Every NCAA Tournament, without fail, a high seed goes on a run, knocks off a couple Goliaths, and is crowned the year's 'Cinderella Story.' It's part of March Madness; just ask poor Iowa State and Baylor.
And though College Basketball will churn out plenty of these narratives over the next month, the startup world - where an idea at a coffee shop can transform into an enterprise - is responsible for a new Cinderella every hour. From day one, startups are a high seed battling a variety of #1s - fundraising, product development, client retention, hiring, etc. - all at once.
That's why we talked to several Chicago entrepreneurs about the times they overcame seemingly insurmountable odds to fit into their own glass slipper. Here are their Cinderella Stories:
Raaja Nemani, Co-founder and CEO, BucketFeet:
“We were almost bankrupt, so we borrowed $25,000 from [co-founder] Aaron's dad to float the Company. I used the money to get our house in order, while Aaron drove around cross-country (in Brian Spaly’s - CEO of Trunk Club - car no less) knocking on doors of retailers trying to sell shoes. At the end of the trip, Aaron attended a tradeshow by himself, did something like $75,000 in business and allowed us to payoff the loan! We raised a round a couple months after that.
Nick Petit, Founder and CEO of Kahoots:
I started at 1871 with a previous startup called WYR, which eventually failed - yet I took all the lessons learned from that failure and I repacked the business and really focused the idea (into what is now Kahoots) and I cold called the single person who I thought Kahoots would be perfect for.
Long story short - my cold call was to Thad Wong, Founder of @properties, the larges real estate company in Chicago, and it turned into our first large ($250,000) investment, a new board member, and a leading advocate for Kahoots.
It was a shot in the dark and we hit a home run with @properties.
Dan Ushman, Co-founder & CMO of SingleHop:
We founded SingleHop in 2006 while still running our other company, midPhase, which was founded in 2003. SingleHop started without any outside money, right before the major financial crisis of 2007 struck. Because of this, banks were not keen on loaning money during the crucial time in our infancy when we needed additional cash to grow, so we had to find another way.
The play we called was to sell and then reinvest the proceeds from midPhase almost entirely into growth for SingleHop. In retrospect it was the right decision, which allowed us to beat the financial buzzer and continue our ‘Cinderella’ run in the cloud space. At the time it was a difficult decision because so much of our lives were invested into building the first business. Selling the company, then risking substantial portions of the proceeds on another project, was a scary thing to do—but also the absolutely right thing—and we're for the better now because of it. That speaks directly to that old cliche--no risk, no reward—and that’s a lesson I'll remember for life.
Jeff Ellman, Co-founder and President of UrbanBound:
In 1999, I owned a staffing and recruiting firm and after Sept 11, 2001, most of our clients (79 out of 80) went on a hiring freeze. It looked like we were headed towards going out of business. I knew it was time to get creative to make money. One of the things we realized is that we had a huge database at our disposal of individuals who shared the same obstacle - they were all looking for jobs.
We saw this as an opportunity and decided to address their pain point by putting together professional networking events for them. The networking events quickly turned from 100 people showing up to 1000! People saw value in these networking events and it was a way for us to make money and save our business during the hiring freeze.
Jeff Pieta, Founder and President of Shiftgig:
At the end of February 2015, Chicago was experiencing record days below freezing and our offices in Dallas and NYC were buried in snow. Our Dallas office had recently launched and received its first order from a Fortune 500 client for a Prep Cook to start at 4:30am. Despite record snowfall in Dallas, making many of the roads impassable, the worker using our mobile app arrived on-time for the shift. The client was very impressed, considering that many of their other staff did not show up for work that day and has placed further orders since. Shiftgig got it done.
Star Cunningham, Founder and CEO of 4D Healthware:
While 4D Healthware's team has experience solving large-scale problems and navigating highly regulated markets, healthcare is uniquely challenging. Customers, doctors and investors - right or wrong - approach disruptors with healthy skepticism, so converting “interest” into a sale is especially challenging. We are focused on the portion of the population that is most in need of healthcare management solutions - those suffering from chronic illnesses like diabetes and obesity - to demonstrate our value in more than just an abstract way. Response has been terrific. 4D Healthware was accepted into the MATTER Healthcare accelerator, and we’re also partnering with dozens of healthcare systems across the country to roll out our solutions at a measured pace.
