Rachel Charlupski built a business that has broken $ 1 million in revenue by providing babysitting services to hotels, sports teams and families on vacation in 18 cities. Relying on more than 2,500 independent babysitters, Charlupski, based in Miami, now serves 18 cities at The Babysitting Company. The high-end service, first launched in 2007, charges from $ 25 to $ 35 an hour for private clients with one to two children and $ 50 per hour for babysitters at private events.
She is part of an exciting trend in which more solopreneurs and partnerships are getting to seven figures in revenue in tiny micro businesses. The number of nonemployer firms—those with no employees except the owners—that hit $ 1-$ 2.49 million in revenue reached 41,166 in 2018, up from 26,744 in 2011—a 48% increase.
Still, these small businesses are not immune to devastating market conditions. When the lockdown hit, demand for babysitting at hotels, resorts and sporting events dropped dramatically, but Charlupski realized people still needed childcare. Where they sought it, however, was at home. That was presenting challenges, with some families’ regular nannies unavailable, due to childcare needs of their own or reluctant to take public transportation to clients’ homes during the height of the pandemic.
So Charlupski and her babysitters got creative. The Babysitting Company offered in-person babysitting to families in their homes but only if they could make a 20-hour a week commitment to work with the same sitter. Given the COVID-19 crisis, she wanted to make sure sitters were not traveling between multiple homes. She also kept in close touch with sitters and families to make sure every health precaution was being taken during assignments.
At the same time, Charlupski began offering clients virtual babysitting services called “videocare,” with her babysitters logging into a videoconferencing platform and playing with the children virtually while their parent worked on the computer or was in the next room making dinner. The Babysitting Company charges $ 36 for a 45-minute session. “We’ve done language lessons, tutoring and sing-alongs,” says Charlupski.
One sitter found that a toddler simply wanted to bring her toy food, one item at a time, and played along, across the screen. Charlupski wondered how it went over with the child’s mom—and found she was delighted and relieved, after days in lockdown. “The mom said it was the best—the child was able to play and interact,” says Charlupski.
Although Charlupski and her extended team are still figuring out how to adjust to a fast-changing business environment day by day, she’s a good example of how pivoting is sometimes the best strategy for a small business right now, given that many states are not fully open for business. If you can’t bring in revenue the way you always have, it may be a good time to try something new.
Pivoting may be necessary if there’s no way to go back to what you were doing and still bring in revenue. Although 60% of small businesses said they would reopen as soon as they are allowed in a Lending Tree survey conducted from May 13-20, another 26% said they are not sure they will ever reopen, and 15% said they will wait a little longer. The primary reason was lack of funds, even with 44% of those applying for Paycheck Protection Program loans receiving funding.
Among those that plan to reopen, many owners are facing tough conditions. 46% of small businesses said they expect fewer customers and lower sales. Adding a new service or product line may help to fill in the gaps.
Here are some ideas from Charlupski and other founders of million-dollar, one-person businesses and partnerships on how to pivot.
Anticipate new needs in the marketplace. Charlupski is planning to keep her virtual babysitting offerings available as the country opens up, given that many employers are having workers telecommute. However, she’s also well aware that other employers will be asking workers to come back into a brick-and-mortar workplace as their states reopen.
With many summer camps cancelled, parents who were planning to rely on them for childcare are now in limbo. Charlupski sees an opportunity to help them. “We’ve been speaking to large companies who want to provide on-site childcare, or childcare for their employees,” she says.
Apply your existing skills to a new offering. Harry Ein is great at selling swag . He’s built a one-man business called Perfection Promo from his garage in Walnut Creek, Calif., providing B2B customers with items like water bottles customized for road races and T-shirts with a company’s name on them for conferences. The business brought in $ 3.9 million in revenue in 2019, he says. Ein relies on an outsourced service called iPROMOTEu to handle back-office tasks like invoicing and devotes himself to getting to know his clients and providing a level of customer service that has, at times, included tracking down shipments in the middle of the night and personally delivering them.
Once the pandemic hit, Ein’s swag sales fell off a cliff. With live events at a standstill, few customers needed give-aways for attendees.
Ein reacted quickly. When he thought about what businesses really needed, he realized it was masks and other personal protection equipment (PPE). To get up and running quickly, he reached out to a physician friend who educated him on the masks that were in the greatest demand. He soon located a source of one in-demand product, the KN-95 disposable mask, and began reaching out to businesses who needed them.
Then Ein tapped the selling skills he always had. He’d soon won an order for 20,000 masks with a coffee chain that estimated it would need two or three a day for each store employee and was off and running. He’s now selling other PPE items, such as nitrile gloves and thermometers.
He’s also found the situation a good opportunity to give back and is donating some of his stock to organizations in need. “We’re doing the best we can with the situation,” says Ein.
Adjust to how your customers are pivoting. What customers needed pre-pandemic has probably changed since the lockdown—and it may be evolving again now that some states are reopened.
Patrick Falvey and Jason Martin are well aware of this. The co-founders of the software development agency AppEvolve—formerly DjangoForce—are paying close attention to how their customers are pivoting and customizing their services accordingly. AppEvolve, based in Boise, Idaho, is a two-man business, built on the freelance platform Upwork, that relies on the help of 20 contractors around the world. It hit $ 1.7 million in annual revenue last year.
“Businesses are pivoting in a way they never had to think of before,” says Martin.
One example: A client who formerly held live cooking and fitness classes for women has shifted to doing them virtually. She’s working with AppEvolve to create a custom app that integrates with Zoom, after experimenting with using third-party applications.
Another client, whose team is working from home, has found that when employees tunnel in to the company’s systems using a VPN line, the connection is very slow. “Multiple people can’t be logged in at the same time,” says Martin. “He wants a web-based application that would be easier for all of his employees to access.”
Falvey and Martin are happy to help them. “A lot of companies have executive management that never considered the idea of people working from home,” says Martin. “They have never done it before but were forced into that position. They’re now realizing it can be done, and it sheds a whole new light on the workplace.”
With each new project, they’re developing skills within their team that will help other customers coping with similar challenges. “We’re seeing a long-term paradigm shift,” says Falvey. “I don’t think we’re going to go back to the way it was entirely.”
That will spell opportunity for small businesses that find ways to seize the moment.