PTM 005: Making Extra Money By Turning Your Hobby into a Small Business with Jeff Block of JustPaperRoses.com

Welcome to the Part-Time Money Podcast, Episode 5: Making Extra Money by Turning Your Hobby into a Full-Time Business. I am your host Philip Taylor, creator of PT Money Personal Finance.

Part-Time Money Podcast is designed to help you discover new and interesting ways to make extra money and to learn the ins and outs of those money-making methods, not from me but from the people who are actually doing the work. Along the way hopefully you can pick up a few entrepreneurial skills to help you in whatever money-making pursuit you take on.

Philip Taylor: Alright. Today I am speaking with Jeff Block, founder of JustPaperRoses.com. Jeff’s site provides custom-made flowers for anniversary gifts and other occasions, but it was really a business that was started because he had a hobby, and that was origami and creating flowers out of paper. I am going to let him explain a little bit more about that and talk about his business, welcome, Jeff. Glad to have you.

Jeff Block: Thank you, Phil. Thank you.

Philip Taylor: So exactly what kind of products are you making for people at JustPaperRoses.com?

Jeff Block: Well, the business always morphs, and that is a topic in itself. Somebody years ago created these themes for wedding anniversaries. Most people will know the first anniversary is paper, the twenty-fifth is silver, and the fiftieth is gold, but very few are going to know that if you go to a Hallmark calendar you are going to see the first is paper, the second is cotton, the third is leather, the fourth is fruit, and it goes all the way through fifteenth. So, what I have done is I came along, and my hobby was origami, which is playing around with paper, and I created some paper flowers. I am sort of in the middle of the story already about the business, but when I put them online, people started buying them. To this day, Phil, I really do not know whether I knew the first wedding anniversary was paper or one of my first customers told me that is why he was buying it, but that is our niche. We have created actually for 20 different anniversaries the material flowers for them.

Philip Taylor: Okay. That is great. Yeah, I have definitely heard of that anniversary calendar you are talking about. So, many of your customers are first-year anniversary husbands or wives looking to give flowers to their spouse, right?

Jeff Block: Well, it started out with first, and again I am sort of telling the story from the middle of the story outwards, but it started out with paper in the year 1999/2000. Then 2001 really started taking off. I come from a family of entrepreneurs, so I kind of looked at 4 men in my family who are all deceased, but I look at them as my mentors. By the time 2003 came, I said to myself, “I’m really doing a disservice here. Phil (I will use you as an example), a great customer from first anniversary told me his wife loved the paper roses. The second year I know the date of your anniversary, I have your e-mail address, and I am doing nothing for you.” So in April 2003 my wife and I got real cotton from the fields of Tennessee thinking that is what we would sell. Well, those are dirty and nasty. So, I created artificial cotton roses and we put them on the internet to see if they would sell. I figured if I sold 5 of them for the month, I would be happy. Well, we sold 25. So, the rest of 2003 was spent filling up in materials, leather through aluminum (the tenth). And, now we have repeat customers, and it is not just for the first anniversary. We have customers coming back year after year for whatever the next material is.

Philip Taylor: Oh, I love that! So, you have sort of taken that calendar and then built your business on top of that. That is genius!

Jeff Block: Exactly. Exactly. There is one common question if you ever have an astute business person ask you about your business. What you are generally going to hear is, “Do you have repeat customers, and do you have referral customers?” The reason of that is (I do not care what business you are talking about) gaining a customer the very first time is very expensive. It is marketing, and it is advertising. Getting a customer to repeat or refer is close to zero cost. So, until you have a business model that has repeat or referred customers, I do not want to say you do not have a business because there are some businesses out there, you know maybe even residential real estate brokers, who are like a one shot even though they all talk about referrals and everything. There are a lot of businesses out there that are one-shot deals, but it is very difficult. You are always trying to gain a new customer. In 10 years now we have had 35,000 customers, and at this point in time I really do not even know where they all come from, whether it is referral or how they heard about us.

Philip Taylor: Wow! Yeah, I am sure you have a lot of listeners excited about your business, so let us back up a little bit and talk about your hobby and sort of how that translated into a side business idea. So, maybe just tell me a little bit about your hobby of origami.

Jeff Block: Well, let us go back to the early 1990s. I had a hobby of origami, which is the traditional art of Japanese paper folding. Generally, you work in instructions, and depending how practiced you are, you can get more and more complex. I was in the corporate world, and my last corporate job was in 1992/1993. I was the head of marketing for a subsidiary of a Fortune 500 company. Our subsidiary was a nice little company. We did about $40 million a year and had a couple hundred employees. And, the parent company sold the subsidiary to one of our major competitors. Now, at that time, Phil, I had created just sort of for fun a heart-shaped fold out origami greeting card, and one of the things that happens to all of your listeners if they are hobby related, is when you are good at something, all of your family and friends around you are always going to say, “You should be in the business.” Well, if somebody is a good cook or a good chef, they say, “You should open a restaurant.” Well, being a good chef in your home is completely different than opening up a restaurant. They are 2 different things.

Philip Taylor: Right.

Jeff Block: So, I got 2 weeks’ notice, and I had a choice. My choice could be to dust off my resume and see if I could get another corporate job. It was a neutral divorce, it was not just the selling, but I am not really a team player. I am not really into meetings, meetings, meetings and doing the corporate thing. So, I said, “I want to see if I can make a go of this greeting card company, make the greeting card into a greeting card business.” It was designed specifically for Valentine’s Day, and I also decided at the same time because I had 2 other hobbies (I like to eat at least twice a day, and I like to sleep with a roof over my head), that I would drive for a limousine company. This was down in South Florida. This is another thing entrepreneurs can do; we can grit ourselves to say, “Okay, for 6 months I can do anything.” Phil, you could tell me right now for 6 months you have got to jump rope 100 times a day. Well, I can do that – for 6 months.

Philip Taylor: Right. Right.

Jeff Block: So I set my mind that in 6 months the greeting card business would be up and running. Well, 5 years later I was still driving for the limousine company. The greeting cards sold very well locally, but nationally I got nowhere because I was up against Hallmark and American Greetings. By that time, now I was into 1999, the internet had come along (Al Gore invented the internet for us). I had a very crude website, just really informational, like an online brochure. You could not really buy anything there. It was showing my fold-out heart cards, and I did other shapes that folded out. I also put my origami orchids on there which are on the current website too. That is my art. I make origami orchids out of hand. Of course, everything is by hand. It takes about 3 to 3-1/2 hours for me to make 1 arrangement, and then I sell them for about $200. Well, those were on the website, and at the same time I was teaching kids for 2 weeks at a summer art camp. I was the origami instructor. Have you yourself ever seen anybody do a cocktail napkin rose, take a napkin and twirl it around their fingers?

Philip Taylor: I know what you are talking about, but I do not think I have ever seen it up close, no.

Jeff Block: Well, you do not hang around at enough bars I guess. Millions of people do it, and a friend of mine in 1990 showed me how to do it. Now, again, this is 10 years later in 1999. So, I am showing the kids how to twirl a cocktail napkin rose around their fingers, and I remember it like it was yesterday, Phil. I remember the little boy. I bent down to help him, and that was the light bulb moment of my life. I thought, “Why don’t I take that high-end art paper that I make my origami out of and see if I can make an upscale cocktail napkin rose?” You know, instead of using a napkin, I use the paper, twirl it around my fingers. Instead of using the napkin to create a stem, I would create a wire stem and floral tape. That night I went home, and that night was the birth of (I didn’t name it yet) Just Paper Roses.

Philip Taylor: Okay.

Jeff Block: I put some red paper roses on the website, and they started selling. Another friend of mine really enlightened me on the marketing side. I was sort of like, “Why are these selling?” He said, “Well, Jeff, your origami orchids are beautiful, but a man buying those for his wife, he’s not quite sure she’s going to like them.” You know it is a very eastern taste, a very minimalist taste. He said, “But roses are roses are roses, so a dozen red paper roses, that’s a no brainer.” So, that is when I changed the name of the business to Just Paper Roses, thinking I would service only the first anniversary, and I have already told you the story of how we got into the second and more. That was the start of the business. I use the word morph a lot, and that is very important for businesses because this did start as a greeting card business, and now we are selling not only these flowers that I have created, but we are selling some ancillary products and other products that are in the same themes. You know, there are some stories out there, like the Shell Oil Company that is in the oil business. They started out actually trading seashells. That was the origin of their business. So, businesses do morph, and an entrepreneur has to be comfortable with that, has to be accepting, just go with the flow the way the business goes.

Philip Taylor: So, you mentioned you spent about 5 years doing the greeting cards and the limousine service driving. So, during that time period how was the greeting card business able to support you? From a revenue perspective on a monthly basis, what were you getting in generally?

Jeff Block: Well, on a revenue basis it was not more than a couple hundred dollars.

Philip Taylor: Okay. And then once you switched to the roses, how soon were you able to leave the limousine job?

Jeff Block: Well, the switch came when I had about a $1500 month, and again that is gross revenue. I had to pay some business bills out of that. That is when I realized that I had something sustainable that I could put full time into it.

Philip Taylor: Awesome.

Jeff Block: It really took until June 2001, which is when I really chronicle the start of the business because that is when I learned about Paper Click. It was goto.com, and then it became Overture, and then that became Yahoo. Google AdWords came in along the way. That is really what spiked the business. I should mention at this point it is 100% internet business. I have never had a retail store. I do not want a retail store. It is a niche business that does not really enough customers in a little geographic area to survive. As soon as you are on the internet, you are national, you are international. We are like a UPS commercial; 100% of the orders come through the website, and we work out of a home office. Everyday UPS picks up 20-25 packages from our front door, shipping all over the country, all over the world.

Philip Taylor: Amazing.

Jeff Block: I think so.

Philip Taylor: Well, it is definitely an impressive story. What skills do you think make you successful at doing this?

Jeff Block: Well, again I come from a family of entrepreneurs. First of all I wrote a book about the business called Steel Wool on a Stick: My Hobby on Steroids. Sometimes I think that entrepreneurs can learn (that it is a learned skill). Other times I think it is genetic. There is one quote I saw years ago on a Harley Davidson T-shirt, and I just think it so applies to being an entrepreneur or what is an entrepreneur. That quote said, “If I have to explain it to you, you wouldn’t understand.” That is just so insightful because I really think that my skills I learned or I genetically learned from my upbringing. I grew up with my family, my grandfather and father, who were in the costume jewelry manufacturing business. If that business had survived, I would probably be a jewelry designer with them, a packaging designer. That is my area of strength – I design these products, things like that. You know the persistence (that is something else that I am not sure can be learned or not). I could probably chronicle about 35 times where I just wanted to quit and throw in the towel, but you just persist through those. In my case the business kept growing. I do not claim to have any particular artistic talent. You know I do not want to say I am the greatest origami artist out there because I am not.

Philip Taylor: Right. Right.

Jeff Block: There are others out there who far surpass it. In terms of the entrepreneur again maybe the parallel is the art. There are some great artists that you call them starving artists for a reason. They do beautiful art work, but then it sits in their home or in their gallery, and they never get out there and sell and market. Well, I am a good combination of both because as beautiful as my stuff is, if nobody buys it, I will be a starving artist.

Philip Taylor: Right. Right. Yeah, I am reading the book E-Myths, and you are echoing some of the basic principles of that book that talk about finding the balance between your technician, your manager, and your entrepreneur that all live inside you.

Jeff Block: Exactly.

Philip Taylor: Most people start a business when they are the technician, and in your case, the technician skills were your ability to make the flowers. It sounds like you had a good balance of managerial and entrepreneurial skills to be able to grow this business.

Jeff Block: E-Myths Revisited by Gerber is one of the 12 books that I mention in my book as a reading list. I am right now on that second level. My adult stepdaughter works for me full time. She is in charge of production. Her job description is that as long as all of those packages are on the steps by the time UPS gets here, then she has fulfilled her job description. What it does is it frees me up to work on the marketing of the business. As far as Gerber, I am on that second phase now where I do not yet have the business and I am the manager. It is funny, 3 years ago when we moved here, that is when my stepdaughter started working for me full time. I always had part-time workers in Florida, but here I wanted her full time. She asked me what was my job description, and I said, “Well what I want my job description to be is a daily cell phone call to you saying, ‘Shannon, how much money did we make today?’”

Philip Taylor: So Jeff, someone who might be wanting to start an online business such as yours, can you give them some advice as far as setting up a website and how to drive traffic to the site to create sales?

Jeff Block: Well, it is really a lot of basics. First of all, you can start very inexpensively with your own site. I know I have done a couple of totally unrelated sites through GoDaddy.com, and it is literally only a couple of bucks a month to set up a site. I am pretty sure Yahoo and PayPal and a lot of others have these merchant kinds of sites. I started up long enough ago that I am my own credit card merchant, so I do not need their services for taking the money and that kind of stuff.

Philip Taylor: Okay.

Jeff Block: But basically you have got to start some place, and the beauty of the internet is it is very easy. Somebody who has an idea or is a home hobbyist, literally in a few hours they can be online. Driving traffic is sort of the holy grail of search engine optimization (SEO), and I have actually done a very lazy job about it. It is amazing we have come so far because I am not top ranked when people search for different things, but I do have a couple of affiliates that are top ranked, and they feed business to me.

Philip Taylor: Okay.

Jeff Block: Also, I have one particular gift listing site. It is called FindGift.com. We get about 25% of our business through them.

Philip Taylor: Okay.

Jeff Block: So there are a lot of different ways to bring in your visibility. Of course, one of the easiest things to do because even though I am unique, there is nobody who does our products directly. There are always ways. For example, there are other businesses that participate in the first anniversary market. One of them does framed poems. Well, the poem is a piece of paper. Another does stock certificates. Another one does a message in a bottle. These are businesses that I have known about for 10 years because I have seen them when you Google first anniversary gift – I see my competitors there. So, if you have a business or a business idea, you can see what else is out there. One other thing I would like to note about that comment is so many entrepreneur wannabes have these ideas of, “This is such a great idea. Nobody else is doing it.” Well, that is sort of a yellow flag for me. Sometimes there is a reason why nobody else is doing this.

Philip Taylor: Right. Right. Yep.

Jeff Block: So, just a void in the marketplace is not necessarily going to create your success.

Philip Taylor: Right. So, what other mistakes do you see people make when they are trying to make money with a business like yours?

Jeff Block: Well, what I see because I am basically if you would label it a business, it is an arts and crafts business online, arts and crafters make the mistake all the time of, “My stuff is so beautiful, people will buy it.” Well, that may or may not be true, but it is a very limited and a very competitive environment. When you go to any arts and crafts show, you are going to see the busiest booths are women’s jewelry, women’s handbags, and women’s clothing. The other arts and craft things, the pottery, the flowers, the wall hangings, those are very difficult sales. The reason the women’s jewelry, handbags, and clothing have the best sales, the best traffic, is because there is a utilitarian part of their business. There is a use for it. One of the mistakes that arts and crafters make again is, “My stuff is beautiful.” Well, you really have to figure out a niche use for it. Then there are other ways to really work at your own product, so we have a wood crafter who makes wood vases for us, and we buy about 700 vases a year from him. While he could go to all the arts and crafts shows he wants, he would never sell 700 vases in a year. We buy wholesale. You know he found a niche, and he has a couple of other wholesale places. He is happier than can be. He loves the woodworking, and he does not even do the shows anymore. He has a couple of wholesale outlets for his craft.

Philip Taylor: I see. That is good advice. Well, I think that about wraps it up. Any other thing you want to share today, maybe promote your website or the book?

Jeff Block: Well, again the website is JustPaperRoses.com, so I invite everybody to go there and see what we have. The book is listed there for sale. The long-run advice I could talk to people for hours but also short-run advice because entrepreneurship really is about just getting out there and doing it. We can all have mentors. We can all have friends. We can have mastermind groups, things like that, but there is nothing that is going to replace the personal persistence. I have gotten to the point, and you are meeting me at the point in time, where I do not consider what I do to be W-O-R-K. It is just what I do with a lot of my hours each day. I have joked with other people when they talk about entrepreneurship or working for yourself versus a job/a career, and I say well the thing about being in your own business, is the pay really sucks, but you make it up with the long hours.

Philip Taylor: I would agree with that.

Jeff Block: I do not even keep track of the hours I put into the business.

Philip Taylor: Well, that is good. I appreciate you sharing a lot of good advice, and I know some people listening will be definitely thankful to you, so I appreciate you coming on today with me, and good luck with the future of your business.

Jeff Block: Very good. Great speaking with you.

That does it for this week’s podcast. This has been Philip Taylor with the Part-Time Money Podcast. You can contact me at PT@ptmoney.com or just visit me online at ptmoney.com. Again, thanks for listening, and see you next week.