TWO school friends have built a cash machine empire that’s now aiming for a £1million turnover after a £270,000 profit, all while studying for their degrees.
Andrew Margison from Chichester in West Sussex and Andy Goodwin from Yateley in Hampshire, first met in sixth-form.
But it wasn’t until they both joined Bournemouth University in 2011 that they masterminded their cash-handling business ZZap.
Starting a business around the use of cash might seem like a bad move with debit card payments overtaking cash for the first time in 2018, according to trade body UK Finance. But the two lads have proved the opposite.
The 27-year-old pair, who both now live separately in West London, say they were “pretty obsessed” with finding an idea to start a business early on.
‘At the age of nine, I was washing cars in my neighbourhood’
“At the age of nine, I was washing cars in my neighbourhood, at 11 I was mowing their lawns and at 14 I sold sweets from my school locker,” Andrew told The Sun.
“I have always loved being an entrepreneur because of it’s limitless potential.”
While studying at uni – Andrew did a degree in business studies while Andy studied finance and law – the pair went through all sorts of different business ideas, including selling HDMI cables and tennis rackets on eBay.
But it wasn’t until they stumbled upon an unbranded coin counting machine for sale in office supply retailer Staples that they realised they might have struck gold.
After doing some research, the pair found that these machines – used to count notes and coins from punters – were overpriced, unreliable and that there were no big brands supplying them.
This prompted the duo to source a reliable model, which they then sold on eBay within 24 hours – and it came with a 20 per cent profit margin.
At the time, they were in their first year of university so they used their student loans to survive and splashed all their savings – roughly £1,500 – on ordering 30 more coin counting machines.
As the business grew in their second year of university, they filled up their student house with hundreds of boxes of coin counters leading their home to being dubbed “the warehouse” by pals.
They also started collecting shipments from the local docks in Southampton using Andrew’s mum’s car.
The duo’s top tips for other budding entrepreneurs
IF you want to start your own business just like Andrew and Andy, here are their best tips:
- Be persistent: If you believe in what you’re doing, and you can persist, you’re pretty much guaranteed success. If you’re prepared to never ever give up trying different ideas, eventually you will hit on one that works. It’s just about long-term persistence over five to 10 years.
- Challenge yourself: It’s important to continually improve yourself in terms of gaining knowledge and becoming more efficient.
- Make sacrifices: You need to embrace sacrifice and keep in mind that success doesn’t come without it.
- Have an all or nothing mentality: Great businesses aren’t built from a small commitment.
‘We had lorries delivering 40ft containers to our house’
“As we made larger orders, we soon were travelling down in a convoy of our friends’ cars and eventually to my dad’s shock we had lorries delivering 40ft containers to our house.
“To this day I still don’t know how we fitted the container on our driveway,” Andrew said.
Despite starting from humble beginnings on eBay, ZZap has now become a leading international supplier of cash handling products, such as coin and note counters and safes, and they’re used by big companies such as McDonald’s, Sainsbury’s and Gucci.
“We started off with online sales; a lot of these brands would just buy on eBay,” Andrew said.
“Then as we grew and we got more of a reputation, they’d start placing bulk orders.”
Today, they have around 100 clients and now sell their products on their own website. They also recently opened a base for the brand in Wokingham in Berkshire.
‘We took inspiration for ZZap from Apple’
The name ZZap came from their wish to be different.
“All our competitors had boring or typical names for our industry.
“We took inspiration from Apple – their name doesn’t relate much to their industry and it’s unique.”
They were only able to take out their first salaries four years after they sold their first product, but they completed their university degrees in full, so their student loans allowed them to scrape by.
They also used the profits to re-invest into the business and have never raised capital from external investors.
This year, the business is expecting a turnover of more than £1million – they don’t want to share exact figures.
But its latest so-called “profit and loss account”, which is a way to measure a business’ profitability, on Companies House shows the figure of £268,772 for the year ending March 31, 2018.
They’re also aiming to expand the business into Europe, the US and Asia to achieve a turnover of “multi-millions”.
But the success hasn’t come without sacrifices.
‘It’s a hell of a lot of work’
“From day one, it’s been our life really. It’s a hell of a lot of work,” Andrew said.
“We’ve been working so hard for so long. On one occasion I worked alone without seeing either friends or family for eight weeks, between 9am to 10pm, without a weekend break.”
They’ve yet to take on any staff since the business was founded eight years ago, although they admit that they’re currently recruiting for one person to help them with search engine optimisation – how companies rank in Google – something they’ve been in the process of for months.
“We know how important our team is going to be, so we are making sure we get the right person.”
They say that a two-man band has been enough up until now as they use manufacturers to develop their products, and they’re learning a lot from competition too.
“People think that we know nothing about this industry, but I’ve met loads of different people at various awards, and it’s clear that you don’t need to know.
“We had no knowledge whatsoever, but we sold the first few products and we just learned along the way.
“The beauty of running an online business is that people can see that you’re a multinational company, even if you might just be two people in a bedroom.
“Our story shows that if you truly want something bad enough you can achieve it.”
Want to start your own business but could do with more inspiration?
Last week, three lads revealed how they started £15m phone case giant Skinnydip with £10k borrowed off friends and family.
Recently, we also spoke to a 23-year old entrepreneur about how he started a million-pound video business with just £50 after his parents lost £150k in the Northern Rock crisis.
And we’ve chatted with a dad-of-two launched beer made of leftover bread – and the company now turns over £1million a year.