3 Business Ideas

1. Marijuana Industry

Don't laugh at my idea or think that this isn't a serious proposal, because it is. I feel that the passing of Initiative 502 and a similar law being passed in Colorado in November 2012 will create a unique and lucrative business opportunity for the first movers in this newly created industry. Law makers in our state are currently working on exactly how marijuana will be regulated, taxes, and sold, but it is expected that the specific guidelines will set sometime at the end of this year. For those of you that may be unfamiliar with the topic of marijuana legislation, I have cut & pasted the following from Wikipedia.com:

As described by the Secretary of State's office, the measure shall "license and regulate marijuana production, distribution, and possession for persons over twenty-one; remove state-law criminal and civil penalties for activities that it authorizes; tax marijuana sales; and earmark marijuana-related revenues."

This measure removes state-law prohibitions against producing, processing, and selling marijuana, subject to licensing and regulation by the liquor control board; allow limited possession of marijuana by persons aged twenty-one and over; and impose 25% excise taxes on wholesale and retail sales of marijuana, earmarking revenue for purposes that include substance-abuse prevention, research, education, and healthcare. Laws prohibiting driving under the influence would be amended to include maximum thresholds for THC blood concentration.^[7]

I haven't come up with an exact idea for the type of business I would like to start, but my ideas range from a brick-and-mortar storefront that sells marijuana and related products to consumers to a coffee shop that also   sells marijuana. The coffee shop idea is adopted from the coffee shops in Vancouver, BC and Amsterdam, Netherlands. The difference is that in my coffee shop, you can actually purchase marijuana, whereas in Vancouver and Amsterdam, you are not allowed to purchase the marijuana from the store, but are permitted to smoke on the premises. I thought this idea of a marijuana shop disguised as a coffee shop would allow consumers to make a purchase without the negative stigma attached to marijuana use.

2. Restaurant

This is not an innovative idea, but since I started classes at UWT, I felt that is a lack of variety in food choices during my lunch break. By far I think that Subway has captured most of the UWT lunch rush because of their fast service and low prices. Whenever I walk down Pacific Avenue, I find myself thinking of possible restaurants that could be successful in the UWT area. The business that comes to mind is a Teriyaki restaurant. Maybe it's because I've worked as a teriyaki cook before and I also have a family member that owns a teriyaki restaurant in Port Orchard, but I feel like opening a teriyaki restaurant on Pacific Avenue could be a success. I am aware of an already existing Teriyaki restaurant on Pacific Avenue, specifically Happy Teriyaki, but they are located about a 1/2 mile down the road and from my experience, they seem to serve mostly students that attend Everest College down the street. Also, they seem to be a more higher end, if there is one, for teriyaki. They not only serve teriyaki, but also serve sushi and it is more of a sit-and-eat type of restaurant. My teriyaki restaurant would be different in that we would provide large portions at a fair price, with quick service being the emphasis. You wouldn't get your food on a plate or a server wouldn't come out to serve your food or get you refills. Instead, the restaurant itself would be very small with only a few tables. The food would be served in a styrofoam "to-go" box so that students could take their food to eat where they please.

3. Dog Breeder

My two great ideas went as far as my marijuana business and my restaurant. Either than that I thought about what my hobbies were and what I thought would be cool to do as a side business. I am the proud owner of a American Pit Bull Terrier and feel that the breed gets a bad wrap because of irresponsible owners. When I purchased my dog in 2008, I paid $1000 and drove to Oregon to pick him up. The breeder I purchased the dog from had a website and owned about 10 dogs. When I visited his home to pick up my dog, it seemed like he wasn't doing too bad for a dog breeder. He told me how he did this full time and loved working with his dogs. I feel like this is a fairly simple business to set up with very low up front costs. I would simply copy my breeder's business model of having a website and networking with other reputable breeders to mate my dogs with theirs. I doubt that this is the idea I will ultimately go with, but since we needed 3 business ideas, I came up with American Pit Bull Breeder as my third option.

Technology Entrepreneur's Guidebook

During the last class session, we finally discussed the first few pages of The Technology Entrepreneur's Guidebook. More specifically, we looked over the first few pages of Entrepreneurship by Reggie Aggarwal and Mark Esposito. I had some difficulty finding the link to the book on Professor Fry's website, but I managed to finally find it and print it out. This short section was somewhat of an intro to the rest of the book and opened with some interesting but alarming facts. I almost feel like it was a "Debbie-Downer" "Negative-Nancy" way to start the book. The authors list 5 facts about entrepreneurship, which are listed below:

1. 1 in 6,000,000 high-tech business ideas end up in an IPO
2. Less than 1% of business plans received by VC's get funding
3. Founding CEO's usually own less than 4% of this company after an IPO
4. 60% of high tech companies funded by VC's go bankrupt
5. Most high tech companies that successfully have an IPO take 3-5 years

After reading these facts, it almost seems like I have a better shot of hitting it big by winning the lotto than successfully starting my own high-tech firm. These facts surprise me somewhat, but at the same time, not really. We all hear about the Bill Gates, Steve Jobs, and Mark Zuckerberg's of the world, but think about all the people that failed at becoming an overnight success and were never heard of. Truthfully, who doesn't want to become a multi-billionare? For example, Kaleil and Tom thought they were going to be the next big thing and it almost seemed like they might get there when watching StartUp.com. Of course as we all know, they didn't and the entire life cycle of GovWorks.com was a little over a year.

Since our class is concerned with starting up a business and not specifically in the technology sector, I would like to believe that the success rate of a typical business (non tech business) might be a little better. I feel that the high-tech industry is a high risk, high return type of business and from the perspective of a venture capitalist, I may fund 20 companies where 19 fail, but that 1 success will cover the money spent on all 20 of those start-ups. With that being said, I would like to see some facts about a typical business and their success rates. I think I've heard from somewhere that 90% of businesses fail within the first year. This isn't much better than the facts stated above, but I like a 10% success rate over an almost certain failure rate of a high tech company.

Erik Hanberg

During our 3rd session of class, we had a guest speaker come in and speak to us on his experiences of becoming an entrepreneur. The guest speaker was Erik Hanberg and he was previously involved with non-profit work before becoming an entrepreneur. He used his past experience of working with non-profits to self publish a "how-to" book on non-profits and also wrote a few mystery novels. Instead of attempting to find a publisher that would be interested in publishing his book, Erik released his books on the Kindle website to be purchased as an e-book. He found limited success in the beginning, but told us of how the income that is brought in from his books are passive income. This means that for every book that is sold online, he receives income without really doing anymore work to support the book. Once his book was uploaded, it is there for purchase forever and the potential for him to continue to collect money from his books is never ending.

Erik also teamed up with his wife, who is a graphic designer to start a company called Side by Side. The company is hired by authors to design covers for books. Erik spoke to us about how the company was doing well until 2008, when the recession hit and Side by Side lost its biggest customer, which equated to about 44% of their total revenue. Personally, I probably would have quit and gone back to my day job when this happened, but not Erik, he stuck to what he believed in and according to his graphs, it looks like he and his wife are at about the same level of income before the recession.

I thought Erik's presentation was interesting, but it did not apply to me. I understood the underlying message that in order to become a successful entrepreneur, you have to be willing to take risks. Erik was willing to quit his day job in order to write his books and work with digital design with his wife. But this doesn't apply to me really. I don't possess any real skills such as writing a novel or doing freelance digital work. Erik also mentioned a friend that started their business by taking photos of kittens for people and that later became a business for them. I also don't enjoy photography. I don't feel that I have any exceptional skills that I can sell on the internet or go out on my own to do freelance work. I think that Erik was in a very special situation where things played to his favor and as of now, everything seems to be working. I think in order to be a successful entrepreneur, you have know yourself, which includes your strengths and weaknesses. You also have to be at the right place and the right time and be involved with the right people. When the stars align for you, just maybe, you'll become a successful entrepreneur.

StartUp.com

During the 2nd session of our class, we watched a documentary called StartUp.com. StartUp.com is a documentary that follows the life of Kaleil and Tom, two friends from high school that decide to start a .com business in the early 2000's. Kaleil quits his job at Goldman Sachs and Tom (I'm not sure of what he quit in order to start the business) become co-CEO's of GovWorks.com. The website is supposed to allow citizens to pay for such things as parking tickets, fishing licenses, etc. conveniently through their website. A question I had about their idea is that was GovWorks.com going to be an intermediary for municipal governments to pay for tickets, or did they intend on selling the technology to municipal governments so that they could incorporate GovWorks to their existing websites? In other words, was GovWorks going to be a middle-man for citizens or were they going to sell their website/technology to a government to use as their own?

In the beginning Kaleil and Tom are running around to find investors for the company and it becomes apparent that Tom is not the business-minded type to successfully find investors. Eventually they do raise the money they need in order to launch the company and I believe they somehow find $50 million or so. My second question is, How in the world did they every get people to invest $50 million on an idea? At this point they didn't have an actual product (ie a working GovWorks website), they just sold investors their idea and they willing forked over their money.

Either way, their company balloons from about 5 employees to over 200 workers at the end. The relationships of the characters begins to get tested as the movie progresses. A third partner, Chen (or something like that), is not willing to quit his current job to come work for GovWorks and is bought out by Kaleil and Tom for $700,000. The company's rival CEO stops by as a friendly gesture and tours their facilities. Later, GovWorks gets broken into and some files are stolen from Kaleil's computer. In the next couple scenes, the rival CEO is shown on television discussing their website and I think gets their product to market first.

Towards the end, GovWorks.com does go live but with many problems. The website is not functioning correctly and is very user-unfriendly. Soon afterwards, the company is bleeding money and eventually goes bankrupt. The part I didn't understand was the main characters were so excited to start this company and raise money and so on, but it never once shows them actually working on the product! So in the end, their great idea doesn't translate to a great end product (the website GovWorks.com). The final clip shows Tom and Kaleil going back to their lives. Tom is combing his daughter's hair and Kaleil, well he seems to live in a pretty nice house and ends up with a new girlfriend. The two later start a business from their experience with GovWorks.com that helps ailing companies.

First Blog

Hello Everyone,

I would like to begin by introducing myself to the class. My name is James Koo and I am a senior in the Milgard School of Business at the UWT. Specifically, my major is in Accounting, but I have received a minor in Economics and I am well on my way to completing a minor in Applied Computing. The reason I chose to take this class was: 1. I had to take a TINST course that fulfilled the required credits toward my Applied Computing minor and this was the only course available 2. I felt that I could actually learn something in this course that could be valuable in the future.

My current plan after graduation is probably like most of you. Find a job (hopefully in accounting in my case) that pays well so that I can make a decent living. I know in life not everything goes to plan, so I've imagined a scenario where I am a jobless college graduate that has given up on finding work. I could go find any job that'll get me by that I'll probably be way over-qualified for, but I have to eat, so I could take a job as a waiter, fast food restaurant, etc. Or, I could pull myself up by my own boot straps and venture out there and start my own business. At this point I wouldn't have much to risk, so why not? That's where this course may become helpful to me. I feel possessing the knowledge of how to start a business from the ground up is something that I may never need to know, but if by some chance I do, I will be fully prepared and will be able to avoid many pitfalls that exist when starting your own business.