These days, Siddiqui’s work is as president of PriceDrip, a Monroe Township, N.J.-based operator of an online auction site. Last week, PriceDrip raised an undisclosed amount of funding from 2G Associates, an angel investment firm located in Central New Jersey. PriceDrip says it stands apart from its competitors because prices of items for sale on its website fall as opposed to rise during the auction.
This is Siddiqui’s second startup. He previously launched BookSwim, a provider of an online book rental service.
I call Siddiqui a cereal entrepreneur in the headline above because that’s part of the tagline of Bootstrapper.com, where Siddiqui blogs about being an entrepreneur.
Q: How long have you been blogging on Bootstrapper?
A: I’ve been involved with Bootstrapper.com for over a year now. Richie Hecker [chief bootstrapper and founder of the site] and I have been good friends for a while. Richie has a great network, as evidenced by the bloggers on Bootstrapper.com, and he’s always willing to connect people that can make great things happen together.
Q: Did you raise any outside capital to launch BookSwim?
A: BookSwim was entirely bootstrapped. My partner and good friend, George Burke, and I had very little experience with this entire game of launching a business. Our finances were a mess and all of our projections were just… wrong.
But we kept our expenses down and did a lot of work ourselves. We were the founders and janitors. I can say we went into a lot of debt to make it all happen. It was “all or nothing” really.
Q: How’s BookSwim doing?
A: BookSwim is doing very well, I’m pleased to say. I’m involved in the background and I am not at liberty to say too much. There are some awesome plans ahead, and without getting too specific, I can say that the next year for BookSwim will be amazing. They’ve got some amazing ideas and ways to utilize unused inventory in your house, and the houses of millions of Americans and bookstores.
Q: In the online auction market, what sets your company PriceDrip apart from the rest?
A: There really is one big player in the space, Swoopo, and they are definitely innovators. No one, to my knowledge, has had the price come down and given customer something to look forward to.
All of the other auction sites out there keep the customer in perpetual suspense by increasing the price seemingly forever, and that’s not really fair.
Q: What are your plans with PriceDrip?
A: I wish I could tell you more, but right now I can’t due to a variety of agreements in place.
Q: Where’d you get the idea to launch PriceDrip?
A: I think a lot of people surf the Web at work. And a lot of people are bored at work and want something to do. People are very bargain hungry, and with the economy the way it is, people really want the best deal possible. Watching prices come down is rewarding to many people.
Q: What made you decide to raise money from 2G, rather than bootstrap the company yourself?
A: One lesson I learned from BookSwim is that you’re only as successful as your marketing. We were lucky to get a lot of press because the idea was so awesome, but good press can only carry you so far. You need to invest in marketing and that’s where 2G and I were in agreement.
The terms were favorable and fair. I think the fair part is critical to raising financing.
Q: Do you expect to raise VC or more outside capital for PriceDrip?
A: I’ve been approached by a few private equity firms and VC firm and I am in preliminary discussions right now. We’ll see what happens.
Q: What advice do you have for other entrepreneurs considering whether to raise capital?
A: Build a great product. Be realistic. If you go to investors with a valuation of $50 million and you’ve earned nothing, don’t be surprised when you hear nothing from them. Show your investors how you plan to spend their money, and always remember that it is their money.
You are responsible for it and should spend it in a way to benefit the company the most. Never forget that when you bring investors on board, you bring on partners with a vested interest and you owe it to them to give 110 percent.
Q: Do you want to continue to start companies or do you want to try something else?
A: I love the thrill of the start. I love to diversify and can definitely see myself starting more concepts in the future. I’m always pitching new ideas to friends and family and I keep a journal of the good ones.
Q: I hear you’re into extreme sports. Is that so?
A: I don’t know about extreme, but I was trying to get my skydiving certification and would like to get a wing suit one day. That would be a lot of fun.