Entrepreneurship

One of the most common pieces of personal finance advice given is “turn your hobbies into side income.” While my hobby of watching sports has yet to net me any money, there are people out there who are taking that advice to heart, and are managing to do something they love (that they’d be doing anyway) and turn it into a nice little side business.

1. Describe the devices you sell.

We sell an open source SD card based CD changer replacement for most 1996 & newer BMW cars; click for more information.

2. What motivated you to start building these devices?

I got a used Z3 in 2004 and absolutely loved the car. I wanted to bring my fairly large music collection with me in my car, but didn’t want the extra risk of an in-dash CD player (theft rates at the time were pretty high, plus I didn’t want someone to ruin my convertible top to get to the radio) or the hassle of burning CDs of music to keep in the trunk based CD changer. Not to mention that with the CD changer installed, I couldn’t fit a set of golf clubs in the trunk – with the Crooner, I can fit 2 sets. I also wanted something that was easy to customize to my liking. Nothing else I could find gave me the level of customization I wanted. Given my training as a computer engineer & enjoyment of designing & building electronic devices, in 2006 I decided to build a small MP3 player for my car. The current model of the Crooner is many times more powerful than the original design – at roughly the same cost.

3. Did you start with an idea of making it into a full-time (or at least part-time) job, or were you just doing it for your own benefit, regardless of any potential money you could make from it?

At the start I just wanted to make one for myself & be done. I didn’t want to have to alter my wiring harness, so I needed to buy the proprietary BMW connectors – which led me to form a shell company to try to get approval. Once I got approval I discovered that the smallest quantity of connectors I could purchase cost around $1,000 – with no option to sample them. After talking with some friends & family, doing a cost analysis, and saving some money I took the plunge & decided to buy the connectors & try to make enough players to break even. At this point the company was real & I was serious about recovering my investment.

4. What was the hardest step, going from where you started to where you are today?

The most difficult step was getting the audio quality up to the level I could enjoy. Due to some extremely complicated electrical interactions (you could faintly hear the spark plugs fire during quiet parts of a song) with the car it took me about 3 years to refine the player into a product. Along the way I made somewhere around 7 unique versions of the player trying to solve the audio quality problem. Each prototype cost anywhere from $80 to $150, plus around 6 hours to hand assemble. On the next to last prototype I nearly gave up. By this point I had nearly $3,000 invested & the light at the end of the tunnel didn’t seem to be getting any closer. With encouragement from my wife I made another prototype – the one that finally worked.

Deciding when to stop is difficult & can be emotionally challenging given your extreme involvement with the project.

My neighbors still laugh about hearing me open the garage door at 2, 3 or 4 AM to drive around the block to test a different circuit configuration. I was pretty lucky during the majority of the testing because I only had to explain what I was doing to one police officer & I didn’t get a ticket!

5. Where do you see your business heading from here? Do you have a specific goal in mind?

I’d like it to slowly grow a customer base & get the first batch of 25 units sold. I have focused on sustainable growth (very slow sales at first, ideally they’ll pick up to a moderate rate). Sustainable growth is important to my business model because I want to take advantage of the customer base’s use of the Crooner for additional testing beyond my car & car model. Once the first batch is in the field, ideally the pace will pick up more – both in terms of the viral marketing & my overall confidence in the product working in a wide range of vehicles.

I’ve really got two goals I’m shooting for. The first is to break even. At that point I will have beaten my investments in the stock market and house over the same time. The second goal is to earn the same value I paid for my car (I’ll need to sell many more than 25 to hit this mark).

6. What’s the best part about turning a hobby into a business? The worst?

The best and worst parts are interestingly interwoven. It is terrific fun to be able to take your hobby to the next level. The thrill & excitement are second to none. You discover you’re capable of working on a project nearly 40 hours in a weekend and still be excited about the next time you get to work on it when you truly love what your doing. When I’m listening to my media player in the car going to work, I love the feeling I get knowing that “I made that.”

With the amazing highs you may also experience some bewildering lows. Nothing is worse than when you’ve poured all your energy (and resources) into your project only to discover it comes up short (each time this happens it feels worse). As a hobby you can often live with ‘character marks’ in your projects, but not when it is a business. Unlike when your hobby was fun, you now must force yourself to work on it.

Is it worth it? Absolutely. Once you get through the latest cycle of problems, you’ll regain your confidence & your enjoyment.

I’d like to thank Trent and Wes for taking the time to answer my questions. The most interesting thing about what they had to say was they saw a deficiency with the current products that were out there; the standard technology wasn’t meeting their needs so they decided to use their expertise as computer engineers to develop something that would. Unusual circumstances sort of pushed them into turning their product into a commercial item (the inability to purchase less than $1,000 worth of connectors, among other things), but they’ve rolled with the changes and have produced a commercially viable, useful product. Their answers are full of important lessons for anyone looking to start their own business: find a need and fill it, rely on your previously obtained expertise, be flexible enough to handle adversity, persevere through challenges and most importantly, do what you love and whatever is interesting to you. Again, thanks to Trent and Wes, and if you’d like more information on their products, go to open roadster.