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6 INCREDIBLE COMPANIES THAT STARTED IN A GARAGE
https://www.americanexpress.com/us/small-business/openforum/articles/6-incredible-companies-
that-started-in-a-garage/
The humble beginnings of the following six multibillion-dollar companies prove that great ideas are
still great ideas, no matter where they're started and developed.
Apple
brands today, so it's often surprising when people learn that Apple's first computers were built in a
small garage in Cupertino, California.
In 1976, Steve Wozniak created the first Apple computer. He then joined forces with the late Steve
Jobs and another partner, Ronald Wayne, to launch Apple Computer Co. from Jobs' adopted
parents' garage.
One of their first big orders was from a local retailer who ordered 50 computers at $500 apiece,
which they were able to produce in just 30 days. Although Wayne had already abandoned the
business, Jobs and Wozniak successfully reached their goal in just 30 days.
Today, the Silicon Valley home where Jobs grew up is listed as one of the city's historic
properties.
Hewlett-Packard
Just 10 miles from the garage where Apple was started, Stanford graduates Bill Hewlett and Dave
Packard launched their own company, Hewlett-Packard Co. (HP), in 1939 with an investment of
just $538. In the 12-by-18-foot garage
in back of the house they were renting, Hewlett and Packard built their first product: an audio
oscillator. One of their first customers was Walt Disney Productions, which bought eight audio
oscillators to use for certifying the surround sound systems installed in theaters for the
film Fantasia.
The garage was used as a research lab, development workshop and manufacturing facility for
nearly a year before the partners outgrew it and moved to roomier quarters nearby. The company
was incorporated in 1947 and, 10 years after that, became a public company. Today, Packard's
garage is a private museum and is known as the "birthplace of Silicon Valley”,
Amazon
Four years after being named the youngest vice president of a successful Wall Street investment
firm, Jeff Bezos quit his job and moved to Seattle to pursue what he believed to be untapped online
retailing opportunities in the book industry. He set up shop in his garage in Bellevue, Washington,
and began developing software.
Bezos held meetings at a nearby Barnes & Noble, where most of Amazon's first contracts were
negotiated. In July 1995, Bezos launched Amazon.com and sold his first book
from his garage startup. Two years after that, Bezos issued his IPO. The company is now the
world's largest online retailer.
Larry Page and Sergey Brin met at Stanford in the mid-1990s and decided they wanted to start a
company together. Two years later, the partners established Google's headquarters in Susan
Wojcicki's 2,000-foot Menlo Park garage for $1,700 a month.
At the time, Wojcicki—who held a senior vice president position at Google until January 2014—
was a recent business school graduate and rented out her garage to the Google guys in order to
make her mortgage payments.
Within one year, the Google team would outgrow the garage space and move to an office in Palo
Alto along with their eight employees.
It's the highest-grossing media conglomerate in the world, and it all started in the summer of 1923
in a one-car garage that belonged to Walt Disney's uncle, Robert Disney. At the time, the company
was called The Disney Brothers Studio
and was located about 45 minutes from today's Disneyland Park in Anaheim, California. In this
small space, the team filmed the Alice Comedies, which would later inspire Disney's version of
Alice in Wonderland.
A few months later, Disney, along with his brother Roy, moved to a bigger lot down the street from
their uncle's house, which is where Disney signed a deal with Universal Studios to distribute the
Alice Comedies. And the rest, they say, is animation history.
Mattel
out of a Southern California garage. From the scraps of the picture frames, which were made of
Lucite and flocked wood, Elliot started making dollhouse furniture. Ruth, who worked at Paramount
Pictures, is said to have landed her husband's first order by bringing a suitcase full of the dollhouse
furniture to a store on Wilshire Boulevard not far from her job.
The success of the dollhouse furniture pushed Elliot and Ruth (Matson had left the company due to
poor health) to focus solely on manufacturing toys. In 1959, Ruth invented the Barbie doll, named
after her daughter, Barbara.
But these uber successful companies aren't the only ones that started from small garages. Cloud
company Box.net, mobile payment company Square and Tesla Motors were all launched from a
garage. And garages aren't the only usual place companies are born. Nike started out of founder
Phil Knight's green Plymouth Valiant's trunk, and the beginning of Michael Dell's computer empire
came together in his dorm room at the University of Texas at Austin.
The lesson here is that the most amazing ideas have no boundaries. From small, rented garages
to multibillion-dollar companies, anyone who's passionate about an idea can start—and grow—that
idea anywhere, as long as they have a little privacy and room to shut out the rest of the world.
uber- [ˈuːbə] (also über-/ˈyːbə/) combining form denoting an outstanding or supreme example of a
particular kind of person or thing;
As much as people love mom-and-pop businesses, it can be hard for these small shops to
compete with the big guys. Nonetheless, some of the biggest and most successful companies in
the world got their start as a small mom-and-pop business. Many of these small business owners
never envisioned becoming international corporate giants, but when you've got a great idea, the
sky is the limit. Here are 10 mom-and-pop businesses that turned into empires:
3. Party Pieces
Party Pieces is one of the biggest online and catalogue party supplies companies in
the UK. The successful homegrown business was started by Carole and Michael
Middleton, the parents of Princess Catherine Middleton. In 1987, Carole launched the
mom-and-pop company out of frustration when she couldn't find affordable party bag
gifts for her children's parties. Her husband, Michael, quit his job to help run the
business from the family's backyard shed. Party Pieces grew rapidly and the
Middletons moved their operations to three converted farm buildings outside of
London. Despite its success and growth as a partnership, Party Pieces has
maintained its family business model and Carole continues to be involved in the
sourcing and developing of new party products. Even though Party Pieces and the
Middletons aren't required to disclose the company's earnings, it's likely that the
company received an extra boost in business during the royal engagement and
wedding.
4. Energy Brands
Energy Brands, also known as Glacéau, is a privately-owned subsidiary of Coca-Cola
Company that's best known for its enhanced water products, such as Smartwater and
Vitaminwater. Energy Brands was founded in 1996 by J. Darius Bikoff, who distributed
his enhanced drinks to health food stores, independent retailers and mom-and-pop
stores in the New York area. Bikoff's small business came about after the 1993 water
contamination scare, in which he wanted to provide a sanitary and flavorful alternative
to bottled spring water. The idea took off and Bikoff responded to the success by
expanding the drinks to national distribution. In 2002, the Glacéau, line of beverages
became the top-selling enhanced water brand in America and it raked in $350 million
in revenues in 2006. The following year, Coca-Cola bought out Energy Brands for
$4.1 billion.
5. Wrigley Company
The Wrigley Company is one of the largest and most recognized makers of gum,
mints, hard and chewy candies, lollipops and chocolate. But chocolate lovers and
sweet tooths may be surprised to learn that the Wrigley Company started off selling
soap and baking powder before adding confections to the list. This family-owned
business was founded in 1891 by William Wrigley Jr., who started giving merchants
free chewing gum with each can of baking powder they purchased. Two years later,
Wrigley launched Wrigley's famous Spearmint and Juicy Fruit flavors. Wrigley's gum
became a huge success and he moved the company to its first factory in Canada,
then Australia, Great Britain and New Zealand. The company now has 19 production
facilities across the world.
6. Wal-Mart
Considering the fact that Wal-Mart is the biggest company in the world with more than
2 million employees and 8,500 stores worldwide, it's hard to believe that the
corporation began as a mom-and-pop business. The founder of Wal-Mart, Sam
Walton, started his retail empire in 1950 when he opened Walton's Five and Dime in
Bentonville, Ark. It was here where Walton achieved higher sales volume by marking
up items slightly less than other competitors. Using this successful sales technique,
Walton opened the first Wal-Mart Discount City store in Rogers, Ark., and expanded to
24 stores over the course of five years. Since then, Wal-Mart has infiltrated all 50
states as well as 14 foreign countries, where it operates under different names.
7. Burt's Bees
Burt's Bees is by far one of the biggest names in natural personal care products. Even
though Burt's Bees is a multi-million dollar enterprise, the company was built on very
humble beginnings. In 1984, Burt Shavitz and Roxanne Quimby founded Burt's Bees,
a mom-and-pop candle company in Maine. They used the excess beeswax from
Shavitz's honey business to make the candles in an abandoned one-room
schoolhouse that they rented, and Quimby began making homemade personal care
products from the wax and other natural ingredients. In 1991, Burt's Bees became
incorporated and the company started selling natural soap, perfume and their best-
selling lip balm. In 2007, Burt's Bees was bought out by Clorox for a reported sum of
$925 million.
9. Mattel
Mattel may be the largest and highest-grossing toy company in the world, but this
empire got its start as a humble mom-and-pop business. In 1945, Ruth and Elliot
Handler and Harold "Matt" Matson launched Mattel and set up shop in a garage
workshop in Southern California. The company's first products were picture frames,
but after the success of Elliot's dollhouse furniture business, the owners decided to
shift their focus to toys. Mattel revolutionized the toy business by advertising on
the Mickey Mouse Club and creating the beloved Barbie doll in 1959. Although Mattel
has seen its fair share of lawsuits and product recalls over the last few years, it has
maintained its place as a premiere and trend-setting toy company.
10. Whole Foods Market
It may be hard to believe that Whole Foods Market was anything but the massive
supermarket chain it is today, but its beginnings were in fact much, much smaller. In
1978, John Mackey and Rene Lawson Hardy opened up a small natural foods store
called Safer Way Natural Foods in Austin, Texas. The couple later partnered with
Clarksville Natural Grocery owners Craig Weller and Mark Skiles to merge the two
stores and create the original Whole Foods Market in 1980. Whole Foods became an
instant success among natural food supermarkets and continues to dominate the
industry to this day. The Fortune 500 Company has also maintained its ranking as one
of the "100 Best Companies to Work For in America."
https://techcrunch.com/2017/07/01/invisible-unicorns-35-big-companies-that-started-with-little-or-
no-money/
Why the ‘end of the startup era’ could be great for entrepreneurs
Invisible unicorns: 35 big companies that started with little or no money
Venture capital is a hell of a drug, and it’s possible to overdose on VC, but for most founders that is a
champagne problem. More often the question investors hear is “how do I get a VC to back my
startup?” These founders aren’t worried about how overcapitalization will make their IPO prospects
trickier — they’re scrambling to get someone, anyone, to sign their first term sheet.
There’s a widespread belief among founders that venture capital is a precursor to success. VC is a
common denominator of the most successful tech startups, but it isn’t a prerequisite, especially at the
early stages.
Entrepreneurs can prove out quite a bit with little to no capital. Capital won’t make your company
insightful. If you can’t creatively turn $1 into $10, why do you expect to be able to turn $1 million into
$10 million?
To help illustrate how startups can move forward, here are 35 examples of companies that started
with a few thousand dollars, or even just sweat equity, and went on to become exemplars of what I
call “efficient entrepreneurship.”
Many of these companies have subsequently earned billion-dollar valuations, some even have
billions of dollars in revenue, but none started with anything other than what would be considered a
seed round. Most of these startups raised money from VCs, but only after they established the fact
that their success would come with or without a wire transfer from an investor. Even now, many of
them aren’t widely known — they are the invisible unicorns of the tech industry.
So before scrambling to schedule meetings with investors, read these stories. They provide a
counterbalance to the VC-centric outlook held by many founders, and provide alternative ways to
think about funding.
What follows are brief and simplified descriptions of these companies (categorized by approaches
they share) and links to stories where you can read more about them. Remember, taking venture
capital should be a choice, not a compulsion. These companies show how it’s done.
MailChimp: Co-founder/CEO Ben Chestnut was running a design consulting business in the year
2000 and had a stream of clients who wanted email newsletters created. The only problem was that
he hated designing them. So, to spare his team the tedium, he decided to build a tool that would
streamline the process. MailChimp, a $400 million run rate business, was born.
Lynda: Lynda Weinman started as a teacher in need of tools to instruct web designers in the late
1990s. The offerings at bookstores were bland, so she began producing training films that better
educated her students. Tutorial by tutorial her company helped software developers and designers
improve their skills. She spent two decades building a content library and tech assets that had
enough scale to entice LinkedIn to pay $1.5 billion to acquire the company.
AdaFruit Industries: Limor Fried started her DIY electronics e-commerce empire as a student at MIT
by assembling DIY kits comprised of off-the-shelf parts. Fried merchandised the same building
blocks found at electronics stores, but also crafted quirky content that made the prospect of soldering
a replica Space Invaders cabinet seem reasonable. Now she has 85 employees and earns $33
million per year.
SparkFun: Similar to AdaFruit, Nathan Seidle started SparkFun out of his dorm room by selling
electronics kits and oddball components to a coterie of engineers who wanted to explore exotic new
sensors and systems. Now his e-commerce empire employs 154 and has revenues of $32 million
per year.
Braintree Payments: Exchanging money online, without being fleeced by fraudsters, is one of the
oldest problems on the web. All parties to a transaction happily agree to pay a fair “tax” for a superior
experience. Braintree built a better tech solution and survived on the proceeds of those transactions
for four years before raising $69 million in two rounds of venture capital, which preceded an $800
million acquisition.
Shopify: Shopify’s founders were looking for a shopping cart solution when they were starting an e-
commerce site for snowboarders. Unable to find one, they decided to scratch their own itch and built
a bespoke solution on the then red-hot Ruby on Rails framework. It turned out to be a perfect
solution for plenty more people, and the founders ran the business independently for six years on the
revenue they generated. They ultimately raised money from VCs and later IPOed, which rewarded
them with a billion-dollar valuation.
Self-reliance rules
Many entrepreneurs waste their time “playing CEO,” crafting a strategy and drawing up a dream org
chart for what their business might become. Don’t do that. Instead, figure out what you can do, today,
to advance this idea using only the resources you have.
Ipsy: Sending boxes of makeup to amateur beauticians has become a growth industry thanks to
pioneers like Birchbox. YouTube star Michelle Phan didn’t have first-mover advantage, but she
leveraged her online celebrity (8 million+ YouTube subscribers), relationships with cosmetics brands
and <$500,000 in seed funding to build a subscription box startup that generated $150 million in
revenue before raising $100 million in VC.
SimpliSafe: People scoff at the idea of trying to bootstrap a hardware business, but SimpliSafe’s
Chad Laurans did it. He raised a small amount of money from friends and family and then spent eight
years building a self-install security business, literally soldering the first prototypes himself to save
money. Eight years later, the business has hundreds of thousands of customers, hundreds of
millions in revenue and $57 million in VC from Sequoia.
Tough Mudder: Track & field entrepreneur Will Dean turned $7,000 in savings into a company with
more than $100 million in annual revenue. The secret was pre-selling registrations to races and then
using those funds as working capital to construct the electrified obstacle courses that have made
Tough Mudder a global phenomena.
CoolMiniOrNot: CoolMiniOrNot started out as a website where geeks could show off their ability to
paint Dungeons & Dragons figurines. Eventually, the site’s founders decided to design and distribute
games of their own, leveraging Kickstarter as a channel. They have run 27 Kickstarter
campaigns which have raised $35,943,270 million dollars of non-dilutive funding. Game on.
Scentsy: DNVBs are hip, but they are over-reliant on twee launch videos and Facebook ads to drive
revenue. Scentsy sold candles at swap meets when they couldn’t afford to buy ads. It wasn’t
glamorous, but it did give the founders a solid grounding on the messages that resonated with
buyers — now they have more than $545 million a year in revenue.
CarGurus: This app leverages data analytics to help customers find the best deal on used cars, but
the company’s CEO credits its $50 million a year in revenue, and profitability, to hiring a sales team
early in the company’s life cycle. Nearly half the company’s 350 employees are busy making sales
calls, not writing software.
LootCrate: LootCrate had more than 600,000 customers and $100 million in revenue before they
raised institutional capital. Part of the reason they were so efficient was that the company started
charging customers from its first weekend in existence. The founders were at a hackathon, set up a
landing page, collected orders and used that capital to buy the geeky goods that would fill the
packages.
Wayfair: The home goods e-commerce company was profitable from its first month of operation
because they skipped brand advertising and bought up hundreds of domain names that were exact
matches for common search terms. This model kicked off a decade of profitable growth until they
ultimately raised a Series A — worth $165 million — shortly before going public and earning a market
cap that is currently over $4 billion.
If you can’t creatively turn $1 into $10, why do you expect to be able to turn $1
million into $10 million?
Cards Against Humanity: With just $15,700 in funding from Kickstarter, the Cards Against Humanity
team built a business that grossed more than $12 million in its first year. They’ve also sustained their
brand with a series of canny marketing stunts, selling cow poop, cutting up a Picasso, digging a big
hole representing the ennui of a post-Trump America, then selling Trump “bug out” bags and
simply asking for money. These promotions aren’t cheap to run, but they make enough money to
defray costs while earning a disproportionate amount of free media.
GoFundMe: Viral marketing is dismissed, rightfully, when it is tacked on to a business model, but it
can be a powerful driver when properly integrated into a business model. Paired with hyper-efficient
conversion rate optimization (CRO), it can be unbeatable. The founders of GoFundMe were able to
use these twin forces to bootstrap a business to the point where it was valued at ~$600 million.
PaintNite: The idea of combining Monet and Merlot has been around for a while, but the founders of
PaintNite wanted to make the model more cost-effective. While their competitors relied on a slow,
expensive franchise sales model, PaintNite paired art teachers with existing bars that wanted to sell
wine on weekdays and created a business that did $30 million in revenue the year before it raised
venture capital.
Plenty of Fish: The dating site was founded in 2003 and didn’t change dramatically regarding
functionality or aesthetics over the next decade. Other sites had more features, flashier graphics and
copious amounts of venture funding, but PoF was free and spent most of its resources fighting spam
accounts. As with Craigslist, Plenty of Fish’s biggest asset was its reputation as a well-stocked pond.
The company iterated on the product over time, but never needed massive infusions of capital.
Ultimately, the company sold for $575 million.
Mojang: The masons behind Minecraft never raised any venture capital, employed just 50 people
and earned nearly a billion dollars in profit before selling to Microsoft. The Swedish studio never got
sucked into fads like Zynga-inspired social spamming and predatory microtransactions. Minecraft
grew by charging users a flat fee, resulting in a $2.5 billion acquisition.
SurveyMonkey was founded in the dot-com bubble of the 90s and though it wasn’t as disruptive as
peers like Kosmo, it was more durable. It survived the dot-com crash and steadily grew into a nine-
figure run rate, only raising $100 million 11 years after getting started.
Protolabs does for plastic injection molding what Vistaprint does for business cards, and is
currently worth $1.2 billion.
Cvent, worth $1.3 billion, builds event management tools and Textura,acquired for $663 million,
handles construction management — neither typically considered a hot or hip market.
Grasshopper is a phone networking company that had 150,000 customers and more than $30 million
in annual revenue, but no VC on the books, and was eventually acquired by Citrix.
Epic was founded by Judith Faulkner in 1979; the Wisconsin-based electronic medical records
provider may be the largest bootstrapped software company operating today.
eClinicalWorks was founded in 1999 when the mantra was “get big fast,” and many of its
contemporaries crashed and burned. By focusing on excelling at the dull, yet profitable work of
managing clinical data, the company survived and now employs more than 4,000 workers and
generates $320 million in annual revenue.
Unity became a backbone of the mobile gaming industry by focusing on all of the unsexy aspects of
game development, like cross-platform compatibility and “bump mapping.” They went years without
raising capital, but now have avaluation over $1.5 billion, and are more successful than the majority
of branded game startups.
GitHub took the pain out of version control and became a critical part of the tech ecosystem before
raising capital.
Qualtrics started as a tool to administer surveys for schools and businesses in a basement in Utah
and now employs 1,000 and rakes in $100 million a year, profitably.
Atlassian: One of the benefits of building a startup outside Silicon Valley, NYC, LA or Boston is that
there isn’t much VC available. This may sound like a curse; after all, how could it be helpful to have
no access to capital? It can be a blessing in disguise.
This kind of isolation prevents you from daydreaming about what you’d do with millions of dollars and
forces you to make happy the paying customers you do have. Atlassian, based in Australia,
bootstrapped its way to a $4 billion market cap. If it had easier access to funding, they might have
found themselves chasing low-quality growth and gone under before they figured out how to scale
efficiently.
You don’t need permission from funders to found and scale a startup.
Campaign Monitor: One of the odd features of capital-efficient companies is that their first rounds of
funding tend to be eye-popping sums that look more like proceeds from IPOs. This is the case for
Campaign Monitor, whose first round of funding amounted to $250 million. Sydney-based Campaign
Monitor didn’t have easy access to venture capital, so they bootstrapped the business and built a
unique technology that offered superior email analytics to companies like Disney, Coca-Cola and
Buzzfeed. Time will tell if raising a quarter billion dollars helps or hurts the company, but it is certainly
a validation of the progress they’ve made so far.
The Trade Desk: While he had a unique view of how to power the programmatic advertising industry,
founder Jeff Green started The Trade Desk late in the funding cycle for modern adtech. This
overcapitalization of the market, combined with investors getting burned by bad performers, made
every round of funding a struggle throughout the life of the company. Green was a consummate
startup CEO, who raised only $26.4 million in venture capital during the company’s first six years and
turned it into a billion-dollar business traded on the NASDAQ. How? By embracing the constraints of
having less capital, focusing on the highest return activities and building a culture of innovation
powered by ideas rather than infusions of capital. (Disclosure: Founder Collective is an investor in
The Trade Desk.)
VCs aren’t perfect, and even the best miss out on ideas that seem like sure things. It is shocking how
common it is to hear founders talk about how they couldn’t sell investors on an idea that went on to
become a billion-dollar business. AppLovin founder Adam Foroughi sold his business for $1.4
billion, but found it hard to raise venture capital, even with serious revenue. “I couldn’t find anyone to
give us an investment at what I thought was a reasonable starting point valuation (maybe $4 million
or $5 million) and, by the end of our first year of operations, we were profitable and doing over $1
million a month in revenue.” The rest, as they say, is history.
Our advice isn’t to try to bootstrap a business in perpetuity. Venture capital has powered nearly every
major tech company from Apple to Zappos. Just remember that you don’t need a penny to get
started. You don’t need permission from funders to found and scale a startup. So the next time a VC
tells you they “pass,” remember these three principles:
It’s possible to get a tech-enabled business off the ground with no capital.
It’s feasible to scale a tech business rapidly with very little capital.
It’s often in the founder’s best interest to limit the amount of capital they take.
If you know of some other companies that self-funded their way to an extraordinary outcome, please
let me know.