Lessons Learned From a Failed Ivy League Entrepreneur

A "Case Story" By Chris Cononico
 

Chapter Eleven

By the end of the summer, we launched our direct mail campaign for QuakerCard. We rented a P.O. box near Penn’s campus, so students could send us their sign-up forms. Because Mark was first among us to finish his summer internship, he headed back to campus early to begin preparing for the new semester. One of Mark’s duties was to collect the mail everyday from our P.O. box and report back the contents to the group. Receiving no mail was a sure sign that our company was a bust, so we called Mark twice a day demanding updates on how many customers we had. Based on the number of envelopes we received, We tried to project how many customers we could expect. It was a futile exercise, but we couldn’t stop ourselves.

I remember the first time I walked into our office. It was a small rectangular room of approximately 300 square feet located on the first floor of an old building that rested in the heart of Penn’s campus. Black wrought iron bars protected its set of casement windows that hung on the far wall across from the door. The office came furnished, which meant it included a large wooden desk, some shelving on the back wall, and a few wooden chairs. That day, the room was a complete mess, filled to the brim with empty boxes, equipment, and wires. An engineer from CMC was busy setting up our system and there was barely a place for me to stand. I looked around the room for the first time and was filled with a deep emotion. It sounds ridiculous, but I was 21 years old, and this tiny office was the first tangible proof that I owned a business. It gave me a great sense of pride to know that I ACTUALLY had an office! I ACTUALLY owned equipment!

Unfortunately, I didn’t really own all of that equipment because we intended to lease it from the manufacturer. The financing agreement required that we each personally guarantee the payments on the $120,000 worth of equipment. After Mark showed the “personal guarantee” to his girlfriend’s father, our attorney suggested we include our corporate titles and company name with our signatures. That was meant to imply that we were signing as officers of the company and not as individuals, so the company would be liable, not us.

I don’t think any of us had any concept of how long it would take to pay back $120,000. At the time, I estimated I could knock off my share within my first year in the workforce. I had no clue about the grim realities of income taxes and the cost of living. Besides, we were too excited about our business to worry about such details.

Once the four of us arrived on campus, we made daily pilgrimages to the post office together. Sometimes, the mail clerk would come back with several large stacks of envelopes. Those were good days. We would dance back to our office, and Mark would open each envelope and announce the contents.

“This one is a sophomore and he is signing up for the $325!” A loud cheer would emanate from the room, followed by a round of high fives. We would all quiet down and wait with anticipation for Mark to open up the next envelope. “This one is a junior for $995!” George and I would hear that and practically be dancing on the chairs. Whenever a $100 check would come in, we were all a little disappointed, but we comforted ourselves with a collective pat on the back that we got that person in the door at least.

We were so obsessed with checking the mail that we began checking it three times a day, just in case the postal clerk made a mistake and forgot a few straggler envelopes. We were indignant if the clerk gave us 19 new envelopes when there were really 20 envelopes. Sure, we would have gotten the extra envelope the next day, but we demanded to know how many customers we had at that moment. In those early weeks, we lived and died by every trip to the post office.

As the start of the new semester approached, Mark and Jake worked closely with the CMC engineer to set up the network, while George and I organized our on-campus promotions. My friend, Chad, who was a graphic designer in his spare time, designed the look of the QuakerCard from a photograph of the Philadelphia skyline. We made enormous canvas banners to hang in the windows of our restaurants and in front of our offices. These banners had the image of the card emblazoned, and the logo “QuakerCard” in huge letters.

We had similar signs that we hung around campus and in the store windows of merchants that accepted our card. We also designed several different flyers that we distributed under every student’s door in the school. In addition, we printed lots of full-color glossy brochures that sat in point-of-sale display holders at every merchant’s register. Stickers that proclaimed, “QuakerCard accepted here,” were placed on every merchant’s door. We even printed menu books to distribute to students that contained the menus of QuakerCard vendors, and a map of where each restaurant was located on campus.

As students, we were able to recruit a large team of our peers to help us. We planned to cover the campus like ants on an ice cream stick. We borrowed tables and chairs from the fraternities, made QuakerCard shirts for everyone, and had enough manpower to recruit students all over campus. It felt like we were planning a war.

 

Copyright  2005 by Chris Cononico
All rights reserved. No part of this manuscript may be reproduced in any form or by any electronic or mechanical means, including information storage and retrieval systems, without permission in writing from the author, except by a reviewer who may quote brief passages in a review.