How Ghanian turned down$200,000 investment and built a $10million company

Adam Stone, Contributor
Kwame Kuadey is the CEO ofGiftCardRescue.com

Kwame Kuadey is the CEO ofGiftCardRescue.com

What is it? An online service for selling unwanted gift cards in exchange for cash and purchasing gift cards at a discount from over 450 major merchants.

When was it founded? January 2008.

How was it financed? Personal funds, savings and credit cards. Over the first two years I put in about $350,000, which went toward website development, inventory, just covering monthly expenses.

Where did the idea come from? A friend of mine had a bunch of gift cards that he didn’t know what to do with. At the time I was getting my MBA at the Johns Hopkins Carey Business School and I became intrigued by the idea. I could see it was a problem that a lot of people had and there was data to back it up, showing that about 10 percent of gift cards sold went unused.

Then you landed on ABC’s “Shark Tank.” They actually called me. When I started there were only two other companies scratching the surface of this market. It was a new concept and I had gotten a lot of press. The people at “Shark Tank” read about me in the Wall Street Journal and asked me to audition.

You won — but you didn’t take the money? They were going to invest $200,000 for 50 percent of the business. Back in 2009 I needed the money, that’s why I went on the show. But by the time we got around to talking about the deal and doing the due diligence, it didn’t make sense anymore. I wasn’t in that desperate position anymore. I had gotten the company to the point where giving the 50 percent away didn’t make sense. We had gotten a lot of free press, I was actively pitching reporters, and there was the exposure from “Shark Tank.”

Annual revenue? Last year we did $6.6 million, and this year we are shooting for $10 million.

Is it profitable? We were last year, and this year we think we still will be, but profitability is not something I sink my teeth into at this point. My goal is to invest in growing the business, so that measure is not something we are too concerned about.

How has being from Ghana influenced your work? I came here in 1997 to attend Middlebury College in Vermont. After that I got hired by Citigroup in Baltimore. I decided to stay because I saw more opportunity here in the United States. In most developing countries you have to be well-connected: Hard work is not going to get you far if you are not in the network of the elite. Here, I know that if I put in the hard work, there is a good chance it will pay off.

 

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