The Weekend Entrepreneur
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So you want to start a business, but don't think you have the time? Think again. All you need to get started on the path toward your dream business are inspiration and determination... and maybe a few extra hours a week. Meet three entrepreneurs who used their off hours to launch and grow successful businesses--and get some tips on the dos and don'ts of starting a weekend business of your own.
Filling a Need
After buying their first home, Debra Cohen and her husband faced the unenviable chore of finding reliable home improvement contractors. Fed up with blindly picking names from the Yellow Pages and waiting for contractors who didn't show up, it occurred to Cohen that if she and her husband were having trouble finding contractors, other homeowners in their community must be facing a similar predicament. This bleak reality sparked the creation of a unique service that has since expanded into a profitable cottage industry across the U.S. and internationally.
After extensive conversations with lawyers, business consultants, contractors and insurance agents, Cohen, 38, started Hewlett, New York-based Home Remedies of NY Inc. from her home in February 1997. This stay-at-home mom used a $5,000 loan, a computer and a refurbished fax machine to launch her part-time business. Right away, the response from homeowners was tremendous, and after three months in business, she repaid her loan. Her gross earnings in the first year were almost $30,000.
Today, Home Remedies is a contractor referral service that matches home-owners with reliable home-repair workers. The appeal to customers is that the company takes on the time-consuming task of locating and screening qualified contractors, checking to make sure they're adequately insured and licensed, and serving as a liaison between the contractor and the homeowner throughout the course of a job. Home Remedies provides a win-win situation for both parties: Services are provided free of charge to the homeowner, and contractors represented by Home Remedies only pay a commission for any work they secure.
At first, Cohen worked approximately 15 hours to 20 hours per week; she now works about 30 hours per week. Last year, sales for Home Rem-edies exceeded $100,000. Cohen earns additional income by selling manuals and packages on how to get started in the referral business. (Her manual, The Complete Guide to Owning and Operating a Successful Homeowner Referral Network, is available at www.homereferralbiz.com.)
Working From Home
Talking about filling a need you discovered on your own, Mark Rogers, 39, was an amateur photographer who was considering turning pro until he did a Google search for 13-by-19-inch frames and realized he'd stumbled on a niche waiting to be serviced.
It turns out most frame companies were not making it easy for photographers to buy frames in the sizes they needed. With the popularity of digital photography, Rogers says, "I was frustrated with the lack of [alternate] frame sizes from the usual suppliers." He also had difficulty finding standard-size frames that would help reduce fading and would not cause yellowing. Rather than continue to deal with the frustration, he decided to start manufacturing and selling gallery-style picture frames to fine-art photographers. In 2004, Rogers founded Dallas-based Frame Destination Inc., which markets specialized products such as acid-free, conservation-quality frames in wood or metal.
At first, Rogers juggled his new business with his day job as an electrical engineer and his photography hobby, but he quit photography when the long hours started taking their toll on him. "That got old. I was starting to get burned out," he says. "I mix business and pleasure quite a bit now. For instance, when I go to a photographer's gallery reception, I view the work, so-cialize and enjoy hors d'oeuvres, but I am working. Some of the attendees are people I do business with, and others are potential clients."
With an initial investment of $30,000, Rogers' framing business was cash-flow positive in about six months. Hiring one part-time contract employee has helped him meet the demands of his busy operation. It had been Rogers' longtime dream to be his own boss, and he had seriously contemplated opening a photography business until he realized that, although he would be the business owner, he would still have to perform manual activities. Instead, he wanted to build a company that would become an asset-one that would produce income even if he wasn't working and that would allow him to retire. Frame Destination was the picture-perfect opportunity.
Rogers started the business out of his home. Compared to other frame businesses, Rogers says, "Mine is a high-volume wholesale version, so it isn't an easy one to start at home, and it definitely can't last in a home. Regular custom picture-framing, however, is a common [homebased] business. You can get the distributors to do a lot of the frame and mat cutting so you don't need as much equipment, and you can just do the final assembly in your home." The advantage of homebased picture-framing businesses is the low overhead, which makes it easier for smaller companies like Rogers' to compete with big companies like Michaels. The advantage has paid off for Rogers, who moved operations out of his home in May 2005 to accomodate the company's growth. He projects 2006 sales to reach more than $500,000.
The internet has been an important resource for Rogers to build his customer base. He uses Google AdWords and a couple of banner ads on photography art show websites to attract customers, and enjoys helping photographers in online forums. "People post questions about where to get frames, and I help them," he says. "Now that photographers know me, they recommend my company to others."
Even though Brian Eddy, 31, worked 40 to 50 hours a week at a Minneapolis law firm, his day wasn't over when he left the office. This entrepreneur man-aged to practice law by day and run Q3 Innovationsin his free time. The company, which he co-founded with longtime friend Chad Ronnebaum, 31, is a product design, development and distribution company with an emphasis on the personal safety and monitoring devices market.
Since launching in 1999, Eddy and Ronnebaum have successfully marketed the Alcohawk ABI digital breath-alcohol screener and other Alcohawk products to big-time retailers like The Sharper Image and Target.com.
Eddy got the idea for his business while working for a drunk-driving defense attorney in Iowa City, Iowa, during law school. So many clients said they would not have driven had they known their blood alcohol content was so high. After Eddy discussed the potential of an affordable personal breathalyzer with Ronnebaum, the pair found a company online that manufactured a disposable alcohol tester.
Eddy and Ronnebaum didn't purchase any inventory for Independence, Iowa-based Q3 Innovations until it became a distributor of the disposable testers in December 1999. By January 2000, after they had purchased $1,000 in inventory, orders started rolling in, and the company became profitable within the first couple of months.
Initially, Eddy and Ronnebaum kept their day jobs and worked nights and weekends on Q3 Innovations. But since then, Eddy has left his firm and Ronnebaum has left his pharmaceutical job.
Although Eddy says a business degree provides a solid foundation on which to start and run a business, he also says a law degree doesn't hurt. He was just starting law school when the business took off. So why didn't he quit his day job early on? Eddy's law degree and the knowledge he gained working in the field of business law have been to be extremely useful as he and Ronnebaum as build a company that generates annual gross revenue between $2 million and $5 million.
What to Do...
Starting a business using just your weekend hours (and maybe even your weekday evenings) can be a challenge--so we went to Jeff Sloan, co-founder with his brother Rich Sloan of StartupNation LLC, an online outlet for starting and growing a business, and co-author of StartupNation: America's Leading Entrepreneurial Experts Reveal the Secrets to Building a Blockbuster Business, to get the dos of starting a weekend business. Listen up.
- DOstart part time. Using your evenings and weekends to build a business while keeping your day job is a great strategy. The accessibility of technology and the end of homebased business' stigma means starting part time is now a more viable option than ever.
- DObe efficient with your time. It's important to be completely focused during the precious little time you have to spend on your business. Says Sloan, "The time you spend doing the business needs to be focused, dedicated and serious if you're interested in real business success."
- DOdetermine your weekend business goals. Ask yourself: Do you want your business to be a hobby business? Do you want the business to provide a living for you and your family? Do you plan to grow the company exponentially to reap enormous profits? Making some specific goals will help you plan and target your efforts toward meeting those goals.
- DOeliminate distractions. Sloan suggests setting up a private, dedicated space in your home for work-free it from distractions like TV or boisterous youngsters.
- DOstrive for balance. Before you even create your business plan, says Sloan, create your life plan-then you'll see where your business fits on your list of priorities. "It's really important to have the discipline to create a balance," he says. "And make sure you don't forget other priorities."
...and What Not To Do
Along with the great many tips on how to start and run your weekend business, we asked Jeff Sloan, co-founder with his brother Rich Sloan of StartupNation LLC, about mistakes to avoid with your part-time startup.
- DON'Tskimp on technology. Because you're not there to fix problems right away, invest in top-notch technology (website, e-mail, fax, phone, etc.) to keep things running smoothly when you're away.
- DON'Ttreat the business casually. Part time doesn't mean half-assed-if you're serious about starting a weekend business, you still need to deal with all the elements of startup: incorporation, taxes, legal issues, employees and insurance, for starters. Says Sloan, "A part-time business is still a business, and it needs to be conducted accordingly."
- DON'Tadvertise your part-time status. But you needn't lie about running a part-time business, either. The truth is, customers don't care if you're part time as long as their needs are met. Says Sloan, "What a customer wants is a good experience.... They want whatever it is they purchased from you to be realized."
- DON'Ttake on too much business. More isn't always better-especially when you're working under a tight time crunch. Says Sloan, "Don't overburden yourself with so much business that you can't execute on the promise and deliver to your customer."
- DON'Tbe unprofessional. To build your weekend business, make sure your marketing materials (business cards, stationery, brochures, etc.) are all highly professional-looking. Says Sloan, "You want to convey an image of credibility and effectiveness so the customer has confidence in you."--Nichole L. Torres
Excerpted from The Weekend Entrepreneur: 101 Great Ways to Earn Extra Cash by Michelle Anton and Jennifer Basye Sander. To purchase the book, visit EntrepreneurPress.com. For another excerpt, read "Weekend Businesses for Domestic Gods and Goddesses."