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Good Fortune

Diary of a start-up: from idea to fruition.

Once upon a time, there was a police officer named Sid Martinez. As a cop, his job was to uncover problems and find solutions. Seeking a career change, Martinez found a new outlet for his problem-solving and bilingual communication skills: cookies.

While innovative ideas may be born in an instant, businesses can take years to succeed. Here are the steps Martinez and his partner, Jeff Dole, took to achieve success:

1994: While at a Chinese restaurant, Martinez decides fortune-type cookies could be the perfect vehicle for teaching Spanish. He modifies the cookie into a taco shape, adds cinnamon flavoring and inserts a small phrase, or "dicho." Each phrase is printed in both Spanish and English. He bakes 100 Dichos for a test run at a local restaurant and the treats sell out in 30 minutes.

1995: Martinez knows he has a great idea. Without food industry experience, however, he's unsure how to proceed. He meets food industry veteran Dole and invites him to join the venture. Martinez and Dole invest $37,000 of their personal savings and work day jobs to support the business.

Winter 1995-Spring 1996: The partners perfect the Dichos recipe, logo and package design. They apply for a patent and trademark.

July 1996: The duo finds a manufacturer and debut Dichos at the Texas Restaurant Association Show in Houston; 5,000 cookies are sold. Orders pour in from Mexican restaurants. Martinez and Dole quit their jobs to concentrate on the business full time.

October 1996: The "Smart" Cookie LLC is officially incorporated.

February 1997: The company lands its first national account with the Tia's Tex-Mex chain.

Spring 1997: Southwest Airlines purchases Dichos for holiday promotions.

July 1997: An article on The "Smart" Cookie appears in The Wall Street Journal.

September 1997: The "Smart" Cookie signs its first buyer in Mexico.

October 1997: The Austin Independent School District orders Dichos for school lunches, incorporating targeted bilingual messages for students like "Stay in school." The partners launch their Web site (http://www.thesmartcookie.com), which has garnered orders from as far away as Russia.

December 1997: Annual sales reach $250,000.

January 1998: Work begins on an amaretto-flavored version of Dichos with messages in Italian and English.

May 1998: The owners are offered $1 million to sell their business; they decline the offer.

October 1998: A deal is sealed with Taco John's International, a Mexican fast-food chain with more than 430 restaurants. The Taco Tico chain also comes on board with 85 restaurants.

December 1998: Sales reach $500,000. Of 25,000 Mexican restaurants in the United States, 1,500 carry Dichos.

1999: Martinez and Dole estimate $1.5 million in sales.

2000 and beyond: "This product will be around when we are long gone," says Martinez. "We're building a brand name."

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This article was originally published in the March 1999 print edition of Entrepreneur with the headline: Good Fortune.

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