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Inside The Challenges Of Transforming An eBay Side Hustle Into A Million-Dollar Business

Platforms like eBay and Etsy have enabled women to build big businesses by starting small and building step-by-step.

Inside The Challenges Of Transforming An eBay Side Hustle Into A Million-Dollar Business
[Photo: Flickr user Cory Doctorow]

When she was still a starving graduate student, Sarah Davis did what a lot of enterprising young people do: she looked around for what she could sell. She listed a pair of Doc Marten Mary Janes, Gap overalls, and other assorted clothing for sale on eBay and quickly made $240. Just like that Davis became a micropreneur.

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“I was like a gambler,” she tells Fast Company, laughing at the memory. “I sold everything that wasn’t nailed down.” It wasn’t long before Davis started scouring discounted merchandise to list for sale and turn a small profit. She recalls buying a set of Louis Vuitton luggage for $700, an amount that made her husband question her sanity as they struggled to make ends meet. Davis confidently turned a $600 profit and her husband into a believer.

Sarah DavisPhoto: via Fashionphile

Flash forward to 2015. Davis has grown her little business into a full-scale enterprise. Called Fashionphile, the online platform for buying and selling luxury handbags and accessories brought in $20 million in revenue last year.

Davis is in good company. Other women who started as micropreneurs include Sophia Amoruso, who started by selling a stolen item on eBay and went on to build the $100 million empire of Nasty Gal. Then there’s Alicia Shaffer, who sells knit legwarmers and headbands on Etsy and rakes in almost a million dollars a year.

More are springing up every day, encouraged in part by the ease of setting up shop on web platforms. A global survey that polled 1,200 aspiring and current entrepreneurs who have owned their businesses for less than three years found that 50% of the aspirational entrepreneurs polled described themselves as optimistic and saw few barriers to their future business success.

The survey, conducted by PayPal, found that nearly half (47%) of women said passion was a leading motivation for starting their own business. These women were just as concerned with finding a better work-life balance, gaining greater independence and to be more financially successful. Female micropreneurs abound in developing nations, many selling handmade crafts or food simply to sustain their families. Ghana, for example, is the only country in the world with more female than male entrepreneurs. Such small enterprises headed by women have been the root of half of China’s self-made billionaires. 


Yet behind the inspiring stories of Davis, Amoruso, Shaffer, and the like are the real-life challenges of building a business from scratch. Even going from one small sale or client to another, there is plenty of room for hesitations and missteps, not to mention long hours.

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Getting Prepared to Make the Leap

It’s no surprise that many women list creating a business plan, getting legal and financial help, and establishing payment methods as milestones along the road to building a successful business. The challenge comes when you’ve got all–or most–of those ducks in a row and you need the courage to make the leap.

The PayPal survey found that plenty of female entrepreneurs balk at actually launching. This is partly due to a pervasive case of lack of self-confidence among women. Plenty of studies back up the fact that many women are fully competent to take bigger roles in business, but few are as confident as men to grab that brass ring.

The PayPal survey found that only 13% of aspiring business owners reported feeling ready to start their enterprise, but this varies widely by country. In Mexico more than half (59%) felt prepared and 68% were ready to start their business within a year. In China, 35% of women spent more than a year thinking about their business before launch.

“Part of the problem,” says Melissa O’Malley, director of global merchant and cross border trade initiatives at PayPal , “is that [they ask] do I take a leap of faith without a safety net?”

One of the things she believes helps is to tap into a network of micropreneurs. O’Malley says that PayPal’s Passport is targeted to the particular hurdles small merchants face as they try to establish their business. From fraudulent credit cards to making deliveries, O’Malley says case studies abound. “You can grab nuggets that apply to your own situation,” she says, “Small business owners are happy to share because they were once that person who didn’t know.”

Too Many Hours

O’Malley tells Fast Company that it’s especially important for female entrepreneurs to understand that running a business is just as important as “doing” the business. “They underestimate the time it takes to run the business,” O’Malley says, because they are too busy making their handmade items. This comes at the expense of thinking about how to scale sustainably. “It’s why you see a lot of them burn out,” says O’Malley, who once owned her own consulting firm and experienced that kind of fatigue first hand.

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For her part, Davis says the decision to hire two people to help as the business grew was one of the best she ever made. “I was working so hard,” she recalls, doing everything from buying merchandise and taking photos, to writing copy, packing and shipping. She reached a breaking point when she found herself in the post office, pushing a stroller filled with boxes (her baby was strapped to her body in a carrier) and exhausted. “Every time I think about that I start to sweat,” she says. Realizing that she could farm out packing and shipping, as well as admitting she was not particularly skilled photographer, freed up her time to grow.

The Ups And Downs Of Finding More Customers

O’Malley says that many entrepreneurs dream of the day their product or service starts getting traction internationally. Unfortunately, that can also translate to disaster if the business isn’t equipped to deal with demand.

Rather than focus on variety or choice, most consumers–no matter what country they are shopping from–are beginning to expect free shipping. But the cost of shipping internationally, combined with customs, duty and taxes, could make international sales prohibitive to a micropreneur.

Beyond that, you have to be prepared for any upticks in traffic, says O’Malley. This was the scenario for Davis. Fashionphile had been selling internationally for several years, but in some countries such as Brazil, the bags were never making it to the shopper. “They were either held up in customs or stolen,” says Davis, resulting in a big loss for the business both in terms of dollars and customer loyalty.

But when a Brazilian fashion blogger purchased a bag successfully from Fashionphile (she had it shipped to a hotel in New York prior to a visit) and wrote about it, the e-commerce website couldn’t handle the additional overwhelming traffic and shut down.

Davis realized she needed to revisit selling in Brazil and eventually found MyUS, a consolidated shipping service that handles transactions in 220 countries. Now Davis estimates 20% of Fashionphile’s revenue comes from overseas shoppers. As with hiring staff, getting on board with MyUS allowed her to get beyond the challenges of international sales. Davis says: “You can’t be afraid to ask for help when you need it.”

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About the author

Lydia Dishman is a reporter writing about the intersection of tech, leadership, and innovation. She is a regular contributor to Fast Company and has written for CBS Moneywatch, Fortune, The Guardian, Popular Science, and the New York Times, among others.

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