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Tom Nardone's Key Move: Starting Part Time

 

Tom's Story:

If you've got a job taking hair-raising rides on an auto-company test track, flying around in corporate jets all over the globe and helping decide how to spend millions of dollars for one of the world's largest companies - why would you quit? Well, if you're Tom Nardone, you'd do it because you knew that you really were born to start and run your own business.

In fact, even as his career at Ford Motor Co. went swimmingly, Tom was always on the lookout for ideas for starting his own company. And then he read a book called What Were They Thinking, about all sorts of business failures, which suggested that a fruitful idea for a successful business might involve saving people from embarrassment of all sorts.

Tom mulled that over, and in 1998, at the height of the dot-com boom, he did what thousands of other Americans were doing: He launched an Internet company. ShopInPrivate.com allows visitors to browse discretely for various unmentionables and then order brown paper-wrapped quantities of everything from hemorrhoid cream to Rogaine hair-growing gel, from nose-hair clippers to condoms.

Because ShopInPrivate.com began providing a truly valuable and unique service, it not only survived the bursting of the dot-com bubble, but it now generates more than $2 million in annual revenues and has a full-time staff of four and a warehouse in suburban Detroit.

Tom's Key Move: Starting Part Time

Like many people starting a business, Tom wanted to be able to ease into it and see how things went with ShopInPrivate.com before quitting his "wonderful" job and plunging into entrepreneurship full-time. Fortunately, one of the great things about a dot-com is that it often allows owners to tend their start-ups only part-time, at least at first.

"That was an easy decision for me," Tom says. "But I was very straightforward with my co-workers and bosses - I just wanted to be honest about what I was doing, which made it easier for them and me."

On weekends, Tom would scrounge the Internet for potential competitors and built his own website using instructions he found on Yahoo!. He incorporated his business in August and put in a request for a two-week vacation in early October so he could launch the website without having to worry about interfering with his day job. Over the next few months, he would burn up another couple of weeks of vacation time in half-day increments. "It wasn't unusual for me to be up until 1 a.m. working, then be up at 5 a.m. working again," Tom says.

But as the business grew, haltingly at first, Tom noticed that "I wasn't 100% devoted to my job at Ford," he says. "But I knew that if the business wasn't going to become bigger, I was going to discontinue it. The part-time thing wasn't going to work long-term."

With a big seasonal run on "relationship" wares, by Valentine's Day, 1999, it became clear to Tom that ShopInPrivate.com was going to make it: Growth had averaged 50% a month. He also became certain that he couldn't nurture the business anymore while working at Ford. So he quit his job, but not without assuring one more thing.

"I did a good enough job over the last five months that they would easily have hired me back," Tom says. "I always wanted to have a safety net."

Yet Tom is convinced that he couldn't have afforded to quit Ford cold-turkey to start his venture. He made about $50,000 in salary during the eight months he was straddling the vocational fence, "and that was an important source of financing in the early stage," he says. Without that Key Move, "the whole business may not have succeeded."

Tom's Bonus Insight:

Before launching ShopInPrivate.com, Tom came up with at least two other ideas for businesses that he thought were worthwhile - and which you're welcome to, if you can make a go of them! One is buying up mom-and-pop salvage yards and consolidating them into a lean, huge, junkyard-dog of a company that would dominate what is a highly fragmented industry. The other is closer to Tom's heart - er, stomach: mall-based shops that specialize in peanut-butter-and-jelly sandwiches.

"It seems like everyone at the mall gravitates toward the least-expensive place to eat - and everyone like peanut butter and jelly," Tom says. "I would have made my own peanut butter. But then my friends told me: How are you going to make money selling $2.99 sandwiches?"