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There are degrees of profitability. Some businesses aren't profitable from a VC standpoint but are by a lifestyle business standpoint. Some businesses aren't pr
by trcollinson 9y ago
There are degrees of profitability. Some businesses aren't profitable from a VC standpoint but are by a lifestyle business standpoint. Some businesses aren't profitable from a small business workforce standpoint but are profitable from a single person workforce standpoint. Some businesses aren't profitable from a certain geographical and political standpoint but are profitable from a different geographical and political standpoint (United States vs. China, and visa versa, for example).
I'll give you an example. A friend of mine sells small (US Quarter sized) stickers in sheets to Walmart and Walgreens and a few other smaller retailers in a small geographic area. He makes right about $1,000,000.00 a year in net profit (in stickers, I kid you not). This business is very profitable for himself. His business would not be profitable to a VC or a Incubator because it does not scale well and has certain risks associated with it. But he's quite happy with it.
He had a problem recently. Packaging the stickers (literally pulling the sheets off of rolls and putting them into self sealing plastic baggies) was costing him too much. Not in actual packaging costs but in finding reliable labor that could complete the task in a timely fashion so he could make his production deadlines. Solution: I made a very small business packaging the stickers for him at $0.06 per completed package. Now he can worry about the sales of his stickers and other business needs he has and I can worry about making sure the packaging is taken care of on time. The whole business will make around $120,000.00 a year gross. I will net far less than that. Is that profitable? Not from a VC standpoint. Not from a single owner standpoint (I could live on that but I don't want to). But... my daughter and her friends who want work while being in college full time find the work very fulfilling and very profitable.
So, profitability is a bit of a weird thing to ask about. We need a lot more information if you'd like us to answer what types of currently unprofitable business ventures might be solvable by you.
- nicodjimenez 9y ago"Some businesses aren't profitable from a VC standpoint but are by a lifestyle business standpoint. Some businesses aren't profitable from a small business workforce standpoint but are profitable from a single person workforce standpoint." well said, the stickers anecdote is amazing by the way.
- trcollinson 9y agoI was just as amazed when I figured out what he did. Talk about the literal “millionaire next door”. Stickers! Who knew?
- mongeone 9y agoDoes his name start with a B and he spent considerable time in Japan? If so, I may know him. If not, amazing to hear of multiple millionaires from stickers!!!