Sometimes great risks need to be taken to earn great rewards. Other times, an unfortunate accident can turn into a resounding success. And even other times, people stumble on pure gold without even knowing it. Many have tried and failed in business, but for this trivia post, here are a few entrepreneurs who took advantage of their circumstances and capitalized.
Chicago (and the Rest of the Nation) Will Pay Your College Tuition!
College tuition has been the bane of many academic careers. It has sent students into the real world with tremendous debt, forced students to balance a full-time courseload with a full-time workload, and discouraged potential graduates from finishing or even applying to college. Mike Hayes, a freshman chemistry student at the University of Illinois in 1987, was unfazed by the money-grubbing hands of his college’s regents.
This was because Hayes saw the value of a penny. People were not worried about pennies they lost in their couch cushions, dropped on city streets, or threw in their car’s cup-holders. They didn’t value their pennies, so Hayes wrote to the Chicago Tribune and asked to have a feature written for him. He told columnist Bob Greene his plan: millions of people around Chicago and the nation read Greene’s column, and if each person sent just one penny, Hayes would have enough to pay for college.
At the time, Kickstarter wasn’t around, and the word “crowdfunding” wasn’t even created until nearly 20 years after Hayes’ attempt to pay for college. Still, Hayes’ entrepreneurial spirit inspired thousands to send money – not just pennies. After less than one month, “Many Pennies for Mike” had over $23,000, or 2.3 million pennies. Someone from every state in the United States, Mexico, Canada and the Bahamas sent Hayes money to fund his college education. And Hayes followed through with his end of the bargain; he graduate college a few years later without spending a dime, or even a penny, of his own.
Non-Newtonian Fluid Makes Man Rich
The gooey, bouncy toy packaged in eggs that could once pull print off of a newspaper page, bounces like a super ball, and can flow like a slow-moving liquid was actually invented out of a wartime need. The Pacific front of World War II saw Japan invading many rubber-producing countries, creating a shortage of natural rubber. US citizens were asked to ration rubber, and the US government began supporting research on synthetic rubber.
In General Electric’s laboratory, James Wright mixed boric acid and silicone oil in hopes of meeting wartime production demands. What came out was “bouncing putty”, which he found did not sufficiently replace natural rubber. Wright hoped his invention would at least have some potential use so he sent samples to government and academic labs all over the nation, only to discover no practical use. Eventually, the pseudo-rubber found its way into the hands of Ruth Fallgatter, owner of the Block Shop toy store in Connecticut.
Fallgatter took the putty to cocktail parties, trying to find some use for the stuff. Peter Hodgson, owner of an ad agency, watched at one of these cocktail parties as guests would stretch and fold and squeeze the goop in their hands. He convinced Fallgatter to sell the “nutty putty” as an adult toy in his magazine, and its sales skyrocketed. Fallgatter, though, was unimpressed by Hodgson’s marketing and thought the toy would sell itself.
Hodgson was over $12,000 in debt at the time, but he truly believed the toy could be something big. He took a risk and borrowed another $147 to purchase a large quantity of the putty and hired a Yale student to package 1 ounce balls into small, red plastic eggs. He dropped the original name and decided to call it Silly Putty, eventually targeting children as the toy’s primary consumer.
Strangely enough, there are now plenty of uses for Silly Putty. It’s often recommended for its ability to pick up pet hair off of carpets or clean dirt off of surface. It can be used as a stress reliever. It was even used during the Apollo 8 mission to prevent tools from floating away in zero-gravity. Still, its peak success is as the “toy with one moving part”. Hodgson cashed in on his risk, too; he died in 1976 with an estate worth over $140 million dollars, thanks to this accidental invention and his serendipitous investment.
How to Double Your Profit: Double Your Sales
The best way to make more money is to sell more of your product. Of course, this is like saying that the best way to succeed in business is to succeed in business. It seems too obvious to need to be stated. However, Alka-Seltzer followed this business strategy and saw sales increase dramatically.
Since the time of the traveling merchant, salespersons have attempted conniving schemes against consumers to force people to buy more than they want. Department stores place employees in the make-up section to tell patrons that they need this scent or that eye-shadow. Sandwich shops offer one free sandwich after you spend upwards of $60 buying ten. Listerine, which first saw use as a surgical antiseptic, then flopped as a floor cleaner and a cure for gonorrhea, practically single-handedly turned halitosis into a social faux pas, And who hasn’t sat for hours in their shower wondering when the endless loop of “Lather. Rinse. Repeat.” ends?
Alka-Seltzer used to be the go-to pain-relief for heartburn and acid indigestion, but with the 1960s came an ever-rising popularity in pharmaceuticals. Alka-Seltzer was seen as a product for the older generation, and the company started attempting to increase sales by trying to attract younger generations. They failed miserably; apparently, the squeaky-voiced and bulgy-eyed cartoon disk named Speedy didn’t boost sales like they expected.
An advertising think tank finally solved Alka-Seltzer’s problem. The first issue they changed was Alka-Seltzer’s apparent fixation on pain. Previous commercials showed men and women running around screaming about pain, but the think tank decided to take a less blunt approach and focused on “Alka-Seltzers on the Rocks”. The commercial showed two Alka-Seltzers being dropped into a glass of water, even though previous commercials and packaging had only promoted use of a single tablet. Now, overall sales did not double but sales did increase likely due to a combination of the new advertising and just by implementing the good old-fashioned trick of suggesting to people to buy more.
Making Something Out of Nothing
The company 3M is well-known for its pressure-sensitive adhesives like Scotch Tape. Naturally, lots of research at 3M goes into making better, strong, more resilient adhesives. Dr. Spencer Silver was working at 3M and attempting to develop a super-strong adhesive. His concoction ended up being a material composed of tiny spheres about the size of a paper fiber.
Silver found that he could not dissolve the spheres. He found that the spheres would not melt. He discovered that, by themselves, individual spheres were very sticky, but they didn’t stick strongly when applied like tape. It was an interesting discovery but completely useless as an adhesive. He relentlessly advocated his intriguing discover but ultimately could not find a useful application.
Six years later, another researcher at 3M thought the “unglue” could be the solution to his problems. Art Fry was annoyed by his bookmarks constantly slipping out of his books. He proposed applying a strip of the glue to make “temporary permanent bookmarks”. He pitched the idea to his bosses, who remained unconvinced that this would be anything more than a niche product.
Eventually, the product was given to a few secretaries as a test run. They liked the reusable adhesive so much that they wanted to keep them after the trial. Dollar signs flashed in the executives eyes, and they knew they had a future success that was more than just sticky bookmarks. 3M released the product as “Press ‘n Peel” before finally re-introducing them as the now-popular Post-It Notes, which has seen great success despite initially appearing useless.