My First Business
I’ve been an entrepreneur most of my adult life, but the scope of what I’ve done has changed so many times in my lifetime. Take for instance, my first business, Computers by Design. This was in the middle of the 90s, right around the time the web was first taking shape. To run a business back then, was very… mechanical. It was still the old way of doing things before the technology boom.
It all came about right after I purchased my first IBM PC. It was 1994 and it was the first time I was venturing away from a Commodore branded computer. Since my teen years, I had used a Commodore 64, then moved up to a Commodore 128. I was well aware of the PCs, being a computer running DOS. I may have even heard about an early version of Windows, but I really didn’t know anyone who owned a DOS PC, or what we commonly referred to as an IBM. We, diehard Commodore users, always referred to IBM users as “Beamers”.
For the early part of the 90s, I started hearing about another computer made by Commodore that was catching my attention with its new stereo synthesizing capabilities, and beautiful graphics. Of course, nowadays we would just do a Google search and read everything about it, but back then it was all about trade magazines. Take a trip to the grocery store and stop by the magazine isle. From there, you could find out just about anything you wanted to know about any kind of computers and current technology. Better than that would be a good old-fashioned computer store. How I miss those, but I digress. This computer that I just had to have was called the Commodore Amiga, or commonly known simply as Amiga.
So, I saved my money and purchased the lesser of several models, the Amiga 500, with an attached hard drive of 250 MB. Yes, in 1993, 250 MB was A LOOOTT!! This was also my first experience with a hard drive! All I ever used with my Commodores were floppy drives. You can imagine having a floppy disk collection of 300+! Yep, that was me.
As much as I enjoyed the Amiga, it did fall short when it came to game titles, and it was the exclusion of one particular game that caused me to say goodbye to the Commodore Amiga. Star Wars X-wing. (Did I mention I’m a Star Wars fan?) 🙂
So, after living through the 80s and a few short years of the 90s being a diehard Commie (well that’s what the beamer’s called us), here I was trading it all away for my first DOS based IBM PC. I was such a sellout. 🙁
It was 1994 when I bought my first PC, from one of the best computer stores around back then, Randy’s Computers. They built custom computers, built to order, by using standardized parts from different manufacturers. These computers were commonly referred to at the time as “IBM clones”.
I had already spent the last year learning the Amiga and was familiar with all the popular Commodore BBSs. Now I started dialing into IBM related BBSs and started learning all over again. THE biggest BBS in Birmingham by far was, The Matrix, ran by Birmingham’s legendary Rocky Rawlins. It was there that I befriended two sophomore students from Hayden high school, Josh Bishop and Jason Belcher. They were both programmers and taught me all about DOS and Windows, as well as the internal hardware of an IBM clone.
I started reading Computer Shopper. This was a HUGE monthly magazine/catalog that was THE industry standard for hardware and software manufacturers and distributors. There were lots of advertisements, selling every component you can think of, from floppy drives, motherboards, processors. Everything up to the case you build it all into. It was all there, with prices. All of this gave me an idea!
We started looking at different computer packages being sold by Randy’s Computers, and would break them down per component. Then we found each component in the computer shopper and figured up what our cost would be to build the same thing or equivalent. We soon realized there was a good markup to be made. We thought, “hey, we can do this. There’s nothing to it”. Josh and Jason could do all the physical labor, while I could do software installation and support.
So with a quick trip to the courthouse and a business license purchased, our new business was official. We called it “Computers by Design”.
One of the first things we needed to do was find out how we could sell our computers with Microsoft DOS and Windows preinstalled, like the big boys do. So, being completely wet behind the ears, we called Microsoft and said, “Hey, we just started a new business selling custom-built PCs, and would like them to be preinstalled with DOS. How do we do about doing this”? They told us we needed to speak to their OEM department and transferred us. We said “okay, thank you” and then looked at each other scratching our heads saying “What’s OEM”? LOL.
Of course, we would find out that OEM stands for Original Equipment Manufacturer, which it turns out is what our business was! We were manufacturing original equipment under our own brand name. Microsoft was very kind and nudged us in the right direction and even made a few recommendations of distributors that we could purchase our parts from. As for being an official Microsoft OEM, they wanted to fax over an application. Of course, we didn’t have a fax machine. 🙁 I’m sure this nice Microsoft representative couldn’t help but chuckle after our call that concluded. So, what do we do? Well, you know, every business has to incur some kind of expense upfront, and Computers by Design was no exception. I went to Sears and bought a fax machine.
Shortly thereafter, I had a dedicated fax line installed in my home. After requesting applications from various computer parts distributors, I soon realized that to even get access to wholesale prices, I had to prove I was a legitimate business and intended to sell these parts at retail prices, so back to the courthouse. This time for a sales tax ID.
It was truly a learn-as-you-go experience. We started establishing suppliers and putting together packages, and set everything up with some inventory software that allowed us to make estimates on the fly. Our goal was to have people see our ads and call us, and we would talk to them and find out just what they needed a computer for. Ideally, we would try to spend at least 15 minutes while we put together a custom estimate for their needs. What seems like every day, Josh, Jason and I would call each other, doing drills and training ourselves to speak with customers. Being able to answer questions on the fly about the hardware we were selling them, was crucial, and not to mention, a lot of fun!
We actually purchased our business license in June of 1995, not realizing that right around the corner in August, Microsoft was fixing to release its brand-new operating system, Windows 95. When we saw the anticipation that was building, we started marketing all of our advertisements to include that anticipation. We start selling our computer packages to include preorders of Windows 95.
Over the next several months leading up to Christmas, I poured a lot into advertising. We were averaging one or two phone calls a day with requests for an estimate here and there, but still no sales. Then finally, after months of work, getting prepared and placing ads, we finally got our first order! I was so excited. I was like Janine in Ghostbusters, “We Got One”!
Being a new business, we dared not ask a customer to pay in advance. It just wasn’t good business practice anyway, so I turned to my grandfather who financed our orders until we delivered and collected. So I called my suppliers and placed our first order.
Once everything was in, we cleared the dining room table and started to work. Building the first PC was a nervous project. We had never done this before, my grandfather’s money was on the line, and the customer was expecting delivery. What if we messed it up? What if we plugged in something wrong and fried the whole system? Although it was not all that bad, I must admit now that our customer would never know how many times we had to call our suppliers to ask for help. 🙂
Over time, however, we would build so many that it became second nature. Josh and Jason had a lot of influence with the computer department at Hayden high school, and got us some service work upgrading hard drives in nine computers. We also got ourselves on the state of Alabama vendor’s list in hopes of a getting some government contracts, but never submitted any bids because I could not afford the liability insurance that they required.
After nearly one year of on and off sales, Josh and Jason were now juniors in high school. All profits had been put back into the business, and being held for future orders. However, Josh and Jason wanted to explore other things. We decide to divide everything three ways and Josh and Jason took their cut. I, on the other hand, decide to keep going as a family operated business. I trained my mom to build the PCs, and she got quite good at it. For the next three years, we rocked on, always exploring new advertising, and trying to stay ahead of the price war with newer and better suppliers.
For the last two years of its life, Computers by Design started using a local supplier in Hoover called Computerman. It was actually the wholesale division of the computer store, Alabama Computer Associates.
As the Internet was ramping up by 1998, I started learning how webpages were made. I would open the source of any page I wanted, and studied the HTML code inside. Even though it was a totally different language than BASIC, which is what I grew up with on the Commodore 64, my skills as a programmer and understanding the language of logic made it pretty easy to pick up on. Borrowing a copy of Microsoft Visual Basic 3.0 from Josh, I learned how to create CGI executables. These were essentially Windows programs that had no interface. They would run in the background on a Windows server whenever they were called to do some execution from a webpage on the Web server. With it, and using an access database, I created an online estimate generator. Now my customers could go to my websites, see current prices (which I could edit on the backend), and could get a complete custom estimate with virtually endless possible configurations.
Unfortunately, all of this is exactly what all the big companies were doing as well. As the .COM era began, big companies like Gateway, Dell, and CompUSA started using the same marketing approach. Even newcomers like eMachines with their iMac copycat designs became a serious competitor when they teamed up with AOL and offered a one-year subscription to Internet access with every purchase. Competition was killing us.
I was desperate to win over customers. I got a toll-free number, I started selling extended warranty and service contracts, and by partnering with a local finance company that had a lot of retail clients, I started offering financing on all my computer systems. All of this helped a little, but it was all coming down to having a big enough presence. With the exception of Dell, all of my other competitors had real stores that could attract real customers with real money and real intentions to spend that money.
My goal through all of it was to eventually open a real store. So, to that end, I sought the assistance of the Small Business Administration. The SBA advised me to do what I should have done to begin with, to write a business plan. Then, and only then, would I ever truly understand how to prepare for such an endeavor, and reasonably justify whatever amount of money I decided I would need for start up.
While doing research for my business plan, I discovered a software business called Palo Alto, whose flagship software was Business Plan Pro. Eagerly, I purchased a copy and begin writing my business plan. In three months, I had something substantial to show would-be investors.
I went back to the SBA and showed them my business plan. They told me it was one of the most well researched and written business plans they had ever seen. Unfortunately, even an SBA loan would highly depend on good credit rating and existing assets. Either of which I did not have.
With the phone ringing less and less, and only a few online estimate being generated, no sales turned into no money. Turning to the Internet, I started researching other kinds of resources that might assist minorities or disabled entrepreneurs with financing to start a business. This is what led me to the Alabama Department of Rehab Services. ADRS is a state funded organization to encourage and assist people with severe physical and mental disabilities in finding real employment.
My initial hopes was that ADRS could help me acquire funding to move Computers by Design into a real storefront. After meeting my new case manager, Marilyn Long, and sharing with her a copy of my business plan, I could tell she was like a fish out of water. Come to find out, ADRS never have a client quite like myself. Most of the ones they helped were people who were looking for part-time work that could accommodate their specific needs. Wheelchair access, special software, etc. Finding someone with a severe disability such as mine, only to find out I had been successfully self-employed for four years, with ambitions to achieve even more, was quite different than what they were used to.
As impressive as it all was however, there was no policy in place to help disabled people be self-employed. It had only been 10 years since the Americans with Disabilities Act was signed into law, and changing the way employers saw handicapped people was a big part of ADRS. It was almost unheard of for disabled people to be self-employed business owners, and home-based employment was not considered a viable option.
After seeing what technology and other resources were available that might help me actually work a steady job, albeit away from home, seemed very appealing. A steady paycheck was something I had never achieved with my own business. Relying on my background in computers and information technology, ADRS suggested I try for a position doing technical support.
It was the turn of the millennium, and the 1990s were now a part of history. It had been nearly 3 months since I had made any sales and it was quite obvious that Computers by Design had seen its last days. Many things changed in those 4 years. I learned the ins and outs of starting and managing a business. I saw the birth of the World Wide Web and the beginning of The Internet, that would change the world forever.
I never took any position doing technical support. Instead, in true entrepreneurial fashion, I started another business. This time, partnering with a fellow entrepreneur and Vietnam veteran living in British Columbia Canada, Lloyd Low. Together, we started GoodLifeNow International, and partnered with several early Internet businesses and taught people all across the world how to use affiliate marketing to create a steady, usable income. It led to even more successful business partnerships in the early 2000’s, but that’s another story.
It’s a totally different world now in 2017, but in the last half of the 1990s, Computers by Design was my dream job. It taught me so much in business and marketing, but more importantly it taught me the value of hard work and determination. Today, it’s just the opposite of what it was then. With modern e-commerce, online stores are very successful, but brick-and-mortar storefronts have much more overhead, and have dropped a number.
One thing that e-commerce will never replace, however, is the one-on-one attention a customer gets when actually being in a store and trying the product before buying it. I suppose it’s one of the many lost aspects of business that gave way to the age of technology.
At least entrepreneurship is not dead. E-commerce has allowed it to thrive! The online world is changing everything we do today. Even the way we consume television shows has made a shift from satellite and cable to the Internet and mobile phone. Modern e-commerce connects businesses directly to customers that are looking for them, anywhere in the world. To accomplish the same amount of work back then would require hundreds of employees. If I had this much power at my fingertips in the late 1990s, then Computers by Design… Well, I guess this would be a whole different story, wouldn’t it?