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Not all business ventures need to be glamorous, according to Nick Huber, entrepreneur and host of the Sweaty Startup podcast. Huber has spent years running a self storage startup, which began as a summer job during college, then took off to become a successful company.
Huber advocates for the old-fashioned view of entrepreneurship: starting a business that serves the community, but doesn’t necessarily scale up. Sure, companies like Amazon or Facebook started out small, but soon grew into behemoths. Huber says you don’t need delusions of grandeur to become an entrepreneur and make millions.
Thinknum: First off, I’d love to hear about the Sweaty Startup. How did that concept come about?
Huber: I guess it started when I was in college, at Cornell. A lot of folks were very serious and very driven about starting a business, and they all wanted to have the next sexy tech startup that was going to be featured in TechCrunch, and they were going to try to raise a Series A, and a Series B, and potentially get acquired by a Google or a Facebook. There were 20 or so people who were in my circle, and almost every single one of them ended up going to get jobs, and didn’t end up making entrepreneurship work.
I took a different approach, and that was to do something that doesn’t necessarily scale, do something that’s not necessarily sexy, more hands-on, more service oriented, and it worked for me. I came to the realization that the people in our towns and our communities that were wealthy — whatever your definition of “wealthy” is — and almost all of them didn’t start apps or technology companies. They started regular, sweaty, old fashioned businesses.
Since then, I’ve been on a kind of mission. I myself started one of those. I’ve been really successful and had a really fun time designing the life that I want to live. I realized that you don’t really need to be a billionaire to make it happen, and you’re actually a lot more likely to succeed if you take one of the — I wouldn’t necessarily say the boring route, but yeah, the sweaty service business.
I’d also like to hear about your own storage business, Storage Squad. Where did the idea for that come from?
It wasn’t really an idea. There were other companies doing it. I put my apartment on Craigslist when I was in college to sublet, because I was heading home for the summer, like all the other students. I really quickly realized I wasn’t going to be able to lease my apartment, but a parent of another student reached out to me and said, “Hey, I don’t need to rent your place, but I’d love it if you could pick up my son’s stuff and if you could put it in your room. Because the company at Cornell was not a good experience last year.” And I said, “Yeah, I might as well make some money instead of no money.”
So I went up there and picked up the stuff, and once I had it in the room I realized I can’t sublet it, because it’s got someone’s things in here. So I went around to my social network, and advertised a storage service. Before I knew it I had a full room, and my two roommates, their entire rooms were full as well, and I still had the phone ringing for more and more customers. And I found my business partner whose name is Dan, and we started the business together. Before we knew it we had 50 customers and five or 10 grand in cash, with just the tools we had in our hands, with our cars and our apartments. We said, “Hey, this might not be a big sexy new idea, and our grandparents aren’t going to talk about it to their golf buddies, but it’s a chance to make some money.”
We said, “Hey, this might not be a big sexy new idea, and our grandparents aren’t going to talk about it to their golf buddies, but it’s a chance to make some money.” - Huber
When did you realize that this could grow into a serious venture?
We kind of got laughed at. I called my dad and said, “You know, I’m considering not getting a job and doing this pick up and delivery storage service.” And we saw our friends go to New York City and get offers to make $150,000 a year. My dad tried to have an intervention with me, where he was like, “Nick, what are you doing? You’re in the ivy league, you have all these opportunities to go and make money, why are you doing this?” I say that in a joking way, he was very supportive of me. But it was not looked at as something that had a lot of potential.
We said, “Okay, look. We know our opportunity cost is high. We need to take a real risk and see where it takes us.” So we made a goal to get 250 customers the next year, and we knew that we couldn’t do that at the school we were at. I had a good buddy who went to Indiana University, and another friend who went to Iowa, and we convinced them to run branches of our business. We bought several cargo vans and invested our student loan money into launching. We hit our goal, and we promised ourselves that weren’t going to go get jobs, and the rest is history.
This is obviously not a world-changing business idea, and you’ve said before that entrepreneurs don’t necessarily need a world changing idea. I was wondering if you speak about finding a “conventional” business idea and running with it.
I like to look at my odds of success. I’m a practical person. I try not to get emotional about what I do, or let my ego get involved and try to change the world. I look at — okay, how big is the pie? How many people are already doing this? How much money is changing hands? I look at that and say, “Okay, what do I have to do to get my slice of the pie?”
When you look at entrepreneurship, far too many people take that one in a million chance to raise venture capital and have a new big idea. People read books like “The Blue Ocean Strategy” about creating your own monopoly, when in my opinion that’s all wrong. That’s a good way to set yourself up for failure. You’re taking massive risk, you’re competing against the brightest minds, the sharpest people, venture capital money, and frankly it’s not the way to go in my opinion.
I think the way to go is to take a pie that’s already big and just get your slice of it. You don’t need to do anything different if you execute the fundamentals. Me and Dan, all we had to do was answer the phone, and show up when we say we’re going to show up. And if we do those two things, we can build a business that does several million dollars a year in sales. For me it’s all about doing common things uncommonly well. But unfortunately, entrepreneurship culture, if you look at any MBA or entrepreneurship classes in America, they always ask, “What’s your differentiator? How are you any different from X?” So what you have is a lot of people trying to reinvent the wheel, and spinning in circles, in my opinion.
You wrote that Shark Tank and TechCrunch culture is ruining the spirit of low-risk entrepreneurship. What did you mean by that?
When you ask somebody, “What is entrepreneurship?” they think of Shark Tank. They think of new ideas, they think of Steve Jobs, Mark Zuckerberg, they think of Elon Musk. In my opinion, those aren’t the true entrepreneurs. The true entrepreneurs are just regular people starting businesses. They don’t even know what the word “entrepreneur” means. They don’t consider themselves entrepreneurs. They consider themselves opportunists who decided to start their own business and design the life they wanted. When I look around my country club in Athens, the wealthiest people there, they didn’t have new ideas. They all just had the guts to go try something. They did the common things well and carved out a piece of the pie. And business is about momentum. For me, I started with a $1500 cargo van and I was lugging boxes myself up and down spiral staircases in BU, in Boston, and five years later we’re acquiring $20 million worth of self storage.
“When you ask somebody, “What is entrepreneurship?” ... They think of Steve Jobs, Mark Zuckerberg, they think of Elon Musk. In my opinion, those aren’t the true entrepreneurs.” - Huber
Why is there such a fascination with Silicon Valley and all these tech startups?
I think people are selfish about entrepreneurship. They have an ego — they want to say that they raised venture capital, they want to try to change the world. It’s all about what they want to do, and in my opinion that is the wrong way to look at entrepreneurship. The way you should look at is “Hey, where’s the problem that I can solve, and if I’m in the 50th percentile, if I’m better than half the people, I can do really, really well.”
What advice would you give to an entrepreneur who wants to be the next Steve Jobs? What about for an entrepreneur who’d rather run a sweaty startup?
I never try to talk entrepreneurs out of doing what they’re doing. The people who really have the vision, I would say just make sure you test your concept really quickly. And make sure you find out as soon as possible whether or not it’s going to be successful. Otherwise you’ll waste way too much time chasing things that maybe aren’t going to work out.
If they’re interested in starting a sweaty startup, I would say look up from your computer screen. Not every company has to be a scalable company. If you look at the physical world around us, and how big of a job it is to build and maintain the physical world, anything that requires you to be present and be face to face with clients, that’s the stuff nobody wants to do. That’s the hard stuff that sucks to do. The less people that are excited about what you want to do, the more potential opportunity there will be.
Are there any downsides to that business model?
Definitely. I make it sound easy, and all you have to do is show up. But the downside is that you wake up and you’re 35 years old, and you have a business that owns you, and you’re stressed out working 80 hours a week and you’re only making 50 grand a year. There’s a lot of entrepreneurs that find themselves in that spot. They run a roofing company, they run a lawn care company, a pest control company, and they realize they’ve created for themselves a very risky job. That’s the risk. You have to try to combat that by building a business that can scale somewhat, and that’s the hard part.
“The way you should look at [entrepreneurship] is ‘Hey, where’s the problem that I can solve, and if I’m in the 50th percentile, if I’m better than half the people, I can do really, really well.’” - Huber
Right, because you want to get out of that 80-hour workweek. You want to get back to the 40-hour workweek.
Yeah. Or zero. For me, I work five hours a week maintaining what I’ve already built, and the other 35 are growing things that I don’t necessarily have to do, but I want to do and I’m excited about.
Do you see a resurgence of this kind of startup in the future?
Honestly, I hate to be a cynic, but I don’t. I don’t see a rally cry for this kind of entrepreneurship. A lot of people don’t want to hear my message. It’s like a dietician saying, “Look, your diet is not gonna work for you. You have to build a long-term sustainable lifestyle.” Nobody wants to hear that they have to work their butt off for five years, and they’re not going to be famous. I think I’m getting to some people. We have a small community on Reddit, my blog, and YouTube channels. Overall, my goal is just to impact a couple of people’s lives. If I can get a couple of people to look at that side of entrepreneurship, and realize, “Hey, I can compete with these people if I go about it like I want to build something, be a manager, not just someone who wants to create themselves a job.” If I can impact one person, and have one person take the leap and change the trajectory of their entire family and the generations to come, that’s a huge win for me. This stuff sucks, right? I mean, this is sweaty, hard work.
But you probably don’t regret any of it.
Oh my God. I feel so blessed every single day that I’m in a position where I don’t have 30 grand in the bank and two vacation days saved up. I’m really thankful that I’m not getting in the car and driving an hour each way to work for somebody else.
The Link Lonk
September 30, 2020 at 11:57PM
https://media.thinknum.com/articles/silicon-valley-sweaty-startup-entrepreneur-nick-huber/
Forget Silicon Valley. You can make millions running a “sweaty startup” according to Nick Huber - Thinknum Media
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