Know Y: Part II of Young and Entrepreneurial

Alright, sorry – where was I before my European hiatus? Ah yes. Entrepreneurs! Young ones! People that walked 16 miles to their shops uphill both ways in debt up to their eyeballs. Right.

I had learned from Sava, Curtis, and Al that the tough times are just water under the bridge, especially for Gen Y business owners. But something told me that they had something special, and when I spoke with the owners of Ghostly International, Henrietta Fahrenheit, and FOUND Magazine, I confirmed what it was. Being a small business owner requires shutting off that section of the panic button in the brain and just reacting. Some call this intuition, others call it calculated risk – and it's happening a lot more frequently on the coasts. Here are three individuals taking risks right here in Michigan.

Four: Sam Valenti IV – Ghostly International

Ten years ago, Sam Valenti saw possibility in this region. He started his record label in Ann Arbor because there was under-represented music talent in town. A talent pool here that the music industry had only dipped its toe into, or was ignoring completely.

Ghostly International claimed its mission in providing work of high quality, integrity, and individuality. Rather than talking much about the nuts and bolts of his business, Sam riffed on the philosophy of running it as a young person. Having gone to school without a defined career path (he studied art history), Sam felt that Gen Ys who aren't sure of their direction should hedge their bets and do something they find interesting. Otherwise, they won't be able to break through the wall that weeds people out.

"In Med School, that's usually Organic Chemistry. In starting a business, it's a million little things that come up and require you to have faith, a belief in yourself, and persistence."

This formula seems to have worked for Ghostly International, whose positive energy and vision has drawn many key collaborators (artists, producers, etc.) to the label. In this way, he's been able to find graphic designers, interns, people that gravitated to the vision and made the company happen.

"The Gen Y audience is interested in being a part of something they can get behind philosophically. I knew I never wanted to be an accountant, so I'm not an accountant. It's less about trying to be everything (as a business owner) and more about knowing what you're not great at. You need to eliminate the crisis of confidence."

With this kind of conviction, Sam falls into the ‘passion business' side of the entrepreneurial coin. On the other side, the business of making a quick buck – something Curtis Sullivan and I had discussed in Part I of this feature.

According to Sam, "The dream of the fast dollar is dead. If you're going to start somewhere, start with what speaks to you individually." Through this mentality, he's built a company vision that is no longer documented, but bases itself in shared values that resonate with many Gen Yers – team-based, quality, integrity, mutual respect, and charity.

At this point, Ghostly is Sam's creation and his vision, but he says, "I am an assistant to this company, and I don't have to be there to impart Zen lessons. The brand is a sensei."

Someone else who identified a need in the area was Jennifer Albaum. And she found it in handmade goods.

Five: Jennifer Albaum – Henrietta Fahrenheit

For Jennifer, it started where most things start and end – with a handmade faux fur hat in the shape of a cat. Jennifer had bought a product online from Portland-based Queen Bee Creations, and wished there was someplace to find handmade goods near her (Ypsilanti, at the time).

Remember that this was back in 1998. No, no Stitch n' Bitch knitting circles…people into crafting were more likely to be in nursing homes than at coffee houses. So you can imagine Jennifer's reluctance over opening a business where the market was still very niche.

"It took me a couple years where I was like, I gotta do this. I quit my job for a year and a half, telling my boss that this was something I just had to do. I couldn't face dying with the regret."

Over the next few years, she wrote and revised the business plan, persevered through two loan rejections from the bank before an acceptance, and Henrietta Fahrenheit opened in 2002. So then things were all gravy. Right?

"The easy part was that there was a lot of interest in the product and the vibe of the store. I'm an extrovert, so I had good marketing around downtown Ypsi and a good sense for telling a story. The difficult part was that it wasn't as easy to sell as much as I needed to in order to make it."

Surprisingly, most of Henrietta Fahrenheit's customers were not coming from Ypsi. Before Jennifer's entrepreneurial debut, she worked for a retail innovation research firm, helping businesses decide where to locate. Through this she knew that, on average, 70% of small business customers come from within a six mile radius, the other 30% from outside that radius. But it was just the opposite in Ypsi and not enough to sustain the business.

Queue the panic button, which Jennifer promptly shut off, and reacted. She made the decision to move to Ann Arbor in Nickels Arcade, where the space was perfect and foot traffic higher. Unfortunately, sales didn't follow suit. As she was scraping the vinyl off the doors, one woman came up and insisted that she could not be closing. "I love your store", she said, "I've been so loyal, even following you from Ypsi to Ann Arbor." This was closely followed by, "Well – I mean, I never bought anything, but…"

The majority of Jennifer's clientele treated the store like a museum, intrigued by the pieces, but not fronting the money to buy. We talked about how we both hoped that a business with this kind of product and character could succeed in Washtenaw. That if avant garde and local products were going to make it anywhere, they'd be able to make it here. Other small business owners told her that she'd probably need to set up shop where there would be more traffic from young people with disposable income.

I disagree. I think Henrietta Fahrenheit was just a business ahead of its time. Proof? Guess who co-organizes The Shadow Art Fair to rave reviews every year? Albaum et. al. Shadow's organizers were all connected through Henrietta Fahrenheit, and the Fair is what Jennifer hoped the store could have been. But she says she has no regrets, and would do it again. Except this time, she's going more mainstream - she wants to do a down-home southern vegan restaurant.

Six: Davy Rothbart - FOUND Magazine

Davy Rothbart's ‘homemade faux fur cat-shaped hat' actually came in the form of an accusatory note addressed to someone named Mario. The note launched his current livelihood. While in Chicago working as a writer for This American Life, Davy found a very angry, yet loving note on his car windshield that read, "Mario - You said you had to work, so why's your car at HER place? (Signed) Amber P.S. Page me later."

Showing the note to friends, he stumbled into this shared fascination people have with little glimpses into other people's lives. After sitting down with his 12-year-old cousin, cutting and pasting all the items they'd found or that friends had found onto pages, Davy's 50 copies of what would become FOUND Magazine were ready for the world. A Kinko's worker with the foresight to know that he was onto something big suggested he make that 800 copies, and they could still do it on the cheap.

Shortly after the release party for the ‘zine, Davy took off for six weeks on a trip, leaving his roommate with entire pallets of magazines that he'd recently re-stocked. When he returned, he thought they'd been robbed. Turned out, people kept coming by, night and day, to buy out every copy they'd printed. Jackpot.

For Davy, the magazine has been an art project over a business, and Ann Arbor was home to the friends that would help get the word out and develop future iterations of the magazine. He moved operations into a house in Kerrytown with five or six roommates (he wasn't sure which, there's always people coming and going), and set up the FOUND ‘offices' and storage space from a sub-basement lovingly referred to as ‘The Cave'. When I asked Davy ‘why Ann Arbor?' for his business, he shared with me an anecdote that makes A2 sound like Mayberry.

"20/20 wanted to do a piece on the magazine, and a producer called the Found gallery store in the Kerrytown Shops, (owned by Mary Cambruzzi, of no affiliation with the magazine) to talk with me. She told him, ‘I don't have his number, but I know that he's down at Kosmo all the time, let me send someone down there to check…it made Ann Arbor sound like this quaint little place where everybody knows everyone else. That's not going to happen in New York."

Another thing that's not going to happen if Davy lived in New York? The freedom to travel the country for months at a time on tour with the magazine, while he leaves his apartment empty back home.

"Paying rent for an empty apartment in New York or San Francisco could break you."

Well put. Davy has also capitalized on his local ties. "Everything's so easy here. Ann Arbor has been very supportive. Students from Community High and UM (both his alma maters) have worked as interns for us, and friends I grew up with help out. To have friends that you've known your whole life working with you creates a real community atmosphere. We'll work a few hours in the basement, then go out and play hoops for awhile."

Davy goes on to talk about the network businesses have built between themselves in Ann Arbor. Of the people I interviewed for this feature, four of them are closely tied. Al does the distribution for FOUND, which Curtis and Jennifer stock and Davy edits. Small world? No – more like elegant symbiosis. I'm sure if Davy ever wanted to make FOUND an indie rock band, Sam would back him up.

On his success? Davy just says, "I feel lucky. It seems random, I guess, but following what sparks your attention [is what counts] – I like found notes, and I wanted to see what other people had found. Many of my friends have stumbled into their livelihoods by following what they're interested in, or were thrown into it by default."

A couple of those friends were FOUND co-creator, Jason Bitner, who now works on, along with other film projects. And Frank Warren, who created Post Secret, where people mail their secrets anonymously to him on handmade postcards.

Davy's ultimate interest is writing, and FOUND has enabled him to start other projects and even get into filmmaking. So wherever they are, I hope that Mario and Amber know just what they started.

Let me return to the question that sparked this whole quest; how well are we equipping Gen Ys to be entrepreneurs? I've learned enough through these conversations to say that young people will take the calculated risk when they're fired up about something. Whether or not they stay here is determined by the sense of community we're fostering.

For Washtenaw, the outlook is fairly positive. Sam found this area to have the under-represented music talent he wanted to serve. Al and his staff are hooked on the lifestyle and affordability. Jennifer's clientele from Henrietta Fahrenheit are now Shadow Art Fair supporters. Davy can't complain that his day includes work on the magazine with frequent stops for street ball in Wheeler Park. Sava has loyal customers with a penchant for local food that she's happy to support.

It all depends on what you're looking for. When you're young, entrepreneurial and just doin' stuff, Michigan is a great place to find whatever that is.

Kate Rose is an MSU grad and native Michigander. Her day job is at Google; her views here are her own. Her previous article for Concentrate was Know Y: Young and Entrepreneurial (a.k.a Doin' Stuff)
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