Bootstrapping from Opposite Sides of the Globe
How two entrepreneurial paths converged to disrupt the U.S. LED market.
PHOTO CREDIT: Getty Images
Guillaume Vidal is an Entrepreneurs' Organization (EO) member in Shanghai and co-CEO of GREEN CREATIVE with business partner, Cole Zucker. About 10 years ago, both independently ventured to China, learned Chinese and worked their way up in companies. They eventually met and decided to start an LED light bulb business together with hardly any startup money. Through trial and error, they learned what was necessary to successfully run their startup and persevered through tough business conditions. We asked Guillaume and Cole about the twists and turns of their international green tech bootstrapping story. Here's what they shared.
Tell us about your entrepreneurial journey.
Guillaume: As a teenager, I got my first taste of entrepreneurship providing sound systems and music for weddings and parties around town with a friend of mine. A few years later when business school brought me to Asia, I started working at a medium-sized business in Hong Kong where crazy opportunities were thrown at me. Eighteen months after graduation, I was in charge of opening an office in Chinafrom scratch. The process of accomplishing that by myself elevated my confidence.
My work involved developing LED products; I saw that the technology was evolving rapidly. I had my "aha!" moment when I realized that the industry had reached a point of no return: LEDs would be the mainstream lighting technology in the near future. I realized that the larger players with older, incumbent technology were moving too slowly. I knew there was room for disruption.
Cole: I moved to Shanghai in 2007 and immediately caught the entrepreneurship bug, specifically looking for a product made in China to sell in the U.S.; I considered several consumer products but nothing resonated. In 2009, I read an article about Japan's high adoption rates for LED lights, which mentioned that U.S. market volume was very low but would skyrocket over the next 10 years. That was my "light bulb moment." And, since I worked with LED vendors, I felt ideally positioned to leverage my experience and bring LED products to the states.
What skills have helped your company survive?
Guillaume: I initially relied on marketing and product management skills as well as technical knowledge. But as bootstrapping entrepreneurs, we literally oversaw everything ourselves for several years before we could afford to hire anyone. As a result, we developed a wide arc of skills in accounting, finance, HR, operations, supply chain, IT, quality control, engineering, IP and legal. Unfortunately, we acquired most of our skills by learning from our mistakes. Luckily, we have since found people far more competent than we are in most of those areas and now we learn from them. Identifying key areas to outsource is one of the most important skills we developed over time.
Cole: My background was in sales, but neither of us was properly equipped to start a business, let alone one that would require rapid scaling and infrastructure. Figuring out everything by ourselves made us very scrappy and determined. We didn't point fingers, we focused on solving problems and remained flexible. As a result, we developed an effective communication style as we constantly evaluated what was working and what was not.
What was your biggest challenge?
Guillaume: A company is only as good as its people, but it needs money to run. Finding money and people are our biggest challenges--because those two resources are critical to every company's survival. In year two, we ran out of cash and accumulated $1 million in debt. The company was our liveswe had invested everything we had. Cole was living out of his car in San Francisco, selling LED light bulbs door-to-door; I was in China managing production on a shoestring budget. We put a "burn the boats to take over the island" mindset into action. We never stopped encouraging each other. Eventually, we received angel investor funding, followed by a credit line from a bankboth huge wins. In the end, it all worked out: We're now about to enter the LED fixtures market and our 2018 revenue projections are $100 million.
Cole: For any rapidly growing, inventory-heavy business, one of the biggest challenges is figuring out the right mix and quantity of products to allow continued growth without putting yourself out of business. You must be very strict with cash flow management, something we learned the hard way. With limited sales history and increasing demand, we often made inventory decisions based on "this feels right" as opposed to a strict process. It's something that we have worked hard to standardize.
Tell us about the environmental aspect of your business.
Guillaume: Selling a product that massively reduces our customers' carbon footprint is a huge plus. We are a technology company whose product line has a positive environmental impact because of the longer lifespan and lower power usage of LEDs.
Cole: Knowing that the equivalent of millions of cars have been taken off the road as a result of our business is extremely gratifying. We're proud to help bring a green technology mainstream.
What has surprised you most about your journey?
Guillaume: In hindsight, I can hardly believe how long and hard we worked every day and how the right partner is such a determining factor for success! Because we share a strong work ethic, possess complementary skills and provide each other with the utmost support, we were able to navigate a number of tough situations, any one of which could easily have ended our journey. It's not the set of cards you're dealt--it's what you do with them that matters.
Cole: I echo Guillaume and would add that in the last eight years, we have both grown so much as individuals. The number of ups, downs and challenges we have experienced since the start of the company feels equivalent to an entire lifetime. As a result, I am a far different personfor the betterthan when we first sat down and dreamed of building a business together all those years ago.