Before Sam Lillie founded a rural startup, he took a hike.
It was a five-month, 2,653-mile hike to be exact, down the Pacific Crest trail that starts from the Canadian border in northern Washington to the Mexican border in Southern California. Fresh out of college with a business degree in hand, Lillie realized if he was going to do the hike, now was the time.
“This may be a once-in-a-lifetime opportunity to at least attempt this kind of hike,” he said. “If I don’t attempt it, I’m going to regret not even trying.”
As he embarked on the first 700 miles, the relentless hot desert sun made him second-guess the decision. Yet he was experiencing a level of freedom he had never realized before. There was nothing but his own will motivating him to forge ahead. Finishing became a personal challenge – a pursuit within himself to push the limits.
Often the reasons for the hard days were out of his control. Mother Nature does what Mother Nature does, and Lillie had to decide how to handle the moments when she was ferocious.
“When it went south, it went south real fast,” he said.
There was the time he hiked 20 miles in a blizzard. He couldn’t see more than 30 yards ahead. His down jacket was soaked with sweat. Lillie was cold, wet and exhausted. He had a choice. He could put a tent up and hunker down for the night, consuming limited food and water resources, or he could persevere to his checkpoint.
He moved forward until he reached his destination, with a book on tape keeping him company.
When the 2,600-plus miles were mercifully behind him, Lillie carried both a college degree and confidence that he could do hard things. It was time, he thought, to find a job and embark on a career, but again he faced obstacles out of his control. He applied with 106 companies throughout the U.S. for all types of jobs. He received just one offer to sell background-check technology over the phone.
The reason for all the rejection was lack of experience, according to Lillie. He found himself in a common catch-22. How can one gain experience without being offered a job? His hard-earned business degree seemed worth less than the fancy paper it was printed on. Lillie was disheartened, and with his bank account running empty, he needed to regroup. He moved to Port Townsend, Wash., to live in his mother’s basement and took a part-time job at the local gym folding towels and selling water bottles.
It wasn’t the career launch he anticipated.
Port Townsend is a city of nearly 10,000 with a maritime heritage. It sits at the northern part of the state on the Quimper Peninsula and is an active rural community inviting locals and visitors to take part in a variety of festivals. It’s an older community with a median age of 55, nearly 20 years higher than the national average.
Lillie doesn’t view it as a booming economic area, but feels a good vibe from the tight-knit community.
“A lot of times I see that these small communities, they’re just supportive,” Lillie said. “They’re not negative. They don’t provide negative feedback … to people that are at least trying to make a shot at something.”
Lillie has been taking shots at something since age six. He had a lemonade stand, but realized that was seasonal so he started a hot chocolate/coffee stand.
He ran a business cleaning up after dogs called Sam’s Super Pooper Scoopers.
As a middle schooler there was a car wash company and cleaning teachers’ cars during summer school. He washed the cars for $7 and could do two per hour, thus making nearly 2 1/2 times the minimum wage back then. He would take that money and buy a four-pack of candy for a dollar and sell them on the playground for $0.50/piece – a 50 percent profit.
Lillie has a knack for seeing a need and creating a business to address it.
“I don’t know why, but [entrepreneurship] is in my soul,” Lillie said. “I love it. I love every part of it.”
It was only a matter of time before that spirit surfaced in Port Townsend. One day, a need presented itself at a town hall meeting. Someone suggested that there were too many fruits and vegetables being grown privately and going unused. This unleashed an idea. Why not provide a marketplace to make it easier for local growers to sell surplus produce to local buyers?
He immediately began testing the idea, asking people directly if they’d be interested in unloading their extra produce.
“I had knocked on this guy’s door and asked him if I could sell his apples,” Lillie said, “and he was like, ‘What the hell are you doing in my yard?’”
The concept was explained further, and the man agreed. Lillie repeated the process for three months, connecting 30 home growers with 15 families and distributing over 300 pounds of homegrown produce. He didn’t have a car at the time, so he delivered the goods with a bicycle. At the gym, he now distributed towels, water bottles and locally grown fruits and veggies.
His theory proved viable, so he started a new business, Vinder, for $18.58, enough to purchase a domain name and build a $6.58 website. That left him with just under $10 in his bank account.
He brought a co-worker on as a formal advisor. He hired a freelancer to work on the website, and spent 80 percent of his paychecks developing it. Meanwhile, Lillie continued to learn his business model manually. As the process matured, he began promoting the website for people to sell and buy produce within their local community. It’s a similar marketplace system to Uber or Airbnb. The business makes money through a fee added to purchases through the service. Anyone from any community can download the mobile app and begin selling their homegrown produce.
“All you’re doing at the very core is validating the idea, and then you’re figuring out the system,” Lillie said. “From there you can add technology to then automate that system and then grow and scale.”
He doesn’t have a rich uncle so he is finding other ways to raise capital. Vinder entered various business competitions. The company took a first place, $10,000 prize at the Silicon Valley Business Plan event. At Food and City by South by Southwest, the company was placed as one of the top 15 for agricultural supply chain innovation.
Lillie has attended many angel investors meetings, taking two buses and a ferry to meet with investors and learn about the process of raising capital. He opened an initial funding round, with investors mainly coming from his friends and neighbors in Port Townsend.
“It’s massive,” Lillie said. “I don’t take that lightly. It’s people of my community. It’s my neighbors.”
Currently, Vinder is raising capital through equity crowdfunding and has raised over $135,000, and Lillie feels the business is poised to scale.
In many ways, embarking on this rural startup is not much different than setting off on that 2,000-mile hike. There are challenges and days similar to walking alone in the blistering heat or trudging through a heavy blizzard. Yet, there is also a level of freedom and exhilaration as a rural entrepreneur walks that less traveled path and explores the limits of his or her ability.
A new business doesn’t necessarily need a whole lot of money to get started. The first step is to test the idea on a small scale and see if it holds water, according to Lillie.
“Even if you don’t know anything about business or the law, or raising money or all of the stuff that can seem overwhelming, just start, and then ask for help,” he said. “Ask the town for help, and they will reciprocate.”
Rural communities can cultivate this by providing resources to their young entrepreneurs, Lillie said. Small towns need intellectual capital that provides a support system for young, ambitious community members.
“You want to be able to foster that ambition within the community and help them stay,” he said, adding that with today’s technology jobs can be created in any area as long as there is a good support system in place.
And, in some cases, some extra apples to sell.
Related
Episode 23: Rural Startup Connecting Growers to Local Buyers