May 21, 2024

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Think Differently

St. Thomas student has rung up $1M in sales keeping office furniture out of landfills

At 10 years old, John Costello took it upon himself to sell chicken eggs from his family’s hobby farm at a Carver County farmer’s market near Watertown.

No parents. No siblings. Just John.

“He didn’t want to be the little helper,” said his father, David Costello. “He wanted to have the whole interaction with customers to himself.”

By his senior year of high school, Costello was running West Metro Solutions, a company that refurbishes discarded office cubicles and resells them to other businesses.

Now a junior at the University of St. Thomas, Costello has balanced being a full-time student and his company, which has generated more than $1 million in sales so far.

The lightbulb moment

Costello followed his egg business with reselling used clothes and electronics. While placing his goods online for sale, Costello came across an advertisement by a business looking to give away its used office cubicles.

Upon further research, Costello discovered billions of pounds of office furniture are dumped every year into landfills.

His solution: Help the environment, and make a buck or two, by recycling those items.

Costello and some high school friends would search Facebook ads for free furniture. They’d pick up the items and then resell them. The Costellos’ garage and basement became their warehouse.

The business model, however, was unsustainable, and Costello’s friends weren’t as determined to grow the business.

So Costello pivoted, coordinating pick-ups and drop-offs between companies throwing away their cubicles, contractors that tear down the used cubicles, refurbishing and carpentry experts and transportation companies that deliver to the parties involved.

He spent as many as eight hours a day cold-calling furniture installation businesses to gain leads.

Elliot Gensler — a partner at Charlotte Fabrics, a Crystal-based company that supplies fabrics to designers, architects and upholsters — came across the West Metro Solutions website three years ago while looking for new cubicles.

Gensler was surprised Costello was still in high school, but he ended up purchasing 10 refurbished cubicles.

“He was able to find what we were looking for,” Gensler said.

Earlier this year, Gensler needed 18 more cubicles to fill out his call center.

Costello’s product was “at a price we couldn’t find anywhere else,” he said. Plus, his business acumen is stronger than most of the people Gensler works with.

“The attention he gives was the biggest draw,” Gensler said. “He’s on site, looking over things. He knows his product very well.”

A growing opportunity

Since 2021, West Metro Solutions sales grew fivefold and expanded to clients in Texas and Arizona, Costello said.

While a decade ago, corporations expanded into giant towers and business parks, ordering cubicles by the thousands, these same companies are downsizing in a post-COVID world to accommodate hybrid work.

Still, the industry is not booming, Costello said.

“I wasn’t in the industry before COVID,” Costello said. “All of my competitors have told me that the industry is way down from its heyday in the ’90s. I wasn’t even alive then, so for me, I’ve just made it work in this environment.”

Costello’s niche is small-scale orders like what he supplied to Charlotte Fabrics. But he is securing a cubicle manufacturing partner overseas to give clients that want brand new workspaces an option.

Costello makes about 20% off his contracts. He’s putting some of his profits into stocks, but most is tied up in liquid assets to pay vendors and subcontractors on time.

“I’ve had to keep my operating expenses small because I have to be more nimble,” he said.

Balancing act

Costello, who recently turned 20 and is a Schulze Innovation Scholars fellow at St. Thomas, will graduate in May with a double major in entrepreneurship and finance.

Funded by Best Buy founder Richard Schulze’s family foundation, the five-year-old scholars program provides full tuition to 10 students each school year.

Students selected for the program participate in extra programs including exclusive sessions with alumni and serial entrepreneurs on topics from venture capital and business funding to mergers and acquisitions and also receive coaching.

“What I think is great about John’s business model is that it aligns so well with the mission of the University at St. Thomas, which is to advance the common good and to think about how are we leveraging entrepreneurship and business to do good in society,” said Danielle Campeau, associate dean of the school’s Schulze School of Entrepreneurship. “John’s business model is an exact example of that, looking at environmental sustainability and overfills of our landfills and how much damage we’re doing to our environment.”

While entrepreneurship programs are not new, expanding opportunities to help solve companies’ problems and mentorship are expanding, she said. Students in the scholar program next spring will work with underserved entrepreneurs in the Twin Cities who have business ideas, but need help moving them forward.

Costello plans to run West Metro Solutions full-time when he graduates. He switched one of his majors from accounting to finance to understand how to raise capital from investors.

His father, David Costello, who works in product development in the medical device industry, was afraid his son’s business would interfere with his college education.

“He was trying to tell me that he didn’t think he needed college. I was like no, no John, you need college,” he said. “You need to be there. Now that he’s into his junior year, I’m less concerned about it.”

Within a short amount of time, his son has figured out his career path, David Costello said.

“It’s all him,” he said. “The guts he has to do what’s he’s doing, I don’t think I could force a kid to do that.”