Released From Prison, and Starting a Company

Hoping to reduce recidivism, he came up with an idea for an online platform, called Fotopigeon, that lets friends and relatives upload photos, which are then sent through the postal service directly to the incarcerated for a flat fee of 50 cents a print. “Companies like Shutterfly and Snapfish — their packaging won’t get accepted by prisons,” Mr. Hutson said, “because they don’t like anything that doesn’t come in a plain white envelope.”

Mr. Hutson knows his market well. In October 2007, when he was 24, he was deeply immersed in solving a different business problem — the inefficient distribution of marijuana from Mexico to Florida — when 10 Drug Enforcement Agency officers showed up at his mail store in Las Vegas with guns drawn. Mr. Hutson had been moving marijuana through his business, using DHL, UPS and FedEx trucks to transport it to Florida. With no previous criminal record and an honorable discharge from the Air Force, which he entered directly after graduating from high school, Mr. Hutson expected to get off with a “slap on the wrist.” Instead, he was sentenced to 51 months in prison.

Like many former inmates, Mr. Hutson, now 29, has benefited from a growing number of support programs available to those who want to start businesses. In Manhattan, for example, Catherine Hoke founded Defy Ventures, a nonprofit organization whose participants have started 44 businesses, including an event-planning company, a cleaning service and a mobile barbershop. “One of the primary skills they need to survive on the street are good hustling and sales skills,” Ms. Hoke said. “I’m not saying that all drug dealers make great entrepreneurs, but many of the skill sets are shared.”

In Silicon Valley, Chris Redlitz, a venture capitalist, and his wife, Beverly Parenti, have started an organization called the Last Mile, which is opening a business accelerator within San Quentin State Prison. Mr. Redlitz runs a traditional incubator called KickLabs and is trying to replicate the model within the prison. “We’re looking for three things,” he said. “Do they have passion? Can they be a leader? And do they have perseverance? To survive in prison, you have to have those three things.”

Mr. Hutson was released in March 2012 from a halfway house in Tampa, Fla., where he had been working on the first version of his company, then called Fotopigeon. He got help refining the idea at NewME, an accelerator based in San Francisco that works with entrepreneurs in demographics that are underrepresented in the tech community. “He really is a natural-born entrepreneur,” said Angela Benton, who founded NewME two years ago. “At first, he wasn’t sure how much to share about his background.”

At one point, when he was trying to persuade the chief executive of a large photo-fulfillment company to work with his start-up, Mr. Hutson explained that he was aiming at a demographic that few understand. The executive, Mr. Hutson said, “asked me the million-dollar question: ‘How do you know all this?’ ” Mr. Hutson told his story, and the chief executive took the gamble, signing on as Fotopigeon’s fulfillment company. “I thought my record would prevent people from doing business with us, but it was just the opposite,” Mr. Hutson said. “I had domain expertise.”

His business plan involved tapping into the little-understood market of 2.3 million people incarcerated in the United States. According to his research, the average inmate has $300 a year in a prison commissary account, the means by which prison goods, including phone calls, are purchased. Inmate families spend $600 annually per prisoner, he said. Mr. Huston’s plan was to market directly to prisoners, who would send friends and family members to the Fotopigeon website. If 10 percent responded and their loved ones sent 10 photos a month, Mr. Huston estimated, the photos, combined with other offerings, like a phone service, could bring $22 million in annual revenue within three years.

At NewME, he said, “they thought it was a good business model, but they didn’t see how it could be huge.” His mentors at the accelerator, including Mitch Kapor, the founder of Lotus Development, who wound up investing $100,000, suggested that he re-evaluate. Sending photos, they suggested, was just one way for the company to make money.

This article has been revised to reflect the following correction:

Correction: November 6, 2013

An earlier version of this article misspelled the surname of the founder of NewME. She is Angela Benton, not Barton.

Article source: http://www.nytimes.com/2013/11/07/business/smallbusiness/released-from-prison-and-starting-a-company.html?partner=rss&emc=rss