Entrepreneurs: How they become rich

How 23 young millionaires built their empires
The inside secrets to success of those blazing their own trails
Entrepreneur.com
Updated: 10:24 a.m. ET Nov. 8, 2005


Think it's nearly impossible to become a multimillionaire before you're 40? Meet 23 young entrepreneurs who did just that -- and learn the inside secrets to their success.

Billy Stade, 35, & Kari Stade, 25
The Closet
Costa Mesa, California
Projected 2005 sales: $6 million

Description: High-end clothing retailer with three locations in Orange County, California
Snowboard season: Billy Stade's passion for snowboarding led him to start selling snowboards out of a tiny 5-foot-by-20-foot retail space in 1993. With only enough money for first and last month's rent, Billy negotiated deals with vendors he knew to front him product. The snowboards sold well that first season, but as warmer weather approached, Billy realized he'd have to expand his product offering if he was going to stay in business during the spring and summer months. As he looked at the surf and clothing shops in his high-traffic Huntington Beach, California, location, Billy decided to get into the fashion arena. And there were other expansions: About six years ago, Billy hired Kari as an office manager, and the pair married in 2003.

Fashion forward: Going beyond typical surf wear, The Closet sells both men's and women's fashions that echo chic international styles with the relaxed California vibe mixed in. "We always had to be forward, progressive and intelligent to compete with such big surf shops around us," recalls Billy. Today, The Closet sells only a few high-end, limited-edition snowboard products, having shifted to focus on its extremely successful fashion retail business. With an eye for the high-end sportswear and casual trends exemplified by brands like Lacoste, Modern Amusement, Stussy and Volcom, The Closet has been compared to boutiques like Henri Bendel in Los Angeles.

Failed economics: It hasn't been all sunny days for this entrepreneurial couple, though. They recall late 2001, when The Closet launched a third location that was quickly toppled by the economic downturn after 9/11. "We just buckled down," says Billy. "We went completely bare-bones. It was just [Kari] and I working 9-to-9 shifts [to] build back up." With perseverance, they weathered the storm, and today the company again operates stores in three of Orange County's coastal locales--Costa Mesa, Huntington Beach and Newport Beach--with plans to add two more next year. --Nichole L. Torres

Babak Farahi, 32
Multivision Inc.
Oakland, California
Projected 2005 sales: $17 million
Description: Company that records and catalogs broadcast coverage for clients
Adrenaline rush: For Babak Farahi and his high-school friends, after-school activities like sports took a back seat to more urgent events taking place in their hometown of Walnut Creek, California. Their love of adventure and excitement kept Farahi and company glued to the radio scanner. At first mention of a fire or an accident, they would rush to the scene, capture footage and then sell it to the news stations that had arrived too late.
Hobby turned business: After high school, Farahi started a video production company specializing in custom video editing. While getting to know the industry, he noticed that news stations didn't record their own broadcasts, and he saw potential to profit by taping news shows, then selling the videotapes to the individuals who had appeared on TV. Multivision, created in 1996, also caters to large corporations wishing to track what is being said about them in the media. Currently, Multivision gathers information from more than 1,100 stations worldwide and creates tools such as DVDs, digital clips and transcripts so its clients can monitor, watch and analyze the information. Farahi's ultimate goal: to expand Multivision's coverage to include all broadcast stations worldwide.
Youthful ndeavor: Farahi was only 23 when Multivision was born, and he admits that being so young was difficult at times. "It is definitely a challenge when you're young to go out and hire a finance person who might have gray hair," says Farahi. "It's a challenge to make him believe in you."
Small World: Despite Multivision's eight offices nationwide and international expansion into Canada, Farahi has kept the company cohesive. He has established an intranet system to promote employee interaction, and organizes an annual sales meeting to bring all 125 employees together. He says, "We go for four days and work hard, play hard, and make sure we're all one company." --Sara Wilson
Mike Domek, 36
Ticketsnow
Crystal Lake, Illinois
Projected 2005 sales: Over $120 million
Description: World's largest online marketplace for secondary event tickets
The ticket master: If you're an avid event-goer in the Chicago area, you might run into Mike Domek at a Cubs game or in the front rows of a Def Leppard concert. These days, the founder of online ticket reseller TicketsNow has no problem getting good seats. But that wasn't always the case. When he first began selling secondhand tickets the old-fashioned way, he sometimes had to call over 20 different ticket brokers looking for the best locations and deals for an event. Domek decided to take the inefficiency out of the system by moving his ticket service onto the internet.
$100 and 7 years: Domek started his business with $100 and a one-bedroom apartment in 1992. He had run out of money for college and decided to try ticket brokering full time to save up for school. He never went back. It was seven years before TicketsNow, the online company, was launched from the foundation of that original ticket brokerage. All those years of slow growth and building relationships with ticket brokers across the country finally paid off. This year, TicketsNow expects to more than double its 2004 sales--money it won't have to share with investors. Says Domek, "I'm very proud to say we haven't had a penny of outside funding."
Size matters: Since the website was launched in 1999 from a 1,600-square-foot building with seven employees, Tickets-Now has exploded to 170 employees and has filled its 16,500 square feet of assorted office spaces to capacity. That sort of rapid growth would send some companies reeling, but Domek takes it in stride. "My plans are to keep doing what's best for the company, and right now what's best for the company is to keep growing."
Ticket, please: The secondary ticket market is hotter and more legitimate than ever, and TicketsNow's technology and security are a big reason. Domek is just excited to be a part of something he's loved since childhood. Says Domek, "There's so much emotion in buying tickets." And for Domek, frustration is no longer one of those emotions. --Amanda C. Kooser
Joseph Semprevivo, 34
Joseph's Lite Cookies
Deming, New Mexico, and Sebastian, Florida
Projected 2005 sales: Over $100 million
Description: Sugar-free and fat-free cookies and food products
Kid confection: Life can be tough for a diabetic 12-year-old. But in 1983, with a little help from his father, Joseph Semprevivo created a rich, sugar-free ice cream in his parents' restaurant that he could indulge in without harming his health. He and his parents began offering the ice cream to their customers, and the enthusiastic response led them to re-brand their business as a sandwich and ice-cream shop. Within three years, Semprevivo--with Dad as a chauffeur--had stocked the freezers of 197 grocery stores and ice cream shops in New Mexico.
Fortune cookie: Though his parents have long since retired from their business (and from helping Semprevivo with his), back when he was 15, his parents created a sugar-free oatmeal cookie that changed the course of Semprevivo's company. The logistical nightmare of keeping the ice cream frozen, combined with the success of the oatmeal cookies, led Semprevivo to leave ice cream behind in favor of sugar-free baked goods.
Proving ground: Concocting cookie recipes was one thing, but handling sales calls and meetings as a teen and young adult proved to be more difficult. "When you're pitching a 50-year-old Harvard MBA and you're 17, he's not amused," says Semprevivo. "Extra preparation for presentations was key." His hard work paid off--the business has since expanded to 13 flavors of cookies, bite-size cakes, brownies, pancake syrup and peanut butter. Introducing almost 40 new items this year, the line is now in 37 countries, and will reach 125,000 U.S. stores by year's end.
Singular sensation: Semprevivo's original intention was to help fellow diabetics, but his line's loyal followers also include hypoglycemics, cancer patients, and diet and health enthusiasts who shun sugar. Using all-natural ingredients, "we've set ourselves apart through quality and taste," says Semprevivo. Whether through Joseph's Lite or his fat-free food company, Santa Fe Farms, which he started in 1989, the goal, says Semprevivo, is "helping others live active, healthy lives." --April Y. Pennington
Amy Katz, 39, & Donna Slavitt, 38
World Packaging Corp.
New York City
Projected 2005 sales: $9 million
Description: Manufacturer and distributor of promotional, private-label and licensed items--most notably the Clik Clak line of mint- and candy-filled tins
Side project: Donna Slavitt worked in both the hospitality and retail arenas early in her career, but it was a job in Old Navy's prototype coffee and candy division that led her to her passion--creating fun candy and mint tins. Wanting to branch out with her own specialty retail creations full time, she enlisted the help of college friend Amy Katz, who also works as a corporate lawyer.
Explosive growth: The pair's first success came in 1997 with a retail product called WebFuel--a mint tin in the shape of a computer mouse that was designed to market websites. WebFuel attracted the attention of big names like AT&T, IBM and Microsoft at the beginning of the internet boom. Says Slavitt, "We started getting calls [saying], 'What can you make for us?'" That launched the company into the private-label arena, creating promotional tins for other companies. Their pivotal moment, however, came in 1999, when they signed an exclusive agreement to distribute candy- or mint-filled Clik Clak tins in the U.S. (the Clik Clak tins were being manufactured and distributed by a French company primarily to European outlets). Named for the sounds the tins make upon opening and closing, the Clik Clak line became a staple of World Packaging Corp. and quadrupled the company's revenue.
Success on the street: Slavitt and Katz have created specialty candy-filled tins and other items with official Major League Baseball, NBA and NFL licenses, and have worked with clients like Henri Bendel and Kate Spade. Next on the list: an organic confection line to complement their already-yummy candy offerings. The actual "we've arrived" moment for the pair? "I saw one of our Clik Clak tops melted into the tar of a New York City street," says Slavitt. "I thought, 'When you start seeing your own brand as litter, you know you've really made it.'" --Nichole L. Torres
Andrew Fox, 33
Clubplanet.com
New York City
Projected 2005 sales: $22 million, including Fox's other businesses
Description: Online nightlife destination service
All access: In 1995, this oft-rejected newcomer to New York City's club scene found a way to get past the doorman of every hot club he longed to enter--start a website offering club-goers free club reviews and information. The now-savvy Fox recalls his earlier, awkward days: "I showed up at a club wearing green shorts, and everyone was in black. The bouncer looked at me and said, 'There's no way.'"
A-lister: Working on the website in his off hours at first, Fox chucked his investment banking job in 1997 to give Clubplanet.com (then ClubNYC.com) his all. Volunteers provided early club reviews, until Fox hired a full-time editorial staff in 1999. Then he came up with a new idea: Start a guest list on his site for access to otherwise hard-to-get-into clubs. By offering a discounted cover charge to those who both signed up on the site and arrived at the club before midnight, Fox helped enhance the exclusivity of the clubs as well as increase revenue. Club owners were dubious about Fox's concept at first, but when hundreds of club-goers who signed up showed up at their doors, the owners gladly forged relationships with the innovator and paid him a "bounty" for every head he brought in.
Fight club: Fox installed a management team for Clubplanet.com so he could focus on two other businesses he was involved in, but he admits giving up control was a mistake. Upon learning of Clubplanet.com's mismanagement and financial woes, Fox engaged in a bitter struggle to regain control. He ultimately won, but the battle took its toll on the company. He was forced to lay off employees he had never met. With only two employees, Fox started back at square one, selling his other companies to refocus on his "baby."
The party syndicate: Clubplanet.com has grown to include thousands of club listings around the United States and the United Kingdom, and now syndicates its content to Citysearch, newspapers, Yahoo! and other third-party clients. Fox also recently launched NocheLatino.com, an upscale, urban Latino version of Clubplanet.com, and is working on a version for the gay community. He's since expanded his empire to include a New Year's Eve event ticketing site, NewYears.com; an exclusive club access site, CoolJunkie.com; a ticketing company, WantTickets.com; and an offline event and marketing company, Track Entertainment. --April Y. Pennington
Joe Palko, 33, & Scott Sanfilippo, 34
Neeps Inc. & Solid Cactus
Wilkes-Barre, Pennsylvania
Projected 2005 sales: $7 million
Description: Pet supply websites, including AnimalCages.com and TheFerretStore.com; website development and internet marketing group
Pet sanctuary: Scott Sanfilippo and Joe Palko became ferret owners in 1994--and soon discovered few pet stores carry ferret food or toys. While ferret supply manufacturers exist, retail stores are reluctant to devote any shelf space to such a small niche market. From their home, the friends decided to start a website, TheFerretStore.com, to serve ferret owners like themselves. Sanfilippo, an ISP sales engineer at the time, and Palko, a UPS manager, spent nights working on their venture until devoting themselves solely to their business in 1999. Today, they offer over 1,500 unique ferret products. Recently, Sanfilippo was thrilled to see another order from their first customer ever: "I found that to be a testament to our company."
Under development: In 1999, when the partners were ready to expand their company, Neeps, beyond ferrets, Yahoo! Merchant Solutions enabled them to create ActiveK9.com, AnimalCages.com, CritterStore.com, PetCareCentral.com, RabbitCentral.com and TheKittyStore.com. It also led them to a group of Kyrgyzstan-based recent college graduates who had responded to TheFerretStore.com's website redesign bid. Though he and Sanfilippo opted to use another developer, Palko developed a strong friendship with the young men. When the partners spun off their website development and internet marketing group to create Solid Cactus in 2000, Palko successfully immigrated two of the Kyrgyzstanis to the U.S. to work for them. Palko and Sanfilippo have since brought over two more Kyrgyzstanis and one Indian, and Solid Cactus has already created 1,700 websites for clients such as the Kennedy Space Center and the National Wildlife Association.
Single-minded approach: Today, Neeps continues to develop the specialty market with more supplies sold online for small and popular pets (three of the online stores also have print catalogs), while Solid Cactus creates and maintains websites for clients. Solid Cactus and Neeps are separate companies that share one philosophy. Says Palko, "It's about servicing our existing customers and making sure we did everything we possibly could." --April Y. Pennington
Chris Griffiths, 32
Garrison Guitars
St. John's, Newfoundland
Projected 2005 sales: Over $7 million
Description: Manufacturer of acoustic guitars using a patented bracing system
Brace yourself: A Garrison acoustic guitar looks like a regular guitar on the outside, but the inside is a modern marvel. Instead of wood braces, a one-piece injection-molded fiberglass structure called the Active Bracing System is encased in the guitar body. It's a high-tech leap for an instrument that's been around for hundreds of years. Garrison is on track to build 25,000 guitars this year, selling to more than 450 dealers in North America and to distributors in 35 other countries.
The long and winding road: Griffiths likes to mention that it took six minutes to come up with the bracing concept--and six years to build it. He was no stranger to running a business, having started Griffiths Guitar Works, a small custom guitar-building shop and later a retail store, in 1993, when he was only 19. "All the lessons and all the troubles and all the issues were extremely similar between both companies, just on a different scale," he says. With no factory and only five prototypes in hand, Griffiths went to the National Association of Music Merchants trade show--the industry's largest--in 2000 and came away with prospective orders for over 46,000 guitars per year. By February 2001, Griffiths had secured $4 million in funding. "We had no employees, no sandpaper, no wood, and we started to build a company," he says. By September 2001, Garrison was shipping its first batch of guitars.
Canada calling: From one of North America's oldest cities come the newest innovations in acoustic guitars. As Griffiths says, St. John's is "way out there. It's a big deal to have a guitar factory in this town. We've shown that you can be innovative in Newfoundland and still be a global company." The 37 employees at the 20,000-square-foot factory are all locals. "Without good people, it's just a building, a bunch of machines and a pile of wood," says Griffiths. That focus on the community has paid dividends in terms of loyalty and low employee turnover.
Making beautiful music: "I've transitioned from being a fan of the guitar and a guitar builder to being a guitar CEO," Griffiths says. But he still finds time to play the instrument he's loved since he was 12 years old. With Garrison Guitars looking to double in size over the next year and a half, Griffiths has definitely found his groove. --Amanda C. Kooser
Vinay Bhagat, 36, & David Crooke, 34
Convio
Austin, Texas
Projected 2005 sales: $20 million
Description: Provider of online constituent relationship management software and services for nonprofit organizations
The sound of business: Austin, Texas, is known for its music scene, but it has also built a reputation for innovative technology. While so many tech startups were sprouting in Silicon Valley, Convio decided to launch in the Lone Star State. "We could build a business more economically here than we could on the West Coast," explains chief strategy officer Vinay Bhagat. What he and David Crooke, Convio's CTO, built is a for-profit company that uses the internet to improve the way nonprofits communicate and work with their constituents.
Money matters: Bhagat and Crooke met while attending school at the University of Cambridge in England--a long way from Austin. "We had dreamed and talked about one day starting a company together," says Bhagat. Years later, after reuniting at Trilogy Software in Austin, they got their chance. The Convio concept was born when Bhagat volunteered for a public TV pledge drive and was amazed at how antiquated the fundraising system was. He was confident that his idea to build an internet system for nonprofits would fly. Says Bhagat, "What attracted me to this idea was that it could be a neat way to combine building a business with having a real impact on the world."
Without a net: When most entrepreneurs start a company, they risk losing capital if the venture fails. While Bhagat left his high-paying job to self-finance six months of research into Convio's business concept, Crooke risked being deported if the business didn't get off the ground--he was a British citizen who left his job to found Convio, despite the fact that he didn't have a green card. A $4.6 million round of venture capital from Austin Ventures in 1999 allowed the founders to breathe a sigh of relief.
Role models: Crooke's role as the technical force behind Convio hasn't changed, but Bhagat made a big move in 2003 to bring in an experienced CEO while he switched over to the chief strategy officer role. "I put my ego aside," says Bhagat. With the founders' focus, drive and passion, Convio has helped nonprofits raise over $175 million and put e-philanthropy on the map. --Amanda C. Kooser
Jonathan S. Bush, 36, & Todd Park, 32
Athenahealth
Waltham, Massachusetts
Projected 2005 sales: $38 million
Description: Internet-based revenue-cycle management provider for the health-care industry
Wisdom and war: Athena is the goddess of wisdom and prudent warfare. Athenahealth brings both qualities to its internet-based billing and revenue-cycle software solutions for medical providers. Wisdom is a quality the founders have picked up over the varied life cycles of the company. According to Jonathan S. Bush, "The prudent warfare is using technology to get large, impersonal insurance companies to pay their claims properly."
A business is born: In 1997, Athenahealth as it is today was just a gleam in the founders' eyes. Originally, Bush and Todd Park bought an OB-GYN clinic in San Diego county that they refer to as "the baby company." They both had backgrounds in health care and had met while working at strategy and technology consulting firm Booz Allen Hamilton. "We believe the battle for health care will be won or lost in the doctor's office, so we wanted to be close to that," says Park. But they didn't expect the jungle of red tape that came with getting claims paid.
Growing pains: Burned out and frustrated with the baby company's withering finances, they went looking for an internet-based billing solution to ease their woes. They couldn't find one, so they built one themselves--and discovered a larger truth. "Billing is killing and frustrating physician practices across the country," says Park. The founders realized they could do more good on a larger scale by making their technology available to physicians everywhere, and Athenahealth was born. Several rounds of VC funding got them growing.
Beyond billing: "We believe passionately that we are on the same mission we were on when we started the baby company, which is to make health care work the way it should," says Park. That mission doesn't stop with billing. Athena-health is rolling out a major new project for 2006 that will bring the same process control to the clinical side, helping to keep track of lab orders, results and prescriptions.
Athenahealth is the dominant online revenue-cycle management company in an industry that remains highly fragmented. "After all this success, we have less than 1 percent market share," Bush says. That leaves a whole lot of room for Athenahealth to grow. --Amanda C. Kooser
Ryan Duques, 29, & James Warner, 29
Shore Publishing
Madison, Connecticut
Projected 2005 Sales: $7.5 million
Description: Publisher of 16 community newspapers in Connecticut and Rhode Island
Class act: Walking around the halls of their high school together, childhood friends Ryan Duques and James Warner knew they wanted to start a business. They'd already tried their hands at lawn care and tie-dye T-shirts, and in 1994, just as both turned 18, they started a publishing company to help businesses market to the local community. Eventually, they produced promotional fliers and even a local restaurant guide. While attending college, their deep ties in the community as well as Duques' experience at his college's newspaper led the two to set their sights on something bigger--a community newspaper. Says Duques, "The first edition went out in March 1996, and we fell in love with the newspaper publishing business."
Set it free: The basic revenue model for Shore Publishing was to sell ads to local businesses and distribute the paper gratis to everyone in the community. But when Duques and Warner launched their second newspaper, they went the paid-subscription route. They quickly saw their mistake, as both advertisers and readers balked, and the company lost revenue. "We realized just how fragile things can rapidly become," says Duques. "You may feel that [your choice] is right, but if your customers aren't feeling the same way, you have to adapt." After re-evaluating the business model, they went back to what originally worked and re-launched the free paper.
Playing nice with others: Employee morale and passion are paramount to Warner and Duques. "We cultivate a corporate culture that is fun, creative, high-energy, aggressive and entrepreneurial," says Warner. The pair also entered into a partnership with New London, Connecticut-based Day Publishing, which took on an equity stake in the company in 2003, giving Shore myriad new resources, from IT support and better printing rates to capital and equipment.
Poignant press: Covering 9/11 through the eyes of a local businessman who traveled to New York City to distribute flashlights was a particularly moving moment for Duques. He and Warner love the niche they've carved out with Shore's 16 titles and plan to expand into even more Connecticut and Rhode Island communities. --Nichole L. Torres
Shawn Prez, 34
Power Moves Inc.
New York City
Projected 2005 Sales: $3 million
Description: Street promotion, marketing and event-planning company
Self-promoter: As senior director of promotions for Bad Boy Entertainment, Shawn Prez promoted CD and record releases for Sean "Diddy" Combs' label. Impressed clients sought out Prez to handle additional work after the initial projects with Bad Boy were completed. In 2002, Prez felt it was time to start his own business. "I knew promotions inside and out and was at a point where I made more money on the side than with my salary," he says. Combs supported Prez's entrepreneurial endeavors and became Power Moves' first client--he hired the company to be the marketing force behind his "Vote or Die" election campaign. Says Prez, "That was really my proudest moment."
Testy waters: Even with Combs as a client, startup wasn't totally smooth for Prez. Four months into business, a big client abruptly pulled out. "We lost a big chunk of our revenue, and it was sink or swim," Prez recalls. Rather than give up, he sat down with his staff and his accountant to strategically map out the next six months. Power Moves not only pulled through lean times, it flourished and has now served diverse clients ranging from those in the music industry to HBO to a labor union.
Street smarts: Prez knows traditional advertising doesn't work with Generation X and younger groups. Power Moves instead targets lifestyle locations, such as barber-shops, bodegas and even street corners, to embed clients' products in consumers' minds using posters, CDs and more. The company's handpicked "street teams" consist of hip, trend-dictating urbanites between the ages of 18 and 27. They're paid to report on what's hot and what's not, covering 31 markets in the U.S. as well as Europe and Japan. Prez stresses that the urban consumer isn't confined to a particular color or race. Says Prez, "It's a mind-set, a lifestyle." --April Y. Pennington
Joel Boblit, 29
Bigbadtoystore Inc.
Somerset, Wisconsin
Projected 2005 sales: Over $4 million
Description: Online toy retailer specializing in collectible action figures
Robo-biz: Joel Boblit parlayed nostalgia for his childhood toys into big-time business when he discovered how much Transformers--robot action figures whose popularity has continued since the 1980s--were being sold for online. He launched BigBadToyStore.com in 1999 shortly after graduating college, while he was reliving fond memories of trading his favorite childhood toys--GI Joe, Masters of the Universe and Transformers. The biggest challenge in those early days? Boblit admits: "Being teased by my friends."
Parental guidance: While in college, Boblit sold action figures as a hobby for extra money, but when he decided to turn his hobby into a business, his parents supported him on all levels. They went heavily into debt to finance the business, and worked 100-plus-hour weeks alongside him for BigBadToyStore. Housing his inventory at one point, his parents had to create aisles in their home to navigate around the ceiling-high boxes. Says Boblit, "They have been instrumental throughout all this and worked just as hard as I did to keep it all together during the tough early years."
Grade A service: BigBadToyStore caters to specialty toy buyers with vintage favorites like Star Wars figurines and Teenage Mutant Ninja Turtles. Boblit also branched out to comic- and movie-related items, earning loyal customers around the world. Serious collectors prize mint-condition toy packaging, so Boblit guarantees his toys by using a grading system to distinguish "standard grade" (mint or near-mint condition) from "substandard grade" packages. He also offers a premium packing service that ensures an item is in tiptop condition and handled with extra care when it's shipped. Another big draw is the "Pile of Loot" function, which allows customers to stockpile items they've already paid for in a virtual storage bin. Upon the customer's choosing, the company will ship out all the items at once, reducing shipping costs. Future plans include distribution to approved retailers, who can view volume pricing online. Boblit says, "We've got the competitive edge for convenience." --April Y. Pennington
Darrin King, 34, & Jeff King, 38
Clubfurniture.com
Charlotte, North Carolina
Projected 2005 sales: Over $5 million
Description: Online retailer of high-quality, upholstered furniture and accessories handcrafted in North Carolina
Model example: When brothers Darrin and Jeff King decided to open an online furniture retail business in 1998, they were so confident in the power of the internet that they established their business in North Carolina, the furniture capital of the world. Previously working at manufacturing companies, the two had noticed inefficiencies in the supply chains and calculated that the internet, if used correctly, could bring down costs and streamline their operations.
Cushy business: The Clubfurniture.com website offers a full line of fabric and leather furniture handcrafted by nearly 100 North Carolina artisans, but offering their goods solely online initially posed quite a challenge for the brothers. To convince manufacturers to supply them with furniture, the Kings had to pay for the initial product development and marketing. Since then, they have gained customers' trust by mailing them swatches and samples, producing a high-quality catalog biannually and taking advantage of their low overhead costs to keep prices competitive.
Sit back and relax: Clubfurniture.com didn't join the statistics as yet another dotcom failure thanks to the Kings' effort to maintain a slow but steady growth pattern and to build a solid infrastructure. In addition, they are able to compete with mass-produced overseas imports by offering customers the opportunity to partially customize their furniture. "We're going for sophisticated consumers who want to have some say in their products," says Jeff. "We compete mainly on quality, style and turnaround [time]."
Dynamic duo: For the first three years, Darrin and Jeff were a two-man show, which they now recognize as being one of the biggest mistakes they made early on. "As entrepreneurs, we took a lot on ourselves, put a lot of pressure on ourselves and tried to wear too many hats," says Darrin. Now they have eight employees and can step back to see the bigger picture, which will eventually include new furniture lines specifically targeted to kids and teens. --Sara Wilson
Emily Mange, 39, & Doug Zell, 39
Intelligentsia Coffee & Tea Inc.
Chicago
Projected 2005 sales: $12 million
Description: Coffee roaster, retailer and wholesaler
Picture perfect: Order a latte at Intelligentsia Coffee & Tea, and you've just ordered a work of art. Preparing your beverage is a team of professional espresso makers, or baristas, who have mastered "latte art" and deliver each cup topped with a rosette design so beautifully formed that it's a shame to spoil it with a sip. At Intelligentsia, employees must complete a two-month barista certification program. Consequently, the company is home to some of the finest espresso makers in the nation, three of whom placed in this year's United States Barista Championship finals. Says Doug Zell, "Having this whole latte art presentation and the craft of the barista is something I think is hard to instill across 5,000 stores and is really something that helps to distinguish us from our competitors."
Coffee 101: In a hot market like coffee, competition practically sizzles. But while entering such an industry might be intimidating for some, it didn't keep Zell and wife Emily Mange awake at night. To prepare, Zell worked for several San Francisco-based coffee roasters, moving up from coffee brewer to manager and learning the ins and outs along the way. Driven by a vision of delivering quality coffee in Chicago--a market they felt was overlooked--the couple headed east, where they disappeared into the basement of Zell's parents' house, emerging a month later with their first business plan. Founded in 1995, Intelligentsia has grown to two retail stores with a third set to open early next year, and will eventually expand to other major markets outside Chicago.
Lasting impression: Breathe deeply, and the scent alone will transport you to another world. Intelligentsia's team of coffee buyers will travel to more than 10 countries this year to meet with local farmers in an effort to create an unforgettable cup of java. With loyal customers and more than 700 restaurants, gourmet food stores and espresso bars carrying Intelligentsia's products, they must have made an impression. Why the obsession with quality? Explains Zell, "For me, the notion of quality has always been easier to defend than something like price." --Sara Wilson

Amanda C. Kooser is Entrepreneur's assistant technology editor. April Y. Pennington, Nichole L. Torres and Sara Wilson are staff writers. Additional research was compiled by Steve Cooper, James Park and Lori Kozlowski.

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