50 million from investors to fund real estate projects. They are on target to make $3 million dollars this year.
Josh Goldstein is the co-founder of Underdog, a small technology startup that started with a simple idea.
He created a simple form that took a minute for candidates to complete. He and his team of four take that information through a process of analyzing, tagging, and grading candidates. Once that process is completed, they feature the best candidates to a network of startups who in turn pay them a subscription fee.
Josh started the business in April 2014 and was determined to make his business the curated marketplace for talent. He worked for startups in the past, which gave him the experience in dealing with the stress, inefficiencies, and lack of capital.
From the start of his business until now, he remains a bootstrapper. He and his team run the business at The Founder Collective in New York City.
Underdog is doing well over $500,000 a year and works with over 120 NYC startups.
Even with Underdog’s amazing success, Josh admits that he and his team are overwhelmed with work. In the beginning, it was much worse since they were utilizing a manual process rather than their current streamline system.
If there is one thing that Josh and the Underdog crew care about the most, it is their customer service. “We love to hear from candidates that found new jobs through our platform. And it is nice to be charging such a small fee to our customers. You can be a customer on Underdog for four years and make one hire, and it is still cheaper than using most recruiters,” Josh said.
Three and a half years ago, Alex Rizos would feature a curated selection of 12 menswear products with hopes to eventually become an online clothing retailer. “When I launched, the business was basically just an idea. I was not anxious to launch, but I wasn’t sure which direction it was going to take. Therefore, I decided to fund it all on my own to make sure that it would not cost more than I had.”
Within a year in the business, Alex took a different route and started to add content to make it resemble a blog. While the business earned him about $200 a month in the first few months and almost $8,000 within his first year, it only accounted for 10% of his income.
Alex wasn’t satisfied. He wanted to invest his current income from the business to develop it further. He pushed even harder and was able to earn a full-time income in his second year of business.
Le Club Des Douze now generates over $100,000 in annual revenue and have partnered with hundreds of independent brands.
For the aspiring business owner, Alex shares a good nugget of wisdom. “Having a vision is not enough. You need to have the drive and an action plan to turn your idea into a profitable business.”
Featured photo credit: citirecruitment via imcreator.com