Entrepreneur Paul Aitken saw a problem; the world’s wealthy had been snapping up Bentleys, pink diamonds and loads of expensive watches, often on easy credit. Aitken says “People who consume luxury goods are risk takers”, and offered them a solution to when they needed to turn their luxury assets into cash to pay unexpected expenses etc.
Out of this Aitken started an “upscale pawnshop”, where entrepreneurs, entertainers and sports stars can liquify their luxury assets. Today Aitken’s upscale pawnshop generates a revenue of $17 million. This is generated through an interest rate of 3.99% monthly.
This is a great example of a great way to start up a company. Instead of thinking of an idea, what one should do and something Paul Graham also argues, is to find a problem you can identify with and solve it. Incorporating views he suggests in his blog (paulgraham.com), one should work to solve a problem one has them self, or could have them selves. Though, make it narrow and very necessary. Aitken’s Pawnshop is dubbed “It’s the pawnbroker to the 1 percent” due to the exclusive nature – thus has a very limited customer base. For these few customers, however, it is a very necessary product. A couple of examples are listed in the article, where wealthy people are in situations where large amounts of cash is needed in a short period of time, and they do not wish to sell their precious luxury goods – then this pawnshop is ideal.