How to build a business in 7 days for under $500 [Day#1: The Idea]

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How to build a business in 7 days for under $500 [Day#1: The Idea]

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So, you want to start a business but have no time or money? That’s no excuse, according to Sebastien Eckersley-Maslin.

In early 2010, serial entrepreneur Sebastien Eckersley-Maslin set himself a grand entrepreneurial challenge. In seven days, he would create a new business from scratch — from concept and branding to product development and launch.

And, to make things just that bit more tricky, he would do all this with a budget of only $500. For seven days, he blogged about his adventures (and misadventures). This is what happened.

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Entrepreneurs’ Challenge: Day #1

It’s my belief that everyone (yes, everyone) during their lifetime has at least one million-dollar idea.

Unfortunately, only a small few act on them.

There is always an excuse, always a reason why not.

The most common I hear is: “I don’t have time” and “I don’t have the money”. Bollocks! I want to show that, with just a little capital and a little bit of time, anyone can turn an idea into a business — a startup.

This is the first blog in a seven part series where I attempt to create a startup business in just seven days for under $500.

It all starts with an idea

The first thing is to come up with an idea.

In my case, the idea has to be simple to develop, quick to market and have wide appeal. And due to the short time frame I have given myself (and the tiny budget), the idea must be achievable with my personal skills and capabilities.

A premium SMS service instantly comes to mind. However, as these have a high initial setup cost, that would blow my $500 budget. So no. But SMS might still have merit.

I recall an idea that came while chatting to a good friend of mine a few months ago.

Working from his car, he was repeatedly frustrated by having to write down his mileages in a logbook — a logbook that would then be misplaced, lost and chewed by the dog.

Logs would be jotted down on the back of receipts, discarded wrappers or scrap paper.

Ultimately, he wasn’t recording every business trip and he was, therefore, unable to claim the most he could come tax time.

A quick calculation on the back of a laptop revealed that missing just one trip in ten would cost him $1,000 in lost tax claims! He suggested a log book could be managed electronically and I thought this would be a great idea to use for this challenge.

A service to maintain a vehicle mileage logbook online and update it anywhere via SMS.

It was simple to develop — I had experience with building SMS and online business systems. It was quick to market — the benefits could be explained quickly, promoted online and bought on the spot. And it had wide appeal – seven million Australians claim work-related expenses each year on their tax returns.

What about the marketplace?

Although I already had one customer — my friend who kept losing his logbooks — I needed confirmation that others would like the idea. I jumped on Facebook and Twitter and asked the question.

I floated the idea past friends, family, my bank manager, my accountant — anyone who would listen. I even asked random people waiting in queues, though this has more often than not drawn a cold response.

From all of this I deduced that people were very warm to the idea of managing their logbooks online and having the ability to send SMS. Lots of people didn’t like premium SMS and a few suggested that they would rather send an email from their smart phones to save money.

My accountant put me onto various ATO websites and noted that the cost of using the service could even be considered a tax deduction. People were generally happy to pay up to $10 a month for such a service.

What about the competition?

Okay, time to see what else is available. I jumped online and tried every search term combination I could think of and came up with a list of existing businesses that compete directly or indirectly with the AutoCarLog concept.

  • Officeworks. At $4.69 this paperback logbook is the cheapest and most popular product I would be competing against!
  • TrackInABox is a product that does automatic logbooks using GPS tracking. Pricey and targeted at truck drivers.
  • AutoCentral is one of many fleet management software systems targeting large organisations.
  • There are a plethora of iPhone apps designed to manage log books but none seem to be targeted to the Australian market.
  • SideBuddy is proof that the eCarLogging concept is viable and was the only product I could find similar to my concept.

There were, of course, others, but the above list shows the variety of tools and services that currently exist to manage vehicle mileages, including one very similar concept. Although there was competition, I try never to see an existing service or product as a reason to back out.

I see alternatives both as a challenge (to do better) and reassurance that the concept is valid and the marketplace is already being educated.

What about a name?

The name is important.

It’s on your business card. It’s on your website. It’s the first impression people get of your product. It’s what sets the scene.

Initially I started thinking of inventing a word, such as Carnoodle or Odonaba, using the cheekily simple web2.0 name generator. But I wanted a name that would draw in business by itself. So I needed something that was memorable, quick and described itself.

Not easy.

I jumped on my whiteboard and wrote down words that describe the service: ‘logbook’, ‘car’, ‘mileage’, ‘automatic’, ‘sms’, ‘online’, ‘tax’ and eventually settled on the combination ‘AutoCarLog’.

The name “AutoCarLog” is a combination of words that are instantly memorable and informative. The added advantages are that it is short and, therefore, Twitter friendly (not needing to use a url shrinking service) and, importantly, top level domains .com and .com.au were available.

The business plan

One of the most important first steps to creating a business is the development of a business plan.

The first attempt doesn’t have to be a full blown business plan suitable for seeking funding from the most conservative of banks. But, for this venture, a plan will help me prioritise tasks for my six remaining days and work out where to spend my $500.

When I came up with the challenge, I figured $500 was more than enough, it turns out it was just enough! My quick budget is as follows:

  • Domain name registration — $13 a year
  • Web hosting — $5 a month
  • SSL certificate — $88 a year
  • Credit card payment system — $220 plus $22 a month
  • Bank account — $6.50 a month
  • SMS modem — $140
  • SIM card — $5 a month

Total: $499.50 (upfront) and $66.50 a month (ongoing).

As there were things I could only do during business hours (visiting the bank), I split each day into two parts.

During the day, I would have to cover registrations, marketing and promotions and during the evenings and weekends I could focus on development and design.

  • Day 1: Research & Planning
  • Day 2: Registrations
  • Day 3: Marketing & Development
  • Day 4: Development
  • Day 5: Graphic Design & Development
  • Day 6: SMS Gateway & Development
  • Day 7: Launch!

This would give me seven hours on research, seven on registrations, seven on marketing, 42 on development, seven on graphic design, 14 on the SMS gateway and seven for the launch — 91 in total!

And, each morning, I will blog about the previous day. I will also cover other topics which don’t fit into the daily summaries at my blog semi-blog. Or you can follow my progress on twitter.

Let the challenge begin!

One of Anthill Magazine’s inaugural 30under30 Award winners, Sebastien Eckersley-Maslin thrives on creating smart solutions to every-day problems. For the past decade, he has spent his time balancing the demands of a full time Naval career, a Masters in Engineering and running personal businesses.

In 2009, Eckersley-Maslin returned from duty in Iraq with a drive to storm the ‘front line’ of Australian business. In 2010, he was the subject of an international documentary, where he aspired to create the world’s smallest multinational.

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