What is your business idea?

[cyclone4L]

15 years ago I told my now-wife, "we should have satellite internet and you can order stuff directly from your TV into your online-shopping account".

If you could patent ideas I'd be rich.

In 1998, My business mentor started a company which essentially is what the Google Drive/Google docs/sheets, etc is today.

He raised $100 million for the project and and threw in $25 million of his own money. He had contracts with the CIA and a few other companies. After a few years, it was evident that nobody wanted it. He was losing money hand over fist and investors started to pull out.

The company went defunct in 2001. To this day, he has over 5,000 koozis (so?) in his basement that he was unable to give out. He uses those boxes as a reminder to NEVER bet on something he thinks might work without testing it first.

Starting a company takes hardwork, dedication and the ability to move fast. But it also takes timing, luck and being the right person for to do it.

 

[throwittoblythe]

This is a difficult issue because you are dealing with restoration of art instead of creating a factory.

The first thing I would do is chat with customers and do lots of research. Ask homebuyers what they look for in a house, if their first three things doesn’t include “I want a beautiful, historic house” or something like that, they ain’t ever gonna buy your house.

Going through this will not only give you a feel for if there is a need for historic house restoration, but also what problems homebuyers DO have. If you find a trend, you may have something to pursue.

Also, A SURVEY DOES NOT DO THE JOB AT THIS STAGE. Surveys do not give you pain points, you are trying to solve someone’s pain points.

let me know your thoughts.

All good points. Here’s my rough, no-research-complete idea:

-Buy a house with cash or close to cash to keep the mortgage at a minimum. In a small town in iowa, I’d think you could get a fixer upper from that era for $50-60k or less.

-contract out major work, but do finish work myself since that’s where the important details are that I’ve mentioned

-this assumes not buying a house with any major repairs needed. The first one would be small, maybe 1000sf home or less.

- So maybe you put $10-20k into it to repair and renovate. You’d need to sell that house for $100k or more to make it worth it, financially.

Of course, before even starting, I would need to talk to some realtors in the area to know what renovated houses of the type I’m discussing would go for. Then get an idea of what you could spend and still turn a profit. From what I’ve read, even the fast flippers only make 15% on their homes. So this might be more like 8-10% since I don’t want to rush and do it cheaply.

In an ideal world, I’d do this to learn the ropes, and also find myself a good right hand man/woman who can start running the day to day and I’m just financing and making the big decisions. Then it really becomes a business when you can do 5-10 houses a year making a modest profit.

Thoughts?

 

[cyclone4L]

All good points. Here’s my rough, no-research-complete idea:

-Buy a house with cash or close to cash to keep the mortgage at a minimum. In a small town in iowa, I’d think you could get a fixer upper from that era for $50-60k or less.

-contract out major work, but do finish work myself since that’s where the important details are that I’ve mentioned

-this assumes not buying a house with any major repairs needed. The first one would be small, maybe 1000sf home or less.

- So maybe you put $10-20k into it to repair and renovate. You’d need to sell that house for $100k or more to make it worth it, financially.

Of course, before even starting, I would need to talk to some realtors in the area to know what renovated houses of the type I’m discussing would go for. Then get an idea of what you could spend and still turn a profit. From what I’ve read, even the fast flippers only make 15% on their homes. So this might be more like 8-10% since I don’t want to rush and do it cheaply.

In an ideal world, I’d do this to learn the ropes, and also find myself a good right hand man/woman who can start running the day to day and I’m just financing and making the big decisions. Then it really becomes a business when you can do 5-10 houses a year making a modest profit.

Thoughts?

Before you make ANY plans about buying any house, Do. Your. Research.

Understand how much houses are going for in the area, who's moving in, and what those people were looking for. The first two are easy to find, just talk to realtors. You'll need to talk to recent homebuyers in the area for the last point (Budget, living conditions, blah blah blah remember, no surveys. conversations.)

This will give you a sense of the price range houses are selling at and what people are looking for. Old beautiful houses are AWESOME and you'll have buyers, but the price has to be right and the market has the right fit, too.

After I bought my first house, I realized something. I had no furniture and my house was bare. I have no clue how to decorate either. I had a "great idea". I was going to create a company that first time homebuyers could send pictures of their house to my company and we would came and bring furniture and artwork the day they moved in to make the house a home. I thought it was ingenious.

HOWEVER, I did my research and learned two things. First thing, Most first time home buyers are gifted hand-me-downs from a bunch of relatives when they move in. Second thing, almost all over them had no budget left to spend on something like this.

After a month of research, I scrapped the idea. I saved myself years of work and TONS of money by doing my research FIRST. Feel free to make it work anyone.

 

[cytech]

All good points. Here’s my rough, no-research-complete idea:

-Buy a house with cash or close to cash to keep the mortgage at a minimum. In a small town in iowa, I’d think you could get a fixer upper from that era for $50-60k or less.

-contract out major work, but do finish work myself since that’s where the important details are that I’ve mentioned

-this assumes not buying a house with any major repairs needed. The first one would be small, maybe 1000sf home or less.

- So maybe you put $10-20k into it to repair and renovate. You’d need to sell that house for $100k or more to make it worth it, financially.

Of course, before even starting, I would need to talk to some realtors in the area to know what renovated houses of the type I’m discussing would go for. Then get an idea of what you could spend and still turn a profit. From what I’ve read, even the fast flippers only make 15% on their homes. So this might be more like 8-10% since I don’t want to rush and do it cheaply.

In an ideal world, I’d do this to learn the ropes, and also find myself a good right hand man/woman who can start running the day to day and I’m just financing and making the big decisions. Then it really becomes a business when you can do 5-10 houses a year making a modest profit.

Thoughts?

Contracting out the major work will likely eat into your likely profit margins, also the homes that need major work are usually some of the best deals. As long as you can identify that major work ahead of time, and you know what it would take to overcome it.

Another thing to look into is becoming a realtor yourself. This is what we did, it gets you early access to new listings. You can go and do showings yourself, and you save on commissions when purchasing and selling properties. If you save 6-7% on each end that can add a good amount to your margin.

Of course not everyone is capable of putting on all those hats at the same time, so that might not be for you.

 

[SayMyName]

My idea is for a topless barbershop in campustown. You're welcome.

 

[cyclone4L]

My idea is for a topless barbershop in campustown. You're welcome.

How would you find employees?

 

[ISUCyclones2015]

How would you find employees?

The college across the street...?

Topless/near topless baristas in Seattle make minimum wage. You could absolutely find the employees at the low end of barber pay, which I'm sure is only a couple bucks over minimum wage anyway. They'd make 5x the amount of tips they'd get over at a Starbucks or Great Clips

I'm not OP and it's not my idea but finding women willing to show some skin is the least of your concerns in that business idea.

 

[BCClone]

The college across the street...?

Topless/near topless baristas in Seattle make minimum wage. You could absolutely find the employees at the low end of barber pay, which I'm sure is only a couple bucks over minimum wage anyway. They'd make 5x the amount of tips they'd get over at a Starbucks.

I'm not OP and it's not my idea but finding women willing to show some skin is the least of your concerns in that business idea.

I would say if small town convenience stores and dollar generals pay $12-14/hour, you'd probably have to be at that level with tips on top of it.

 

[ISUCyclones2015]

I would say if small town convenience stores and dollar generals pay $12-14/hour, you'd probably have to be at that level with tips on top of it.

https://www.nytimes.com/2018/12/26/business/cosmetology-school-debt-iowa.html

"Walk into any hair salon in Iowa and you’re likely to find a stylist making $10 an hour who loves her job but is struggling to pay off her student loans"

Yea pay the same plus they get way more in tips from creepy dudes? You'll find them.

Like I said, it's not finding or paying the employees that's the problem

 

[cyson]

Ok, enough joking around. I will be serious now. My wife and I love old houses. Our dream is to move to a small town in Iowa and start fixing up old places. I'm not talking historic preservation or century-old mansions (though that may be what we do for our house). Just regular people homes that were built in the 1900-1940s era. I want to connect with a smaller community and help it thrive by making it a desirable place for people to live.

Yes, this is almost exactly what the couple on Home Town on HGTV do. We would like to do that, but haven't figured out how you do it without the backing of reality show.

I’ve done four houses. From a financial standpoint small towns are the best places to buy. The first house, I paid 1000$ bucks for an absolute piece of **** house and three beautiful lots. Had a hell of a garden during the two years it took me to finish. I still get sweaty palms when I drive by a run down house with potential. Made decent money on all of them

 

[cyson]

I have thought about this very same thing, thinking if you got a big group of investors and some good hands on people involved. I just can't think how the logistics of buying out neighborhoods would work. Seems like there would've both people that simply wouldn't sell, and those that once they figured out what was going on would hold out for a huge payday. I also think an alternative or combo with your idea is also leaving a shared park.

This is exactly right. If you don’t get all the neighborhood you will get stuck with properties with owners who have no vested interest in improvements and growing capital.

 

[throwittoblythe]

I’ve done four houses. From a financial standpoint small towns are the best places to buy. The first house, I paid 1000$ bucks for an absolute piece of **** house and three beautiful lots. Had a hell of a garden during the two years it took me to finish. I still get sweaty palms when I drive by a run down house with potential. Made decent money on all of them

did you do all the work yourself or hire it out? How many have you done so far?

 

[Cydewayz]

I'd like to start a short term storage business set up like Air BNB, targeted at the college town market.

Folks could designate what they have to rent (room, closet, shed, garage, climate controlled, outside) and how long available.

Many college kids need like 1-4 months of storage for random sizes (some a few boxes, others winter motorcycle ,etc).

I've seen similar, but never specific to college town market.

 

[cyson]

did you do all the work yourself or hire it out? How many have you done so far?

First couple I did the work myself. Would rent for a few years, then roll them. Did four. I didn’t mind working on them, therapeutic. If prospective tenants shove money at you don’t take it. Screen on the front end before it’s too late.

 

[cytech]

I'd like to start a short term storage business set up like Air BNB, targeted at the college town market.

Folks could designate what they have to rent (room, closet, shed, garage, climate controlled, outside) and how long available.

Many college kids need like 1-4 months of storage for random sizes (some a few boxes, others winter motorcycle ,etc).

I've seen similar, but never specific to college town market.

This is where I now do my business in self storage, we started flipping houses (still have 2 rentals). The idea you have there has been tried a couple different times. In a couple different manners. There are several businesses now that will allow you to ship your storage items to the warehouse for storage. Then they will send them back when you need them. There is also the Air BnB storage type businesses where people use unused garages or rooms etc. The biggest complaint I have seen is letting unknown people into your home for storage and how do you trust those people.

Perhaps the college market may be a little better for this, but remember the college market is usually just May to August. How will you make money during the other part of the year? There is also a second part of the college market in the people who vacate for a week at the end of July before their next place is ready, but those are even shorter term rentals.

First couple I did the work myself. Would rent for a few years, then roll them. Did four. I didn’t mind working on them, therapeutic. If prospective tenants shove money at you don’t take it. Screen on the front end before it’s too late.

We got tired of being landlords a while ago and switched to self storage which has made things a lot easier in dealing with tenants. You followed the same model we did rent it for a few years then sell the home on contract or outright sell it. I used to enjoy all the different jobs I got to do when I was redoing a house. It is one of the things I like most about what I do now. I do a different job almost everyday. Not saying I like all the jobs but it keeps it interesting.

 

[Mtowncyclone13]

I'm always amazed how products fail and essentially the same thing a decade later is a huge hit.

Myspace/Facebook
Senseo/Keurig

 

[BCClone]

I'm always amazed how products fail and essentially the same thing a decade later is a huge hit.

Myspace/Facebook
Senseo/Keurig

Timing. Sometimes the early one gets the ball going but revenue isn’t strong enough for the initial startup and test

 

[cyson]

Variety is nice. I have one commercial building. Put two large lofts up, a couple of businesses down. Get four checks a month out of it. Doesn’t cost me anything.

 

[ISUCyclones2015]

I'm always amazed how products fail and essentially the same thing a decade later is a huge hit.

Myspace/Facebook
Senseo/Keurig

Kuerig was around before Senseo 1992 vs 2001 and then your mind will be blown when you learn about Easy Serve Espresso pods from the 70s from Illy. Kuerig was the most successful because they had the most expensive pods so they gave away free commercial coffee machines to all these Dot Com Startups. Then eventually other large companies because it was a cool hip thing to have in your office in the early 00s. All while relying on these organizations to buy their expensive pods and it worked. Then they got bought out by a coffee roaster and expanded into the home market and the rest is history.

MySpace wasn’t a failure by any stretch of the imagination. It was worth $12billion at one point. The biggest thing that held them back was their deal with Google for advertising, it cluttered up the page and made it far too slow. Then the whole child porn thing happened and everyone fled to Facebook and Twitter.

That’s like saying Blockbuster was a failure because “tHeY cOuLd’VE bOUghT NetFLiX” No absolutely not, they researched it and thought they could’ve done it better themselves. They had a plan and had Netflix and other services as a market disrupter in their earnings reports since 1999. They came out with streaming way before Netflix did. But... they partnered with Enron. It was bad luck and overestimating the amount of people willing to go into stores to switch out DVDs instead of waiting the few extra days for it to come in the mail. Then on top of it, it was a couple bucks a month more expensive. Netflix was still losing money in those days when Blockbuster rolled these things out, still in acquisition mode.

I could go on and on about how companies rise and fall, it fascinates me to no end. And I always like to correct people when they call companies that fell, “failures”.

 

[jdcyclone19]

@cyclone4L

What’s the best and easiest way to create a LLC in Iowa? I’ve been told it’s easy to do yourself and not to spend a lot of money to do it.