Book Review: The $100 Startup
By Chris Wendel
Crown Business – Hardcover: $23.00 – Kindle Version: $11.99 – 304 pages
By its gimmicky title, The "$100 Startup" may seem more like a give-away from a late-night infomercial than a practical business book. But this book should never be confused with any late night promise of instant wealth or government grants. It serves as a good resource for those wanting to know how starting a small business actually works.
Written by 30-something whiz kid Chris Guillebeau, The "$100 Startup" centers on the testimony of 1,500 individuals who built businesses earning $50,000 or more from modest investments, in many cases $100 or less.
Guillebeau chooses the 50 most intriguing from this group and identifies the commonalities of people starting businesses based on their lifestyle, personal expertise and passion.
The rise of the micro-business is the new reality of many people still crippled by the economic upheaval of recent years. Long gone are the days of borrowing to the hilt, betting the farm (or home), or quitting one's job to test a business idea.
According to Guillebeau, entrepreneurship and the rise of the Internet are the chief catalysts of this new small business development wave. He reinforces his points through interviews with his case studies.
Some of those profiled are accidental entrepreneurs that had a service that consumers desired. Many devised ways of doing what they truly wanted to do while prioritizing their families and other personal needs.
The "$100 Startup" spends a lot of time discussing the expertise that each business owner had and how they matched a skill set with a product or service that people wanted to pay for. Starting on a smaller scale, an idea can be tested for feasibility in the market before larger investments (including money and time) are taken on.
The book's entrepreneur profiles were the most interesting component. Guillebeau stresses that not everything one is passionate about is that interesting to everyone else ("I may be passionate about eating pizza, but no one is going to pay me to do it.")
Take the Excel spreadsheet expert who built an online business of downloadable guides and trainings that nets $136,000 annually. Or the veteran sales executive that is laid off and then starts a successful business selling bed mattress that he delivers by bicycle. Or the woman from Omaha who sells custom made wedding dresses to brides all over the world. In each case the business was built around the owner's interests and lifestyle with limited start-up overhead costs.
The "$100 Startup" shows how much money these entrepreneurs needed to get their projects started, how they generated funding, and key mistakes they made along the way.
Much of this start small mentality is possible because of niche demands of today's market place. Guillebeau's examples are easy to relate to because they aren't all "pie in the sky." Many are cautionary tales that readers can read and learn from.
He also includes bulleted summaries of pivotal areas such as pricing, business plans, marketing, business expansion and a relevant summary of how to write a mission statement.
This minimalist approach to business development counters many prevailing theories of job creation. Indeed, there are many people in northern Michigan who pattern their business around their expertise and family life while spending money locally, paying taxes, and sending their children to our local schools.
Some of these small start-up businesses grow from home-based businesses into larger companies that provide a significant employment, such as Hagerty Insurance or Baabaazuzu.
No matter how you slice it, it is clear that the micro-businesses phenomenon is playing out in a positive way for northern Michigan.
Chris Wendel serves the Grand Traverse Region as a Business Consultant and Lender with Northern Initiatives, a private, nonprofit community development corporation that provides rural entrepreneurs with access to capital, information and markets.