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This week Nellie Akalp, founder and president of CorpNet.com joins me to share her startup success story. Nellie is a serial entrepreneur who launched her first online business – a legal document filing service back in 1997 right out of her apartment living room.

That business grew into a company that was acquired by Intuit for $20 million!

Like many entrepreneurs, Nellie and her husband weren’t content to just cash out and retire to some island in the Caribbean. After a few years away from business Nellie was ready to launch something again.

So she and her husband launched CorpNet, a company that helps other entrepreneurs setup businesses – whether it’s a sole proprietorship, LLC, or corporation operation.

In this interview, you hear some valuable takeaways to launching an online startup:

How Nellie and her husband launched their first online business mycorporation.com with only $100 (and this was for a domain name).

How they grew that startup to over $ 1 million a year gross in the early days; and how their marketing strategy has changed in the age of social media.

Why it’s so important to test, test, test when launching a startup.

You can read the transcription below:

Nellie: Hi, Jonathan. Thank you so much for having me.

Jonathan: It’s an honor to have someone like yourself. It sounds like entrepreneur mindset, entrepreneurship is just in your blood in reading your bio. I’m really excited to share your story today with our listeners.
Before we get started, if you would, maybe just go back briefly and share. I’ve covered some of the points, a little background going back to the beginning of Corpnet or even before that when you launched your first business. We would love to hear about that.

Nellie: Sure! So my husband and I met in undergrad. We decided and realized that we had similar interests, one of them being that we wanted to both go to law school together. So we took the law school entrance exam and unfortunately got into two different law schools.

But at the end of our journey to date, I think we look at that when we look back as a blessing because so many things happened for us.

Once we entered law school and we were at the end of our journey at law school, we realized that we don’t really think we want to go after a legal profession. And frankly, we think that we want to go into business for ourselves. Both of us come from very different backgrounds, but both of us are only children. We’re very much alpha dogs, A-type personalities and we like to do things in our way on our own time.

And so he was getting a really poor grade in his Corporations class in his last year of law school. The teacher was talking about how there are two really hot topics going on right now; one is Enron and one is this whole idea of starting businesses online and incorporating online.

So I was working about a couple of hours away from home daily and commuting at an hourly job. I was a law clerk. I came home one day. I was pretty tired and a little bit uneasy with the whole concept of, “Okay, I’m going to start a life with you, but you don’t really have a direction in your life. I’m kind of scared. So I don’t know if I really can commit.”
He goes, “Wait a minute! I have this really cool idea and I need $100.”
I said, “Oh, my God! You need another loan from me?”
At this time, we were just living together. We weren’t married yet.
He’s like, “Yeah, I have this idea of buying this domain name.”
I said, “Well, wait a minute. What’s a domain name?”

This was back in 1997 where we were at just the birth of the Internet.
He goes, “It’s an address in the cloud for your business and for your online store. I have this cool idea of buying this name and we want to start selling corporations online.”
I said, “Okay!”

I’m pretty easy. I said, “Okay, here’s $100.” We had to write a check to this guy, Sky Dayton at Earthlink and we had to send it to him. I said, “Okay, fine!”
So we purchased the domain name literally for $100 and we put up a one page website and that was when our first company was born.
Truly, we rolled our sleeves up and we worked our butts day and night and grew that company to fast forward in 2005, it was nearly doing a million dollars in sales, gross sales.
At that time, we were approached and blessed with the opportunity of being approached by Intuit who looked at us and was very interested in this. They liked us because it was just the two of us with a bunch of employees in 2005. They liked the fact that we didn’t have any investors. The company was fully self-funded.
And what was really interesting is they’re like, “Okay, who do you have as investors?”
“Nobody. It’s just my husband and I.”
“Well, how much debt do you owe?”
I’m like, “Well, maybe $2500 on a credit card that I pay monthly. Other than that, the business is making a profit every month and we all take a check. It creates a living for us.”
And that was very, very attractive to them.
So when they initially approached us, it was under the guise of a partnership and the conversation soon changed to one of an acquisition, which was really a wake-up moment for me because I never really had a strategy, an exit strategy for my company and neither did my husband.
We’re two kids out of law school, no risk, nothing to lose, no kids. We put up this site and then literally, the minute the site went live, we were getting orders from it. At that point, we didn’t even have a credit card merchant services online mechanism where we would take the order online. People would call and they’ll put their credit card info on our answering machine.

It was really funny because we didn’t have this exit strategy.
So they came to us and they’re like, “We want to get serious and we want to purchase your company. So do you have a number in mind?”

I said, “No. I really don’t put a price on something that I’m so passionate about and I love doing every day. I really look forward to coming to work every day and enjoy being around my team.”
They’re like, “Well, you know what? The lightning doesn’t strike twice. Why don’t you go home and really think about this because you have kids now.” By this time, we had twins and another infant. So there was a lot to consider.

So I spoke with my business manager, my husband and we come up with a figure. There are negotiations back and forth. We ended up agreeing to $20 million. It’s all public information.
We sold the company. It was a very, very quick process for us. But with any acquisition, as you know, there are a ton of lawyers involved, due diligence involved, back and forth negotiations. But for us, luckily, it was a really quick turnaround.
We sold the company in November of 2015. But I kid you not, Jonathan, it was like a world win for me because I really don’t even think I even processed the actual sale of the old company as much as I wanted to because everything happened so fast and so quickly.
We announced the sale to all our employees at 10 o’clock in the evening on a particular evening. I stayed on, but we really realized how everything changed because it had lost its entrepreneurial spirit for us.
So my husband and I decided, “You know, it’s time for us to just step back” and focus on our then growing children. And so we decided to resign, step down and maintain contact with the entire team at Intuit because it’s a great company and I still do to this date.

In fact, I was at the QB Connect event a while back and met with the CEO over there. We have a great relationship and it’s always great to maintain the relationship, but it was time for me to move on.
I stepped down, I took my 3-year non-compete, I didn’t do anything, complied with their agreement.
And then in 2009, I was crawling out of my skin and I realized that I’m too young, too passionate, too energetic and too bored. How many purses and shoes and how much traveling are you going to do? It kind of loses its allure at a certain point in time.

Jonathan: Absolutely! Well, I’ll tell you, before we move ahead, I want to step back for a minute because this is fascinating, your story, because you’re talking eight years from the launch back in ’97 to it being acquired in 2005. That’s really amazing.
And just looking at the way you bootstrapped things, starting out, not really having an online shopping cart at that time and being so new to the Internet in getting started, I can only imagine. That’s just fascinating to hear someone talk about that as far as growing that that fast.
You provided online legal documents, is that correct?

Nellie: Correct! So what we did and what I do, really, the old business and what we did is literally the business that I do today, but just a different model, a different name and a lot more automated.
My current company is Corpnet.com and we provide new and existing business owners with any type of business filing service that is required to start a business, whether it’s a sole proprietorship, a corporation or an LLC. For existing business owners, they can come to us to keep their business in compliance.
We also offer trademark registration services. We offer anything and everything that has to do with the starting and maintaining and protection of a small business. We’re basically considered a one-stop shop for small business owners.

And truly, my old company, MyCorporation.com offered the same services, but with Corpnet, it’s a different model. We packaged our services. It’s packaged. We have a package for anyone starting from $79 all the way up to an all-inclusive package that would start at $249 plus state fees and we offer the service in all 50 states.
So it was really the same business, same services, but fast forward 2009 to a different crew. It’s the same founders, but a different crew, a different name and a different business model.

Jonathan: New technology makes things a little easier to operate a business like that today.

Nellie: I’ll tell you, when you said, “Let’s step back,” I’m not kidding you, at first, when we launched our first company, at one point, I was having my mother-in-law process our credit cards because we didn’t have a merchant services. So she would put them through her company and then write us a check so that we can process orders.
We wanted to really, really knuckle out there and get investors involved with the company. We really wanted to do this on our own.

That’s something that I truly believe in for small business owners. Oftentimes, there’s this hype or misnomer that, “We’ve got to bring in so many people. We’ve got to start big. We really just have to blow it out of the water right of the bat.” And oftentimes, that leads to really quick failure, which again, is a good thing because at least you fail quickly, but the downside of it is that now, you’ve strapped yourself with all these debt that you owe towards all these people.

So my recommendation to small business owners is that have a vision, have a plan, have a direction, but start small. Start small, but do a lot of testing. Do a lot of testing. Go out there and test the idea because your family and friends are going to tell you want you want to hear. It’s those people that are going to ultimately write you that check, cut you that check for your product or service are really the ones that you want to hear from.

So for us, it was a blessing and it was a really unexpected exit. And to this day, part of me misses my old company. It was my baby. I created it out of nothing. But we’re healthy competitors in the industry. Intuit no longer owns my old company. It’s privately held. It’s headed by actually a gal that I had hired as part of my legal time in-house when I owned the old company. She runs it and we wish them well. We’re healthy competitors in the industry today.

Jonathan: So what kind of start-up cost for getting started with your original back in ’97? Obviously, it was a lean start-up, but what kind of expenses did you have outside of employees and things like that that you had to invest in?

Nellie: Well, I actually didn’t have any employees. Truly, my start-up cost was the $100 to purchase the domain name. My husband is very, very educated and he’s a techie, so he literally did everything that had to be done with the development of the website. And then all the fulfillment and processing of the work was done by my husband and I. And in the beginning, we would just have friends come and help us package and ship out.

And then once we started getting some funding under our belt as a result of selling the products and services, then we invested a few dollars in, for example, automating the order forms, putting up a calculator on the website, adding an online order intake mechanism whereby it automatically charged the credit card.

Everything happened slowly and surely. Really, we started at the end of 1997 and we got literally our first employee probably 15 months out after starting the venture.
We started with one employee. And to this day, I will never forget, she was a very, very loyal employee and she worked with us for a very long time. That’s when we had moved the operations from our 2-bedroom apartment to the basement of our then purchased house because we had money to pay off our student loans and now purchase a home and start a family.

And then, I would say in 2000 was when we literally moved the operations into an actual office building because by then, we had to hire more employees.
So employees really didn’t come into the picture until probably 2 or 2 ½ years after the business has started.

Jonathan: Wow! That’s a very lean start-up. You were talking ’97, late ‘90s, early 2000s. What kind of marketing were you doing to get the word out about your new business and get found online?

I know it was less competitive back then, much less than it is today, but you don’t have all of the media opportunity that you have today with podcasting, with videos and things like that to get your message out. What kind of things did you do back then?

Nellie: So as you mentioned it yourself, 1997 was truly the birth of the Internet. It was truly a time where anybody can put up a one-page website and get indexed on Yahoo and the Internet search engines back then and start receiving orders.
It was funny because back then, if you had a name that started with a 1 or an A, you would be listed on the top. So we really didn’t base our choice of the company name on that. We learned that as we went. But we would purchase other domain names and direct it to the main site to get those rankings.

But truly, we didn’t do a ton of advertising initially. It was just purchasing other domain names that started with a 1 or like the A in the alphabet. We would do like 123 Incorporation Services or A1 Incorporation Services and then we would have those linked to the main site. We would get ranked like that.

And then a ton of search engine optimization because again, my husband is considered an expert in SEO. So back then, he did a ton of work in optimizing our site so that it was search engine optimized.

And then, again, once we started getting a little bit of money, I would say in 2000 was when we started signing heavy, heavy advertising contracts with MSN, Lycos, Excite, these search engines back then that were really hot.
We started truly, truly getting out there because in our industry back then, there were probably four, big player. It was really after we started that other big players came into the picture. And really, really those big players took over when Phil and I sold the business.

So really, 2000 was when we started investing in huge ad contracts and signing insertion orders with major search engines out there at the time such as Lycos, Netscape, Excite and doing a ton of banner ads and really getting out there and getting our business development team together and striking a ton of partnerships.
After that, the business literally started growing. We’ve been trying to scale it and grow it.

The orders kept coming in and we would set ourselves in growth metrics and hit certain targets. And once we hit certain targets, we would bring on more people.
And then fast forward to 2005 was when the acquisition took place and Phil and I just decided that, “You know what? This is a blessing from God. It’s a message that we really need to step out and focus on our then growing children and focus on ourselves a little bit and really do some self-growth and self-improvement.
Three years a lot of time. You have a lot of down time and I was crawling out of my skin.

And in 2009, after dabbling in a ton of other business ventures that obviously were not in competition with what we offered before, I realized that really, I love small business. My passion lies in small business. I’m too passionate, too young, too energetic and frankly, too motivated to take on an early retirement.

Nellie: So I decided to start all over again with Corpnet.com, my current company.

Jonathan: What would you say is the biggest challenge in getting started? You probably mentioned earlier just talking about the level of competition where so many other companies are getting started just how much the explosion of growth online with so many companies now. What’s been the biggest challenge in launching the second time around as opposed to the first?

Nellie: I think the biggest challenge for us was really trying to gain market share and traffic to the site and competing with the companies that were already existing out there and really competing against the 800 lb. gorilla, LegalZoom.
When we sold our company, LegalZoom had just started. They had come out, but then once we sold, that’s when they came out with a really great team of guys and really exploded that business.

So I think, really, the biggest challenge was gaining market share and really finding the sweet spot for us as to what worked. It was challenging for us because I would say until probably last year, we kept changing business models and plans and testing different things.

But the one thing that always remained constant with the starting of Corpnet was that I decided to come out and brand myself as the brand for the company because of all the accolades I had in the past and because of being coined as this pioneer of the incorporation industry.

So I decided to come out with this whole angle of branding myself as the company and really being out there in front, front and center with my clientele and took this heavy social media angle and really started engaging with people.
Even though we were still experiencing a ton of challenges, once we stopped spinning our wheels, we realized that in the last four years, we’ve built such a phenomenal brand as a result of all of my efforts with my social media, with my content that I continuously place out there that we truly just stopped advertising as far as any type of paid search.

It’s working for us and it was that sweet spot that we found with this current business. And luckily, it’s really, really helped us elevate ourselves to where we want to be today.

Jonathan: That’s fantastic! Yeah, things have changed a little in the last 15 years, right? Now, it’s about engaging people and using things like social media. Back then, like you said, your husband’s a whiz on SEO and all of that stuff and that’s changed a lot over the last several years. The emphasis so much is on just engaging with people and connecting with them on a personal level.
And I love that, what you’re doing with your own personal brand and connecting with people from a personal standpoint to show that you’re not a big corporation. You’re someone that people can relate to.

Nellie: That’s truly what it is, Jonathan. And it’s funny you say that because that’s really the message that I want to get out there. That’s why I did what I did with branding myself as the face of Corpnet.
Small business owners, in my opinion, are already so scared of starting a business that adding the whole legal aspect of the paperwork that’s required to start a business can, to an average person, become a scary issue where it could lead them to not even starting the business.

Jonathan: Right. Exactly!

Nellie: And for me, the message that I want to continuously put out there (which I’ve done a good job to date because normally, I get a great response from any podcast that I do and I resonate with people as someone genuine, sincere and really just out there to help people) is making the legal aspect of starting a business and the documentation a breeze so that you can focus on what you do best, which is starting and growing the business and leaving the hassle of all the paperwork to us.
Jonathan: Yeah, you’re absolutely right. I mean, that’s where people need to focus on, what they’re good at. And so many times, entrepreneurs are, “I want to do it all.” They have an ‘I need to do it all’ mindset and they try to run themselves into the ground or they end up running themselves into the ground because they try to wear too many hats instead of delegating certain things within their business that they need to delegate and focus on what they do best, which is serving their customers, their clients.

Nellie: That’s true, that’s true. But I think you and I both have a little bit of that too.

Jonathan: Yeah.

Nellie: I wear many hats in my business.

Jonathan: Oh, yeah.

Nellie: My title is CEO, but sometimes I’m there answering the call center. It’s funny because I was on the Mixergy Podcast with Andrew and he actually challenged me. He thought I was literally not being sincere with him when I told him that I sometimes answer the call. So he tested me on the actual podcast and he called Corpnet and he goes, “Can I talk to Nellie?” and they’re like, “Yeah, sure. Here you go.”
But again, for me, entrepreneurship is truly a fascinating, passionate aspect of my life. I’m a mother of four. I have four, beautiful children – teenagers that are a set of twins and then a 10-year old and a 3 ½-year old, but I love being an entrepreneur and I love being a mom. I balance it and I take it one day at a time. I think what drives me most every day is the fact that I have passion. I love what I do and I do what I love and I get to serve as an example to my children who are learning from me. I get to inspire and motivate and help people, which for me, is the greatest gift.

Jonathan: I got to ask you. What was it like when you got that call back in 2005? I assume it was a phone call or something to the effect of, “We would like to talk to you about your business and see if you’re interested in letting it go.”

Nellie: It was actually funny. Their phone call came as a voicemail in my husband’s mailbox at work. I think it’s a business development inquiry. And back then, with the old company, I used to handle our business development and all our contract negotiations. I just called them back, I spoke with them.
And really, I thought it was a partnership because Intuit has a small business product that I think is great for the small business owner. So I thought, “They want to work with us and have us promote their small business software to our clientele.”
And then once we spoke, the conversation was like, “Hey, we want to come and chat with you.” Even to that minute, I was like, “Okay, it’s a business development deal.”
So they set up a conference with me. They wanted to come and meet me. I was at the gym the day that they were supposed to come and meet. I come in the office and my assistant is like, “Uh, you know, there’s like eight guys here dressed up in black and navy suits. Are you sure you want to go in like that because you’re in your pink jumpsuit from the gym.” I’m like, “Yeah! Sure, why not?”

I went in and they were really, really, really nice, welcoming, but I wasn’t expecting everything to happen the way it did. But again, I’m grateful and I wouldn’t change a thing about how everything rolled out because I wouldn’t be here today with Corpnet and what I’m doing today.

Jonathan: Absolutely! I love your story, Nellie. I really do appreciate you sharing it with us today. Where can people find out more about Corpnet, about what you all do, about some of the services that you offer for small business owner?

Nellie: Absolutely! So you can always reach out to us at the website at www.Corpnet.com. If you have a specific question directed to me, you can email us to info@Corpnet.com or follow me on Twitter or direct message me on Twitter, @corpnetNellie.

Jonathan: @CorpnetNellie, very easy to remember. And again, we’ll also have those links posted on our show page for the show. The people can find all of those. They’ll link right back to your site, to your Twitter page. I’m assuming you also have a Facebook page too, so we’ll have all of those links.
Nellie: Yes, I’m pretty, pretty active on social media. You can find us on Facebook both for the company, Corpnet.com and then also my personal profile and the brand for Nellie Akalp. You can find us on Facebook, on Twitter, on Google, both for business and local. We’re on Pinterest. We have a ton of videos on YouTube.

So check out the site, check out my social profiles. And again, I am here for you. If you need to start a business or have an existing business and would like us to keep it in compliance, we’ll make sure that it is established and maintained for you.

Jonathan: Thank you so much, Nellie. Thank you again for joining me. It’s been fantastic! That is Nellie Akalp. She is, again, the legal expert and CEO of Corpnet.com. Thank you. Have a great weekend! It was fantastic talking with you.

Nellie: Same here, you have a great day.

The post 322 – How this Entrepreneur and Her Husband Sold Their First Online Startup for $20 Million – Interview with Nellie Akalp appeared first on The Beginner Internet Business Podcast.