How This Immigrant Entrepreneur Built A $60 Million/Year Fulfillment Business

Fort Lauderdale, Florida, September 12, 2019  / Starter Story /

Hello! Who are you and what business did you start?

Hi! My name is Jan Bednar and I’m the CEO and founder of ShipMonk, a technology-driven fulfillment center based in South Florida.

Our services are primarily geared towards B2C/eCommerce, subscription box, and crowdfunding fulfillment. We also offer FBA prep and B2B/retail services for online merchants. Our clients come from all walks of life, but small to medium-sized businesses are our sweet spot.

We’ve been operational for about five years now, and we could never have imagined how fast we’d scale. ShipMonk’s revenue rose from $130K in 2014 to nearly $30M in 2018. We remained completely bootstrapped until October of 2018 when we raised $10M in Series A funding.

Last year, we were named America’s Fastest Growing Fulfillment Center and scored a spot at #29 on Inc. 5000’s list of fastest growing companies. We made the list again this year at #154. With projected revenue of $60M for 2019, we absolutely can’t wait to see what else is in store for us!

What’s your backstory and how did you come up with the idea?

From a young age, I knew I wanted to do big things. I’ve always had an entrepreneurial spirit, which led to my first gig as a DJ when I was thirteen years old. It was a great way to meet new people and make a little money. But, most importantly, it allowed me to familiarize myself with the world of business.

Think of a problem you care about and find a solution that works.

When I was sixteen, I left the Czech Republic and immigrated alone to the United States to pursue a college education. I was accepted to Florida Atlantic University, a public college in Boca Raton, Florida and studied Management of Information Systems.

Not long after starting college, friends and family back home began asking me to send them American products that either weren’t available in the Czech Republic or were from brands that wouldn’t ship to them. It didn’t take long for me to realize this was a problem that needed to be solved, and that I could make money doing it. I started buying the products in the States in stores or would have them sent to my Florida address.

Then I would package and ship the stuff to my friends overseas. To expand my package forwarding services to more people and other countries, I created a $100 website that asked what they wanted and where it needed to go. The demand for orders skyrocketed, and I started making a profit immediately. This led me to launch my first company: BedaBox.

I operated BedaBox out of my dorm room while in college. I was making some money, but I didn’t know anything about running a business and knew I needed help. I decided to attend some free workshops at FAU for young entrepreneurs. It was there that I found a mentor, a successful business owner, who helped me write a killer business plan for free. The voluntary mentorship I received was unbelievable to me, and it proved to be one of the best moves I made starting out.

I applied for some business competitions — the FAU Business Plan Competition and the Florida Venture Forum Collegiate Competition — and won first place in both. I was then invited to join an accelerator program at FAU called Tech Runway. The program provided services for startups to help them break into the industry, as well as a place for them to operate.

Through the Tech Runway program, I received a free warehouse space. However, at the time, I really didn’t have enough products or packages to fill it with. To appear like I had more business than I actually did and to attract the attention of new clients, I would assemble empty boxes to fill up space. The strategy worked.

I was contacted by a local company in downtown Fort Lauderdale who was in the business of selling Internet of Things (IoT) products. They wanted my help fulfilling their orders. At the time, I didn’t even know what fulfillment was and looking back, it’s funny because this company that wanted to hire us had to explain to me the service they were hiring us to do. I wound up telling them that we could do it — we had a warehouse and people who know how to ship products. We took the job and as a result, attracted more clients looking for order fulfillment services.

While I started BedaBox as a package forwarding company (sending a product from a store to a buyer), I quickly began to realize the huge potential of order fulfillment (the process of receiving, processing, picking, packing, and shipping online orders)

Realizing there was more money and higher demand in order fulfillment pushed me to really look into the current state of fulfillment. The large, established companies offering fulfillment and third-party logistics had really poor customer service and old, antiquated technology from a software standpoint. I realized that many big improvements could be made and that most of these changes would only be possible if there was a focus on technology and automation.

The plan was made — we would rebrand the company and revolutionize the industry by bundling eCommerce order fulfillment with first-class customer service and modern technology, giving our customers all the intelligence and functionality needed to manage their businesses. ShipMonk was born.

Take us through the process of building the product.

With the funds and services I was awarded from winning the business competitions, the guidance I received through Tech Runway, and BedaBox’s success and popularity, we were equipped to go to the next level.

However, we had a bit of the chicken versus egg problem. Do we build something that will help us get more customers and streamline our operations or wait to build what our customers need and streamline our operations based on those needs? It wasn’t just something we could brainstorm and make an easy decision. It’s the same with every feature or new service we launch. In the end, we knew our foundation was going to be kick-ass software, but things certainly didn’t happen overnight.

(Original Team)

There’s a fine line in being scrappy and not investing in what is essential for a successful business. In our bootstrapping ways, we were able to piece together solutions that would validate our thought process. We ran our data on Google Sheets to track metrics until it made sense to invest in a business intelligence platform — it wasn’t necessary, but it was extremely nice to have.

Likewise, during development, we started off using a third-party WMS (warehouse management system). It was difficult software to use, but it allowed us to run our business while remaining profitable.

The very basic model of the ShipMonk platform took us about six months to build. I had three full-time developers working on the project, and they barely got any sleep. Our WMS license was expiring at the end of December, and if our own software wasn’t ready by then, we would have had to pay $18,000 to renew the license for another year. There was a clear deadline, and meeting it was beyond crucial. Luckily, my awesome developers had the legacy software completed by December of 2015.

Our first version of the ShipMonk software wasn’t a bad start, but it was limiting and lacking 90% of the features we have today. Since we were growing at a rapid rate, it became a huge undertaking to keep up with the development needed to support the business.

We needed to hire as many developers as possible (as in, within our budget), prioritize the roadmap based on the warehouse needs versus the merchant needs, and optimize the legacy feature we built to get up and running.

Describe the process of launching the business.

We continued operating BedaBox as both a package forwarding and order fulfillment company for about a year and a half during development. Juggling launching a new company (ShipMonk) while continuing operations and moving from facility to facility as we grew even larger was not easy. But being profitable from day one and knowing we had a market for our services made life easier.

Getting caught up in the whirlwind of a startup can seem unavoidable, but having confidence in myself and in others, as well as embracing the speed bumps along the way has guided me forward. I work hard at what I can control, and I accept what I can’t.

The logistics space as a whole is a bit stale. At the time, companies were able to get by without having to innovate and were stuck with their legacy platforms. The brands were boring, the sales cycles were long, the tech was underwhelming, and ultimately we thought we could build something that fit our needs better and outperform everyone else.

We wanted to come up with a service that was fresh and agile. We started by recognizing all the missing links we surveyed while looking for a WMS when we got started, and we went from there.

Our goal was to keep things as simple as possible for transparency purposes and only build what our customers wanted. We kept our ear to the ground whenever we implemented something new and didn’t let our ego prevents us from making changes.

Ultimately, launching ShipMonk was relatively easy once we had things in place. We spent a year tackling rebranding efforts — creating a new logo, website, marketing material, sales collateral, etc. Because we were already in business with BedaBox, we notified our client base of the rebrand and were able to ride off our existing momentum.

Since launch, what has worked to attract and retain customers?

Customer retention is extremely important to us at ShipMonk. It’s more than a metric; it’s our biggest indicator of whether we’re living up to our values of being transparent, helpful, and attentive to our customers. Everything we do — whether it be marketing, sales, or customer support — centers around those values.

I credit a lot to our marketing department. We have an incredible team that handles our SEO, PR, and PPC campaigns, as well as all of our content marketing. Content is a major driving force behind our success and is extremely important to us. In addition to generating a ton of articles for our blog on different topics related to the industry (and some simply for fun), we’re active on various forums like Quora and the Shopify Community. We’ve also had inclusions in publications, like this article for Forbes, and ShipMonk has been featured by various outlets, like Business In Focus magazine.

Besides being f’ing awesome, we leverage any opportunity — big or small — to get in front of people. Whether it’s something small, like replying to a HARO query, or a larger accomplishment, like making it on Inc. 5000’s list of Fastest Growing Business, we constantly have our ear to the ground and take what we can get. I was invited to speak at a TEDx event about my journey starting a business, and I was included in Forbes’ 30 Under 30 list in 2018. All the attention has really helped build general brand awareness in the industry (as well as boost our SEO rankings.)

Our Support Team, or Happiness Engineers as we call them, are trained to be fulfillment experts and provide best-in-class customer service. We count on our level of customer support to be a clear differentiator between us and the competition. When a customer signs up, we connect them to their very own dedicated Happiness Engineer.

Happiness Engineers serve two main functions: they’re liaisons to our warehouses as well as the main point of contact for any software-related questions. Essentially, they are our customers’ eyes behind the scenes. This is what sets us apart — we value being both tech-centric and customer oriented.

Our current customers are also a major part of our continued growth. Through positive word of mouth, we gain a lot of very strong referrals. The guys at FEAT socks are an example of a customer that grew into both a great friendship and partnership. (In fact, we wrote an entire case study about them, and they’re also featured on Starter Story.) Knowing we’ve created something our customers love and will recommend to others makes it all worth it!

How are you doing today and what does the future look like?

In terms of expansion, we’ve been very busy! We outgrew our California location, moving us from Redlands to San Bernardino, and we’re now enjoying 94k sq ft of space! Our most recent acquisition in Pittston, Pennsylvania is 76k sq ft, giving us 3 facilities on different coasts — Florida, California, and Pennsylvania.

Last month, we moved our South Florida headquarters to Fort Lauderdale and opened our biggest location yet at 220k sq ft. The office is built out of storage containers and has a full bar, gym, trampoline, and game room. It’s pretty rad!

(Fort Lauderdale Office)

(Fort Lauderdale HQ)

It’s amazing not only to see how much we’ve physically grown but how our ShipMonk family has grown as well! We now have over 350 employees nationwide (and actively hiring), plus over 1,000 incredible customers (and rapidly increasing)!

In the future, we have plans of opening warehouses in more US locations and also expanding internationally. Our sights are set on Europe, but we’re still evaluating other foregin markets.

Through starting the business, have you learned anything particularly helpful or advantageous?

I credit my wonderful team for getting us to where we are today. I absolutely could not have done it without them. They are a rockstar group who gets shit done!

Over the past few years, I’ve seen entrepreneurs making the same mistake: overestimating their earnings and underestimating their efforts. If you’re just starting out, it’s expected to have limited resources.

However, hiring and maintaining a core group of people hasn’t always been easy. Early on, I hired the wrong person for a prominent position within the company. A shiny resume hid the fact that they just didn’t mesh well with our company culture. While I was able to eventually fire this person, the headaches and financial loss could have easily been avoided had I set up a probationary period or simply considered how they would mix in with the ShipMonk team.

Similarly, the best decision I’ve made is to concentrate on who is being hired for each position and how they fit within the team. In 2017, we were awarded one of the best places to work in a local publication (the SunSentinel) and experienced a huge spike in job applications. This led to a much more competitive applicant pool which we’ve benefited from significantly. Hiring has become a more deliberate process. As a result, we’ve seen an increase in both productivity and employee retention. We are building an even stronger ShipMonk family filled with motivated, passionate people who align with our values.

On a personal level, ShipMonk has helped me grow tremendously. I learned to surrender my need for control and trust the process. I got better at embracing change and taking it one day at a time. Getting caught up in the whirlwind of a startup can seem unavoidable, but having confidence in myself and in others, as well as embracing the speed bumps along the way has guided me forward. I work hard at what I can control, and I accept what I can’t.

What platform/tools do you use for your business?

When a company is running with its accelerator to the max, daily operations can get (to put it mildly) overwhelming without the right tools. Luckily, we’ve been able to find a few indispensable apps and websites that keep our sanity and productivity going.

For communication and project management, we use Slack and Asana. With our numerous locations, remote and international, communication is absolutely essential. While Slack is more conversational and casual, it’s a great way to reach out to coworkers with quick questions or updates. Asana is also fantastic — it makes coordinating tasks across departments, offices, and countries so easy. Both really help keep the teams in check.

Other favorites include Freshdesk for customer service, Autopilotfor marketing automation, Salesforce for CRM, Fullstory for customer experience analytics, Grow for business analytics, and Zenefits for HR and payroll. We also rely heavily on G-Suite and, of course, the ShipMonk inventory, order, and warehouse management software.

For a more in-depth look into our tech stack, and why we use what we use, we created a cool infographic — check it out on our blog.

What have been the most influential books, podcasts, or other resources?

My book favorites are Rework by Jason Fried and David Heinemeier and The Goal by Eliyahu Goldratt. I think they’re both essential reads for entrepreneurs and have personally taught me a lot about innovation and leadership.

Advice for other entrepreneurs who want to get started or are just starting out?

I can only speak from experience, but the first step in an entrepreneur’s journey is to have the right mindset.

Before ShipMonk was ShipMonk, I forwarded packages to friends and family in the Czech Republic. There was a demand for that kind of service, and I was able to supply it. Knowing that I was providing something valuable to others was the solid foundation on which I built my business. To put it more succinctly: think of a problem you care about and find a solution that works.

Over the past few years, I’ve seen entrepreneurs making the same mistake: they overestimate their earnings and underestimate their efforts. If you’re just starting out, it’s expected to have limited resources.

While we’re always excited to work with new clients, there are times when they simply aren’t in the right place to outsource. Since I’m also a business owner, I can empathize completely — they’re excited about their growth and want to take it to new levels. We feel the same way! However, there’s a time for everything and sometimes it’s not cost-effective to outsource right away. We can apply this scenario to any other business decision, and it all boils down to being frugal and realistic. If something is working for you right now, wait to outgrow this solution before changing it.

Are you looking to hire for certain positions right now?

Absolutely! We’re always looking for awesome people to join our team. Our company values revolve around transparency, perseverance, and innovation. We’re a dynamic group who knows how to work hard and have fun doing it. If you think that sounds like the right fit for you, check out our careers page to see our current openings.

If you needed any more convincing, here’s a sneak peek of what you would be in for…

Where can we go to learn more?

• Website: shipmonk.com
• Blog: shipmonk.com/blog
• Email: info@shipmonk.com
• Facebook: TheShipMonk
• Instagram: theshipmonk
• Twitter: theshipmonk
• LinkedIn: shipmonk

–  Jan Bednar,  Founder of ShipMonk