Nobody asked me to vote on “entrepreneur of the year, but I voted anyway….
I coach more than 500 entrepreneurs a year, all over the world, up close and personal. Every time I meet new ones, I compare them to two people I’ve coached intermittently for about 18 months now. While their current company won’t ever give Google or Amazon a scare, David and Charlotte Cho exemplify the spirit, tenacity and smarts of great entrepreneurs.
Those who dream of startup success can learn a great deal from this married Korean-American couple. ( I have a cardinal rule: never co-found a company with somebody you sleep with or hope to sleep with, since that makes decision-making a lot harder. The Chos have successfully defied this.)
David is a student at Columbia Business School and a West Point graduate who served a combat tour in Iraq and commanded a 120-man light infantry company. Charlotte spent five years doing international PR for Samsung.
The results speak for themselves – their company, Soko Glam, launched quietly in early 2013. That year’s revenues were a scant $50,000. Early 2014 revenues quickly eclipsed $50,000 per month, then doubled and sometimes tripled. 2014 delivered truly amazing growth rate, with huge potential in 2015. As impressive as these numbers may be, it’s not what makes this dynamic husband and wife team so special. The Chos’s path to standout startup offers a lesson for all entrepreneurs.
- Discover a distinct niche opportunity com sells Korean skincare and beauty products to American women. It’s a hot category Charlotte knew well, and through friends and referrals, the Chos were able to bring a diverse product line to the U.S. market at terrific gross margins. Over 40% of their fast-growing monthly revenues come from repeat customers—a powerful vote of confidence in their product and customer service.
- Use bootstrapping and reinvestment as financial fuel Started with credit card borrowings, savings and “on the cheap” to conserve precious cash, Soko Glam has grown by following customers’ response to prices, specials, etc. Customer feedback drives the bus so to speak, and nearly every dollar earned is reinvested in the business since day one. They didn’t waste time pitching to investors; instead they focused on building a terrific business.
Realistically speaking, few if any investors would have backed the Chos in the summer of 2013, no matter how impressive they are. Investors like proof, results and revenues, yet most entrepreneurs waste much time chasing venture or angel investments with no proof of success whatsoever.
- Find the “magic key:” no-cost customer acquisition Charlotte is not just a PR pro, she’s also blessed with beauty. As the self-appointed spokeswoman for Korean beauty products, Charlotte has been featured in Allure, Lucky, Elle, Refinery29 – showcasing Soko Glam approved products and giving skincare advice to women. It’s one of dozens of PR homeruns that allow them to avoid expensive banners or Adwords.
Too many entrepreneurs haven’t a clue of how they’ll do the startup’s toughest job of all — finding customers. Without a lowest-possible customer acquisition cost, most startups die at the starting line.
- Channel entrepreneurial ingenuity The Chos started adding product lines as they saw their first successful months of sales. One day, a huge shipment arrived—larger than expected—at their one bedroom “world headquarters” where the warehouse was the living room and the office was the bedroom. The shipment just wouldn’t fit in the apartment. Most entrepreneurs facing that challenge would quickly rent a warehouse or a storage locker. But the Chos’ solution was to sell the furniture and make “couches” out of merchandise cases covered with bedspreads and the like.
They knew it was too early to declare victory, and that entrepreneurs always need to shepherd their most important asset of all — cash. Six months later, they’re optimizing cash and human resources by outsourcing their fulfillment operation.
- Possess boundless energy and determination When I first met David and Charlotte, they were going without sleep regularly, packing shipments until wee hours of the morning and then turning to the real work of building and managing a growing business. Over time I convinced them to outsource their shipping and use their far greater talents for more important, higher value tasks like sales, marketing and operations.
To learn more about social media, David took an internship at Facebook, on top of his massive to-do list as cofounder. The couple spent half of their four-day holiday vacation answering customer service questions in real time during the peak holiday season. It’s easy to say “entrepreneurship is hard,” but it’s always a pleasant surprise to see entrepreneurs who understand it and work tirelessly, relentlessly, day after day. That’s what makes great businesses.
- Love what you do Every time I see the Chos, they’re full of energy, ideas, optimism and more ideas, while also quite proud not only of their achievements, but of the exciting products they’re bringing to American women.
Entrepreneurs often forget there are many diverse ingredients to building a great, enduring and profitable business. While Soko Glam is barely 2 years old, David and Charlotte are on to something big. Soko Glam may never rival Estee Lauder or Revlon, but it offers its founders the greatest rewards of entrepreneurship: challenge, independence, excitement, fun, and…cash!