Bootstrapping E-Commerce to 16 Million: Valerie Holstein, CEO of Cableorganizer.com (Part 3)

Sramana: In 2002 when you started selling things to hide computer cables, how did people find your website? Was it primarily via your blog?

Valerie Holstein: Yes, it was from the blog. I had a couple of pages that explained the issues we had and what products were helpful in hiding the cables. People started asking where they could find those products. I figured that if people were looking for the products, why not just sell them ourselves? I was hoping we could make a couple of hundred dollars a month. It was attractive because suddenly I had people calling me and asking me for the products. I was happy because it would give me something to do while I stayed home and raised my child.

I had no expectations or goals going into the business. I was dreaming about making $500 a month. A few months later, we started making real money. I had more and more inquiries, and people started referring products to me, hoping that I would carry them on my website. Everything grew via word of mouth. I kept adding products slowly but surely. That prompted me to make phone calls to a few big vendors who accepted our small business. They were large vendors in the cable management industry, and I think they were just tickled by the idea of selling something online. They did not have a lot of faith in it, but they thought it was interesting. They gave us a shot, which let us start distributing products. That put us in a different price bracket because before that, we were buying products at our local hardware store and marking them up to sell on our site.

Sramana: How did you finance the inventory?

Valerie Holstein: I just bought retail priced inventory and added a 20% markup. I really did not have to finance that inventory. People had no clue what to look for, so they were willing to pay for the products on our site because I made it easy for people to find what they were looking for. At the time, keyword analysis was not well known, but we focused on a lot of unique keywords that I knew people were using to try to find these solutions. Nobody knew to look for a surface raceway; they had no clue what they were called. I brought a packaged solution to people and they responded. When you make it easy, things happen. I was driven by what the customer feedback was.

Sramana: Was this all just you or was your husband working on the business?

Valerie Holstein: He was working on the backend of the business. His specialty is ERP, so he set us up with UPS and USPS. He set us up with a free shopping cart. There are a lot of shopping cart systems out there that are free if you transact under a certain amount of money each month. They are not very sophisticated, but they do exist. Amazon was already there and eBay was there, but nothing else sophisticated was really out there.

Sramana: Did your husband keep his job at CSC during this timeframe?

Valerie Holstein: Yes, he did. He was working full time for a year and a half, and I was still working 20 hours a week. We had 1.5 paychecks coming in.

This segment is part 3 in the series : Bootstrapping E-Commerce to 16 Million: Valerie Holstein, CEO of Cableorganizer.com
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