100 Percent Bootstrapped 10 Million Dollar E-Commerce Company: WaterFilters.Net CEO Jamin Arvig (Part 2)

Sramana: So you decided to base your e-commerce business on water filters because of the potential of the industry?

Jamin Arvig: We saw it as an exciting industry and a future market. It was also coupled with other growing markets, including the green industry. Every water filter we sell saves many water bottles. That is obviously a big theme in the green movement. Water filters also offer cost savings. Anyone who is interested in quality water can save a lot by purchasing a filter.

Sramana: You had all of that figured out when you were starting this company in 2002?

Jamin Arvig: They were trends I had identified. I can’t claim that I was an absolute expert on water at that time.

Sramana: Did you figure out all those trends to find the business opportunity, or did you recognize the trends along the way?

Jamin Arvig: Those were trends I had seen at the time. The one that has been a greater factor than I expected is the green movement. I did not expect that to take off like it did. I thought the health and fitness trend would be good, and it did not take off anywhere close to what the green trend did. Given the number of overall markets that water filters touched, I felt it was a conservative business to get into.

Sramana: In 2002 when you decided to start with your e-commerce water filter business, what were the first few things that you did?

Jamin Arvig: Practically speaking, my wife and I were both hard workers. We did not mind contributing sweat equity. We were OK with working hard without making any profits for a while. We were not risking much of our own money, and we have bootstrapped this business entirely. In 2002, we were able to purchase what we needed to begin operations with very little capital. We used our own savings to do that, and my wife helped with the programming of the site.

Sramana: How much inventory did you purchase initially?

Jamin Arvig: We purchased very little. At that time, the expectations of the consumer were not such that they needed it to ship immediately. We benefited from timing. We bought the popular water filters, probably about a thousand dollars’ worth.

Sramana: On your online catalogue, did you show more inventory than the filters that you actually had in stock?

Jamin Arvig: We started from nothing, and it was a gradual thing. Like a lot of startups, we did not go from 0 to 60 immediately. Even though we grew over time, we did list items that we did not have in stock as long as we had good solid relationships that would enable us to get them for the customers in a timely manner.

Sramana: Does that mean you had relationships with distributors and you were able to put some of the catalogue items on your site because you had that distributor relationship?

Jamin Arvig: Yes, that is correct. That was critical for us. All of the trends in the world meant nothing to us if we could not source the water filters. We knew some people in the industry and locked down some relationships before we launched the business.

Sramana: How did you know these people?

Jamin Arvig: My wife had some connections in the water industry through family and friends. We were able to depend on those contacts for lead time and dependability, not necessarily on pricing.

This segment is part 2 in the series : 100 Percent Bootstrapped 10 Million Dollar E-Commerce Company: WaterFilters.Net CEO Jamin Arvig
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