How a Strict Budget Was Key to Getting This Telecom Company Off The Ground

How a Strict Budget Was Key to Getting This Telecom Company Off The Ground

How a Strict Budget Was Key to Getting This Telecom Company Off The Ground

José Cruz is the founder of rēd wireless, a cellular telecom company based in Detroit, Michigan. Cruz calls the company “a collaborative family business” that helps building owners and end-users access reliable cellular connectivity indoors. Cruz leverages 20+ years in the telecom industry to demystify cellular for his clients.

Why did you start this business?

I never had the entrepreneurship bug. In the ‘90s, I graduated with a bachelor’s degree in electronics from the University of Puerto Rico. From there, I started working in manufacturing with companies like Intel and Siemens. That didn’t appeal to me, so I started working in telecommunications when beepers and pagers were around. I’ve been heavily involved in wireless deployments from that part of my career on.

After working for so many companies, I could see the same patterns and the same mistakes where the end-user wasn’t held in the best interest. After doing it for so long and having the same frustrations over and over, I said, “I guess I have no choice. If I want to do it right and put the customers first, I’m going to have to do it myself.”

How do you finance the company?

My mom and sister and I pooled all the family resources together to help me out with this. I sold my fancy sports car. We’re all on a strict budget and living together in the same house temporarily. For everyday necessities, we’re OK. If you can’t sustain yourself personally, there’s no way you’re going to sustain any business.

We have really good credit, but we haven’t gotten a loan or business credit card yet. We know it’s there as a resource, but since we’re selling a service and not a product, we don’t need to buy inventory. We’re taking baby steps and reinvesting what we make back into the company.

How do you manage cash flow?

I tried hiring a professional accountant, but it didn’t pan out. It wasn’t really addressing our needs. My sister sits down with an Excel spreadsheet and we look at what comes in, what we have in the bank, and what goes out. We are very disciplined at tracking all expenses, from the gas in the car to the coffee at Starbucks.

What’s the most challenging thing about running your business?

I call our approach to our solutions “collaborative.” We work with a lot of partners. Not everyone is willing to collaborate for obvious reasons. But, at the end of the day, I feel sorry for them. In the new age, there’s no centralized model. If you’re not willing to collaborate respectfully and fairly with other companies, I don’t think you’re going to make it.

What’s the most rewarding thing about running your business?

Being your own boss is the best. I know it’s a cliché, but it cannot be understated. When you don’t have that stress on top of you from the regular 8-to-5, you can set your own priorities and be flexible, which makes a more efficient day. Three or four of my hours now are extremely more efficient than the 40 hours a week I was working before.

To us, it’s not just about money. I understand that you’re in business to make money. But, if that’s the only reason why you’re doing it, you’re doing it for all the wrong reasons, whether you’re a coffee shop on the corner or Microsoft. When you get feedback and see the faces of folks who feel like someone finally gets what they need, there’s no price tag on that! The interaction with customers is such a great reward.

Did you make any mistakes when you were first starting the company?

We got involved with an international partner. I thought I knew what I was doing with the contract. After the fact, I turned it in to my lawyers and there were a lot of details that were missing. Do not ever agree to any contract without proper legal advice. Even lawyers consult lawyers.

Before you go into any business project, even if you know the person and have an intuition of trustworthiness, be clear about everything – all the expectations, the work, who’s going to be doing what and for how much. Have clear-cut boundaries about your services so you are making money for your time.

What’s the smartest thing you did when you started the company?

The No. 1 thing for us is connections and relationships. The uniqueness about us as a consultancy for enterprises is that we know all the players and have all the relationships. If you work with Company X, they are going to sell you Company X solutions. But, the best thing for you might be a combination of things from Company X, Company Y, and Company Z. We are agnostic, so we can tell you ways to find a better solution.

What advice would you give to new entrepreneurs?

Look for local resources. There are a lot of Small Business Administration resources on their website. Go to your local SBA and sign up for every free webinar and seminar. They are extremely good. There is a lot of free information.

Get as much information as you can and then get a trusted lawyer who understands your needs. It gives you such peace of mind when you go to bed at night to know you are not alone in this and you have put things in place to protect yourself incase things don’t work out. I would say you should find a lawyer even before you find an accountant. We actually found our lawyer at a local SBA event. Within one hour, I was able to have the paperwork for our LLC. We continued to work together after that because they knew us and understood our needs as a small business with a strict budget.

What’s next for rēd wireless?

We are involved in our first tangible installation project. We have a roadmap of entities for partnerships. Not only are we going to be focusing on cellular, but we have lined up partnerships globally to develop Wi-Fi offerings and to help build the Internet of Things.

This article was originally written on October 3, 2017 and updated on January 31, 2021.

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