This article first appeared in the St. Louis Beacon, Feb. 21, 2011 - Greg Faletto started a tutoring business, Integral Tutoring, while a student at Washington University and has continued it since his graduation in December 2009.
Faletto, who graduated with a physics major and a jazz studies minor, knew he wasn't interesting in pursuing a career in physics, but he said, "I wasn't sure what I wanted to do after I graduated. I liked the idea of working for myself because I would be building useful skills for the future and I would have complete ownership of my work."
But just working as a tutor was ultimately unsatisfying. "Tutoring on my own was nice for a while, but there isn't really any way to go up. You can only charge so much, and you're still working for an hourly wage at the end of the day." Faletto, who said he "never really wanted a job," broadened his view and thought about starting a tutoring company.
"It's better for me because I don't have to be in a specific place at a specific time. (I'm bad at being on time, and I'd prefer not to commit away specific times in my schedule.) As hard as I have to work to get in this position, it's pretty cool to be sitting at home or having fun and be able to think, 'One of my tutors is working right now, and I'm making money.' "
Faletto discussed the risks and rewards in starting up and running his own business in an e-mail exchange with Beacon contributing editor Richard H. Weiss. The dialogue has been edited for clarity and length.
Did you feel well prepared to start a business?
Faletto: Yes and no. I felt pretty well prepared because I understood how the tutoring market in St. Louis worked. It's a pretty simple business: Basically, I put up ads, match clients up with tutors I hire, and take a little off the top.
In terms of general business knowledge, I took an entrepreneurship class at Wash U with Cliff Holekamp. Cliff is a very successful entrepreneur himself (having started Foot Healers here in St. Louis) and a great teacher. He taught me the basics of entrepreneurship, and I did well in his class, so I felt confident that I had some business skills.
Even before that, my mom is pretty business savvy. She started her own interior decorating company when I was a little kid, and she's always been a good salesperson and negotiator. I picked up some business acumen from her.
Of course, after starting the business I also learned a lot and encountered a ton of unexpected challenges. That's entrepreneurship.
What were the hard parts? What were the fun parts? What were the things that you did not anticipate?
Faletto: The milestones were really fun -- looking at the certificate for my official company, having my own website, getting my business debit card. As cool as all of that is, getting your first check is amazing. Anyone can file some documents with the state and have a business, but when someone else has the confidence in your business to give you money for it, that's really cool.
It's also really fun when it's easy. The parents really want tutoring, they're really happy with the job my tutor does, and the tutor's happy to get the work.
Every day there are challenges. The hardest parts overall were learning to be self-motivated and making promises I can keep. Essentially my job is to connect people (tutors to students), so clear communication and expectations are very important. And all the unexpected setbacks -- for example, if a student just doesn't show up for his first tutoring session, that's on me. The tutor gets paid; I have to embrace that risk.
I also have to be able to deal with criticism, which is sometimes hard for me. I'm calling all the shots, so if people think I'm charging too much or paying too little or whatever, that all falls on me. It's also kind of funny seeing how people look at the same business completely differently in different contexts. For example, I'm a hero when I ask people about putting up flyers to hire tutors because I'm making jobs. But I'm an annoying jerk when I want to put up flyers to advertise tutoring services. Of course it's two sides of the same coin; I can't hire the tutors unless I get tutoring students.
Did you need to raise some money to start your business? Need investors?
Faletto: No, that's one of the big advantages of this business model. It cost me about $200 to get up and running. That includes setting up a website with professional photographs, getting a PO box, getting a phone number, registering with the state, and initial advertising. It's really cheap to start a business these days, especially if you do some research and find the cheapest way to do it.
How many tutors do you currently have in your stable? What do you pay them?
Faletto: I've got eight tutors currently, as well as a stack of about 50 applications from people who would like to be tutors. I start tutors at $25 an hour, and I give them raises pretty quickly if they're doing well. The split is roughly 50/50; at first a little more than 50 percent goes to me, and later more than 50 percent goes to them. Of course, the costs of running the business, like advertising and so on, come out of my cut. From what I know about tutoring companies in St. Louis, I pay quite generously and I'm in the middle of the pack for how much I charge. My thinking is that I'd prefer to attract the best tutors and keep them happy. When I was a tutor, I didn't like how little some of the companies paid me compared to what I could get through my own advertising on Craigslist. If I were looking to apply to a tutoring company now, as a tutor I would think my company is a great deal.
What's your advice to the next graduating class at Washington University?
Faletto: Really think about what your No. 1 dream career would be and spend time figuring out the best way to get there. If you don't have a clear idea of what you want to do, try stuff that appeals to you and you'll get a clearer idea. Don't be afraid to go for your dream job; your best chance is now, while you're young.
I saw an article last fall about people who take jobs that they don't like for a little while just to pay the bills. That seems sensible, and it seems like a lot of people give that advice to kids just out of college. But they did a study, and people who take "temporary" jobs to pay the bills almost never end up in their dream careers. If you think it's scary to jump into a dream career when you have no responsibilities and no one expects anything of you, think how hard it will be when you have a full-time job. Once your bills are paid and you get a little comfortable, you're even more scared than you were before to drop everything and try something crazy, because now you've got something to lose. And 10 months turns into 10 years very quickly. So make sure that today you're doing the best you can to reach your goals.