In late 2004 it was the beginning of the end of the housing bubble and Ben Reid was in big trouble. Not only had he gotten himself in over his head with some college acquaintances in Florida who were flipping houses, but he had unknowingly drawn his best friend into the mess with him. Over the next year he would work tirelessly to not only free himself from the ordeal, but insure his buddy didn’t lose a penny.
“Some guys who I went to school with were down in Florida flipping houses and making a ton money. I saw them doing really well, having a ton of fun, and calling their own shots. They said, ‘Why don’t you get involved with us? We’ll start a business that invests in properties and looks for foreclosures.’ ”
True to his word, Ben got his friend out without him losing anything. Reflecting back on the whole experience, it was a painful learning lesson, but as he has done so many times in his life, he simply shifted gears and started a completely new course.
His business luck was less challenging in younger years. Growing up in Ann Arbor, Michigan, he got a very early taste of the business world when he launched a candy racket with a childhood buddy.
“When I was in 6th grade, my friend and I formed a ‘conglomerate’ and started selling candy out of our lockers. He brought me on as a partner and we ran the candy racket in my school for a while. We would mark it up 100% and most of the time we would eat half the candy ourselves, since in essence it was free. Not good if you are a drug dealer, but ok for candy. We got busted and the administration told us we couldn’t do it anymore.”
School, but more importantly education ruled his early life. With a father who was oceanographer for the National Oceanic and Atmospheric Administration and a mother who was a scientific librarian, it was “understood” that all three Reid children would attend college. Being the oldest, Ben, was the first to leave the nest and even though they lived within a few miles of the University of Michigan, Ben decided to attend Michigan State in 1997.
At MSU he would go through one of his major life shifts. “I never focused that much on school and in my last year of college for some reason something sort of clicked. I joined student government and started getting all 4.0’s. I realized I am a year away from graduating and I needed to figure out what I was going to do next.”
Not accepting that as a complete answer, I pushed a little harder and discovered this little gem.
“I was a little young for my grade, so in Junior year I had a fake ID. That ID was taken right before the summer and I was like ‘darn, what am I going to do for the summer?’ Rather than finding another ID I just decided to forget it. I started working out a lot, starting eating healthy, lost a ton of weight and joined the water polo team at MSU. We ended up winning the national championship my senior year. “
At MSU he met countless interesting people, all with various plans to do something big with their lives. Among these, he had the misfortune of befriending a few men that would later drag him into the world of foreclosure “flipping” in 2004.
“I did a lot of the computer work and sent out mailings from Chicago and they were the guys down on the ground in Florida. It worked for a little bit, but then it didn’t. Our timing was about as bad as it could be. The business ended up kind of fizzling and then crashing.”
As he talks it’s obvious this story still has a deep emotional connection to him. As so many people I know and from my own personal experiences, it can be very agonizing to talk about one’s business failures. Additionally there is a strong fear of embarrassment about sharing these experiences with anyone.
“The business itself wasn’t that big of a deal. I wasn’t invested heavily in it financially. I invested time mostly. The actual big lessons that came from that were the dealings with my former partners. They were good friends from college, good buddies and lots of memories. “
Stopping for moment and sipping his coffee, Ben takes a deep breath and continues.
“They went down to Florida. They started living a little fast. Making a lot of money at once. Bought BMW’s and started hanging out at clubs all the time. I think they lost their way a little bit and I didn’t realize. I think I felt it, but I didn’t want to say it because I was looking for a reason to get out of my boring cubicle job. So, I overlooked the fact that these guys weren’t the same guys I went to college with.”
As the real estate market started to turn sour, the true nature of his college “friends” finally surfaced.
“So what ended up happening is when the real estate market started crashing, you know, when the ‘free money’ stopped, they didn’t know how to make money anymore and any obligations they made to me and anyone else, went out the door. Not only did we stop doing business, but they stopped managing my property as well. They stopped taking my phone calls. Which as a 24 year old, was pretty scary.
He was willing to lose his own money, but what complicated the situation was that his close friend had gotten involved and invested with him in one of the properties in Florida. There was never a moment he questioned what he had to do.
“Doing it the right way and taking responsibility for my actions and what I got my friend into, that was the best thing was to resolve it and not walk away. I was going to make sure at all costs that he got out and once I made that decision I felt a lot better knowing I had done the right thing.”
His support throughout that entire ugly process was his future wife and business partner Jennifer. Ben’s face lights up as he says, “She was fantastic.” When it came down to making the decision to help his friend escape financial ruin before himself, she was on board the whole way as she had always been since they first met.
They met on a train to Munich while Ben was on a backpacking trip through Europe and the two ended up spending the next two weeks together. They were inseparable the entire time.
Jennifer had to return to the US and she and Ben would spend the next couple months writing back and forth in a quasi “You’ve Got Mail” type of relationship. After the attacks of Sept 11th, airfare became so cheap that Jennifer made the journey back out to Spain where Ben was temporarily living, they rekindled their relationship, and Ben decided it was time to return to the US.
Needing something bigger and feeling the same urge so many do to “escape Michigan”, he moved to Chicago to find work and be close to Jennifer. His new job at a large insurance company as an account rep would create the boredom that eventually fueled his jump into his house “flipping” odyssey.
After escaping the hard lessons of bad partners and needing to bring some stability back to his life, Ben made one of his trademark “giant shifts” and decided the trading world was his next big endeavor.
“Usually what has happened is I stay committed to what I’m doing but every so often I find myself making a big change. I switch to a different path. So, maybe I’m getting a little flabby, so it’s then time to change. It’s my last year in college, ok, time to change. I’m tired of this cubicle job and I just lost a bunch on this stupid real estate investment, ok, it’s time to enter the best business school in the country and get an awesome job as a trader. I just hit a point and change.”
Enrolling at the University of Chicago, Ben was dead set on one goal and that was bringing some stability back to his life and his finances. He figured what better place to do that than the world of finance.
“Reading the Wall Street Journal I sort of discovered the trading world. I took the GMAT and through some connections got an interview at a top trading firm in town and started as a trader’s assistant. I was an options trader for six years and really didn’t think about being an entrepreneur.”
There wasn’t a Hollywood style ‘light bulb’ moment that made Ben jump from his trading desk and run out to start Foodie Registry. The trading world had made him a pragmatic risk taker. The long journey from being a 10 yr old candy magnate to launching a restaurant registry took him down so many different roads, that he is surprised that he is back where he is.
“I don’t look back at these experiences and be like, ‘oh it’s clear I was meant to be an entrepreneur’ and I don’t even know if I am meant to be an entrepreneur now.” Instead, the inspiration, development, and launch of Foodie Registry would be a 12 month road of calculated risks and in-depth planning.
As so many couples do when they fall in love, Ben and Jennifer wanted to get married. As they started to plan it out, they realized there was one aspect to weddings they didn’t want to deal with at all: the registry. They didn’t want a whole basement full of things they would never use.
“We didn’t register anywhere. We planned and paid for our own wedding and we just didn’t think we had time to register or really needed gifts. But, your friends and family are going to get you something whether you like it or not, and they look for guidance to get you something you’ll like. We went to Bed, Bath, and Beyond and spent an hour and really only wanted two things: an air popcorn popper and an iced tea pitcher with lid. They didn’t have either. So we went around the store and registered things like dish towels, spatulas… We looked at it at the end and said this is junk and removed it all.”
Realizing that with no suggestions for any of the guests, they would end up getting plenty of useless junk regardless of registering or not. Asking for cash would be too taboo for some people. Something needed to be done and it needed to be done quickly with the wedding approaching.
“When we got home, my wife said, ‘we don’t need stuff, I’m making a restaurant registry. There must be one out there.’ We Googled it and couldn’t find anything. So we said, ok fine, we will just make one ourselves. We made a little PDF doc with a list of 15 restaurants with a little blurb next to each one saying things like, ‘this is where we had our first date’ and things like that.”
Before and after the wedding, they started to hear from their guests about how much they loved using their restaurant registry.
“We started getting a lot of feedback from the purchasers saying, “wow that was so cool, I wish I had that for my wedding” or “can you make one of those for me?” You hear that enough and the light goes on.”
The light bulb may have gone on, but unlike so many previous times in Ben’s life, he didn’t make a dramatic shift and dive in. No, this time would be different and Foodie Registry would be planned out meticulously.
“We hired a developer who was a friend and starting building it …. We were all working on it part time, but we had to figure out all these complicated things … We waited to start partnering with restaurants until the concept was more developed. Then once we got 25 restaurants who agreed to try it, we launched. We took the approach that we should be doing this part time as long as we can until we know it’s right.“
Two years have passed since those early days and Foodie Registry is on a steady climb. Soon to be newlyweds can register directly on the site and setup dozens of “date nights” that their guests can purchase for them. The system has gone through much iteration, finally arriving on their current model of printing the gift certificates themselves and selling them for their large portfolio of restaurants. That way they control the entire process and the restaurant can be completely hands off.
As for any more big changes on the horizon, Ben hopes his latest move from being a trader to launching a web startup will last him quite a while. At this point he is focused on growing Foodie Registry quickly and intelligently.
“My fear is that if I do fail, that I’ll look back and just think that my failure has nothing to do with the viability of the concept, but in my ability to execute it and inspire others to join me. I don’t think I need 50 people to run this business, but if I can find the right three or four people to join that’s all I need.”
Figuring out the finer details of the business while having another team code it has opened their eyes to the future of tech startups. No longer does someone need a team of twenty coders and $10 million in venture funding to launch a concept.
“I think there are going to be a lot more people like me and my wife who we think have fair business smarts, but cant code. But we can make calls, find funding, and put things together … I’m really a fan of saying that in today’s day in age you can get a minimum viable product up in no time. “
|About the author||Seth Kravitz||@secondcityceo|
|Seth Kravitz is the Cofounder & CEO of Technori. Additionally, he is the Cofounder of Bow Truss (a premium coffee roasting company) and Strange Pelican (a craft beer brewery). Seth is a mentor at TechStars Chicago and The Starter League. At 19, Seth started a web design company out of his dorm room at Ohio State Univ. At 20, he met a local insurance agent with a big idea and co-founded his largest company to date, InsuranceAgents.com in 2004. InsuranceAgents.com grew to a 65 person operation and reached number 24 on the Inc. 500 before being acquired by Bankrate (NYSE: RATE) in 2012.|
Join the Starter Movement!
Find out for yourself why starters love our newsletter so much. Only the articles and news you want and need, delivered weekly.