Company: Buschman Corp.
Start-up capital: $500
You gotta hand it to Tom Buschman, who exemplifies bootstrapping in its raw and pure form -- opportunity seized and exploited with old-fashioned elbow grease. Buschman spied his chance in 1978 while working as a maintenance electrician at Avery International, a paper-manufacturing plant in Cleveland. The company was experiencing a 50% failure rate for metering rods, critical components of the paper-coating system. Buschman said he could make better rods, and Avery promised to buy them.
Buschman had little money, but he was clever with machinery. Keeping his regular job -- and using $500 in overtime pay -- he scrounged in junkyards for materials to construct a little factory in his basement. "There's a feeling you need tons of money and bank financing and all kinds of crapola to start a business," he says. "I traded hard work for capital. If I needed a tow motor, I'd find something at a junkyard, change the engine and transmission, and rebuild it. I had the time. What I didn't have was the money. Later, you have the money but not the time."
Within a few months he was selling Avery rods with a mere 2% failure rate. To augment his business with Avery, he advertised in trade journals. Buschman had precious few customers when he quit his Avery job to go full-time on his venture, but he and his family lived frugally. "I drove an old black-and-white police cruiser," he says. "It had glue in the shape of a sheriff's badge on the doors, where the stickers had been. People called it 'Car 54.' I used to go to business meetings in a coat and tie and park way down the street -- that's how embarrassing it was."
While Buschman labored in the basement, his wife handled the books.
When space got tight, they moved to a ramshackle house on a commercial lot. "We were still bootstrapping," he recalls. "I redid the house myself and put up the factory building pretty much alone." The company had outgrown two more locations by 1992, when Buschman purchased a huge old warehouse in Cleveland. "We've got 14 acres under one roof now," he says. "We won't have to move for a while. And we've set up a new company by leasing out most of the place to other businesses."
This article was adapted from material that first appeared in Inc. magazine in August 1995.