Case 3: Progress

How This Man Built A $3M Business A Year After Four Years In Prison
Frederick Hutson, CEO and cofounder of Pigeonly
Hollie Slade , FORBES STAFF
Frederick Hutson is a man who sees business opportunities in everything. By his own
admission, this doesnt always work out for the best. Hutson spent over four years in prison after
getting busted for an opportunity he saw in drug trafficking, a huge market, and one that was as
he saw it, ripe for disruption. Police busted him at his Vegas mail store, where hed been
reducing inefficiencies by rerouting marijuana through his Florida business via FedEx, UPS and
DHL.

Hutson, whod built several businesses before and after a stint in the Air Force, which he left
with an honorable discharge, began meditating on new ideas soon after he started his 51-month
sentence in 2007, aged 24. I did my time that way, he says. While I was there I just saw how
grossly inefficient the prison system was and there was just so many opportunities.

A big gripe for the 2.3 million doing time in the US is keeping in touch with friends and family on
the outside. Theres no internet in prison so all communication is through snail mail or the
phone. Calls are often expensive and long distance. Relatives and friends, leading increasingly
digitized lives, write less and dont get around to sending photos for weeks on end.

It was a pain point I experienced firsthand, says Hutson. Im very close with my family and I
knew they cared about me but even with knowing how much they cared about me they were still
sometimes unable to send me photos.

Transitioning from digital to analog is tough, says Hutson. Its hard to sit down and write a letter
now but simple to text or email. What if you created a website that printed out emails, texts or
photos from your computer, Facebook or Instagram and mailed them for you in the plain white
envelopes these institutions favored?

The idea for Pigeonly was born. Essentially, its a platform that centralizes the myriad state-level
databases making it a quick search to find where an inmate is in the system Hutson himself
was moved eight times during his stay as well as a way to communicate. People get lost in
the system all the time, he explains. We have attorneys contacting us trying to find their
clients.

Through its sub-brands, Fotopigeon, which sends digital prints to inmates and Telepigeon which
lowers phone call rates through VoIP, Pigeonly is on track to be profitable on about $1 million in
revenue in its first year following $2 million in seed financing from Silicon Valley investors.
Hutsons Las Vegas-based team has grown from two to twelve. Key to this was getting accepted
to NewMe, a Sillicon Valley-based accelerator for underrepresented minorities. It was the only
accelerator to accept Hutson, he says.

When he started as part of the winter 2013 cohort, he and his cofounder Alfonzo Brooks had
already launched a version of Pigeonly while Hutson was still in his halfway house. Theyd
quickly picked up 2,000 customers by directly mailing inmates touting their services.

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We identified 500 people and sent them greeting cards saying heres a product people can use
to send you photographs. Three or four days after our cards landed we started seeing people
show up on our website creating accounts and sending photos so we kept doing that, says
Hutson.

CEO Frederick Hutson

CEO Frederick Hutson

At NewMe Hutson started re-orienting the business from a few services to a searchable platform
and began taking meetings with investors. In the very beginning I was hesitant to even talk
about my background but the question would always come up, well how do you know? he says.

NewMes founder Angela Benton gave Hutson some advice. She said, look some people are
not going to vibe with you and theyre not going to be able to get on board with what youre
doing theres going to be a block because youve been in prison and you dont look like the
typical person they invest in, he remembers.

When he focused instead on the people who were open and understood that his background
was why he knew this problem exists he started gaining ground. A lot of times a thing that can
be perceived as a weakness actually turn into the greatest strength and for me it was that. It
actually became the reason people invested because Id been there, and I know and
understand this market better than anybody else, he says.

Still, fundraising was no cakewalk, he says. It can be hard because as an entrepreneur you feel
like its your baby and when you talk to someone about your baby and they go, no thats whack
Im not interested you cant take that personal, you have to be able to talk to the next person
with the same intensity and fervor, he says.

Convincing investors to write a check for the first million was the hardest. I probably talked to
about 60 investors, and in our seed round we had six, so that gives you an idea of how many
nos you had to get to the six yess, he says.

Hutson thinks prisons are a natural pool of entrepreneurs. When you take away that seven
percent or so that did something violent that people are afraid of, people who we need to have
locked up, most of the other guys were selling drugs or involved in some kind of scam or did
some kind of wire fraud, or white collar crime that was motivated by finances, he says. So you
just really got the business model wrong, you got the product wrong, the goal was wrong but if
you can apply that same drive and bottom line principles to something positive then now you
have a viable business.

He learned a lot from his fellow inmates inside. In some facilities that the classes they have
arent taught by people outside, theyre taught by other inmates, he says. So youll have a guy
who has a white collar crime who might have embezzled 40 million dollars and he knows
something about business because he ran some listed company and now he has a 36 month
federal sentence for tax evasion hell teach a class on how to form an LLP or start a balance
sheet.

Still, getting prisoners ready to reenter society isnt a big priority, thinks Hutson. Most
institutions are geared around containment, he says. Most are based around you dont leave
and you guys dont kill each other while youre here thats their priority number one.

With reoffending rife one study tracked 404,638 prisoners in 30 states after their release from
prison in 2005 and found 68% were rearrested within three years some organizations are
already turning to entrepreneurship as a way forward. For example, the Houston-TX-based
Prison Entrepreneurship Program, which trains around 250 prisoners a year in launching a
business says instances of inmates reoffending once theyve completed the course is only 5%

Source: http://www.forbes.com/sites/hollieslade/2014/08/21/how-this-man-built-a-3m-businessa-year-on-from-four-years-in-prison/2/#220f48651b8b

Summary of News Article

The article is all about the progress of a prisoner named Huston, after being
imprisoned he became a multi-millionaire. He created his own company and earned at
the most $3 million.
He became inspired because of his prison mates. He fought in order to give inspiration
and to make his life better than before.

Correlation to Les Miserables

in the story Jean Valjean was a prisoner for almost 19 years. When he went
out of the prison he changed his identity to redeem his self. Just like in the article,
Huston was imprisoned and became successful after he was set free. But, it was a
different scenario with Jean. Jean became a mayor, a very wise and well known
mayor because of his determination and hard work to improve their town. After
leading the town for plenty of years he was plead guilty of his sin.
I've chosen the theme progress because for me, the whole story is about
change and improvement. There are a lot of stories where a prisoner chose to
change direction in order to redeem his self. May this article be an inspiration to us
that even prisoners or people whom you think doesn't have hope became a multimillionaire.

Case 4: Poverty
Duterte aims to pluck 9 M Pinoys from poverty
By Prinz Magtulis and Edith Regalado (The Philippine Star) | Updated June 21, 2016 - 12:00am

The Duterte administration is aiming to pull nine million Filipinos out of poverty and keep the
country in the growth path by strengthening the agriculture and manufacturing industries. File
Photo

DAVAO CITY, Philippines With greater focus on countryside development, the Duterte
administration is aiming to pull nine million Filipinos out of poverty and keep the country in the
growth path by strengthening the agriculture and manufacturing industries.

In a dialogue-workshop with the business community here yesterday, Dutertes officials

discussed in greater detail the incoming administrations thrust of spreading out development
efforts, which they said were concentrated in Metro Manila for a long time now.

We are targeting to reduce poverty rate between 1.25 and 1.5 percentage points a year. That
will make a combination of around nine percentage points, incoming finance secretary Carlos
Dominguez III told reporters on the sidelines of the meeting with more than 300 businessmen
called Sulong Pilipinas (Move forward, Philippines) at the SMX convention center here.

This dialogue, I assure you, will help us refine the reforms the new administration proposes.
From the onset, let me assure you that the new administration will be guided by what is best for
the nation, Dominguez said.

We seek your counsel as stakeholders in this nations progress, as we will the counsel of other
stakeholders: those who own nothing in their name but whose capacity for hope rests
precariously on the opportunities public policy is able to create, he told the gathering of
executives and business leaders.

As of first semester last year, 26.3 percent or roughly 26 million of the 100 million Filipinos were
living below the poverty line, according to data from the Philippine Statistics Authority.

On government finances, incoming budget secretary Benjamin Diokno said bigger budget would
be allocated to rural areas in the Visayas and Mindanao.

He said agriculture, manufacturing and infrastructure would have more funds. As early as next
year, up to P1 trillion may be earmarked for infrastructure from just P595 billion this year.

We would like to make sure that (agencies) will not ask for a budget that they cannot
implement... We also plan to have the budget approved before the start of fiscal year, Diokno
said in a briefing.

Incoming transportation head Arturo Tugade, for his part, gave assurance that all past contracts
would be honored.

Furthermore, existing public-private partnership (PPP) projects would be accelerated, and new
ones would be undertaken, mostly in rural areas.

I was really amazed that 80 percent of projects proposed are in Metro Manila. Youre just going
to further congest Manila with that, Dominguez said.

Food security
Food security under the next administration would also be prioritized, with Emmanuel Piol of
the Department of Agriculture planning free irrigation and more support for farmers and
exporters.

Incoming trade secretary Ramon Lopez said they would seek to establish connection between
micro, small and medium enterprises (MSMEs) and local governments with large companies.

The strong partnership will help build inclusive business models. We want the big businesses
to include MSMEs in their value chain to provide them a sustainable market, Lopez said in the
forum.

Doing business with the government would also be streamlined, Tugade said, as he aims to cut
business transaction time in his department by 50 percent over the next year.

Dominguez said shortening PPP bidding process to between 18 and 20 months from the current
average of 29 months would also be pursued.

This consultation is a step in the right direction. We welcome this recognition of business as an
important partner sector and we vow to make giant steps to make this happen, said George
Barcelon, president of the Philippine Chamber of Commerce and Industry.

Vicente Lao, chairman of the Mindanao Business Council, said: There really needs to be a
paradigm shift on how the government works and this is a good start.

Cebu Pacific chief executive officer Lance Gokongwei called the dialogue good, and very
participative.

Philexport chairman Paterno Dizon said he was happy several Cabinet members of the
incoming Duterte government were on hand to answer questions from the participants on
various issues of governance, especially the economy.

People here will provide the inputs, the recommendation on the thrusts of this government. It is
very good, Dizon said.

What is good is that all the secretaries were open and were candid with regard to their
responses and how they will act on certain issues, he added.

Philippine Airlines president and chief operating officer Jaime Bautista told The STAR the
dialogue was a good start for the Duterte administration.

The new administration is laying out their plans and they are transparent about it. You can see
their sincerity. You can see how the Cabinet reacts. Its fast, Bautista said.

The PAL executive also praised Tugades appointment, saying he is an action man and an
efficient businessman who knows what he is doing.

BDO president Nestor Tan said what impressed him was the fact that such dialogue was held
for the first time outside Metro Manila.

This is a very good start. Rather than do it in the media, they are doing it through dialogue, Tan
said,

So far, we like what we are hearing. They involved us and the issues raised are answered, he
said.

Bankers Association of the Philippines executive director Cesar Virtusio said the dialogue was
an encouraging start for the Duterte administration.

What we have heard today, how they would address issues, they give encouraging answers to
the questions, Virtusio told The STAR.

The fact that they brought us all down here in Davao, obviously, it is a very good start, Virtusio
added.

Lower but realistic

While it intends to boost development, the Duterte administration may lower this years growth
target as it expects Chinas slowdown and investors wait-and-see attitude to affect the
Philippine economy.

Incoming socioeconomic planning secretary Ernesto Pernia said a 6.5 to seven percent goal is
more attainable than the current target of 6.8 percent to 7.8 percent, as the next administration
may experience birth pains while dealing with the impact of Chinas economic slump.

Perhaps 6.5 (percent) is more achievable. (A growth target of) 6.5 to seven (percent) is more
feasible. The lower end of the target is more feasible maybe this year, Pernia said in a chance
interview Sunday night here. China, I think, is continuing to decelerate.
Asked why he prefers a more conservative full-year target, Pernia said: Were setting up. Well
probably be feeling our way through and maybe the Cabinet (is just starting to work) as a
cohesive team. Birth pains, start-up pains.
Pernia said the 6.9 percent economic expansion in the first quarter would make the 6.5 to seven
percent goal doable.
A seven to 7.5 percent growth may be achieved next year if the country attracts enough
investors and makes some headway in rural development, agriculture, manufacturing and
government spending, he added.
According to Pernia, relaxing ownership restrictions in the Constitution and reducing crime and
corruption the centerpiece of president-elect Rodrigo Dutertes election campaign would
help the Philippines lure foreign investments. With Alexis Romero, Jess Diaz, Czeriza
Valencia
Source: http://www.philstar.com/headlines/2016/06/21/1595083/duterte-aims-pluck-9-m-pinoyspoverty

Summary of News Article

Here in the Philippines poverty is one of the largest cases we have. No one
knows how to solve it and what is the answer to it. Our latest president, Pres. Rodrigo
Duterte, had made a move on his own to solve poverty.
The article states that it is their aim to solve more than 9 million families and raise
them in the poor. The president is making an effort to deminish the poverty here in the
Philippines. He aims to make Philippines a rich country by making his people rich.

Correlation to Les Miserables

Poverty is something that every county and every place has. You can see them
every where. In the story, poverty is what you mainly see if you visualize it. The story is
a world full of poor people.
Just like what you can see with the case of Cosette and Fantine, they stive hard
just to have something to eat every day. Poverty can also lead to troublesome acts like
the Tharnerdiers. They are stealing from people because of tight times