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How Did You Start Your Business
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Quitting Job and Doing Business Full-time
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Sneetch.com: Taking Up the Challenge of Internet Entrepreneurship
Sean Lundgren and Todd Livdahl started Sneetch.com selling videos, games and DVDs as a part-time business. Its success prompted them to give-up their jobs and work full-time from their homes. Their gamble paid off: the site generated $1.2 million in total sales for its first year, before moving into their new office.

by Isabel M. Isidro
Managing Editor

 

A story of two friends who transformed their interests on video games, movies and music into an online business. Sean Lundgren and Todd Livdahl started Sneetch.com in February 2000 with no expectations of success, after all they had pretty good careers at Disney working as computer engineers.

The success of their business, however, surprised the pair. A month and a half of opening their site, they had to quit their jobs and work on their business full time. Working from their homes for a year, they were able to generate sales of $1.2 million. Now they have moved into a real office. Not bad for the pair who simply wanted a part-time business.

There is so much to learn from the story of Sean and Todd. Investing $1,000 each in the business, they managed to get back their investment after only a month in business. This two-man team selling generic products on the Web managed to rise above all their competitors (and there are a lot!), including the online mega-stores. 

Sean and Todd have been featured in Business Week and The Washington Post, as well as on the front page of the Money section of the USAToday newspaper. Get tips from the founders of Sneetch.com on how to run an online business, manage its growth, handle customer service, run a business partnership, and what it is like working from home.

How did you start Sneetch.com?

SEAN Lundgren : We both work at Disneyland in the IS department. Todd and I were both looking at online businesses, which were then at its peak, and we thought we'd do the same. We just wanted to throw a lot of different things, maybe consumables or other things that people buy. We ended up deciding on DVDs and video games.

We spent a lot of time late at night after work trying different areas before we finally ended up on Yahoo. When I say different areas, I mean different sites that allow you to put together a shopping cart. Our first host didn't really work out for us. It didn't have the quality and well built back-ends that we were looking for. It didn't have statistics, or ways to build relationships with banks or credit cards.

TODD Livdahl: We basically just kind of throw ideas. I was big-time on stereos and hi-fi and Sean was big-time on the movies, and we both liked movies.

So it was basically a combination of your interests?

TODD: Yes it was. Plus we both liked video games. We look at Amazon.com or Buy.com, and we're just like, "Why don't we try this?" So we decided to try it, learn a new field and make it a business on the side. We just put it together, and I guess the rest is history.

SEAN: We both didn't know about this industry. Retailing was completely different from our background. But we knew it would be fun! As far as the Yahoo store was concerned, we figured that we could afford the monthly cost. We just wanted to try it and see what the reaction was -what we didn't do right and work on it. We had no intentions whatsoever of being out of a job within a month. None at all.

TODD: But then, we were out of our jobs in a month and a half. It went really fast.

How much did you invest in this business?

SEAN: We made this business from a thousand dollars each, and we paid each other back within a month for our initial thousand-dollar investment.

Todd and I had great paying jobs; good career jobs at Disney. And we made good money. When we decided to go full time on this, we said, "Ok, we're not going to take a raise but we both should continue to get the salaries that we have." So if we're going to do this and we quit our jobs, this business must be able to support our current lifestyle. No change; no upgrades - just our current lifestyle. And from day one, we never had to turn back.

How was it in the very beginning?

TODD: It's pretty scary too because we were working both jobs at the same time. When you're at Disney, you have to give them a 100% of your time because that's your main employer and this business just started on the side. So you're giving yourself a 100% of your time for the company you are working for; from 8 a.m. to 5 p.m. that was all Disney. When we go home, we do all the Sneetch stuff, from 5 p.m. to 3 or 4 a.m. Then we go back to work at Disney the next day at 8 a.m. We were definitely putting in long hours..

SEAN: That was the bonding; that was the bootcamp for Todd and I. We were doing 20 or 22 hours sometimes literally. We were going to bed at 6 a.m. and be at work at 8 a.m. And this was not like a one-time thing: this was like weeks and weeks and weeks. And then you're looking at the other person at lunch and you're giggling and, "We're like zombies!" How can we perform our functions here at work and go home and have another 10 hours of work tonight?

TODD: In our office at Disney, they knew something was up.

SEAN: Your hair is out of place. You're wearing the same shirt that you were wearing yesterday. And they ask us, "Hey, what's going on?" We tell them that we live in a parking garage. Through that whole experience, TODD and I came through it and we're like, "Hey, we did it together." We were working side by side, working with different jobs with similar goals.

TODD: We didn't tell each other to take this job or that job. We just kinda picked up different positions within the company and just took out separate jobs. You've got to wear different hats. I mean you're gonna be the financial person, the accounting person, the product inventory. You've got to be your customer support, and pay the bills. When you first start out, then hopefully when you get big enough you can hire other people.

Two months of that, and I was burnt. And Sean was burnt. So we had to make a choice. I remember sitting down, saying, "Well Sean I've been in Disney for 10 years (I was there in '89 and left last year) and I loved working there. Sean loved working there, too. Those were career jobs; I didn't plan to go anywhere else. But it is nice working for yourself, I tell you that right now. We kind of looked at each other and said, "Why don't we just quit." Then we have to consider the wives, make sure that everything was ok. I was kind of nervous because I'd been there for so long and I was stable.

 

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