It sounds like a great idea: starting your own business, being your own boss, charting your own destiny, coming to work in bright red high-tops whenever you feel like it. In spite of all the talk lately about multi-million-dollar venture capital deals, it is still possible to start a business for less than the cost of a new car, even a cheap one. For the price of 285 movie tickets, 200 pizzas, one good mountain bike or a spring break trip to Florida, you can hang out your "I'm the boss" shingle and get started. In fact, all the entrepreneurs spotlighted here started up for less than $10,000 -- in some cases, a lot less -- and you can, too.
Pamela Rohland is Business Start-Ups' "Smart Ideas" columnist.
"Right now, [anyone] could get rich," says Tony Greene, senior vice president of account services with Sterling Hager Inc. (617-926-6665), a Watertown, Massachusetts, public relations and marketing firm. He's referring to the booming demand for public relations agencies that cater to high-tech clients.
While you should have some knowledge of cutting-edge technology to be effective in this field, your business itself doesn't necessarily need to be highly sophisticated at start-up. In fact, Dennis Chominsky, 28, and his partner, Jason Miletsky, 28, started PFS New Media Inc. in Wayne, New Jersey, under humble circumstances: While working as a bartender, Chominsky started a production company in his garage, and Miletsky toiled as a waiter while running a PR firm out of a one-room home office. In 1996, the two decided to join forces and target the high-tech market, later adding a third partner, 34-year-old Deirdre Breakenridge. They brought in $3.5 million last year.
With growth of the high-tech industries running at an astounding 300 to 400 percent a year, clients will find you, Greene assures entrepreneurs. In fact, his firm turns away business because it already is operating at capacity. Beginners can get the word out about their services by contacting industry associations and advertising their Web sites.
The PFS partners do offer a few caveats, namely, the proclivity of high-tech clients to offer payment in stock options rather than cash. Proceed with caution when choosing your clients, and make sure you have plenty of stamina. "The biggest challenge," Chominsky concludes, "is that everything changes so quickly. To keep up with our clients, we need to be two steps ahead of other public relations firms."
|High-tech PR gear|
|THE BASICS: a high-powered PC, software that lists media contacts (such as Bacon's MediaSource Software, 800-621-0561), a copier, a solid postage processor for bulk mailing, a few phone lines, a fax machine, business cards and letterhead.|
|TOTAL COST: $4,500|
|WHAT THEY SPENT: Chominsky and Miletsky started their separate businesses for about $3,000 each and needed little additional equipment when they merged. They worked full-time jobs after the merger, then slowly built from that base.|
|FOR DETAILS: Public Relations Society of America, (212) 995-2230, www.prsa.org|
Anita Ko was 22 and jobless the day she walked into a Los Angeles fabric store and found herself smitten with a bolt of '70s vintage upholstery fabric -- the kind once used to line the interiors of RVs. "I thought it would make a cute handbag," recalls Ko, whose house had just been robbed, leaving her purseless. Determined not to let a limited budget stand in the way of her overwhelming need to accessorize, Ko bought the retro upholstery fabric for a little less than $100 and whipped up a few handbags for herself and her eager friends.
When Ko realized she might be on to something, she made a few designs and took them to a sample-maker. A friend who was a clothing rep showed the samples to local boutique owners, who liked the funky, retro designs and fabrics. Almost before she realized it, Ko, who has no formal design experience, was in business with Los Angeles-based Trash Bags (213-748-8709).
This is not the usual course of events for young designers, acknowledges Barbara Bundy, vice president of education at the Fashion Institute of Design and Merchandising in Los Angeles. Most of them have some formal training and have worked for established designers, at least for a while. But, in the end, most entrepreneurs need a unique idea and an endless supply of emotional fortitude to make it as an independent designer. For Ko, launching Trash Bags was remarkably easy. "I got a lot of immediate orders so soon," she says, "I thought getting business came naturally to everyone."
The relative ease of that first year, in 1997, in which Ko and her team of contract workers turned out 1,000 handbags a month from a warehouse and earned $200,000, made the second-year growing pains a bit harder to bear, Ko admits. Moving out of the warehouse and into her own downtown Los Angeles studio, juggling new expenses, and continuing to expand the business took a toll on her nerves. "I busted my butt. I cried. I bled," recalls Ko, now older and wiser at 25. "I wanted to quit a million times."
Those who buy her $65 to $165 handbags -- great retailers like Macy's and Bloomingdale's and celebrities like Claudia Schiffer and Cameron Diaz -- are glad she didn't. Now that the business is earning more than $300,000 and Ko is experienced, she's proud she toughed it out. Says Ko, "My life has changed because of this business."
|Accessory design Gear|
|THE BASICS: fabric, a pattern, a sewing machine and other related sewing tools, a business phone line, a standard PC, a printer, basic software, and Internet access. Marketing expenses will cost about $2,000.|
|TOTAL COST: $5,000|
|WHAT THEY SPENT: Ko initially spent $2,500 for fabric, the production of her first samples, showroom fees and travel expenses. She did most of her early marketing by word-of-mouth and visiting local boutiques.|
|FOR DETAILS: Fashion Institute of Design and Merchandising, (213) 624-1200, www.fidm.com|
Web site consultant
T. Renee Wilson was only 19 and working as an intern at AT&T when she dreamed up a consulting company that could meet her clients' every technical need, from research to implementation (including Web site design and development of CD-ROMs and DVDs) to eventual follow-up. The business was not to stay a dream for long, however. Wilson started and ran Communications Management Group Inc. (CMG, 404-287-2700) for six months before letting her parents in on her secret. "I had classes all day [at two Georgia universities], and I worked all night," says the 25-year-old Atlanta entrepreneur. "I remember sleeping for the first time in two days while waiting for my [business cards and brochures] to be printed at Kinko's."
Her determination was boundless: She networked; she cold-called; she did free presentations. People assumed she was in her early 30s when she was just 22 -- and it helped land clients. Word spread among major corporations that Wilson's firm delivered on its promises, and despite CMG's relatively small size, the big fish bit. "We don't take no for an answer," Wilson says, perhaps unnecessarily. "No is just a second chance to make a better impression."
"It's harder today for a small shop to get large clients," says Andrew Q. Kraft, executive director of the Association for Internet Professionals in Los Angeles. "There is a growing number of established companies, and it's no longer enough for a company to be able to do the technical work. They need someone who can work with clients."
CMG does that and more. "We do a lot of clean-up work and repair," says Wilson, who brings in $5 million a year and projects $95 million for 2000, thanks to the e-commerce addition. "We ask clients not only what they want now, but where they'll be in six months."
CMG now has over 100 employees working in offices nationwide. Wilson's best advice for young entrepreneurs? Do what you say you're going to do.
|Web site consultant gear|
|TOTAL COST: $3,500 to $4,500|
|WHAT THEY SPENT: Wilson already had most of the equipment she needed, and she created her own marketing materials. She spent $3,000 on office space, furniture and phone lines.|