A Startup Success Story: Movie Magic USA
By focusing on hard-to-find gems, these eBay sellers parlayed film fanaticism into startup success.
Description: Video and DVD sales
Founders: Crystal Holt, 36, and Steven Holt, 46
Location: Denison, Iowa
2004 projected sales: More than $700,000
eBay user ID: moviemagicusa
Steven Holt grew up admiring John Wayne so much that he may have incorporated a little of The Duke into his personality. After all, Steven became a Marine, a tough-guy career that Wayne would have admired. Naturally, his favorite film is a John Wayne movie--Sands of Iwo Jima. "It's the greatest Marine movie ever made," he raves.
After the Marines, Steven fell in love with Crystal, a high school teacher, and later married her and moved to her hometown, Denison, Iowa. He got a job with a home-warranty company, and they lived on a 180-acre farm. They had a son named Calvin, now 9. Life was good.
That would have been that--until Crystal attended eBay University with her mother, who had started a business on eBay. Crystal thought it would be fun to open one, too, to earn extra income. Because Steven was such a movie buff--he also loves anything starring Peter Cushing, Christopher Lee and Vincent Price--they decided to try selling films. They found a distributor, and in September 2002, started selling. By November, they realized one of them had to quit his or her day job, or they would have to scale back the business.
Steven left the home-warranty industry. He says becoming an entrepreneur was "scary at first." But the way he sees it, "Your fate is in your own hands. I had never stepped out like that. When I quit my job, we had only been doing this company for two months."
But he has no regrets. "I love it," says Steven, whose office has been overtaken by movie memorabilia. "My biggest issue is balance. I could work on this business 24 hours a day. I have to fight the urge to [not] close the door."
The Holts, who first started by offering John Wayne movies, have since gained an edge by selling relatively difficult-to-find films. At their eBay site, you'll easily find the 1980 Volkswagen classic Herbie Goes Bananas, but not many recent films. When they stocked the three-disc Indiana Jones trilogy, it sold terribly, Steven surmises, because anybody could find it at virtually any store in the country. The Holts buy their inventory upfront so they can ship within 24 hours and not be dependent on their distributor.
Now the couple sells 3,500 to 6,000 movies a month. That's a lot of movies, but then eBay is "a global marketplace," says Steven, who has two part-time employees to help ship movies from the office building behind their farmhouse. "It's incredible. There are a kazillion people who shop on eBay."
The Holts see a lot of future growth in their company and plan to soon transition their two part-time employees into full-time positions. Last year, the couple tried taking a two-week vacation and admit it was almost a disaster; they were backlogged with orders when they returned. But by training their employees to fill in, the Holts will be able to take sick and vacation days.
They're also grateful for the assistance they receive in the eBay community. Not only does eBay send them tips through e-mail on how they can market themselves better and bring in more sales, but they also receive advice from other sellers and customers on eBay. "That's the difference between eBay and other types of online auction sites," says Crystal. "It's like a traditional community, even if you may not ever see the people you're doing business with. But people here just seem so much friendlier than they do in other parts of the Internet. Whatever your questions and concerns are, the people on eBay are nice, fun people who genuinely want to help, and we all give each other advice."
Whatever business you go into, sell what you love, urges Crystal, who, when she isn't teaching, focuses on the customer service end of the business-writing or calling people who have questions. "That's what makes it rewarding. Having a business isn't like you see it on infomercials, where you're sitting on the beach sipping a mai tai. That's unrealistic," Crystal says. "You're not going to have to work, work, work, but you're going to have to work. But the nice thing is that you can take off to have lunch with your kid and not worry about exactly when you're getting back, and you make your own hours."
Then there are the intangibles. "Everybody has a favorite movie," says Crystal, who favors Rock Hudson and Doris Day films. "We've received e-mails from people who tell us they bought a movie from us because it was the last film they watched with their father or grandmother, or because they want their child to see a movie they loved as a kid. It makes you feel good that you're making a difference in somebody's life."
Geoff Williams has written for numerous publications, including Entrepreneur, Consumer Reports, LIFE and Entertainment Weekly. He also is the author of Living Well with Bad Credit.