Case Study: 18 Year Old College Freshmen (Former Entrepreneur)

[CollegeTrep123]

18 Year Old College Freshmen (Former Entrepreneur)

I've always been VERY independent with my money, and when I was living at home I rarely had to go to my parents for money (I've always found a way some how).

Income: Depends how creative I can get. When I was living at home I made $3 a walk walking the family dog (2 walks a day, 5 days a week).

I ran a fishing lure company from March 2013 until August 2014 which garnered national press and actively sponsored semi-pro anglers. The company had over 120 customers and was run off a Facebook page/profile. For 18 months I put every penny I made into the company and never took any profits out. The business started out doing around $350 a month and towards the end we were doing $1,800 a month (Netting around $1,000). At the end I had 3 offers to sell the company, but all the offers fell through and I decided to close up shop going into college.

I'm currently living at my college Mount St.Mary's University (about an hour from my house)- but I do not have a car and stay on campus.

I’ve been an entrepreneur my WHOLE Life (Sold crayons at 3, Lemonade at 5-9, Picked up dog poop 9-10, Fishing businesses/fishing freelance writing for 6 national magazines from 15-18. I’m ALWAYS trying to make money
Up until the middle of August I was living off my checking account from $1,800 in Graduation Money that I received May 24,2014 (Friends, Neighbors, Family). I would spend (carefully) and then build back up to $1,000. The whole summer my balance never dipped below $800. I received $1,300 at the beginning of the summer and $500 in the first week of August)

Rushed into Kindle publishing and spent over $1,000 to have almost 50 recipe books outsourced on Elance and published on Amazon (This took place from 8/12/14-8/22). I’ve only made $125 from those books
I made $1,080 from working at my Local TJ Max this past summer

COMBINED I made $3,080 over the summer (Graduation money/TJ Max)

Expenses: I’ve paid all my college expenses thus far (I spend around $6 a day). I paid around $130 for all of my textbooks.

I’m actively paying off my $995 Capital One 360 Line of Credit ($100 minimum monthly payments). This came from June 2014 where I was scammed out of $1,000 in product by a business associate (He was supposed to make/ship orders to help me out, he lived in FL, I live in MD- He never made ANYTHING- Leaving me with the bill to refund  customers out of my own pocket and make everything).

No fixed, or variable expenses. I’m a HUGE reader and spend $20-50 a month on USED Business books off eBay)

Assets:

I had $585 in a stock portfolio (Built it up through graduation money/weekly paychecks from July to the middle of August)- Sold everything to pay for Kindle publishing (Content). I was putting in anywhere from $40-$173 per week).

Kindle Books: When I got into it I saw each Kindle book that I produced as a Cash-Flowing Asset, I went big under the assumption that more books = more daily cash flow. Right now 3 books are producing 80% of the revenue. I’m a HUGE Robert Kiyosaki fan!

I have A LOT of Fishing equipment (Rods, Reels, Lure making supplies) that I have considered selling off (Some of my reels can go for $130+)

Liabilities:

The $995 from the Capital One 360 Credit Line at a 11% interest rate. Finance charges applied monthly (around $8) with a $100 minimum monthly payment.

No other liabilities

Goals:
Save/make $1,995 so that I have $1,000 left after I pay off the line of credit (I want to pay it off in one lump sum if possible

[Cwadda]

Very interesting story. Sounds like you have a great entrepreneurial spirit. Hopefully you're going that path in college?

I would say use your natural talent at college - I think there are some ways there to make money and you'd be more than capable of finding them.

I'd say sell the extra equipment to pay off that credit card debt. 11% is painful. Kill off that debt ASAP.

[J Boogie]

My advice would be to focus less on "business" and focus more on the nuts and bolts of a particular area of interest that you can eventually monetize.

I drop shipped cameras on ebay while I was in college.  I made like $200 total and it was a bit of a headache getting things set up.  (it ran itself though once it was set up... the margins just got smaller and smaller and I ran out of profitable models to sell).

It was a great lesson from the real world - if you bring something of value to the table, you'll get something valuable out.  If you're just a middleman amateur distributor (like I was)  trying to hawk something, you'll scrape by at best. 

Keep that entrepreneurial spirit alive, be patient, do what gives you a truly great sense of accomplishment, and don't take shortcuts when you've found what you love to do.

Like Cwadda said, get rid of that debt.  Other than that, it's a little too early in the game to do a financial case study.  The world is your oyster my friend.

[Cwadda]

One more thing I'll mention is that college is a lot of discovering who you are and what works for you. I find that having a job in college helps me manage my time and I have actually gotten better grades despite being more busy. It's definitely possible.

Keep that entrepreneurial spirit alive, be patient, do what gives you a truly great sense of accomplishment, and don't take shortcuts when you've found what you love to do.

I also really like this advice ^.^

[gimp]

Dude, I love your enthusiasm, and I don't mean to shit on your parade, but you're spending a lot of effort for very little reward. Practically speaking, I'd recommend that you step back a bit, and give your full attention to school. It will not be possible to do an undergraduate degree and try to run a business at the same time.

Exit your positions - sell your stuff, pay your debt - and internalize what you've learned. Get back to it after you graduate. And don't knock the experience you'll get working a real job in your area of interest; you'll learn a lot of things that would otherwise take a lot of time and cause a lot of expensive mistakes if you jump back into doing your own thing.

One of the downsides of youth is that you spend months slaving away, exhausting yourself, to earn what you'll get paid every week once you enter the real world. Believe me, I've been there. I've created relatively large and complex products for a client that took all summer for the money that I now get paid every three or four days, only four years later. That doesn't mean your work is bad or you should give up, but it does mean that perhaps you'd do well to have less headache and more time to work on other things.

[Chranstronaut]

Wow, very interesting story. 

I definitely think it's possible to make $2k by selling some of your stuff and other little entrepreneurial pursuits if that's your only goal (I gave people haircuts in the dorms, but only made like $10, haha).  But it'd be faster to make that money by getting a part time job.  On campus jobs can be really convenient and some opportunities could be related to your intended major.  That can open doors for later work and a chance to start saving extra capital for the future.  Are you taking loans for your tuition?  Will you ever move-off campus and have to pay rent out-of-pocket?  Keeping these kinds of goals in mind doesn't hurt as you start your college journey, even if they are a year or two away.

What do you do with your business books when you are done reading them?  Do you sell them on eBay again?  Can you get them for free from your college or local library?  That seems like your only listed discretionary spending, so it's really the only thing I could recommend to cut.  Theoretically, your out-of-pocket expenses could be zero if you live on campus with a food plan.  Even some text books can be found in the library or online.

Good luck!