Hot Stuff

Want to know what's hot for 2004? We've got the businesses, markets and trends you shouldn't miss out on.
Magazine Contributor
15+ min read

This story appears in the December 2003 issue of Entrepreneur. Subscribe »

While much about the future will always be uncertain, one thing is crystal clear: There's still plenty of money to be made by smart entrepreneurs with a knack for predicting what's next. And even if you don't have a nose for what's new, our annual predictions for the hottest business ideas can help. We've done the research to help give you a clearer picture of what's in store for 2004...and beyond. Check out our predictions, and you're sure to find a niche that can pay off for you.

Hot Biz:Online Learning
Take online learning, mix in some video, audio and other offline methods, and you have the latest wave in the booming Web-based instruction trend: blended learning. "Blended learning is better, faster and cheaper than traditional methods," says Tom Graunke, the 37-year-old co-founder of
KnowledgeNet, a Scottsdale, Arizona-based provider of e-learning solutions.

He should know. Graunke and co-founder Mark Rukavina, 38, started KnowledgeNet in 1998 with the $2.5 million they earned from selling their previous company, Mastering Computers, a corporate training company they'd run for 10 years. Today, Graunke's company boasts more than 7,200 clients, including Cisco Systems Inc. and McDonald's.

According to research firm IDC, the training industry overall is estimated to hit $60 billion worldwide this year, with $6.6 billion coming from e-learning. The e-learning market is expected to reach $23.7 billion by 2006.

"Blended learning is the fastest-growing area of e-learning in the last 18 months," says Brandon Hall, CEO of, an e-learning consulting service in Sunnyvale, California. Hall says three segments in particular are moving to blended learning: IT training is the first, regulatory training and safety training is the second, and the soft-skills market-management training, sales training and other people skills-is going to see the next big wave.

John Alonso is the founder of Boston-based OutStart, makers of Evolution software, which allows the authoring, management and delivery of educational content. He has watched his company grow from four employees to 100 since launching in 1999, and he estimates 2003 sales will more than double 2002 sales, to be in excess of $10 million. Says Alonso, 36: "Blended training is the ability to create a training program that says 'We think this part of the training program is good with an instructor, but we're going to augment the classroom experience by having you watch a video before you come to class and continue learning online after you leave the classroom.'" For a growing number of entrepreneurs, this mix is obviously making the grade. -Steve Cooper

Learn More

  • The eLearning Guild- The eLearning Guild is a community of e-learning managers, developers and designers. With a Guild Membership ($99 per year), you can access learning opportunities, networking services, resources and publications.
  • Learning Circuits- This free online magazine offered by the American Society for Training & Development features strategies, guides, reviews and more.
Online Exclusive
Visit our Hot Centerfor our complete predictions for 2004, including hot markets, what's next in food, and trends to know about. Plus, we ask Jon Berry from market research firm RoperASW about tomorrow's hottest trends.

Hot Biz:Mobile Gaming
For those with a cell phone and a few spare minutes, a quick game of poker might be the perfect escape-especially if they draw a winning hand. That's certainly the hope of Oliver Miao, CEO and co-founder of
Centerscore Inc., a mobile-gaming development company in Palo Alto, California. With mobile gaming the hottest growth area in the online gaming industry, Miao has good reason to be optimistic.

Eighty percent of all mobile phone users in the United States and Europe will play online games using wireless devices by 2005, according to technology research firm Datamonitor. That's more than 200 million people. Creating and distributing games is where the opportunity is in this fledgling market.

Miao, 28, along with friends Justin Min, 28; Leighton Kan, 27; and Winston She, 28, started Centerscore in 2000 to create online browser-based games. Then the dotcom implosion nearly sank them. "The day we were deciding to stop, we fortuitously got a contract to do one cell phone game," Miao recalls.

Miao and his partners weathered the storm and have since developed games such as Jeopardy and Wheel of Fortune for Sony Pictures Digital Inc. The company's revenues will reach six figures this year, Miao says, and he expects them to triple in 2004.

Fabrice Grinda, CEO of mobile games distributor Zingy, is also glad to see the mobile gaming market arrive. The New York City-based company, launched in 2001, also sells ring tones, wallpapers and other mobile entertainment solutions. "In the U.S., game-compatible phones only really reached the market in December of last year," says Grinda, 29, who predicts mobile games will be Zingy's largest revenue generator next year.

Grinda isn't the only one predicting success in the mobile gaming market. Research firm The Yankee Group expects the U.S. mobile gaming market to hit $1.2 billion in 2006-a royal flush. -S.C.

Learn More

  • Midlet-Review- This Web site created by mobile gamers offers news, reviews and mobile game downloads.
  • Game Research- Bringing together the art, business and science of computer games, this site devotes a large section to mobile gaming. It also offers a newsletter, statistics, articles and more.

Hot Biz:VoIP
Ravi Sakaria is hearing voices, and it's a good thing. The 33-year-old co-founder, president and CEO of voice-over-IP (VoIP) provider start-up
VoicePulse a trailblazer for a technology that is rapidly gaining mainstream acceptance. Homes and businesses around the world are leaving their regular phone service behind to make their calls for a fraction of the price over the Net. That the North Brunswick, New Jersey, company came into existence in January of this year serving eight area codes and now covers 30 shows how fertile VoIP can be for entrepreneurs.

"The growth rate is tremendous. As it becomes known that the quality is equivalent to traditional telephone service, the features exceed it and the cost is lower, then that uptake is only going to increase," says Sakaria. Julia Mermelstein, senior consulting analyst with research think tank ABI Researchin Oyster Bay, New York, also sees a trend of steadily increasing sales in 2004. While large enterprise will likely be slow to adopt VoIP, consumers and small business will be on the forefront. That's where companies like VoicePulse are focusing their business models.

Entrepreneurs don't have to look into becoming service providers to get into VoIP. Both digital phone hardware and custom software applications based on VoIP standards will be important components for the burgeoning technology. Mermelstein also sees great potential for entrepreneurial technology resellers to add VoIP to their service offerings.

Sakaria has advice for those looking to get into VoIP: "If you don't look at the promise of the technology and how you're going to add value as far as features go, then you're really missing out on rounding out your business plan. That's where the opportunity lies."

With VoIP still in the process of proving its mettle, now is the time for entrepreneurs to get in on the ground floor and start hearing voices for themselves. -Amanda C. Kooser

Learn More

  • This Web site offers timely IP telephony news and market research, in addition to e-mail newsletters and tutorials.
  • The CT Portal- You can find white papers, case studies, news and related links at this telephony resource.

Tech Security, Spas & Upscale Pet Services

Hot Biz:Tech Security
One of the biggest computer stories of the past few years is the rise of technology security. It's a wide-open area that encompasses everything from biometric thumbprint scanners to VPNs to consulting to firewalls to virus protection and beyond. A 2002 study released by IDC expects the IT security market to jump from $17 billion in 2001 to $45 billion in 2006. Three areas leading the charge are security hardware, services and software.

David Kaufman, 39, CEO and co-founder of Intense School , has helped his 64-employee company find a niche on the training side of security. When it started in 1997, the Plantation, Florida, company featured Microsoft and Cisco certification training. After 9/11, in response to the growing demand for security services, the company shifted gears to focus on information security boot camps. Its menu now features security-professional certification training and a popular professional hacking class from which 2,000 attendees have graduated. "It's one area of our business that is really blossoming," says Kaufman. Intense School illustrates the diverse opportunities available for entrepreneurs in the technology security sector. With the boom in wireless networking, Kaufman points to wireless security as a high-growth field.

Worms, bugs, viruses and hackers aren't going away anytime soon, and companies and consumers are looking for ways to make using the Internet safe again. Growing businesses working in security software and hardware development will find demand for products that fill niches, are easy to deploy, and are cost-effective to meet the needs of tight IT budgets. Entrepreneurs with technology security backgrounds can parlay their experience into consulting, development and security implementation work. Whether you're into thwarting hackers or scanning irises, there's room for new business in security. -A.C.K.

Learn More

  • Computer Security Resource Center - A division of the National Institute of Standards and Technology, this organization's mission is to research, develop and raise awareness of risks and vulnerabilities for new technologies.
  • - This Web site offers news, white papers, a newsletter and information regarding small- and medium-sized businesses and their IT concerns.

Hot Biz:Spas
The definition of "spa" is expanding. Today there are medical spas, spas for men, spas for kids and teens, even spas for the whole family. The spa industry, like the fitness industry, is diversifying its offerings and how it provides them. "A lot of spas are including memberships where you sign up for the year and [get] a variety of services at reduced rates," says Melinda Minton, a spa consultant and founder of
The Spa Association .

Customers are taking advantage of these special deals: 45 million Americans-one in five people-visited a spa at least once between June 2002 and June 2003, according to the International Spa Association. And 2004 will bring continued steady growth, says Linda Lewis, executive editor of Dayspa, a magazine read by 32,000 salon and spa owners.

In June 2002, Susan Tierney opened Seventeen Studio Spa Salon with husband Steve Tierney, 42, and Kathy Karagin, 44. The Plano, Texas, spa licensed the rights to use Seventeen magazine's brand in the United States and Canada. The spa's 30 employees cater to the 12-to-34 crowd with acne facials, waxing, hair styling and other services. But it's not just girls getting primped and pampered: 20 percent of Seventeen's customers are teenage boys coming for haircuts and highlights. "It's a very cool place, and they get to see the girls," says Susan, 44. The company estimates sales of $1.3 million to $1.6 million in 2003 and plans to expand to 150 locations by 2010.

Minton sees the industry trending toward "away day" spas located just outside major metropolitan areas; "wellness spas," where spa treatments are aligned with specific health goals such as nutrition; and "mind spas" that specialize in mental alertness for an aging population. But here's the rub: Minton has watched spa enthusiasts start their own spas without realizing how overhead can drain the bottom line. "Some spas only make 5 percent profit," Minton says. "It's still a great opportunity, but you have to treat it like a business."

For more information on starting a day spa, read " Great Escape ." -Chris Pentilla

Learn More

  • Virtual Spa - This Web site is a one-stop resource, covering everything from the physical facility to the programs and services your spa can offer.
  • SpaTrade - An online spa business management resource, SpaTrade offers news, article links, expert advice and more.
  • International Spa Association - The International Spa Association is recognized as the professional organization and voice of the spa industry.

Hot Biz:Upscale Pet Services
People love their pets, and it's showing. In fact, their overwhelming displays of affection and concern have transformed the pet industry in an explosion of new offerings. The
American Pet Products Manufacturers Association Inc. (APPMA) estimates $31 billion was spent on pets in the United States in 2003, up from $29.5 billion in 2002. With over 80 percent of pet owners purchasing at least one accessory for their pet in the past year, the exponential growth of the upscale pet services sector signals a seismic shift in pet owners' attitudes.

"More people are treating their pets like humans, thus looking for human-like services and products," says Bob Vetere, managing director and COO for APPMA. "We're seeing everything from pet hotels with heated floors to a guy who does liposuction and chiropractics." Other luxury pet services out there include limousine rides, day cruises and personal shoppers-proving what's good enough for humans is definitely good enough for pets.

Tom O'Leary, co-owner of Dog Spa in Beverly, Massachusetts, caters to coddling pet parents by offering a full dog spa in addition to upscale products. Grooming and spa treatments in "quiet rooms" include exfoliating treatments, hair revitalization and aromatherapy. O'Leary, 48, launched the business in June and projects sales of $750,000 to $1 million for the first year.

The two top U.S. pet supply chains, Petco and Petsmart, have boosted sales by adding high-end merchandise and services to their stores. While that may sound ominous for entrepreneurs, the good news is that many pet service consumers prefer boutiques to the larger stores. The key is specialization. "You have to identify your niche and work it to your advantage," says Vetere.

There's also a growing demand for products that help bridge the emotional gap between creature and man, like greeting cards from pets and Bow Lingual, by Tokyo-based Takara Co. Ltd., the first dog bark translator that scientifically analyzes barks and interprets dogs' emotions. With dog yoga being all the rage, maybe "ouch" is what Fido's really been trying to say. -April Y. Pennington

Learn More

  • - This online pet directory offers a free newsletter, product reviews, pet-care tips and more.
  • - Geared toward pet lovers, this site provides information and links for services, training, products and articles.

Wireless, Outsourcing & Senior Care

Hot Biz:Wireless
The telecommunications industry has been dragged through the dirt lately, but that doesn't mean there isn't room for smart entrepreneurs to make waves. And the area to look at is wireless. While on the surface the wireless arena appears to be dominated by jumbo-size enterprises, a lot of the innovation and nuts-and-bolts work is provided by growing businesses and start-ups.

Anjan Ghosal, 39, founder and CEO of Melbourne, Florida-based IntelliNet Technologies , describes his business as building the software plumbing that goes into making wireless services work. Ghosal knows a lot about innovation and keeping his 50 employee company competitive in a tight market. IntelliNet recently came out with technology that allows users to seamlessly roam from cellular connections to Wi-Fi wireless LAN connections without data interruption.

One area attracting entrepreneurs is the wireless hot-spot market, but Ghosal cautions against betting your future on this. "The key challenge in that space is that people are still trying to figure out the business model. Service providers really haven't figured out how to make money out of it." He points to prepaid wireless services and location-based technologies like e911 as two areas that are in solid growth modes. Businesses that can add value and offer desirable services or applications in those areas will be primed to do well in 2004.

Another area with developing potential is home electronics networking. Consumers and home offices have heaps of electronic equipment spread across their property that could benefit by communicating wirelessly, and it's going to take hardware and software to bring it all together.

With all the excitement around wireless networking, don't overlook the continued growth in cellular. Research group In-Stat/MDR predicts there will be 2 billion mobile subscribers worldwide by 2007. Those users will be looking for ring tones, downloadable games, data services and business applications. That all adds up to spell "opportunity" for entrepreneurs. -A.C.K.

Learn More

  • Palowireless - This Web site is a portal for wireless technologies covering tutorials, market research, news, events and more.
  • Telecomweb - This Web site is for wireless communications professionals and offers news, analysis, reports and more.

Hot Biz:Outsourcing
Technology continues to make outsourcing an attractive solution for cost-conscious companies. The finance and accounting outsourcing market alone is expected to generate $37.7 billion worldwide by 2004, according to research firm Gartner Inc. Some estimates price the global outsourcing market at $300 billion annually.

"This is the globalization of the IT industry," says Stephen Lane, research vice president of IT services at market analysis firm Aberdeen Group in Boston. "Outsourcing is really hot right now."

So hot that the U.S. government is opening 850,000 jobs to outsourcing and says $85 billion in federal IT contracts will be awarded over the next three years. International outsourcing, meanwhile, is controversial-and growing: 3.3 million U.S. jobs ($136 billion in wages) will move offshore by 2015, according to technology research firm Forrester Research Inc.

So what are the hot areas for 2004? Outsourcing of business processes such as HR and accounting will remain popular, as will network security. There's also room for small firms that can help companies figure out what to outsource and how to manage their off-shore projects.

"We've consistently grown and made money every year," says Gurvendra Suri, 40, founder and CEO of Optimal Solutions Integration Inc., an 8-year-old enterprise technology consulting firm in Irving, Texas, with 130 employees. The company is going global: It already employs 30 people in Bangalore, India. Sales in 2002 were $22.2 million, and Suri estimates 25 percent sales growth in 2003. With a growing number of global projects starting to pay off, Suri says, "We should have 50 percent or more [growth] in 2004."

Outsourcing firms are shifting to contracts with fewer fixed costs for customers seeking greater flexibility. "You pay for what you use," Lane says. "That's one of the value propositions [outsourcers] are putting in front of their customers." -C.P.

Learn More

  • The Outsourcing Institute - The only global professional association dedicated solely to outsourcing, this site requires a free membership in order to access the site's information, services and solutions.
  • Sourcing Interests Group - This Web site offers free reports and newsletters (guest membership may be required) regarding all things outsourcing.

Hot Biz:Senior Care
Managing the care of children and aging parents is becoming increasingly common for many adults. According to Steve Barlam, president of the
National Association of Professional Geriatric Care Managers , which assists older people and their families with long-term care arrangements, 60 percent of those seeking a care manager's services are managing their parents' care from a distance, while the remainder live nearby but don't have time to handle all the arrangements. In other cases, there's a conflict between family members, and an objective third party is needed. This translates into a growing need for products and services to help this "sandwich generation." These can range from providing senior day-care centers to in-home care services, companionship and even in-home beauty services.

"The personal training industry [for seniors] is going to be hot," adds Barlam. One-on-one fitness training that keeps seniors active and healthy will be popular with both seniors themselves and their adult children. Electronic devices and smart appliances that can send information to adult children will also be in demand (Intel Corp. and General Electric Co. are developing them now).

Products and services offered must be affordable, and in the case of day-care centers, tailored to the needs of those attending, with medical attention available to those who are suffering from dementia or who are disabled, and social stimulation for those who are still healthy and mobile. Products can be marketed both to adult children and to seniors who are managing their own care.

Greg Gunderson started Manhattan Beach, California-based Gentle Transitions in 1994 to help seniors plan and execute a move into senior communities or smaller homes. He helps with everything from downsizing possessions to doing the packing-and unpacking. His sales reached $700,000 this year. "By the end of the day on moving day, a client walks into their home, and it looks like the place they've been for the last 30 years," says Gunderson, 43. "It really helps in their adjustment to a brand-new place." -Gisela M. Pedroza

Learn More

  • - This is an online job-listing site exclusively for the elder care, geriatric, and senior housing industry.
  • American Health Care Association - This non-profit federation for elderly and disabled individuals works to ensure the quality of long-term care through education and advocacy.

Online Matchmaking, Children's Enrichment Programs & Organic Foods

Hot Biz:Online Matchmaking
The future of online matchmaking is no longer the bastion of lonely singles searching for love. According to market research and consulting firm Marketdata Enterprises Inc. , as the dating services industry continues its stellar growth, reaching $1.14 billion in 2003, the growth of online dating services that simply copy popular sites is beginning to plateau. Innovative entrepreneurs are now taking a look at the successful business model and spotting new opportunities that, while still matchmaking, offer a twist.

Finding a fresh niche is key to the success of sites like, a virtual wildfire boasting more than 2 million subscribers despite zero advertising. Founder Jonathan Abrams was inspired by how his friends met people-through other friends. "I wanted to create an experience that was more reflective of real life," explains Abrams, 33. The invitation-only membership site offers a pool of potentially limitless friends and their friends (up to four degrees) with whom clients might make friends, network or, yes, date. While the basic membership will always be free, says Abrams, Friendster plans to eventually add a premium subscription service, though the specifics have not been worked out yet.

After a struggle to find a business partner earlier this year, Craig Maiman, 43, started EntreMate . Entrepreneurs post profiles and search an online database to find prospective business partners or founding team members. Criteria like industry, skills, location and alma mater aid entrepreneurs in zeroing in on a match. Some 900 members joined within six weeks of launching the site, and Maiman expects over 10,000 registered users by 2004.

With market research firm comScore Networks Inc. citing online personals as the single-highest category of paid content for Americans, people are obviously willing to pay for connections, social or professional. "It makes sense," says Bruce D. Weinberg, associate professor of marketing for Bentley College in Waltham, Massachusetts, and expert on the online consumer experience. "[Online matchmaking] taps into what is the heart of the Internet, helping people connect for some kind of potential for exchange." -A.Y.P.

Learn More

  • - A portal for online matchmaking sites, provides a list of dating sites, including their history, cost and what makes their service unique.
  • Dating Services - Another guide for online dating services, this site offers reviews and articles. Tips, resources and a newsletter are coming soon.

Hot Biz:Children's Enrichment Programs
If anyone needs a daily planner, it's today's kids. With everything from dance, martial arts and foreign language to sewing, organized sports and chess programs to tempt parents, it's no wonder enrichment programs have spawned a billion-dollar industry.

Why the push for extracurricular activities extraordinaire? "Given the number of homes where both parents work and a corporate culture that demands people put in longer hours at the office, many families depend on organized activities to fill the after-school void," says Stacy M. DeBroff, author of Sign Me Up! The Parents' Complete Guide to Sports, Activities, Music Lessons, Dance Classes, and Other Extracurriculars (Free Press) and other parenting books, as well as founder of the online portal Mom Central Inc. "Organized activities hold intense appeal since they are theoretically safe and overseen by responsible adults who monitor what's going on in our absence."

Whether you operate a physical location, take your business to area schools or offer private lessons, the opportunities are boundless. Archer Altstaetter, founder and owner of Dance Emotion, a dance studio in Irvine, California, offering all manner of kids' dance lessons, chose the studio route. A former dance student himself, the 33-year-old is a natural with kids, and it shows. "Word-of-mouth is currently my biggest ad," says Altstaetter, who started Dance Emotion in 1997 for around $12,000 in cash and credit cards. "I just can't pay for that. I have 500 happy clients."

Altstaetter expects to have 600-plus students enrolled by springtime, which should up this year's estimated sales of $210,000. With future plans for a built-in theater, a mommy gym, a snack shop and possibly day care, Altstaetter should have no trouble taking those next steps. -Karen E. Spaeder

Learn More

  • National Network for Childcare - This site provides a collection of resources and information, such as child development, quality childcare, health and safety, etc.

Hot Biz:Organic Foods
Consumers craving healthy, environmentally friendly fare are turning to organic foods in greater numbers than ever. And as demand grows, stores are clearing space on their shelves to make way for organics.

"We're beginning to be found in so many more places than at anytime in our past," says Katherine DiMatteo, executive director of the Organic Trade Association . "If you're an entrepreneur, there's lots of opportunity in terms of possible markets." U.S. sales of organic foods are about $11 billion, yet account for only 2 percent of retail food sales, according to the Organic Trade Association, making for nearly limitless possibilities.

Going organic can mean anything from adding organic produce to your restaurant menu to creating and selling an entirely new product. If you're not growing it yourself, you'll pay a premium for certified organic foods. "Look carefully at your client base, and determine whether they're going to be willing to pay a premium price for [organic], or whether you're willing to sacrifice your bottom line for it," says Jackie Keller, founding director of Los Angeles-based NutriFit LLC , a company that makes and delivers healthy, prepared meals to clients, using organic ingredients.

Many companies are finding a way to balance those options and are boasting healthy sales in the process. For O'Naturals , a Falmouth, Maine-based fast-casual chain with 2003 estimated sales of more than $3 million, about one-third of what is served in the company's four restaurants is organic. Fairfield Farm Kitchens Inc. of Brockton, Massachusetts, has obtained organic certification for its line of frozen entrees, soups and bakery products. The company estimates sales will top $15 million this year.

Co-founders Eric Schnell, 33, and Steven Kessler, 43, of The Healthy Beverage Company , based in Newtown, Pennsylvania, expect to earn $2 million this year from their line of organic sodas, Steap, made of carbonated green tea. "Carbonated soft drinks have been flat sales-wise because the beverage category has been moving toward healthier beverages like juices and natural beverages," says Schnell. "[Steap] is a soda, but it's also healthy."

If you want to go organic, creativity is key. "Are you addressing an unmet need, are you bringing something new to the category, or are you just another substitute for what [stores are] already carrying?" asks Bob Burke, owner of Natural Products Consulting Institute, an Andover, Massachusetts, firm that helps bring natural and organic products to market. Come up with a good answer to that question, and you could soon be seeing tasty profits. -Devlin Smith

Learn More

  • Organic Consumers Association - This non-profit organization focused on organic consumers covers issues of food safety, industrial agriculture, genetic engineering, corporate accountability, and environmental sustainability.
  • All Organic Links - This organic portal features carefully-selected organic industry links with descriptions. You can use their search function or browse through their directory, most popular links and more.

Home Automation, Specialty Exercise Aftermarket & Home Improvement

Hot Biz:Home Automation
The mythic Jetsons-style home with its automatic lighting and easy room-to-room communication is no longer a figment of the imagination. The demand for home networking is growing, with nearly 86 percent of consumers wanting to install custom electronics in their homes, according to the Custom Electronic Design & Installation Association (CEDIA). Home security systems top the list of desired automated amenities, followed by home entertainment, lighting and window coverings. Formerly a perk for just the very wealthy, the trend is starting to trickle down to more middle-class consumers, says Jeff Hoover, president of CEDIA.

Joe Dada, founder of Smarthome Inc. , a manufacturer and retailer of home automation products in Irvine, California, has seen rising demand from consumers. Dada notes that his customers generally start with a smaller, more inexpensive product-something to control lighting, for example-then move up to other, more elaborate automation products. "Once you've had it, you won't let go," says Dada, 41. He's expanded his $22 million business to include Smarthome Live, a service where customers can monitor their homes live via an Internet connection.

As big-name electronics manufacturers like Dell, Microsoft, Philips and Sony continue to design home automation products for the mass market, the entrepreneurial opportunity will be found in installing and maintaining these systems, says Hoover. Michael Holthouse, 46, founder of Intuitive Homes Inc. , specializes in such installations. This Houston entrepreneur, who expects sales of $2.8 million this year, notes that the challenge comes in integrating pieces of technology from different vendors-but that the end result is astounding to consumers. "The excitement is when homeowners who are not tech-savvy can fully utilize huge amounts of technology-it makes [it] so simple." -Nichole L. Torres

Learn More

  • - Here you'll find an online directory of home-automation Web sites ranging from hardware and software to example homes and ideas.
  • HomeToys - With educational and promotional content, this zine covers products, services and news for home automation and networking.

Hot Biz:Specialty Exercise Aftermarket
Today, yoga and Pilates are more than fads; they encompass a lifestyle with huge market potential. According to a June 2003 Harris Interactive/
Yoga Journal survey of 4,000 Americans, 7 percent said they are practicing yoga-a 28.5 percent increase over 2002. One in six respondents said they planned to try yoga for the first time within the next 12 months.

Companies are bending over backward to reach this growing market. Yoga and meditation gear-from clothes and mats to DVDs and music-populates retail shelves. Yoga classes aimed at pregnant women and kids as young as age 3 are rooting firmly in suburbia. Men now comprise 23 percent of U.S. yoga enthusiasts. "There's been a maturation of the market," says Dayna Macy, communications director for Yoga Journal, a magazine that boasted 20 percent circulation growth between 2001 and 2002. "There are all kinds of ways to capitalize on the yoga boom." Yoga-inspired foods, gear aimed at men, instructors who work inside schools and large corporations, and franchising are just a few largely untapped markets.

Roughly 4.7 million Americans also take Pilates, a workout that builds abdominal strength. Maria Leone, owner of Bodyline Fitness, bought into the Pilates studio in Beverly Hills eight years ago and bought it out completely from a partner one year later. Her Pilates on the Go video series, developed about three years ago with business partner Holly Correa, 39, is muscling onto shelves, with an estimated $200,000 in 2003 sales.

If you want to teach, keep your overhead low early on by finding a small gym or chiropractic office that will rent space for one-on-one sessions, suggests Leone, 37. "But you'll need great promotional skills," she says. A Pilates session can range from $50 to $70 per hour. "There's still so much room for growth," Leone says. Meditate on this market, and breaking in might not be such a stretch after all. -C.P.

Learn More

  • North American Studio Alliance - Aimed at the the mind-body community, this site offers a free newsletter, business resources and other membership services ($95 per year), such as alternative health-care programs.
  • 365 Fitness - Click here to access links to pilates Web sites and stores.

Hot Biz:Home Improvement
Home was once where the heart was-now the home is the center of the universe. And consumers are spending lots of money to remodel and refurbish their dwellings to make them more comfortable. According to the National Association of Home Builders (NAHB), some 26 million homes are remodeled yearly. The
National Association of the Remodeling Industry (NARI) reports that Americans spent $163 billion on remodeling in 2002.

The proliferation of home improvement shows exemplifies the trend-at press time, there were more than 30 such shows on TV. Vern Yip, a designer on The Learning Channel's popular Trading Spaces series, is at the forefront of trends with his company, Vern Yip Designs in Atlanta. "There's been an increasing turn inward toward what it means to have an amazing home and how that impacts the quality of your life," says Yip. "And people are increasingly entertaining at home."

Mark Brick, NARI's national president, also says homeowners are focused on maximizing their space-from built-in shelves in every nook and cranny to raised ceilings to skylights. "They are using the area they have, and it's being planned out better," says Brick.

Noting that this huge industry is based on service, Brick sees myriad niches and opportunities opening up. These range from traditional fields, such as contracting and interior design, to newer specialties, like interior arranging (designing new spaces with items a client already owns). Making homes more accessible to the aging baby boomer population-adding wheelchair ramps and support rails, for example-is a growing segment, while businesses that design and remodel environmentally sound living spaces continue to develop.

Designing home interiors has been the bread and butter of William Hulsman and Albert Lynch of interior design firm William Hulsman Inc. in Boston. With a focus on classic design, Hulsman, 43, and Lynch, 47, have also added a retail furniture showroom in the Hamptons, Bill Hulsman Home, which they say will top $2 million in sales this year. Hulsman notes that among his clientele, "people are in a transitional mode and being more adventurous with how they want to live. People are recycling what they have and reinterpreting what they [own]-and reinventing themselves." -N.L.T.

Learn More

  • - This resourceful online directory helps homeowners find contractors and offers contractors a chance to publicize their services.
  • NorthWest Builders Network Inc. - Here, builders and homeowners can find free online resources ranging from energy conservation to architectural planning and design.

Women's Fitness Centers, eBay & Medical Supply

Hot Biz:Women's Fitness Centers
Women's fitness is big business: Women comprise 52 percent of the slightly more than 36 million health club members in the United States, according to the International Health, Racquet & Sportsclub Association. The health club industry generated $13 billion in total revenues in 2002.

The strength of the women's fitness market isn't lost on savvy companies. Curves for Women, a Waco, Texas-based women's fitness franchise, is seeing tremendous growth with its 30-minute workout concept. Even the 111-year-old dancewear company Danskin is getting into the act with a line of weight training equipment just for women.

Women's fitness is booming, says Mark Mastrov, founder and CEO of 24 Hour Fitness , a San Ramon, California-based fitness center with more than 300 locations. Women account for 48 percent of its membership. "That number continues to grow," he says. "Women are really getting into personal training, working out with a trainer who can teach them about nutrition and the proper way to exercise."

"Exercise spas" combining spa treatments with Pilates and yoga are emerging around the country, and women's strength training is benching sturdy growth, too. Burr and Carl Diehl, married and both 56, are co-owners of The Bar Method, an exercise studio in San Francisco. They've also licensed the name to owners who have locations in Los Angeles and Connecticut. With estimated 2003 sales of $500,000 from their San Francisco studio, Burr says, "We're growing at a pretty [good] pace."

Opportunities also abound in nutrition, personal training, workout reminders, progress tracking, clothing and equipment. 24 Hour Fitness' research shows women want a maximum drive time of 12 minutes followed by a 30-to-45-minute workout. "Women are looking for something convenient, social and close to home," Mastrov says. "If you're creating a new entrepreneurial concept aimed at the women's fitness market, pick the right location, and make sure you have staying power inside a very strong experience- and service-oriented concept. You've got great opportunity right now." Understand what women want, and you could fit right in. -C.P.

Learn More

  • Association of Women's Fitness - Check out the online home of this women's fitness association, which offers women a chance to meet both formally and informally to share and promote their overall health and fitness.
  • American Council on Exercise - ACE is a nonprofit fitness certification and education provider. Their site features a free newsletter, fit facts, job listings and more.
  • Entrepreneur's How to Start a Personal Training Business - Offering information on everything from start-up costs and marketing ideas to day-to-day operations, this guide can show you how to put your interest in fitness to work for your by showing others how to get and stay in shape.

Hot Biz:eBay
It's easy to get started on eBay. Unearth your forgotten knickknacks or old clothing, snap some photos, and in minutes they can be up for auction. But with 16 million items up for sale, and sales totaling $61 million on any given day, transforming your weekend hobby into a full-time eBay business and really making some noise on this vast site will be your challenge.

So what's hot right now on eBay? Just about everything. Home and garden items grew 151 percent between second quarter 2002 and second quarter 2003. Clothing and accessories grew 103 percent; vehicles, parts and accessories grew 93 percent; and consumer electronics grew 63 percent in that same time period.

Gotham City Online founders Jonathan Garriss, 33, and David Topkins, 31, have found success in the clothing category on eBay, auctioning overstock merchandise for their retail clients since 1999. This niche has brought the New York City-based business an estimated $7 million in sales for 2003, and with projections double that for 2004, it's safe to say the duo has found the eBay formula for success.

They use their eBay Store-a subscription-priced, customizable site that provides eBay sellers with their own URL, discounted fees and a one-stop shop where buyers can easily search all Gotham City auctions-to let customers find what they want more quickly. They advertise their outside site on Google and Overture, and then use it to drive traffic to their eBay auctions and to work with their retail partners.

The biggest secret to running a successful eBay enterprise is customer service, a tactic in which Garriss is well-versed. "We want to remove all barriers holding back a shopper," says Garriss. "We have a return policy, run free-shipping promos [and] offer combined shipping. All our packages are insured at no additional cost, and we post a toll-free number for our customers to contact us if they have any questions." -Laura Tiffany

Learn More

  • - This site is the online home of the National Retail Federation, whose focus is to provide support for online retailing executives. Membership fees start at $2,500 annually, which allows access to the site's member directory, teleconference archive and other member-only content.
  • - This Web site tests Internet marketing strategies then publishes the results for all its subscribers to read-and best of all, your subscription is free.

For more on starting your own eBay business, read "Finding Your Niche on eBay" here .

Hot Biz:Medical Supply
With baby boomers fast approaching the age where chronic diseases like arthritis, diabetes and respiratory ailments set in, and with the number of seniors expected to grow to 70 million by 2030, according to the U.S. Administration on Aging, the medical supplies and equipment industry will continue to grow.

Though the Centers for Medicare & Medicaid Services recently took action against abuses of the Medicare program by temporarily halting issuance of new supplier numbers, which vendors need to sell their products, they are expected to begin issuing numbers again early next year. New applications will be heavily scrutinized, making entr�e into this industry more difficult but not impossible. Most experts say the extra effort will pay off for entrepreneurs, as the size of this market continues to boom. "Families of senior citizens will rely on quality home health care more and more," says Kay Cox, president and CEO of the American Association for Homecare , which represents the home medical equipment and supplies industry. "The entire home-care industry is growing consistently-no one particular segment has been left behind. And the number of patients is rising steadily."

Samer Ariss, 29, and Farshad Firouznam, 30, started their home medical supplies business in 1998 after hearing about the opportunity from doctors they knew. Forgoing dental and medical school, the pair invested $16,000 of their own money and hours of building relationships with area doctors to grow Orange, California-based Global Care into a $6 million business. Ariss credits the success to the partners' focus on a specific niche: respiratory and sleep apnea products. They've also expanded to include a mail order pharmacy. Says Ariss, "At the end of the day, you're really helping older people live normal lives." -G.M.P.

Learn More

  • MedMarket - Browse this medical search index for manufacturers, suppliers, distributors, purchasing agents and physicians.
  • American Medical News - This online news site for physicians covers topics ranging from government and professional issues to business, and health and science.

Steve Cooper, Amanda C. Kooser, Gisela M. Pedroza, April Y. Pennington, Chris Penttila, Devlin Smith, Karen E. Spaeder, Laura Tiffany and Nichole L. Torres contributed to this article. Additional research was conducted by Steve Cooper.


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