LoveSac Corp.
Company description:
Chain of stores (about half are franchised) specializing in modular
furniture
Founder: Shawn Nelson,
28
Location: Salt Lake
City
Projected 2004 sales:
$30 million plus
A Bag Is Born: At age
18, Shawn Nelson was watching TV on the couch when he decided
"a huge beanbag thing" might be more comfortable. He
bought 14 yards of vinyl, cut it into a baseball shape, and spent
three weeks filling it with anything soft he could find. The
finished LoveSac was 7 feet wide, and everyone who saw it tried it
out-and loved it.
Pocket Power: When
neighbors started placing orders, Nelson decided to start his
company almost as a joke. With free help from his friends, he made
the LoveSacs in his parents' basement and sold them at trade
shows, events and even the drive-in. Business was moderate at best,
until he got a call on his cell phone that changed his life: a
quarter-million-dollar order from Too Inc., which was looking for a
back-to-school offering for its Limited Too stores. "I
answered the phone and said, 'Twelve thousand LoveSacs? Sure,
no problem. That's what we do; we're the best in the world
at it,'" remembers Nelson.
Content Continues Below
Hard Road: Undaunted,
Nelson amassed $50,000 in credit card debt building a factory. He
worked 19-hour days and slept at the factory. "It nearly broke
me emotionally, physically, mentally," Nelson says. "My
hands were cracked and bleeding. We finished the order [for Too
Inc.] but ate up all our profits." Just when things seemed
darkest, a deceptively simple idea presented itself: Open a mall
store. Not just any store, but one designed from the beginning to
look like an upscale chain-even before it was a chain. It paid off:
With some 55 stores, about half of them franchised, LoveSac is
looking at sales topping $30 million this year.
Looking Forward:
"We're headed toward owning [the market for] oversized
living," says Nelson, who dispenses with all modesty where his
business is concerned. "We're going to have a catalog
that'll be three inches thick, selling everything that's
over-the-top, bling-bling,
LoveSac-get-out-of-our-freaking-way."
Unstoppable: No one
fully expected LoveSac's success-not even Nelson himself. He
says being committed to solving any problem is vital to his-and any
entrepreneur's-success. "Decide that there is always a
way," he says, "and you'll find that there is."
-Jonathan Riggs
CCM Marketing Inc.
Company description: Media
buying advertising agency specializing in the direct-response
market
Founders: Suzy da Silva,
33, and Nicole Licata, 35
Location: San Luis Obisbo,
California
Projected 2004 sales: $30
million
Directly Speaking: Suzy
da Silva and Nicole Licata met in 1998 while working at a
direct-response advertising agency, and the lack of ethics they
sometimes witnessed inspired the pair to branch out on their own in
2001. "We wanted to do something that would treat the clients
better," says Licata, "because direct response in general
is a not-so-upfront industry. A lot of people take your money and
don't tell you why they're taking it."
Timing Troubles: After
the partners started their business in July 2001, the 9/11
terrorist attacks nearly put a quick stop to their venture because
nobody was watching or buying from infomercials-it was all news all
the time. To get through it, the pair went to TV stations directly
to look for compromises and ad rate reduction deals that would help
everybody-their clients, the stations and themselves-to survive.
"Everyone had to be a team at that point," says da
Silva.
Know Thyself: Says
Licata, "We're both salespeople, so we have a lot of
people watching over what is not our strong point-accounting. If
you see a weakness in your business and you don't [understand]
it, don't pretend you do. Hire somebody."
One Big Family: During
the lean times after 9/11, da Silva and Licata vowed they
wouldn't lay off a single employee. Though they had to forgo
their own paychecks for a time, and each gained 25 pounds from the
stress of it all, they kept their promise. Says da Silva, "We
didn't want people out in that kind of environment. It's
like a family here." The result: incredibly loyal employees
and a knowledge that the duo can get through anything-including
successfully losing their stress-related pounds. -N.L.T.
Urban Evolution,
Civilian and Lotus; Tonic; and J-Squared LLC
Company description:
Clothing stores, a private nightclub and a real estate company,
respectively, focusing on upscale, modern style
Founder: James P.
Funderburk Jr., 39
Location: Charlotte,
North Carolina
Projected 2004 sales:
$3.3 million plus
Southern Revolution:
Since 1994, James P. Funderburk Jr. has injected Charlotte, North
Carolina-known as a conservative banker's town-with his vision
of modern chic, starting with clothing store Urban Evolution and
continuing most recently with J-Squared LLC, his newest foray into
real estate development with architecturally modern housing. The
common thread with these diverse businesses is offering "a
unique product, service or hospitality the Charlotte region is
missing but anticipating," says Funderburk. Doing so in
exciting and innovative ways has drawn a loyal customer base that
has allowed him to continue to expand his scope of style.
Worldly Charm:
Funderburk competes with major metropolitan ventures by bringing
the best concepts from his travels back to Charlotte. Private
lounge Tonic melds Zen and modern elements, with many décor
items designed and built by Funderburk, who has earned local and
national recognition for his enterprises. "I've never let
being undercapitalized stop me from doing something," he
philosophizes. "I always thought 'Worst-case scenario, I
can always use lines of credit.' And if something gets really
bad, I can always get a job again."
Special Treatment:
From including his retail managers on buying trips and paying for
gym memberships to instilling a sense of ownership, Funderburk
stresses appreciation for all his employees. "It's not
easy to retain employees in retail, but I have very little
turnover, and that's because I demonstrate to them [that] I
always want them to be a bigger part of things," says
Funderburk, who partnered with one employee to start Tonic and two
others for his second Civilian store.
New Beginnings:
Inspiration is key for Funderburk, who remodels his businesses
every 18 months. "I look for something new; that's where
the excitement comes from," he says. "It's easy to
lose the excitement-that's why I like moving into other
businesses as well." -April Y. Pennington
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