The $4 Cold Call That Turned Into Millions

How answering a random cold call led me to launching an 8 figure biz:

At 23 I was managing an iPhone repair shop.

Sexy, right? Heh.

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I started it as a college senior & quickly grew it to 4 stores, but I hated my life. Why?

Retail is tough, and hard to scale, and I'm not great at operations (but I didn't know it yet).

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Anyway, one day I got a call that would send me down a 7 year rabbit hole.

The caller asked "Hey, can we buy your broken iPhone screens?"

My mind started buzzing.

Why does he want our broken screens? In fact, why haven't we just been throwing them away?

I had no good answers.

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What I did know was that this call sounded like a lot more opportunity than making a few hundred bucks.

I just KNEW I was about to compete with this guy.

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For some unknown reason we kept our screens in a box in the back of the shop. I suppose we didn't want to put them in a landfill or something.

Anyway, back to the cold call.

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This guy wanted to buy our broken glass for $4 each. I told him "no thanks," hung up, and immediately got to googling.

I learned that a new process of remanufacturing iPhone screens had just been developed in China. I was enthralled.

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I soon learned that this is how the caller's business model worked, in 4 steps:

1. Buy broken iPhone screens for $4 each

2. Receive and test the units to ensure that the LCD still lights up with no dead pixels.

3. Carefully package & ship to China to be remanufactured on a simple machine that looks like this:

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4. Sell for $10 each and profit!

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Heh, if only it were that easy. We all know that ideas are easy but execution is not only hard, but often complex.

Side note: Ideas are supposed to be simple though, right? If they weren't simple then we'd never launch.

It's a law of the universe to keep us humanoids building cool stuff.

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Anyway, I resolved right then and there to get out of the retail business. Why?

Because RETAIL SUCKS, REMEMBER?

Yes, it's true. The idea that I could actually make money without my introverted self having to talk to people in person sounded downright dreamy.

A month after I made this resolution I got a call from a competitor, offering to buy me out.

The universe had my number.

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I couldn't say yes fast enough. That led me to starting LCDcycle.

The day after the deal was signed I incorporated LCDcycle, LLC and got to launching.

Our first quarter's sales went like this:

1. $28k
2. $86k
3. $152k

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Bootstrapped.

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But how? How did we grow so fast? I'm not great at sales or cold calling, but I found some people that were, and they basically did it all for me.

Hold that thought for a moment, lesson time.

If you haven’t heard of product market fit (PMF), the official definition is “the degree to which a product satisfies a strong market demand.”

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But I’d describe it with this analogy:

Normally when you launch a business it feels like sisyphus rolling a stone uphill.

You make progress, but it’s just a constant grind. And if this is happening, that’s okay! Sometimes you just have to get over a hump. And sometimes it will stay a grind forever but still be a profitable, growing business.

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Other times it means your time is better spent on something else.

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But when you DO have product market fit, that stone is chasing you. And the stone = customers = demand. You can’t keep up with it all!

That means you have tapped into something truly unique and special. It means you’ve found a market inefficiency or a supply and demand gap.

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It means you’ve found product-market fit.

It means drop everything and go HARD.

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Anyway, back to iPhone screens. I had found PMF, and so now the playbook is to keep doing that same thing without getting crushed by that dang stone.

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Here’s exactly how we outran the stone:

I started by spending about 7 hours scraping every single iPhone repair shop from Google Maps.

Back then, good software for this was very hard to come by. Today it's quite easy with something like Outscraper or a virtual assistant.

In one tab I had the Wikipedia page for every USA MSA (Metropolitan Statistical Area). I still remember that NYC was first and Carson City, NV was dead last.

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On another tab I had my scraping software (I forget the name). One by one I would type:

iPhone Repair NYC
iPhone Repair Los Angeles
iPhone Repair Chicago
All the way down to Carson City

240+ MSAs!

But….BUT 7 hours later I had a CSV worth a million bucks…or $10m!

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~20k customers, each spending thousands per month on parts, and most ignorant that their broken screens were worth cash.

It was my TAM (total addressable market). Nowadays, I always start with this.

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But here’s the problem…I don’t like cold calling! Who does? So I went and hired 3 virtual assistants and paid them each $5.55/hour to call for me.

They were thrilled and so was I.

I used Zoho for a CRM and uploaded my 7 figure CSV.

Then I spent 5 mins typing up a (probably garbage) call script.

Then I waited…

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Well, let me back up. I also wanted to sell iPhone parts, too, right? Here was my thesis:

Get our foot in the door with the easy sell - We pay cash for your broken glass.

After a transaction or two we have their trust. Then we check and see if they wanted to buy iPhone parts, too.

They can even use their broken glass credit to buy parts - perfect!

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To sell parts I needed a Chinese vendor, and that part was pretty easy.

I went to Alibaba and started messaging dozens of iPhone parts sellers, asking for samples.

2 weeks later 10-15 boxes of iPhone parts arrived on my doorstep, for free!

I had an eye for quality, having just ran and sold iPhone repair shops. So I picked one of the better suppliers and sent him a $17k wire. That was my initial order.

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His name was David Su and we’re still friends to this day. But I think that $17k wire was the biggest risk I’ve ever taken, considering it was most of my liquid capital at the time.

Yes, I had just sold my business, but most of the cash I got was an earn-out (paid over time), so this was a major calculated risk (that paid off).

David could have ran off with my money, but since he didn’t I ended up paying him millions over the next few years.

He was also willing to buy back my broken screens. One stop shop!

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So here’s what I had at this point:

1. A Shopify site with 10-20 SKUs, a free theme and product photos from Google images. 4 hours invested

2. A CSV with ~20,000 leads - 7 hours invested

3. A Chinese supplier. He wasn’t even a manufacturer, just a reseller. - 3 hours invested

4. Cold callers to do the work - 2 hours invested

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That sounds like a business to me!

What next? My callers got to work! We’d group chat on Skype and I’d answer all of their questions.

I literally never made one cold call. All I’d do is hop on calls with bigger fish at times to close the deal. The VAs had accents, after all. We would have done much better otherwise.

Turns out, a lot of customers would order parts before we even bought back their screens. There was a ton of demand there, too.

After a few days they didn’t have many questions, but something interesting started happening.

Boxes of broken screens started arriving on my doorstep and orders started rolling in! I still have the pics:

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I had to get a PO box to manage all the volume, and then I outgrew the PO Box and had to find an office/warehouse combo.

I had to learn a few tricky things, such as:

How to ship boxes internationally

How to test screens before shipping

Chinese culture

How to manage stock levels

How to deal with defective parts

Nothing that Google can’t answer!

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I ended up flying to China in month 4 to meet my vendors and find a couple new ones.

I never did paid ads or had to learn outbound marketing. I combined a new school business model with old school cold calling.

The real secret? I found a tidal wave (lots of demand), hopped on my board and held on for dear life.

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Today’s Takeaways

1. Any variation of this business model can still be launched today. Find a product, find a market with thousands of customers, and hit the phones!

2. You don’t have to have PMF, but life sure is easier when you do.

3. It IS possible to find someone to make cold calls for you, successfully. Don’t let your lack of sales skills deter you from starting a business (but sales skills really, really help).

4. Naïveté can be a superpower. Had I known what I was going into in this biz, I likely wouldn’t have launched. But I’m optimistic and naïve, so this time it worked.

5. This business plan was pretty simple, no? You need 3 things: A product, a plan and demand. The plan will come as you go.

6. Like an investment, experience compounds, but experiences don't happen unless you launch, unless you start. I'd have never launched this biz had I not launched the phone repair biz.

7. You can research all day, but sometimes you have to take that well-calculated risk and send a $17k wire to a man named David in Shenzhen, China.

8. Find a tidal wave. How? More surface area. You won't find it on land, get out there where the waves are crashing down on you.

Test and try new concepts and ideas. We'll go more in depth on how to do that later.

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When I go on long solo bike rides I can ride:

16 mph into the wind
21 mph with no wind
28 mph with the wind

That's the tidal wave. It doesn't matter how nice my bike is or how strong my quads are (they're super strong). You want the tidal wave AKA tailwinds AKA a massively growing market with tons of demand.

That's ^^ my #1 takeaway of the 8 takeaways.

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Below was my first office. 480 square feet and only $500/month.

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