Leo Welder: ChooseWhat
Leo Welder created ChooseWhat because he had a problem: “I was in this startup and I wanted to buy online fax services. So I did the research and there were a lot of services. I chose one and signed up. It seemed like a good deal. But then when my partner tried to add us both to the service, we had to pay twice as much and right there my good deal turned into a bad deal. I knew that other services I had looked at offered multiple users. And I thought, why isn’t there a service for businesses like Consumer Reports that is online, free and targeted to entrepreneurs like me?”
Well, now there is. Welcome to ChooseWhat, an integrated site for what you need as an entrepreneur or small business owner. It’s free to you because their business model is based on affiliate marketing where they get a piece of a transaction on the vendor side.
The company started with, you guessed it, fax service: “We picked that category because we were so irritated with our own experience.” They put up a standalone site, faxcompare.com: “We built that site up, got it pushed online and it got traction. It was profitable in the first month! Within six months we were generating monthly revenues of $30-40,000! That’s when we knew we had a business.”
The premise of ChooseWhat was to help the entrepreneur find what he needs when he needs it: “An entrepreneur doesn’t have time to do the research on everything that he needs. So we do that research and keep it current and publish it on line so that entrepreneurs can get the benefit for free. They don’t need the greatest fax service on the planet but they need it now!”
Leo is no stranger to entrepreneurship. At six years old his favorite time of the month was when catalogs came in the mail so that he could compare different toys and model cars and dream up ideas to make them better. In college he started a rock climbing guide service (Rockfellas).“And that’s where I learned one of the painful lessons of entrepreneurship because a couple of months ruined 15 years of friendship.” He also learned that, “one of the true cruxes of entrepreneurship is that you have to promise the customers that you will service them and at the same time you have to promise your suppliers that you have a way to sell this.”
Discouraged, Leo went back to school full time (University of Texas at Austin) and then found another opportunity to import candles from Africa and wholesale them. “Now you can’t imagine two more different businesses than rock climbing tours and importing goods from Africa, but I swear that the issues we faced were the same! Infrastructure and organizational issues, like building the team, legal, cash flow, customer service. And that’s when I learned another great lesson – 90% of what you do as an entrepreneur is not about what you think it is; it’s about tactical challenges like making payroll and buying insurance! These are the kind of things that if you don’t do them well, if you don’t get them in line early, they will sink your business.”
Leo went back to school again, this time to a graduate school that focuses only on entrepreneurs, Acton : “It was all about real entrepreneurship, taught by real entrepreneurs and we learned about how to start a company.”
After bouncing around a few startups post-MBA, Leo got the idea for ChooseWhat. He had become an expert in search engine optimization and online marketing. “When I came up with this idea, I was taking what I learned to bet on myself that I had picked the right business.”
Leo knew that he needed a partner for ChooseWhat. “When I had the idea, I called Gaines [Wade Gaines Kilpatrick] and he said, ‘I’m in.’ I didn’t want to do it alone. You know this is an endurance game.” Leo knew that he could last longer if he had someone in it with him, someone to challenge him and to take a lot of the burden off of his shoulders. “We have had a Tuesday 7:30am breakfast meeting every week since starting. We give ourselves marching orders. Then when we meet the next week, we report on those. And we get shit done because neither of us wants to be the jerk who didn’t get the work done!”
Leo and Gaines were friends since Freshman year in college but they also did business together. “Yea, we bought a limousine together, you know, for fun,” Leo explains. “And so we did some other business things together too.” He counsels, “Don’t partner with someone who is a friend because he is a friend; partner with him because he’s a good business partner.”
ChooseWhat has never raised any outside money. “We spent money trying to raise money. And then we raised it, close to $1M, but we decided not to accept it.” Leo’s Gaines chimes in, “Yep, we raised the money, but then we turned it down! They were shocked!”
As for the short-term future of ChooseWhat, “We are adding content – about all the things that entrepreneurs need.”
Good luck Leo and Gaines: be famous, make money, have fun – unleash the entrepreneur!