The Indicator from Planet Money - Entrepreneurship On The Rise

The coronavirus has been responsible for massive business closures...but at the same time, Americans are starting businesses at the fastest rate in more than a decade.

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Hey Melinda's indicator from Planet Money. I'm Carlos Garcia and I'm here today with Brittany Cronin, Brittany. Hey, hello, Brittany, you are a producer with the show. And today. You've brought us a lovely story about what it takes to start a small business. Give us some background here. Okay, so I think we should start with the brains behind this business Rayshawn and LaShawn Middleton from Laurel, Maryland. You guys go way back. Is that right?

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Yeah Yeah Usher on Amazon are both train chefs, but at the beginning of the pandemic they lost the restaurant jobs in as the months went by and waited and waited for the restaurants reopen they started to get worried what if their jobs just never came back all we know is restaurants, so it was one of those things with whether or not are we going to go back to the restaurant and not be guaranteed a job so we were like we have to figure something out and then one day they get the site yeah, they're hungry and they decide what they really want or some steamed crabs but it's late summer it's pouring rain outside and they don't want to leave home to go get the crabs lazy and didn't want to go get the crabs and realize no one delivered steamed blue crab in this is Maryland

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Sean lashondra, like wait a minute. We're train chefs. We've grown up on crabs. Maybe we can just do this ourselves and make some money off of it. We're born and raised and we've been eating crab since we were babies like our family eats crab. So we've been taught how to eat crabs if you were a kid. So we already had, you know, Crab Connection, you know, because the it's it's R life is what we we eat it every week with restaurant shut down. This seemed like the perfect opportunity to start a crab delivery business. They wouldn't have to pay for a restaurant space or a commercial kitchen and they could steam the crabs at home and just do their own delivery. So they set out to create a business which like to me just sounds so terrifying starting a business in the middle of a huge economic crisis. I would personally have faith in you doing that pretty but I understand that makes one of us, but you know, it's not just Rayshawn LaShawn. This is happening all over the country according to the

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US Census Bureau Americans are starting businesses at the fastest rate in more than a decade how to start a business with find out what it took for Rayshawn and LaShawn Middleton to start and grow their own business in these less-than-ideal circumstances.

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Okay, so Rayshawn in the Sean Middleton decide they want to start a steamed crab delivery service and to do that. They need two things a massive nut and a huge Boiling Pot is what they need right now probably but also the answer is always supply and demand. So in this case, they needed a supply of crabs and demand in the form of customers. So their first move was to go talk to their crab connections the people that had gone to for years for fresh. Crab. Hey listen, do you guys actually you know wholesale and do you sell to businesses and they actually said yeah they do. So then we told him my situation someone that we were interested in starting a business and they were so eager to like work with us and help us reach on Amazon had some money saved up may use that money to buy their business license and a few other items that they would need like

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Coolers and delivery bags plus their mom to Grandma and their aunt kicked in three hundred bucks in start-up money trap simple and easy. They got the crabs. No problem step to find customers. That was a little trickier let people know about it. So they decided to make an Instagram account and to put some flyers up in their neighborhood when it came time to actually go out and announce their business to the world. LaShawn remember is feeling kind of freaked out I had woke up and I was like, okay, I'm going to back out who's going to put the Flyers up but I was like shaking I was like so nervous cuz I was like, this is ridiculous. Like I'm going to start a business like it's it's one of those like moment would you like am I really going to do this. It's kind of touching. It's like they're putting themselves out there. I love that. Yeah, so they did it they went out and they're putting up the Flyers. They have low expectations. This is just a one

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And they're pretty immediately confronted with the one thing. They hadn't yet done. The last door was my neighbor and she was like, okay put me down for dozen. I was very serious mind you we didn't even have prices job the uncertainties of starting a small business. They just made up a number incredible pulled it out of The Ether. They sure did a dozen steamed crabs for thirty bucks and to put that into perspective for you most places sell extra large battles $400. We sold it for $30 and because we not knowing cuz we just didn't do any research you just like it and so then when you when people start biting your lightweight really this is actually working. Oh wait wait, we actually we are actually have to get it together very strong and LaShawn realize they needed to come up with a price.

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It would allow them to cover their costs and still be competitive. So they did a little bit of market research. We looked at all of the competitors or competitors.

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The boat place to get crabs but unlike some of their favorite places reach on the show had really low overhead. They were cooking out of their own kitchen and doing the wrong delivery. So they did what any Savvy young entrepreneur my do they undercut their competition. We will go and look and I like how much do they charge for extra large and then they charge $99 so we was like, okay well with your new they've been established we have to come cheap. So we sell it for $75 and on top of that we deliver so people are just like, oh, it's a steal the word got around quick for R&L crab. They receive 20 orders in their first week for Neighbors family friends friends of friends and it grew from there as more and more people started to hear about the business and I found a steady Rhythm they deliver 4 days a week Thursdays through Sundays and they get about 10 orders a week, which is future orders per week than when they started because it's no longer crab season, but these are

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Big orders people calling asking for a whole bushel of crabs, which is about 60 extra large crabs 60 crabs in one order. Not bad Rihanna LaShawn. Do you have jobs on the side that they used to pay their bills? Like they act in commercials and they invest their money and that allows them to put all their profits from Arendelle crap right back into the business about $500 a week. They're saving up to buy a food truck and they also want to expand their delivery service to apps like doordash or Postmates, especially by the time crab season starts in March your Rayshawn Lashontae. It was really hard losing their jobs made them feel like they were dispensable and it showed them that as long as they work for someone else. It could really be out of a job with a snap of a finger. So in a way losing their jobs kind of became an opportunity to get out of working for other people to do their own thing and be their own boss and that's something that they're really proud of us.

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Britney thanks so much for this episode. This is fun. This episode was produced by Nick Fountain and Dave Blanchard and it was fact-checked by Sean. Saldana indicator is edited by Patty Hearst and it is a production of NPR.

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