Editor's Note: This article is part of a series profiling companies that started up for less than $10,000.
Initial investment: $9,000
How he spent it: Advertising, website, travel for meetings, legal fees. His first big job brought in $100,000.
2014 revenue: $10 million
Ever since childhood, Alex Moazed wanted to start his own company. In the spring of 2009, as a 20-year-old junior at Babson College, a Boston-area hotbed of entrepreneurial fervor, he took the plunge. In his dorm room, he began racking up $9,000 worth of credit card charges--for website development, advertising, and legal fees--to launch an app services company called Applico. It was a gutsy move, but Moazed thought the risks were reasonable: Apple had launched its app store a year earlier, and he felt confident that the resulting new market for digital services would continue growing.
He also knew that he wanted to save money by being a service company, creating apps for clients, rather than making his own. Moazed had just experimented with being a product developer, building an app to help commuters navigate New York City's public transit system. It was a big success, becoming a best-selling travel app for BlackBerry and turning a profit in a few months--but hiring programmers was expensive. More apps would require even more funding, and Moazed was intimidated by the thought of asking venture capitalists for money. He also knew that outside funding always comes with strings. By starting a service company, he could shift the development costs onto the client, which takes on the risk in return for owning the final product.
Moazed scored his first major client in late 2009, when NBC saw an ad he posted on Google and hired him to develop an app for its TV show The Biggest Loser. The finished product worked beautifully, allowing users to watch clips of the show and track their own calories, and returned about $100,000 for a few months of work. Moazed never even met the NBC people in person: "I don't think they ever knew I was a college kid," he says.
After graduating, Moazed moved back to his parents' Greenwich, Connecticut, home, and landed contracts with education giant Pearson and the National Oceanic and Atmospheric Administration. He asked for 15 to 25 percent of his fees up front; a few employees worked in rented cubicles in Manhattan before Applico opened a full office there. Moazed finally got his own apartment, two blocks from the office, in 2011. Today, Applico has 50 employees, satellite offices in Los Angeles and Boston, and some big clients, including Google and AT&T.
Moazed remains skeptical about accepting money from investors. Applico is more of a specialist developer now, after starting off as a general contractor. If he had to answer to investors, "I don't know if we could have made that jump," Moazed says. "It's hard to do new things with people hovering over you."