Posted on Monday, Jul 12th 2021
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BookPal CEO Tony DiCostanzo had identified a gap in the book business and built a thriving company. Let’s learn the how, what, and why of it.
Sramana Mitra: Tell us a bit about yourself. Where are you from? Where were you born and raised? Tony DiCostanzo: I was born in Anchorage, Alaska. Shortly after turning two, I moved up to Nome, Alaska – from a small city to an even smaller village of 3,000 people. We lived there through the sixth grade and then moved back to Anchorage through most of high school. I ended up spending a couple of years in Washington State but found that California was more of my natural habitat. I came down to go to school at Pepperdine University and met my wife who was from southern California. It was a natural fit to stay here and be close to her family. That was what drove us to the Orange County area. Sramana Mitra: When did you finish university? Tony DiCostanzo: That was 1994 for an undergraduate business degree from Pepperdine. I went on to UCI for my MBA from 1997 to 2000. Sramana Mitra: What did you do after you came out of university? Tony DiCostanzo: I was in an unfortunate circumstance that was actually beneficial to me. I wasn’t one of the kids that had everything covered by their parents. I had to work during school. In my second year, I wound up getting a much better job at a consulting firm. It was an entrepreneurial business providing mostly teen and leadership development consulting to major corporations in the Los Angeles market. It was an amazing side education for me. We grew the business from a couple of hundred thousand dollars to a couple of million dollars over a three year period while I was in school. I actually stayed for a year afterwards doing consulting work.
At the same time, I knew that while I enjoyed that small business and the growth aspects of the company, I also felt like I wanted a more solid corporate background as well to give me a better solidification of why all of these companies were dysfunctional and why they were paying us a lot of money to come in and help them. I wound up getting a corporate finance job at Coldwell Banker, which got merged into SCM. I rose up in the ranks a little bit and then went on to strategic planning and finance management at Disneyland Anaheim where we did a lot of analysis and major park overhaul analysis to determine which entertainment and ride offerings were going to drive attendance and help make some of those key strategic decisions. I stayed there for about six years.
A friend of mine got pulled into a company as part of a turnaround project. There had been three or four CEOs and a number of leadership challenges at this other company and he convinced me that I was being under-utilized at Disney. In hindsight, I think I was. When you’re in a large company, you can provide decision support, but the decision making is at the senior executive level. Coming into this new firm, it was a head-to-the-fire situation of having to make a lot of rapid decisions in terms of cost-cutting, restructuring, and personnel decisions. We had to do quite a few layoffs and had divested a couple of different divisions of the business. As the CFO, I had to get the company brought up to speed on Sarbanes-Oxley and compliance with SEC filing because there had some delays in the previous management. We engaged Deloitte and got all the audit work done. We pulled in some additional investor funds and closed some significant business including a multi-year contract with Pfizer.
While we felt that things were finally on the right path, it ultimately did not work for us. One of the accounts that we had had for a number of years decided that all the chaos that had happened over the years was a bit too much. They brought some of these healthcare programs that we were providing in-house. It became very stressful. I was traveling three to four days a week to different parts of the country. I had two young kids at home and just decided that three years was enough. I left.
The company had additional client challenges after I left and they shut down. It created an opportunity in the space having solidified three years of experience of surviving a chaotic environment of cash flow issues and dealing with legal challenges. Two of the previous CEOs had vacated a space on LaSalle Avenue in Chicago. They moved out of a 30,000 square feet in the middle of the night and of course, the landlord didn’t like that. There were those kinds of lawsuit issues that we were trying to deal with. Ultimately, it was a pretty substantial burn on the company.
The core business of promotional health programs was actually a sound business idea. We were going to large employers providing health questionnaires to their staff. These large employers usually have over 5,000 employees. They were self-insured. They would have Blue Cross United providing claims administration. Ultimately, if somebody had a health issue like a heart attack, those claims were paid out of the company’s reserves. If we could educate the employees, make them healthier, and make better lifestyle decisions, those improvements would translate to savings to the company.
Our conversation continues
here. This segment is a part in the series : Best of Bootstrapping . Bootstrapping to an Exit . Why is Bootstrapping Important? . How Can You Play this Low-Probability Game Intelligently? . Do NOT Go to VCs as Beggars - Go as Kings . Excess is NOT Required for Success . Bootstrap First and Raise Money Later . Some Bootstrapping to Exit Case Studies . The Buy Side of Bootstrapping to an Exit . Blitzscaling vs. Bootstrapping . Bootstrapping to Unicorns More »» . Cinedigm Acquires Bootstrapped 1Mby1M Company Future Today for $60 Million . Mailchimp Bootstraps to $600M Revenue . Bootstrapping from Arizona to $10 Million . Bootstrapped Basecamp Executes a No Nonsense Strategy . How Under30Experiences Bootstrapped to $5 Million . Bootstrapping with a Paycheck . How Algo.ai CEO Amjad Hussain Bootstrapped using Services from Michigan . Seed Investors Who Like Bootstrapped Businesses . How iHeartRaves CEO Bootstrapped a Niche e-Commerce Company to $20 Million . Bootstrapping with Services . How The Intern Group CEO David Lloyd Bootstrapped to $13 Million . How Passageways CEO Paroon Chadha Bootstrapped from Indiana . How SmartBuyGlasses CEO David Menning Bootstrapped to $50 Million . Death by Overfunding . How RainmakerForce CEO Mack Sundaram Bootstrapped Decisively to $5 Million+ . How FormAssembly CEO Bootstrapped a Virtual Company with a Paycheck . TimeSlips CEO Mitch Russo Bootstrapped to Exit with Sage . The VC-Entrepreneur Compensation Disbalance . BioConnect CEO Bootstraps with Sophisticated Strategic Maneuvering . Tremend CEO Marius Hanganu Bootstraps from Romania . Gesture CEO Jim Alvarez Bootstraps to $10 Million . SproutLoud CEO Bootstraps to $30 Million from Florida . Tuft & Needle CEO Bootstraps to Over $100 Million . Co-founders Bootstrap Linguamatics to Over $10M from the UK . Ownership Matters . Vainu Co-founder Mikko Honkanen Bootstraps from Finland . Entrepreneur Couple Bootstraps to $10M from Colorado . 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Bay Dynamics Co-founders Bootstrapped Using Services . Building an AI Software Company from Dallas . RJMetrics Co-founders Bootstrapped First, Raised $22M Later . Bootstrapping Niche E-Commerce Business BuyAutoParts to Exit . TemplateMonster was Bootstrapped to $15 Million . Bootstrapping Edge Hosting to $18 Million . Bootstrapping, Fund Raising and Exiting with Sefaira . Bootstrapping IdeaScale to $5M from Scratch . Bootstrapping to $10M from Finland . Happy Grasshopper CEO Dan Stewart Bootstrapped to Inflection . Bootstrapping Gravity Pro Using Services . Founder Builds Multiple Bootstrapped Education Software Companies . Bootstrapping to $10M from Australia, Raising $25M from the US . Bootstrapped Y Soft to $30M from the Czech Republic . Bootstrapped from Belarus, Raised Money from Silicon Valley . Bootstrapped SproutLoud to $30M from Florida . Bootstrapped 2600Hz Using Services . A Serial Bootstrapping Entrepreneur’s Journey . 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