How a college student started a multimillion-dollar company out of his dorm room

AJ Forsythe’s smartphone repair business racked up US$25 million in revenue in just four years

PUBLISHED : Wednesday, 07 June, 2017, 5:03pm
UPDATED : Wednesday, 07 June, 2017, 5:05pm

By Kathleen Elkins

When AJ Forsythe, 29, was a student at Cal Poly, he found himself overspending to fix a perpetually damaged iPhone.

“I kept breaking my phone throughout the years,” he tells CNBC. “And this was when it was about US$200 to have it repaired.” So Forsythe, a junior at the time, decided to take matters into his own hands: “I ended up taking my phone apart, ordering some parts online and fixing it myself.”

It turns out he wasn’t the only student with a broken smartphone and little money to repair it. “My roommate broke his phone, so I fixed it, and then I just basically started fixing my friends’ phones when they’d break,” says Forsythe.

It didn’t take long to figure out that “college is a hotbed for people breaking their devices.”

Forsythe printed flyers and started advertising his smartphone repair business, iCracked, on Cal Poly’s campus. He charged US$75 per repair, which he could do from his dorm room or the campus library.

“It went from this super-organic college job to one of the coolest jobs, where I could work and go to school at the same time,” the entrepreneur tells CNBC. “I was making the equivalent of US$60,000 to US$70,000 doing these repairs.”

During his senior year, Forsythe teamed up with Anthony Martin, a friend at UC Santa Barbara, and started expanding iCracked beyond Cal Poly. By graduation, the co-founders had built up a network of 40 technicians to help them with the repairs. They had also racked up US$40,000 in credit-card debt.

Forsythe and Martin headed to Silicon Valley. “We packed up Anthony’s truck, moved everything we had to San Francisco and moved in with my brother on the couch,” says Forsythe. “We raised some seed capital through Y Combinator, a big tech incubator, and started working day and night trying to grow the company.”

In 2012, Forsythe and Martin opened the company headquarters in Redwood City, California, and ended the year with US$2 million in revenue. In 2014, four years after Forsythe launched iCracked from his dorm room, the company had upped that number to US$25 million.

Today, iCracked has grown to about 70 employees and built a network of more than 5,000 “iTechs,” who fix anything from cracked screens to broken buttons on iPhones, iPads or Samsung Galaxy devices.

You can think of iCracked as on-demand smartphone repair: Anytime you break your device, a pro will come to you and fix it on the spot. The average repair costs US$100.

“We’re trying to build this technical support network so that, in the future, anywhere on earth you have a tech problem, you press a button, and we show up and fix it,” says Forsythe.

While Forsythe’s journey to a multimillion-dollar company may sound smooth enough, it didn’t feel that way to the founder.

“I think people over-glorify being an entrepreneur. It’s a really hard job,” Forsythe tells CNBC. “When you’re just starting out, all of your friends are making more money than you, you’re going into personal debt, you’re working 18-hour days, and your parents are yelling at you for not having a ‘real job.’”

Be prepared to “eat, sleep and breathe your company,” he advises aspiring entrepreneurs. And, “there’s no such thing as starting a company too early,” Forsythe says. “If you actually want to start a company, stop making excuses. There’s no better day than today.”

Read the original article on CNBC