Campus Sophomore Profits Greatly in Business

Photo: Raymond Lei, a UC Berkeley sophomore, puts on a shirt from ooShirts, a successful virtual ordering business that Lei founded in high school which sells custom T-shirts.
Chris McDermut/Photo
Raymond Lei, a UC Berkeley sophomore, puts on a shirt from ooShirts, a successful virtual ordering business that Lei founded in high school which sells custom T-shirts.

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With ooShirts, an online start-up that allows customers to design their own T-shirt prints cheaply, UC Berkeley sophomore Raymond Lei is trying, one shirt at a time, to debunk the myth that starting a business is difficult - a message other student entrepreneurs seem to be picking up on.

Lei's business focuses on keeping prices low without sacrificing quality by increasing efficiency, he said. The enterprise now collects $1.2 million per year in revenue and is expanding at a pace which, if adhered to, could result in his business dominating over half the market by the time he graduates, Lei added.

Wanting to start a business that would make a "small amount of money" - which he defined as around $10,000 in annual revenue - Lei, then a high school sophomore, found his opportunity after seeing the prices on the website CustomInk, and his idea for ooShirts was born.

He said his business achieves high efficiency by hiring only one employee other than himself - a friend from high school who handles day-to-day tasks like managing suppliers, talking to customers and helping out with web design. Lei also saves labor by using the Internet to transmit a customer's design directly to the supplier and back to the customer, thus eliminating the cost of handling the shirts.

"All businesses are trying to reduce overhead, but it sounds like he has reduced this to virtually a virtual business so that all he does is contract it out and work through the Internet," said Dave Fogarty, the city of Berkeley's economic development project coordinator. He added that most start-up businesses are efforts to market a new, high-tech product, rather than efforts like Lei's to make a common product better.

Lei said he bases his overall efficiency model off Google when it first started, focusing on improving only the core product. Like Google, he believes he can expand by offering a superior product, he said.

"CustomInk is definitely over $100 million in revenue," Lei said. "But I know that many customers, if they knew our prices and quality of prints, would order from us instead."

He said expanding would require more employees, which is counter to his current efficiency model, but could actually increase productivity by allowing different employees to specialize in different aspects of the business.

Lei wants to use either his own profits or money from venture capitalists to fund start-up efforts by other students - a service he said is provided at other schools like Stanford University.

Another start-up created by UC Berkeley students, CampusCred, has differentiated itself not by being more efficient than its competitors, but by targeting a specific demographic - in this case UC Berkeley students and faculty.

Using a model popularized by the website Groupon, students Sagar Shah, Brian Campbell, Louis Fu and Karen Wong created CampusCred to provide vouchers that give customers at least 50 percent off at certain stores. The website then takes a commission as per its contract with the other store, which benefits from the publicity, Campbell said.

"(Groupon) targets major cities and their demographic is usually between 25 and 40 years old, female, with an average income of over $60,000," Campbell said. "So the average price is between $25 and $40 and there's a lot of salons, massages, cruises, getaways - big ticket items clearly targeted towards a different demographic versus college students."

CampusCred has spent over $5,000 on advertising and more on website management, and with all profit coming from commissions on about 450 transactions, they have incurred "a considerable amount" of debt, Shah said. But Campbell added that by spreading the word and securing good deals, the team hopes to break even by the end of the semester.

"We need exposure - people to know about us," Fu said. "We want people to know we're not scamming them ... we really want students to have fun without spending a lot of money."


Contact Samantha Strimling at [email protected]

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