By the time he was 13, Kurt Heinrich was selling iPod accessories online, sometimes buying direct from suppliers in China.
By the time he was a high school senior, he was convinced he had found a more lucrative venture: helping online retailers automate their business.
Now 22, Heinrich recently raised $2.7 million from investors, including delivery giant UPS. His Midtown-based business, eCommHub, is growing, with about 15 employee and plans to hire more. Along the way he battled stress as well as resistance from his parents who didn’t want him to drop out of Georgia Tech.
l had a custom bird house business in fourth and fifth grade. I would put little fliers in mailboxes. Doing things you could be rewarded for and see results immediately, something about it interested me.
In middle school I was subscribing to Popular Science magazine. At the end of this particular issue was how to turn an Altoids tin into an iPod charger. I went to Radio Shack and got the parts. I took it to school. The kids, they thought it was really cool. They wanted me to build one for them. I said, “Yeah, sure for 25 bucks.” It was when this whole iPod accessories market didn’t exist yet.
(One friend said) why don’t you sell these online? At the time I knew nothing about online. I started looking into it. I put up a basic html site with a PayPal button on it. Nothing fancy. But people found it, and I started getting a bunch of orders.
That’s when I got the assembly line going with my dad and my friends down the street in our workshop. Pretty quickly I realized: I’m not really making much (money). What if I could sell stuff and not have to make it but just resell it?
He started reselling colored headphones, cases and other accessories online, at first buying directly from other sellers on eBay. After looking at boxes showing who the retailers got their products from, he began buying direct from suppliers, including some in China. He’d communicate with them through email.
One of my fears back then was these guys finding out that one of their biggest resellers is actually just a kid out of the bedroom.
To actually buy the stuff and set up a PayPal account, my dad had to help set up the business license. I learned customer support at an early age. People buy things and they are out of stock and you have to cancel the orders and you have angry customers. That was something my dad coached me on.
Heinrich started selling name-brand accessories after checking out the names and addresses of makers listed on the boxes of products sold in a local Apple store.
In eighth grade I actually tallied up what I made, because my dad explained this whole thing about taxes and things you have to be accountable for. I had like $17,500 in revenue for the fall that year. I kept it going throughout high school. The revenue was there, but it was low margin. The biggest thing I got out of it was the learning experience.
Heinrich convinced a local web development firm to take him on as an intern during high school.
I was trying to learn not only how a website looks on the front end but how is it also built and hooked up on the back end. How do the orders get processed? I wanted to learn that because if you know how to do web development you can basically build anything.
I used to spend four hours a day when I came home from school just processing orders (for my business). What if I made a script to help automate some these tasks? If I’m spending all this time automating things for myself, I’m sure there are other stores out there that have this same problem. What If I built something that would be useful to them, like a software platform?
I started putting it out there to see if this idea would be interesting to other people. I got to a product that people could start using. That was my last semester of high school. I wasn’t even selling it yet. But I had a strong amount of interest from people.
I was reluctant to go to (Georgia) Tech because I wanted to start my own businesses. But my parents never went to college and they were really big about me going.
I started working with a friend at Georgia Tech who was going to become my business partner. He was a (software) developer. We were about three or four months into it (when) there were differences. Most of it was on my part and inexperience working with other people. It was one of the biggest learning experiences I went through.
We never really talked (before) about compensation and how things would be divvied up as far as the company. We couldn’t come to an agreement on terms.
Heinrich’s parents had been helping to pay his living expenses and his father had covered the costs of computer servers for the business. But his parents were ready to cut the cord.
That would have been a very easy moment to give up on the business. Around that same time I had a collapsed lung. Could have been stress induced. You are sitting in the hospital for a week and a half, and you start thinking: “Is this really worth it? I should just go back to school.” There are so many moments like that. In the hospital I sat down and tried to learn that (software) development stuff I didn’t know. The product was still barely on its legs at that point, and I had to get it functional.
He had only about half the credits he needed to graduate from Tech when he told his parents he wanted to spend a semester in a program only loosely affiliated with the university that would help him gain business mentors and grow his venture. He soon dropped out of college completely.
My mother was pretty upset about it. I think my dad knew he couldn’t really change my mind.
Early on, Heinrich had tried getting investors interested in his business. It was a tough sell for a teenage, first-time entrepreneur with no paying customers.
I quickly realized there’s no way I’m going to raise this money. There’s people who can raise money on the back of a napkin. That’s not me. My best chance of raising money was to go heads down on the business. Let’s get paying customers and that speaks for itself.
I was able to get one angel investor. He wrote the first check (for $75,000). He believed in the opportunity and I guess an element of me. And then there was some credibility from my advisers and mentors who introduced me to him.
With that money came a whole other set of responsibilities. That’s when the clock starts ticking. I had to make that check last as long as I could. That got me through that year until I got paying customers and got momentum.
Fund raising is like a full time job. I thought it was a distraction. The hardest part is getting the first investor.
He started by trying to work with mentors and people he already had relationships with. By last September Heinrich had raised $2.7 million, some through local investors as well as UPS and Sigma, a major venture capital firm in Boston.
I wanted to make sure it was the right move for the business. I still wanted the company to be scrappy and I didn’t want to lose that bootstrap mentality.
Every entrepreneur has different things that motivate them. I like the journey of it. It’s like I’m building something every day.
Heinrich’s comments were edited for length and clarity.