Category Archives: Student Profiles

Startup CEO: Would You Max Out Three Credit Cards To Start A Business?

Image representing Alec Lynch as depicted in C...
Image by None via CrunchBase

This post originally appeared on Forbes.com.

Would you max out three credit cards, spend your life savings, and take on loans from family and friends all for some cool website idea? In January 2008 Alec Lynch did just that and started a freelance marketplace in his garage called DesignCrowd.

Today, Alec and his team announced a new round of financing putting the company’s total fundraising to date at $6.3 million. Back in March, I was able to spend some time with Alec to hear about how he took his small garage-based startup from Sydney Australia and $60,000 in debt, to multiple locations worldwide and $1 million per month in revenue.

Dan Reich: What were you doing before DesignCrowd?
Alec Lynch: I studied Bachelor of Information Technology at the University of Technology, Sydney (UTS).  I loved it and did well academically (I was awarded a $36,000 scholarship and the University Medal).  When I graduated from UTS I was 20 and started my first business with a friend from UTS (Adam Arbolino who studied a Bachelor of Science in IT).  Our business was online CRM software and, while it ultimately failed, we learned a lot of good lessons.  After this, I went to work in strategy consulting at Booz & Co where I worked for 2 years.  While I was there I had the idea for DesignCrowd.  In 2007, a few weeks after scoring a promotion, I quit my job at Booz and moved back home to live with my mum and start DesignCrowd.

Reich: What gave you the idea for DesignCrowd?
Lynch: While I was working in strategy consulting at Booz I was constantly looking at different industries.  I had a personal interest in the design industry, as I’d been building websites since I was 14 and I could see three key problems in the traditional design industry: for small businesses buying design it was 1) slow 2) expensive and 3) risky (you never knew what you were going to get back).  One example that highlighted these problems for me was the release of the London Olympics logo in 2007.  It cost £400,000, took one year to make and was absolutely panned by the public and the media.  I thought to myself  “wow, imagine if they had run a global design contest for £40,000 or even £10,000?”.  I knew they would’ve received thousands of designs and ideas from around the world and saved half a million dollars.  At the same time, I could also see a lot of friends graduating with degrees in creative disciplines but struggling to find work.  Essentially, I could see the dynamic for a marketplace that could disrupt the traditional design industry.

So is Alec and his team disrupting the traditional design industry? According to Techcrunch, “the company currently has over 250,000 registered users in 197 countries, including 100,000 designers and says it recently hit $12 million in design projects through its site, a figure that it expects to exceed $20 million in 2014.”

When I asked Alec back in March what his ultimate goals were, he said “our goal is to pioneer crowdsourcing around the world.”

And with the latest round of financing of another $3 million it looks he is one step closer to that goal. Not bad for someone that maxed out three credit cards and moved back home wit his mum to start some nifty website called DesignCrowd.

Startup CEO: How To Build A Double Sided Marketplace In the Fashion Industry

Textile Supplier with President George W. Bush

This post originally appeared on Forbes.com.

Websites like eBay and Amazon have transformed the way people buy and sell products. With a current market cap of $68B and $151B respectively, it’s clear that efficient and highly engaged marketplaces between buyers and sellers can provide real value to both parties.

A new NYC based startup realized the same marketplace dynamic could be applied to a different part of the retail value chain, and in a very specific but necessary category: textiles. Until recently, textile suppliers from around the world had no way to conveniently sell their products in a global marketplace.

I caught up with Benita Singh, the CEO of Source4Style, to learn more about how she is building an online marketplace for a very interesting but critical part of the fashion business.

Dan Reich: There are hundreds of online marketplaces in existence today. Alibaba.com is one example. When did you realize there was a need for a textile marketplace?

Benita Singh: Throughout my career, I spent a lot of time at trade shows, on expensive sourcing trips and even on sites like Alibaba. And it wasn’t unusual for a two-week sourcing trip to India to result in finding only one new supplier. So I learned early on that it was a highly-fragmented market.

At the same time, many of my “best finds” were suppliers that didn’t showcase at the biggest trade shows. And their online presence was limited to a three-page static content site.

We then started to do some research on the market opportunity. In one of our surveys with independent designers, we heard that they spend up to 85% of their time sourcing and navigating the complex textile supply chain. And among the larger fashion brands, we saw that since 2008 travel budgets on the production side of the business were dropping. Couple all these industry trends with the rise of B2B marketplaces and we saw a clear opportunity.

Reich: Any entrepreneur that has built a double-sided marketplace will tell you how hard it is. How are you building both the supply and demand for Source4Style?

Singh: At the beginning, we focused exclusively on building up the supply side of the marketplace. In our case, that was getting a critical mass of textile mills onto the platform. Within three months, we were working with suppliers in over 30 countries. We learned that we must have a baseline of supply before we could go to the demand and start the engine.

We’ve also learned that the two sides of your marketplace may very well have two very different reasons for wanting to be part of your platform. For our buyers, it’s about discovery and access. They want to be able to replicate the inspirational experience of walking a trade show floor 365 days a year, and that’s how we present Source4Style to them.

Our suppliers on the other hand want a more practical tool to help them streamline their leads, follow up with potential buyers and track conversions from sample requests to purchase orders.

It’s critical to learn the value proposition for each side of your market. For our buyers, we have to effectively merchandise and market. For our suppliers, we have to really focus on building a great SaaS platform for them to help manage their global business.

Finally, your influential first adopters can help you grow both sides of the marketplace. Some of our buyers bring their suppliers onto the platform because they want to use Source4Style to manage all of their sourcing. These buyers are also offering case studies that are inspiring others in the industry to give us a try.

Reich: You had to build a global business pretty quickly. What challenges did that entail and how did you overcome them?

Singh: Sourcing is inherently global, so yes, we had to become an international business pretty immediately. Operationally, we built a dynamic platform that allows buyers and sellers to confirm final pricing before proceeding with a purchase order. This accounts for currency fluctuations in the 36 countries where our suppliers are now based. We also brought on local agents in key markets like India and Italy who help us to both onboard new suppliers and ensure that their collections and data are kept up to date.

We have a global market on the buy side as well. And with a small team, we have to provide top-notch service around the globe. This isn’t easy and it means our phones are ringing around the clock. But I consider it the best incentive to grow quickly and intelligently!

Our next steps are to translate Source4Style.com and optimize our platform in key markets as well.

Benita’s work is paying off. In less than two years Source4Style has created a presence in over 76 countries. More recently, they partnered with The Council of Fashion Designers of America to provide their members with “concierge-level access to their comprehensive online sourcing marketplace.”

From Law To Liquor: How One Corporate Attorney Left Law To Start A Luxury Tequila Company

This post originally appeared on Forbes.com.

Over the past few months I’ve heard the same brutally refreshing remarks from a handful of friends: They all want to quit their job as a lawyer so that they can pursue a business of their own. As one corporate lawyer friend put it, “it’s rewarding to help my clients with their business but I think it would be entirely more satisfying if it were a business of my own.”

This is one of the reasons a new tequila company called Qui Tequila was launched. Pete Girgis, a once corporate attorney, felt the same way and decided to leave his corporate gig so that he could launch a tequila company. Pete put it this way.

“I was at a big firm where I felt like a cog in the wheel.  There wasn’t a sense of creation.  Growing up, my father was a small business owner who owned liquor stores that I managed while in school. I had a passion for the spirits business and was lucky to have met my cofounders while practicing law. We are like brothers.  We saw a great opportunity in the luxury tequila market. Now every time I walk into a bar or restaurant and see someone enjoying Qui, it is incredibly satisfying.”

Pete’s leap of faith to start his own business is now paying off. His tequila is now carried by dozens of liquor stores like Sherry-Lehmann, Bottlerocket Wine & Spirits, Park Ave Liquor Shop, Chelsea Wine Vault and prestigious hospitality venues like the Bowery Hotel, the Standard, Lure Fishbar, Casa La Femme, Darby, 1OAK, the General, and La Cenita.

Although hard work and hustle are two key ingredients to Pete’s success, he was able to share some more tips for future x-lawyers and aspiring entrepreneurs.

Education Matters. Although he doesn’t practice law anymore, Pete’s academic background as a JD/MBA provided him with critical building blocks to build his business.

“If I had to do it over, I would have still studied law and business. Starting a successful business is incredibly challenging and big businesses can have lots of complexities. I’m a firm believer that a strong foundation in the business and the legal worlds only helps your likelihood of success.”

Create a unique product. Pete and his team spent a lot of time meticulously developing a product that they would be proud of and the once lawyer is now a full blown tequila connoisseur.

“On the product side, Qui is the first Platinum Extra-Añejo Tequila in the world. So after the tequila is made, it rests in French Bordeaux and American Whiskey barrels for three and a half years.  This aging process gives it a rich flavor, character and beautiful aroma. Then we filter it 9 times and distill it a third time for an incredibly smooth finish. No one has done that before and as a result, we just won Gold in the Spirits of the Americas Competition.”

Have a good distribution strategy. In the world of liquors and spirits, it is incredibly difficult to stand out. Pete and his partners figured they could create a unique product and distribute it in a competitive landscape by targeting specific market segments.

“We knew that New York was one of the most challenging spirits markets in the world, but if we could win here, we could go anywhere.  We set out to create a brand that was more elegant, sophisticated and cosmopolitan then the rest with a juice that was equally as refined.  So far, Qui has had great traction in the fashion, film, music and art worlds because of our focus on strong product-market fit and distribution.”

So if you are thinking about leaving your corporate job to start your own business, just remember that hard work, hustle and good planning can pay off. And then maybe you too will see your product in a nice window display like the one above.

Founder of Vault.com Discusses Startup Life and His New Healthcare Company Zeel

Samer Hamadeh, Founder & CEO of Zeel.com

This post originally appeared on Forbes.com.

Samer Hamadeh started hustling the good ole’ fashion way by finding a problem and fixing it. A few years later he would apply those same principles to his other ventures, most notable of which is Vault.com. Now Samer is on to an entirely new business but this time it’s in a new industry: healthcare.

I caught up with Samer so he could share some of his insights into his life as an entrepreneur, a candy salesman, and his new startup called Zeel.

Many people aspire to start their own companies. How did you get started as an entrepreneur?

My first big entrepreneurial success was selling candy at recess during 7th grade. I was eventually caught, but I convinced the school that I was just meeting unfilled demand, so they let me continue. (Twix bars were my best sellers – I’d buy them for 25 cents each at Costco and resell them for 50 cents.)

After I graduated from Stanford, my friend Mark Oldman and I saw another opportunity. We realized that internships were becoming an essential part of the career path –and that there was no good information available about where to find a great internship. This was pre-Internet industry, of course, so we published a book, America’s Top 100 Internships, which was a huge success, and started a consulting practice to help companies with their internship programs

I’ve always focused on getting people the services they want to make their lives better, delivering via the latest technology. I’ve gone from passing notes at school, to books, to CD-ROMs, to the web, to mobile apps. I sometimes joke that telepathy is next.

You’ve spent your career building businesses in the career and education space. What made you decide to switch industries?

The thing is that I’ve always been focused on delivery and customer service. At Vault, we were pioneers in on-demand content – our customers purchased and downloaded interview guides and company dossiers in PDF format right before interviews. After selling Vault and before founding Zeel, I was an investor and advisor at Campusfood.com, which we recently sold to GrubHub, the food delivery service, also based on satisfying last-minute needs.

In addition, I’d say that I’ve spent my career figuring out the best way to solve the problems I was facing at the time, from a lack of candy, to getting a job, to, today, easing aches and pains.

When my co-founders and I started Vault, we were right out of school, and we naturally created a company to assist recent college grads. Zeel, on the other hand, was inspired by the aches and pains of our 30s and 40s. I’m married with kids now, along with most of the rest of our founding team. We need the relaxation and pain relief that massage therapy provides. We don’t have time in our busy schedules to book massages a week in advance and spend hours going to and from a spa – plus, getting massage in-home means that we don’t need to hire a babysitter. We like flat fees so we don’t need to worry about tax and tip. We want to use our phones like a remote control for our lives, so we launched an iPhone app for booking. We’ve basically created the most convenient way possible to reliably get a great massage, from a vetted and licensed massage therapist, as quickly and efficiently as possible.

What advice would you give to entrepreneurs looking to get into the healthcare space?

The healthcare space is complicated. You need to take time to understand the industry – just being a healthcare consumer won’t give you anything close to a complete picture. For one, it’s much more regulated than other spaces. Health insurers have intricate rules. And there are laws about advertising, payments and provider referrals that you just don’t have in other industries.

That’s why it took me and my team nearly two years of immersion in the healthcare space to devise Zeel Massage On Demand℠. Massage, for example, might seem straightforward, but there are different licensing requirements in every state, local regulations about when and where massage can take place, and restrictions on how you pay therapists.

So I’d advise entrepreneurs to educate themselves as thoroughly as possible. Go to conferences and healthcare meetups. When you’re ready, apply to some of the superior accelerators and fellowships that have sprung up in this space, like Blueprint Health and StartUp Health.

Startup CEO: How To Quit The Trading Floor and Do A Startup Placing Interns All Around The World

The Intern Group offers amazing opportunities to gain vital work experience, develop extensive, global networks and see the best of what some of the greatest cities in the world have to offer

This post originally appeared on Forbes.com.

It’s easy to get stuck in an unfulfilling corporate career path. Before you know it, you turn around wonder where all that time went. In some industries, like banking or consulting, it’s very hard to jump ship from the lucrative safety net of the corporate world to the treacherous waters of entrepreneurship.

David Lloyd decided to forgo a potentially lucrative career in banking to start his own company in South America and in less than two years, his company is doing a few million in revenue. The business? He places talented individuals with international internship programs in London, Madrid & Latin America where they go to work for leading companies, NGOs & National Governments and live a cultural immersion in a new, fascinating country.

I recently caught up with David to talk about what it’s like to rip off the golden handcuffs of the corporate world and to discuss his business called The Intern Group.

You had a great career path as a banker. What made you decide to quit in order to pursue The Intern Group?

I realized early on in banking that the rigid, hierarchical corporate path in a mature, saturated industry was not where I wanted to spend the next decades of my life.

Before banking I had done something more unusual. I moved to Latin America after university with the goal of becoming fluent in a second language. I moved to Buenos Aires, where I knew no-one, and enrolled in intensive Spanish classes. Outside language classes I searched for an internship as I wished to use and improve my fledgling Spanish in a work-place environment. However, with no particular contacts in a highly contact based environment, I was in trouble. Finally, after months of trying, I was offered a marketing internship at Rolex. The value to my resume of an international blue-chip name, in the context of a different culture and language was enormous.

I developed a great deal through my internship experience abroad. I set up The Intern Group so that individuals have the opportunity to do the same as I did – but in a structured, systematic and educational way – and develop themselves professionally and personally.

How did you go about funding the business? After all, you just quit your job.

I had enough saved up to bootstrap with a very basic WordPress website et al. I started to apply to Start-Up Incubators and 8 months after starting the business we were accepted into Start-Up Chile, a Chilean government program for international entrepreneurs, and awarded 40,000 USD in equity-free seed capital. Shortly afterwards, during Start-Up Chile, we turned cash-flow positive and have not looked back.

What advice would you give aspiring entrepreneurs especially those stuck in the corporate world?

Don´t talk yourself out of it. It is easy to say “You need to be rich to start a business”. You don´t. Technology has made the amount of money needed to launch a start-up astonishingly low. “But what if it doesn´t work. The risk!?”. Do you want to live your life thinking “what-if?”. Yes, your planned project might not work out. But failure, in this context, is seen as a good thing by the people that count – if you learn from it. Many of the most successful businessmen and women started with out-right failures. You learn more from failing than succeeding. The far bigger risk is talking yourself out of it and staying in a job you are unhappy with.

Where do you go from here?

The Intern Group is now on the way to becoming a mainstream option within global higher education.

Just like study-abroad programs became established in recent decades, I see the same now happening with structured intern-abroad programs. Crucially, interning abroad brings even more benefits than traditional study abroad. Not only do you learn all about a country´s history and culture by being immersed there, and develop language skills essential in a globalized world, but you also develop the critical professional skills necessary to advance your career.

I see The Intern Group leading this movement, with more, exciting destinations in our portfolio and further governmental/university partnerships as the next step.

As a young company, operating various international offices presents an extra layer of challenge. How have you overcome these challenges and are there any other pieces of advice you’d give to aspiring business operators?

Firstly, great co-founders/partners in the business. In every program destination we operate, a local partner is leading the business locally, and they are always from the destination. They grew up there. They have the local professional network, and the local know-how vital for success. If your international team is talented, and invested emotionally and financially, you are on the right track.

Secondly, and as a function of the first point, this brings up the importance of spending a lot of time on hiring. I read the other day of a company who spends 98% of their time on hiring, and 2% on resolving hiring mistakes whereas most companies do the opposite. I am a big advocate of this philosophy. In large companies a bad hire is costly. In smaller, younger companies, especially those with different teams spread out around the world, it can break you.

Thirdly, lots of communication. When you are far away from each other, it is easy for individuals and even entire local offices to feel somewhat dislocated and isolated. We prevent this with technology and lots of good-old fashioned talking.

Home Security Startup Raises $180,000 With Its Own Crowd Funding Platform

Scout raised almost $180,000 with their own crowdfunding campaign in order to improve home security systems.

This post originally appeared on Forbes.com.

No one thinks home security is cool or interesting, but when you’ve raised almost $180,000 with a custom made kickstarter-esque website, home security becomes pretty interesting. Lindsay Cohen and the team at Scout realized that home security is a commodity and most of the 17% of the country that has security is dissatisfied with their provider. They thought they could bring security up to date, and to do so they went about building their own organic fundraising campaign to get them off the ground. Lindsay was able to share some insights on how they pulled this off.

Dan Reich: Scout seems like a great product. Why did you decide to raise money without a platform like kickstarter or indiegogo?

Lindsay Cohen: Kickstarter rolled out new rules this year that have disqualified a lot of companies from using their site, including Scout. Too many companies were raising millions of dollars without a solid plan to deliver on their promises. At about the same time those rules hit, Lockitron launched their project and showed that you could be successful with an independent crowdfunding site. We felt well prepared for the campaign and were able to save 5% (about $9000) in fees by not going through a third-party website. That money goes a long way for a startup.

DR: You mentioned that you raised money without a first generation product. What assets did you have when you decided to start this fundraising campaign?

LC: Scout came out of the Sandbox Industries startup foundry in Chicago, IL. We had some initial seed money from Sandbox to do the research and development on the project. We used that money to complete the market research, create our initial prototypes, create our website and pay a small team to execute our rollout plan.

DR: As of this writing, you raised close to $162,000. How did you pull this off?

LC: A huge part of our success has been attributable to our ability to get press coverage. In order to do that, we spent the month prior to our campaign planning who we would contact in the press and how we would pitch the story. Since then, we’ve had a small team here at Scout that has been hustling and executing the Scout plan for the majority of their waking hours over the past three weeks. We do have a small budget for pay-per-click ads and an ad retargeting campaign, but press coverage is far and away the biggest reason we have been able to raise $160,000 to date.

DR: What advice would you give to people that are thinking about doing their own crowd funding project?

LC: Know what you’re getting yourself into, put the time into creating an aggressive rollout plan and then execute your plan every minute that you aren’t sleeping. There is a massive amount of preparation that goes into making something like this happen. We’ve written two blog posts on the topic to help others learn from our experiences. There are pros and cons to our approach. Don’t dismiss Kickstarter, if you qualify, just for the sake of doing it yourself. You can gain a lot of leverage from an existing crowdfunding site with a built-in base of users.

DR: What do you wish you would have done differently?

LC: We wish we would have talked to our early backers of Scout more often and given them more chances to share news about the project. We planned to contact them mid-campaign and during the last week, but we should have started in the first week and touched base every week thereafter. Backers are your best evangelists, their sharing efforts on Facebook and Twitter allows you to reach a whole new group of people that you otherwise would not have reached. Also, we would have incentivized sharing more often. Running referral competitions and motivating people to share can be highly effective.