🔍
The bootstrap entrepreneur taking on Google & Apple - YouTube
Channel: Freethink
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And I go back to them, I
say, “That's just not right.”
[13]
- Brad Johnston spent
his life savings
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to make this
compact computer.
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- Education today,
if you're wealthy,
[19]
you can get the best
education ever.
[21]
There are over 300,000
educational apps out there.
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If you have a high-end computer and high-speed internet
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and everything else, right?
[29]
But if you don't have
that stuff,
[30]
you are being pushed
further down the chain
[33]
than ever before.
[35]
- So Brad founded Tanoshi,
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a computer company that aims to help close
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the digital divide.
[40]
- We wanna give
underserved communities
[42]
exposure to coding.
[44]
- But will they
reach profitability
[46]
when investors don't
buy into their mission?
[48]
- I really believe it can.
[49]
I think we're gonna be a hundred times-return company,
[51]
but we're gonna be
double bottom line,
[53]
which is profit and purpose.
[55]
We're not giving up on
the mission.
[57]
- You just started your
dream business.
[59]
How much profit will you need
[60]
to pay your basic living
expenses like rent and ramen?
[63]
This is a show about the
economics of entrepreneurship
[66]
and founders making
their dreams a reality.
[69]
This is “Ramen Profitable.”
[75]
- Brad Johnston risked a lot
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in order to start his
company, Tanoshi.
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They make affordable
tablet computers for kids.
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But in order to understand why he did it,
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we need to go backwards in his story.
[90]
In 2014, Brad had an eye-opening conversation
[93]
with his mom and sister;
both were teachers
[96]
at low-income grade schools.
[97]
- This is one of the first years
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the nation started implementing standardized tests
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on computers instead
of by hand.
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And what my sister and my
mom both discovered was,
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there was a lot of really
smart kids in their class
[109]
who were struggling
on these tests.
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The majority of those
students were low-income.
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There was no computer
in their home.
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- At that time,
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Brad was an analyst for
consumer electronics,
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and he was starting to
notice a really strong trend
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within the grade
school demographic.
[124]
- The use of technology
was growing
[125]
year over year over year.
[127]
And so often, that led
to developing technology
[130]
that was built for the
more affluent
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because they could afford those products.
[134]
So a lot of great
learning technology,
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at first when it comes to
market, it's pretty expensive,
[139]
and, unfortunately, poor
kids get left behind.
[143]
So, in the back of my mind, I said, “Okay, this is an
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opportunity for a business,
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and it's also an opportunity
to close learning gaps.”
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At that point, I think I had
about $150,000 to my name,
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and I spent it all launching
this company.
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I mean, I bootstrapped
the company
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the first three years
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all out of my own pocket,
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multiple trips to Taiwan,
did a lot of prototypes.
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- It took three years,
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but he finally landed on a quality product
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he could sell for under $200.
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- It's basically a 10-inch tablet with a detachable keyboard—
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does everything a Chromebook can do,
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but really the benefit to it is
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we only preload
educational content.
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All the third-party
educational content
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we preload with partners,
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there is nothing in there
capturing any information
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about the child.
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Then we have age-appropriate parental controls.
[190]
- But getting a factory
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to produce his first round
of computers to take to market
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was almost near impossible.
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- The minimum order for
most of these factories
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turned out to be about
3,000 units.
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Average cost per unit let's say, you know, $120.
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And I said, “Well, okay, that’s gonna be a challenge.”
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But finally going after
factory to factory to factory,
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I met one partner,
sold my story,
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and he said, “You know
what Brad,
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how much can you
commit to?"
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And I said, you know, “Maybe up to 500 units to launch
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based on what we
have available.”
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And he said, “I'll make
that happen.”
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When we finally launched on
the market, we sold out fast.
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- Selling out just launching
a product,
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it's such a great feeling,
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'cause we knew that we had
a demand for our product.
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- But they had a problem.
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They didn't have enough
money to place another order
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of computers until after
they had sold out
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of that first round.
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- We kept having months
and months of no income
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as a company waiting for
the next supply to come in,
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and then once we sold that,
then we could reinvest it.
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- And they did that,
over and over again.
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- Today, we're gonna teach
a coding class
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at Franklin Elementary
in east Oakland.
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The reason we're here
is we've actually taught
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coding classes both
in Oakland
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as well as in Silicon Valley,
right around the corner.
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But huge disparity in
access and opportunity
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to things like digital learning.
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- Hello everyone!
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We are very, very excited
to be here with you today.
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Who knows what coding is?
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- We're very close from
being profitable.
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We just need a little bit
more on the investment side.
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We've tapped out our
friends and family,
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we can't go back there.
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- We're gonna code this.
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So let's get going.
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- Because we're a
startup business,
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we don't really have that business history
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that banks could look at,
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and so all they look
at is, ‘Okay, what about
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how much personal collateral
can you put up on a loan?’
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I'd already spent my
life savings
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bootstrapping this company, so when you go down to zero
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there's not much left
in the bank.
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And that's really what's
throttled us since day one.
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To date, we've raised
$250,000 total.
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We've made $4,000,000
in revenue.
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We know how to make money;
from a little, make a lot!
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And unfortunately, we're
yet to find
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that investment community
and that banking community
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that will support what
we're doing.
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It's just, the sky's the limit
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once you get the right
people behind you.
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Start over at the beginning.
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- Today, they've sold
over 17,000 computers
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and they keep selling out.
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And numerous private
equity firms have offered
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to acquire their company-
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- For a very small amount
of money.
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Our goal is: yes, eventually,
we'd like to sell the company,
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but, number one, we wanna
make sure when we sell it
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it goes to someone who
carries on the mission.
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There’s gaps taking place in
our public education system
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that are not going to
fix themselves.
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- Oh look, you did it!
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- Whenever we hear back from parents about their child
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is motivated to learn,
having fun learning.
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- Yeah, you outsmarted me!
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It's cool to hear that.
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And we're like, “Okay, we're
on the right path.”
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And so we're gonna continue
to do tech for good,
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do tech the right way.
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