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Early Birds

Before DVDs became big business, this pair of entrepreneurs saw the chance to get in on the ground floor.

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This story appears in the March 2004 issue of Entrepreneur. Subscribe »

Matt Kennedy remembers the night he snapped. It was the low point in the early days of 1K Studios. The North Hollywood, California, company-which Kennedy and his business partner, Jayson Won, started in 1996-makes menu interfaces for DVDs. Creditors were circling like vultures, and the partners had been toiling for days-adding music, titles, background visuals and refining other details. In the offices of 1K Studios-Won's apartment-they had hardly slept. Which is why, during a rare nap, a bird chirping at 4 a.m. really bugged Kennedy. And so a stressed-out, irate Kennedy charged out on the street in his underwear, throwing rocks to chase the bird away. He says, "I thought 'I can't take this much longer.'"

It would make an amusing scene for a movie, which is fitting since 1K Studios has worked so closely with movie studios. Fortunately, Kennedy didn't have to "take it much longer" before the company was on solid footing. He also had the benefit of knowing that their problems weren't due to a lack of work or a lackluster reputation. "The first year was tough," explains Kennedy, "because the studios weren't used to paying to have DVDs made, and so it could take months to receive a check."

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