Nash Kabbara, co-founder of Motors On Wheels and ZipZoomAuto provides insight on building and sustaining a business.
When I was about 12 years old, mom would stop the car at the local bakery; I would jump out with a pocket full of change and buy a dozen pastries. It's Sunday, family dinner day, and I knew what everyone's favorite pastry was. I also knew which uncles had the most money and which ones did not. As everyone was finishing up their dinners, I set up a table and marked each pastry with a price. Needless to say, the uncles who drove BMW's had the highest markup!
I've always wanted to make a billion dollars by creating something that makes people better at what they do. At my last job I thought I was doing just that, but I was wrong. I cut my losses and quit with about $10,000 in the bank.
Ten thousand dollars might look like it has enough zeroes in it, but it doesn't go very far. I needed a way to stay afloat while I waited for the billion dollar idea to come to me.
A friend of mine was in the car business. He suggested I buy a car from him at wholesale and resell it myself. I did. I made $1,300 in about 5 hours of actual work!
After a few months, reselling 1 car turned into reselling around 10 cars a month. A one man operation is now a three man effort: myself and my two brothers Jad & Joad. We split profits (and headaches) three-ways, no questions asked as long as each is putting in their 100%. And everyone does.
It was time to make this car thing a real business. I was pushed into it, and I say pushed because my passion is software and I was starting to get worried that I'd end up being the poster child of sleaziness: a used car dealer!
Motors On Wheels created an entrepreneurial environment around me while I waited for an idea closer to my passion to flourish. It's like being an entrepreneur to become an entrepreneur.
As Motors On Wheels grew, it became obvious that we needed to streamline many processes to keep our profit margins worthwhile. So we started looking for software solutions.
All the applications we found looked like they were developed in 100 B.C. On top of that, they were extremely overpriced. This is where the entrepreneur and the software developer in me collided to create the idea behind ZipZoomAuto.
Yes. We use Ruby at ZipZoomAuto. :)
After about 8 months in development, ZipZoomAuto was running all of the online marketing for MoW. It was doing the bare minimum and it was very good at it.
The looming question at the time was, should we start giving out beta accounts? Answering no to that question is the biggest strategic mistake of my life. The second biggest mistake was creating cool features that nobody wanted. Some took months to develop and their only contribution was to bloat the codebase and add unnecessary bugs. Also, Motors On Wheels' success provided us with a comfortable income which made mistakes at ZipZoomAuto feel less detrimental.
Things had to change. Charging for accounts was the only thing that could alter a bad ending.
As soon as a customer starts paying you for something you created (as opposed to a service you're providing like selling cars) a few things start to happen that alter your behavior:
Paying customers will complain and you will listen & enhance.
Bugs & features will have real users attached to them and thus more weight.
Your application's roadmap will be guided by your customers and not by cool ideas.
Today, 6 months after we started charging, we have 72 paid accounts with $0 spent on marketing. All we did was give out a few trial accounts to our friends in the car business and they started telling each other.
Our biggest edge over our competitors is we understand the domain of the car business more than any of them. After all, Motors On Wheels is what pays the mortgage. So far.
This brings up a very unusual business model for aspiring entrepreneurs. Work in a domain that is technologically challenged until you understand it profoundly. Then start a business that advances that domain by empowering its actors. Remember to charge early and to be obsessive about customer service.
Thanks to Edith Hernandez and Jonathan Kay for reading drafts of this.
Nash Kabbara is the co-founder of Motors On Wheels and ZipZoomAuto. After working for a few bosses, he decided to start a different kind of company where co-workers don't feel like they have to be at work, but rather can't wait to be there. He holds a degree in Computer Science from the University of Houston. When not working towards his goal, you'll find him reading, training for his next marathon, or simply enjoying life.
You can follow him @nkabbara or email him at nash[at]zipzoomauto.com