What do Warren Buffet, Martin Luther King, John Wayne, Walt Disney, Harry Truman and Wayne Gretzky all have in common? In addition to all of them reaching the pinnacle of their chosen professions, they also all started their careers performing the same job.
All of these extremely successful individuals were paperboys*.
At its peak circulation in 1969, the weekly newspaper Grit had a circulation in excess of 1.5 million. Each paper was delivered by a child and all of the money was likewise collected by children and sent to Grit’s main office by snail mail. Despite its inherent inefficiencies, Grit was able to sustain a profitable business reliant largely on youthful labor for over 80-years. Surely a savvy, modern-day entrepreneur can utilize online tools to leverage young peoples’ collective energy and fervor.
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Through Rain, Sleet, Or Snow
Similar to the entrepreneurial attributes described in The Lemonade Principle, a newspaper route not only built character, it prepared children for a lifetime of success. For children with a proclivity toward business, a newspaper route provided an invaluable opportunity to develop the following entrepreneurial skills:
- Punctuality – Newspapers had to be delivered on time, irrespective of the weather, the fact that Sunday papers can weigh several pounds each or the requirement to wake up at the crack of dawn
- P&L – Each route was effectively a small business. Newspaper boys collected the cash owed by each subscriber and dealt with delinquent payers. Chasing down deadbeats is an invaluable real-world experience. They also accounted for each paper and were often financially penalized for any papers which were lost, thereby developing strong internal controls.
- Customer Service – As newspaper boys were the face of their employers, savvy carriers learned to establish healthy customer relationships to facilitate timely collections and generous tips.
- Sales – Many publishers, including Grit, encouraged newspaper boys to create new routes and expand existing ones by aggressively selling subscriptions to non-subscribers. This pay-per-newspaper formula directly rewarded the children’s sales efforts and sparked a life-long entrepreneurial fire in generations of newspaper boys.
Make Money – Get Prizes
Newspaper delivery was not the only way that children in the US’s pre-litigious era could learn and deploy important entrepreneurial skills. Other entry-level experiences for budding entrepreneurs included selling items marketed in comic book ads.
The American Seed Company, encouraged young people to sign a simple “contract” that read:
“Please send me your Big Prize book and one order of 45 packs of American Seeds. I’ll sell them at 20₵ a pack, send you the money and choose my prize.”
In bold print, the ad also states, “Send NO MONEY, We Trust You”. The ad includes two coupons, under the heading “Mail One Coupon Today – Give the other to a Friend”, an example of old-school viral marketing. Wow, a simple contract, a statement of trust and viral marketing, three great lessons for young entrepreneurs.
Since the late 1980’s, opportunities for children to run their own businesses have been supplanted episodic fundraisers in which children are asked to sell a variety of over-priced items, such as wrapping paper, community coupon books, candy, etc. Unfortunately, such campaigns are generally carried out by parents, rather than their children. In addition, the money generated goes to the charity, not into the kids’ pockets. By breaking the link between work and reward, such endeavors do little to foster youthful entrepreneurship. Understandably, the pricing has to be excessive to provide sufficient margin for the product’s producer and an adequate incentive for the non-profit organization. Yet when a child attempts to sell such mis-priced items, the experience is often discouraging, due to the poor cost / value equation associated with such fundraising products.
Boys To Men
Unfortunately, the paperboy has met the same fate as the iceman, milkman and diaper services. Rather than pining for the past, the demise of the paperboy represents a huge opportunity for an entrepreneur who can harness the talents of enterprising 12 – 17 year olds.
In order to devise a job that will accommodate modern youth, one must explore why the paperboy turned into the paperman.
Plaintiff Trial Lawyers – Plaintiff trial lawyers, who excel at bringing frivolous lawsuits against entrepreneurs, found that juries were particularly partial to young people hurt while working, irrespective of the actual culpability of their employer.
Working Parents – The trend toward families in which both parents worked fulltime made it increasingly more difficult for children to also hold down a job, as the parents’ ability to assist the paperboys during inclement weather were diminished.
Nonsense of Entitlement – Families in which both parents worked increased the average family’s disposable income, which was passed along to their children in the form of relatively large allowances and overall largess. As noted in (Non)sense Of Entitlement, a spoiled, privileged attitude is detrimental to an entrepreneur’s success and to a would-be paperboy’s motivation.
Death Of Dailies – Prior to the late-1970’s, most cities had morning and afternoon newspapers. As newspapers consolidated, morning papers became the sole survivors in most cities. Although paperboys decreasingly delivered morning papers, the early hours, hazardous conditions (e.g., darkness during the winter) and the other issues noted above combined to severely limit their numbers. Once the afternoon dailies ceased publication, the century-long era of the paperboy essentially ended.
Web 2.0 Alternatives
There is little disagreement that modern kids spend too little time playing outside and an inordinate degree of their waking hours in front of their PCs. Rather than bemoaning this reality, entrepreneurs should focus on how startups can harness America’s youthful energy and creativity, without asking kids to wake up at 5:30 and slog through the snow, ice, sleet and rain.
The entrepreneur who devises a modern-day online equivalent to the paperboy route of yore, will print money. A number of online sites support the potential viability of a youth oriented business, including:
Auction & Classified Sites – eBay, Craig’s List and similar sites allow users to easily sell items online, without creating a dedicated website or incurring marketing expenses
Outsourced Self-expression Sites – Cafepress, Printfection, Zazzle, deviantART and a variety of other sites allow users to create and sell their creative works online
Affiliate Marketing – As described more fully in Pour and Stir, anyone with basic web development skills can become an affiliate publisher and generate income by creating websites that market a variety of products and services
Search Engine Management (SEM) – Search marketing can be performed by anyone with a rudimentary understanding of Google AdWords. The key to effective SEM is diligent and vigilant review of the keywords and their respective effectiveness.
A clever combination of these existing tools, coupled with a bit of trust and a business model that allows young people to be directly rewarded for their efforts, will create substantial wealth. If it was possible for publishers during the past century to leverage the talents of hundreds of thousands of young people with the rudimentary technology of their day, such possibilities clearly exist in the Internet age.
Calling All Entrepreneurs
The old-world newspaper business model is vanishing. However, with change comes opportunity. No doubt a young entrepreneur will eventually devise the modern equivalent of the paper route. Not only will such a venture generate significant wealth in the near-term, it will also help a new generation of young people establish and develop vital entrepreneurial skills that will serve them well as they ascend to the height of their chosen careers, in the footsteps of Buffet, King, Wayne, Disney, Truman and Gretzky.
* I realize numerous girls also delivered newspapers, but I could not locate any who went on to prominent careers. I hope that my decision to not use an awkward, yet politically correct reference, such as “paper carriers”, does not offend anyone.
John Greathouse has held a number of senior executive positions with successful startups during the past fifteen years, spearheading transactions which generated more than $350 million of shareholder value, including an IPO and a multi-hundred-million-dollar acquisition.
John is a CPA and holds an M.B.A. from the Wharton School. He is a member of the University of California at Santa Barbara’s Faculty where he teaches several entrepreneurial courses. He is also the author of an award-winning entrepreneurial blog johngreathouse.com. You can learn more about his experiences at johngreathouse.com
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