3 Founders With Booming Businesses Share Stories About Their Difficult Early Days
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Three entrepreneurs look back on the early days of their now-booming businesses.
“I almost pulled the plug on my business.”
Growth hacker status: Growing despite its customer base in the oil and gas industry cratering by 26 percent.
Amit Mehta was living on pennies. In 2005, after pouring his savings into launching his Houston-based startup, Moblize, which provides analytics to the oil and gas industry, Mehta had $3.13 in the bank and not a single contract for his business. He’d spent the past 13 months living in a shelter that was run by a local temple, desperately pitching potential clients in between free meals. “They thought I was crazy,” Mehta says of the shelter staff and residents. “They were like, ‘You’re educated! You studied at Cambridge! Go get a job!’”
Burned out and broke, he finally decided to take their advice, but he gave himself one more day to hope for a miracle, praying that the $50 fax machine he had hooked up on the shelter floor would spit out good news. “I gave myself until 5 p.m.,” he says. At 4:50, he started the long walk toward unplugging the machine -- and his hopes of entrepreneurship. “At 4:54, I reached to unplug the machine, and it started beeping. It sounds like a movie, but it’s true.” Those beeps signaled an incoming message: Mehta’s first contract for $30,000.
Within 90 days, he had a second contract and a $300,000 investment from Chevron; within two years, Moblize had revenue pushing eight digits. (The 2008 recession greatly impacted his revenue and growth; as of 2016, he’d surpassed those early successes.) Some 12 years later, Moblize has a portfolio of 100 Fortune 500 clients. “I picked up on all this advice from older, smarter people at the shelter -- stuff I wasn’t taught in college,” he says. “That became what I applied in life as I grew the company. It was the best schooling.”
“Being rejected was the best thing that ever happened to us.”
Growth hacker status: 400,000 paid members and 600 employees
Raising funds is hard. But for Gunnar Lovelace and Nick Green, co-CEOs of organic food e-retailer Thrive Market, it seemed impossible. In 2014, the pair spent four months on the road, being turned down by all of the more than 50 VCs they met. “The venture community provides a great ecosystem, but it also lives in a bubble,” Lovelace says. “The folks making decisions are predominantly men, not the female consumer that’s driving the market we’re in.”
The pair started contacting influencers instead -- healthy-food bloggers, celebrities -- who could help spread the word about their affordable organic food. To their surprise, many of the bloggers wanted to invest. Thrive realized it had a new opportunity here: If influencers put down cash, they’d become heavy advocates as well. “We built a really interesting program: Bloggers earn additional equity from their activity with us, like sharing an email with their audiences about the benefits of saturated fats and linking to our coconut oil,” Lovelace says. The company works with a vast web of 1,500 bloggers, and brought in its first $10 million this way.
Thrive Market now has more than 400,000 members across the country and a run rate of more than $100 million. “We wouldn’t have succeeded nearly as well if we had been led by a traditional firm prelaunch,” Lovelace says. “The solution just didn’t occur to us until we were desperate.”
Technology Group Solutions
“When we got our first big client, I remember thinking, Oh my God!”
Growth hacker status: $55 million in revenue, 20 percent year-over-year growth
After more than 35 years working in IT, Lenora Payne is used to being the odd woman out in a male-driven industry. “Years ago, I remember being the only woman at events,” she says. “And to be a woman and black? I didn’t see that in the industry until I started running my own company.”
As a founder and the CEO of Kansas City’s Technology Group Solutions -- one of the fastest-growing women-led companies in the country -- Payne is eager to see more women in the field, but she admits that’s easier said than done. “I’d love to find a woman technician, but they’re not around,” Payne says. “Years ago, when I was working for a previous employer, there was a woman named Kathy, the first woman I knew who fixed computers. The guys would always want to help her carry the monitors, which were 40 pounds. She and I would get together and put them in the back of her car because we wanted to prove, We can do this!”
Payne never planned to be an entrepreneur, but after realizing that there wasn’t a single government-certified minority-owned business in all of Kansas City that could provide full-service IT, she took the plunge in 2005. “I had no idea what to do,” Payne says. “And I didn’t feel comfortable with the sporadic cash flow for at least two years.” She started feeling comfortable once million-dollar accounts started signing on, though it still takes her by surprise. The year 2016 brought $55 million in revenue, and the company averages 20 percent growth each year. “When we got our first big client, I remember thinking, Oh my God!” she recalls. “I would have never thought that this was possible.”