Carlo Silva is co-founder of 2nd Office Inc. 2nd office is an outsourcing company in the Philippines that helps over 100 eCommerce companies grow their business. Some of them being internet top 500 retailers in the USA. His company specializes in eBay, Amazon, Rakuten, eCommerce and other marketplaces worldwide. He is considered to be the outsourcing expert when it comes to eCommerce and has been featured in high traffic eCommerce blogs globally.
My Life Story
I was born Dec 22, 1984 in Manila Philippines. My family moved to sunny southern California when I was 3 years old. I come from a family of 7 children (4 sisters & 2 brothers) with me being the 2nd youngest. Like most immigrants, my family struggled in the beginning. My mom had to work graveyard shift as a Nurse about 1 hour away from our home and my dad worked as a material handler at large furniture manufacturing company. My family was not rich, my parents barely made enough to support 7 children.
Being in a large family, I had to sleep on the sofa until I was in high school. Growing up, I would spend most of my time drawing, playing video games, basketball and coming up with ways to earn more money so I can buy candy and more video games. Since we didn’t have much money, my parents only gave me enough money to buy lunch.
Here’s a drawing I did of Goku from Dragon Ball Z back in 1998.
My first Job was at the age of 16 scooping Ice cream at Baskin Robbins, soon after I learned that I could make more money by doing what I like. My brother helped me land a part-time job as a Graphic designer for Riverside County. Since I had a job, my parents would no longer supply me with a weekly allowance. My parents taught us to be able to support ourselves at an early age, my older siblings would work and go to school at the same time. It was hard at first, but we didn’t have a choice. We had to help each other out anyway we could, and working while studying was the only option.
One of the biggest mistakes in my life was signing up for a credit card during high school. Since I had a job, I racked up my credit card bill to the max which was $500. I would pay off my bill on monthly basis and about a year later my credit card limit was almost $10,0000. What does a high school student do with such a high credit card limit? Spend it of course! If I had any advice to give to any high school students reading this, don’t get a credit card till you’ve taken some kind of financial management class and you have the control not to overspend. Don’t fall into the credit card trap!
Growing up, I was always trying to think of ways to make money. My family wasn’t rich, so I had to put my entrepreneur hat on to make more money to support the lifestyle I wanted. The first thing I ever sold was a homemade sandwich to my friends in the 5th grade. I would make ham, bacon, lettuce, and cheese sandwiches from home and sell them to my friends for $2. I told them it had a special sauce which everyone loved, but it was really just mayonnaise and mustard. I made about $20 from selling sandwiches and I used that money to rent some video games at Blockbuster. I later moved into buying candy at Costco in bulk, and selling it to kids for 50-.75 cents in Jr. high. I learned that selling food and candy wasn’t going to make me a lot of money, so I decided to look for something else to sell.
One day I was browsing on AOL (America Online) and I saw an ad for a Plug and Play Mod chip for the Sony Playstation. I purchased the mod chip for around $100 online. If you’re not sure what a mod chip is, it basically lets you play “backup copies” of Playstation games. The mod chip worked like a charm! I would no longer have to buy a video game ever again. Being an entrepreneur, I started researching for a wholesale supplier right away so I could start selling them to my friends and anyone else that wanted to save money!
I found a supplier in China online that was selling them for around $15 a pop. I bought around 50 pieces using money I saved up from my job. This was in the early 2000′s when eCommerce in the states was starting to boom. I was very hesitant to send my hard earned money to China, but I was thinking I could make a lot of money by selling it at $100 a pop to kids in my high school and to people online, the risk was well worth the return on investment! I sent the money in and a few weeks later I received my shipment of mod chips. The mod chips were sold out in about 2 weeks. I had made a few thousand dollars selling mod chips. I had one of the best summers of my life. Shortly after, I heard that a bunch of people were getting arrested for selling pirated games and accessories. I then realized that selling mod chips wasn’t going to be a long term business and was too risky, so that was the end of my mod chip business.
The College Life & My first eCommerce store
I began college in the year 2003 and had to find ways to support my college education. Tuition and books were super expensive and so was my apartment. To support myself, I had to work several odd jobs throughout my college life. I’ve been a PC technician, sales guy at Best Buy, videographer, graphic designer, web designer, photographer, customer service rep at a car rental company, and a sales rep at an automotive company that manufactured aftermarket car parts.
My first car in high school was a 5 speed 1994 Acura Integra with an LS motor and later a B20 motor after I blew up the first one. I was always a car guy growing up and in college I landed a job as a sales rep for a company that manufactured automotive aftermarket parts. At this job, I learned the ins and outs of the automotive industry and eventually made friends with a lot of suppliers and other sales reps. The sales job wasn’t making me enough money, so I decided to start an eBay store and eCommerce store on the side. I asked my new friends if they could hook me up with dealer accounts and they agreed to open me up.
My first eCommerce store was built on the osCommerce platform, I later ditched that and started using Zen-Cart which was a lot better. Back then, osCommerce and Zen-Cart were equivalent to Magento and Prestashop in todays standards. My first eCommerce store sold automotive exterior parts and accessories. It took me about a month to build out the site and to add all the products I wanted, I did all of this from my college apartment. To drive traffic I paid for advertising on online forums and used froogle and other shopping cart comparison engines. I also traded on eBay. For the first few months I was only selling a few hundred dollars a month, I would visit my suppliers on a daily basis and buy parts and get them shipped out the same day. Since all my suppliers were local, I didn’t have to hold much inventory.
On the 6th month business started booming, my site was becoming popular and getting known for great service on the forums. I would always answer my customers quickly and gave my cell phone number out so they can easily contact me. I would be getting calls during class and I would have to walk out to take the call. School and business was getting difficult to handle. I had two options.
- I could continue the business and let my grades suffer
- Take a break from school and grow the business
Naturally, I opted to grow the business full time. I moved back home to my parents house and started working out of my dads garage. After 1 year of selling online, I was doing around $60,000 a month out of my parents home. My dads garage was no longer used for housing the family cars, it was filled with products and my small office. I had hired some of my friends part-time to help me pick up parts and get them shipped out while I managed the rest of the business. My dad eventually kicked me out of the garage and told me to get my own warehouse, which I did. Once I moved out and into my own warehouse, I was selling around $100,000 per month in gross sales.
Failing in Life
At the age of 21, I had a business that was generating a significant amount of sales online. However, a series of events would eventually lead me to sell the business and go back to the simple life.
At the age of 26. I was part of a company that went from $0 to $200,000k in sales per month in 1 year. The business eventually went bankrupt 2 years later. What did we do wrong? We scaled too fast for our own good and ran out of money.
Being a young business owner, we would like to think we know what we are doing. The truth is, most young people don’t know what the hell they are doing at all. I admit, I thought I knew what I was doing, but I was honestly just winging it. I had made several mistakes with all of my businesses and I eventually learned from them. If I didn’t make those mistakes, I wouldn’t be the same person I am today.
The most significant mistakes I made with my eCommerce business were the following:
- Accounting – I didn’t keep track of the sales that were coming in properly. I should of hired a bookkeeper and an accountant to help me keep track of profits on a monthly basis, but I didn’t. I thought that the sales were more then enough to keep the business afloat, but in reality my margins started to decrease due to new competitors entering the market. These lower margins eventually affected the overall cash flow of the business
- Management - I tried to do everything in the business, from sales, marketing, purchasing, and customer service. I should of focused on managing my staff and the business instead of working directly in the business. I had burned myself out to the point where I was overworked and couldn’t focus on where things mattered most. Which was growing the business properly with the resources I had.
- Expanding too fast – With my first business I opened a 2nd retail location near my college thinking that it would bring in a lot more business. The reality was, it didn’t bring in any business at all and only added to my overhead costs. On my other business, we had moved from a 1,000 square foot warehouse to a 3,000 square foot warehouse which tripled our overhead costs. This was a bad move.
- Bad Luck or bad customers – I had a wholesale customer that I had been dealing with for about 6 months. He always paid on time. He eventually put in a large order and negotiated terms on it. He wrote a series of checks for around $4,000+ each for a total of $20,000+. The wholesale customer was based in Canada and he had purchased products from me and he promised to pay it back within 1 month. I received the checks and my bank cleared them. Since the bank cleared them I shipped out the products. 3 weeks later, to my dismay I see that my account had a series of bounced checks totaling $20,000+. My bank told me that they cleared funds from the Canadian account, but the funds were actually not available as it took 4-6 weeks to verify the funds. However, the bank will clear the funds if they don’t see anything wrong with the account. Reference here for a similar case. This was a lesson learned the hard way, these days I no longer take checks from international customers and only accept bank wire or Paypal.
- Hiring friends – Hiring friends can be a double edge sword. If the working relationship doesn’t work out it will also affect your friendship. I’d rather have a great friend for life instead of a temporary employee.
- People in the wrong seats – To have a successful company, you need to hire the right people that actually want to do the job and do the job well. I’ve learned that you need to put the right people in the right seat and remove people right away if they aren’t fit for that seat.
- Not having the proper systems in place – Systems and processes can make or break an eCommerce business. Back then, it was very expensive to have a good system that actually worked. You would need to invest tens and thousands of dollars for the right solution. We had a system, but it didn’t manage our inventory the way we wanted it to. This resulted in overselling of products across all sales channels, which resulted in refunds and turned into negative feedback.
- Spending more money then you have – A lot of business would negotiate terms with suppliers, although this can be good for the business since you don’t have to pay money up front, it can be a double edge sword. Most businesses like to believe they will be able to sell the products right away, hopefully within 30 days. If your business is doing really well, then it seems like a good move. But the reality is, business isn’t always going to always be the same. There are too many variables in eCommerce which is why eCommerce is one of the hardest businesses to manage. A new competitor can pop out of nowhere to make a quick buck, which will disrupt the marketplace. This new competitor if you don’t watch the market closely, can ruin your business if you don’t act fast. I’ve learned that you need to watch the market and competitors very closely or the competition will leave you in the dust. You should also try to bootstrap in the beginning and hold off on borrowing money as long as you can. Grow your business slowly, but surely and you’ll have a more stable business in the long run.
With my first business, after 2 years of doing business I decided to sell it to one of my suppliers. The margins were no longer what they use to be and the market was getting cut throat. I no longer wanted to deal with the headaches of owning a business since I didn’t have the right team in place. I eventually broke even on the business after the sale, but the lessons and experiences learned was priceless.
“The most successful people are the ones who fail the most”
- Carlo Silva
The Freelancer Life
After selling my business at the age of 21 I decided to go back to school. I started freelancing for companies working as an eBay consultant part-time. For companies that didn’t have an eBay presence, I would help them setup their eBay store and get them going. For companies that already had an eBay presence, I would help them increase their sales by putting systems and processes in place. I did this for about a year. I then had an opportunity to start a business with my friends and I naturally jumped at it.
The Beer Pong Life
After college, my friends had all graduated and Beer Pong was getting really big in the states. It was becoming a national sport in college, well sorta. Come on, ping pong balls and beer, it was the best game ever! They even have a world series of beer pong, checkout the video below.
My friend had a crazy idea to start selling portable beer pong tables. I said dude that’s a great idea! I contacted my friend in China and it turns out that he already sells portable beer pong tables, but the crappy generic type. I told him I wanted to brand our own beer pong tables with different designs, package it with ping pong balls and add a bottle cap opener on the side. I went to china a month later and found a factory with the help of my friend. A few months later EZ Beer pong was born.
Here’s some throwback pics
One of our tribal table designs! Sexy isn’t it? Yes, it come with a pack of balls and a built in bottle opener.
The business did great for about a year and we made some decent money until the market started crashing and new competition started showing up. Sadly, beer pong wasn’t as big as we thought it was and sales started dropping and people weren’t playing beer pong as much anymore. We sold around 2,000 tables. We eventually decided it wasn’t worth continuing the business and that was the end of it.
The Corporate Life
I landed a job as graphic designer for a company selling 22 million dollars a year that was in the automotive and motorcycle industry. The company manufactured parts and accessories. After a month, an opportunity opened up and the marketing manager was leaving. I talked to the boss and told him I could do the job and in 3 x months I increased their online sales by $60,000.
Since the company had a large budget to play with, I got to try out a bunch of tools and different software’s. I also had my own team in India and this is the first time I started outsourcing work to another country. However, the outsourcing to India didn’t work out very well so I decided to just hire local people and I would train them.
After a year, I was promoted to marketing director and was making 6 figures. However, I learned that a big salary comes with a lot of corporate politics. I was one of the youngest people in the company out of 200 employees and had one of the highest salaries. You can imagine the hatorade people were throwing at me. I eventually realized that money, the people and the 2 hour commute didn’t make me happy and I left the job. I realized what made me happy was having my own business and helping people.
A new beginning
After realizing the corporate world sucked. I went back to consulting. I wanted to try outsourcing again, but not in India. I contacted my cousin in the Philippines to ask for help. It turns out that her husband worked for US Auto parts as a data quality assurance officer. I recruited him to work from home. With his help and 3 other family members, we had a small outsourcing team in the Philippines. The team helped us add products to several different web stores and in a year we had over 50,000 products across all sales channels.
The outsourcing worked out really well. It worked out so well, that we decided to start offering eCommerce services to the rest of the world and 2nd Office was born in August of 2012. We started with 1 x client and 4 staff members.
I moved to the Philippines in March of 2013 to help grow 2nd Office. I am 100% focused on the business and growing it. We have a great team and couldn’t of asked for better. We are helping over 100 ecommerce businesses grow their business from different parts of the world.
I hope one day, that 2nd Office becomes the #1 outsourcing company for online merchants worldwide.
Over the next few years I want to share all the things I’ve learned and all the mistakes I’ve made in life with you, so one day you can have that successful business you’ve always dreamed of and a great life.
One day, I want to be able to help change the world in a good way. I’m not sure how yet, but I was once told by a fortune teller that I will help a lot of people in my life and make a lot of friends. Whatever the future holds, I hope to live a good, loving, and meaningful life….and I wish the same for you.