Book Review: The $100 Startup

Reinvent the way you make a living, do what you love, and create a new future

By Chris Guillebeau

Reviewed by Chris Wendel

Hardcover: 304 pages, $23.00     Kindle Version: $11.99

Publisher: Crown Business (May 8, 2012)

At first glance The $100 Startup may seem more like a gimmicky give-away from a late-night infomercial than a practical business book. It is clear that this book will never be confused with any late night promise of instant wealth or government grants. Instead, it delivers a set of realistic resources for those wanting to know how a small business actually works.

Written by 30 something whiz kid Chris Guillebeau, The $100 Startup centers on the testimony of 1,500 individuals who built businesses earning $50,000 or more from modest investments (in many cases $100 or less). Guillebeau chooses the 50 most intriguing from this group of 1500 and identifies the commonalities of people starting businesses based on their lifestyle, personal expertise, and passion.

The rise of the micro-business is the new reality of many people still crippled by the economic upheaval of 3-4 years ago. Long gone are the days of borrowing to the hilt, betting the farm (or home), or quitting one’s job to test a business idea. Entrepreneurs looking to make a living on their own terms and the advent of the internet have been the catalysts to this significant new wave of small business development.

Guillebeau reinforces this idea through his interviews with his case studies. Some of those profiled are accidental entrepreneurs that had a service that consumers wanted more of. Many devised ways of doing what they truly wanted to do while prioritizing their families and other personal interests.

The $100 Startup spends a lot of time discussing the expertise that each business owner had and how they matched skill set with a product or service that people wanted to pay for. Starting on a smaller scale, an idea can be tested for feasibility in the market before larger investments (including money and time) are taken on.

It is the book’s entrepreneur profiles that provide its most interesting component. Guillebeau stresses that not everything one is passionate about is that interesting to everyone else (“I may be passionate about eating pizza, but no one is going to pay me to do it.”).

Take the Excel spreadsheet expert that built an online business of downloadable guides and trainings that nets him $136,000 annually.  Or the veteran sales executive that is laid off and then starts a successful business selling bed mattress that he delivers by bicycle.  Then there’s the woman from Omaha who makes and sells custom made wedding dresses to brides all over the world. In each case the business was built around the owner’s interests and lifestyle with limited start-up overhead.

The $100 Startup lays out how much money these entrepreneurs needed to get their projects started, how they generated funding, and key mistakes they made along the way.  Much of this start small mentality is possible because of niche demands of today’s market place. Guillebeau’s examples are easy to relate to because they aren’t all “pie in the sky”. Many are cautionary tales that readers can read and learn from. He also includes with each chapter, bulleted summaries of pivotal areas such as pricing, business plans, marketing, business expansion and a relevant summary of how to write a mission statement.

This minimalist approach to business development counters many prevailing theories of job creation. Many of these are individuals choose to live in our region, patterning their business around their expertise and families, while spending money locally, paying taxes, and sending their children to our local schools. Some of these small start-up businesses grow from home-based businesses (Hagerty Insurance and baa baa ZuZu come td) into larger companies that provide a significant employment. Either way, it is clear that the micro-businesses phenomenon is playing out in a positive way for northern Michigan.

Chris Wendel is a consultant and lender with Northern Initiative in Traverse City. Northern Initiatives is a private, non-profit community development corporation that provides entrepreneurs with access to capital, information, and new markets.

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