Some entrepreneurs spend months crafting the perfect business plan. Steve Sonnenberg just gets started. And that impulse, he says, is what transformed Awardco from a side project into a billion-dollar employee recognition platform.
"When it comes to entrepreneurship, my superpower is all about just beginning," Sonnenberg told CNBC last week. "It's very easy for me to start, because that's just who I am."
From Failure to Five Grand
Sonnenberg launched Awardco in 2011, right after his previous venture, WholesaleMatch, fell apart. Instead of taking time to lick his wounds, he dropped $5,000 to buy the Awardco domain from its previous owner and immediately started building.
"What does any crazy entrepreneur do? You always have another [idea] on deck," he told CNBC.
The initial version was pure side hustle territory. Sonnenberg worked at software company Qualtrics during the day while developing Awardco with co-founders Mike Sonnenberg and Tanner Runia after hours. It took months of iteration before they landed on their current model: a digital employee recognition platform where companies award points that workers can redeem for actual stuff.
That model clearly resonated. This past May, Awardco closed a $165 million funding round that valued the company north of $1 billion.
When Amazon Says No, You Pivot
Here's where the story gets interesting. A major selling point for Awardco is that employees can redeem their points on Amazon (AMZN). But when Sonnenberg first approached the e-commerce giant about partnering, Amazon passed.
Most people would have pivoted to a different redemption partner. Sonnenberg just ignored the rejection and signed up corporate clients anyway. When employees wanted to spend their Awardco points on Amazon products, his wife manually placed the orders and coordinated delivery to corporate offices.
Yes, you read that right. For years, Awardco's Amazon integration consisted of someone literally shopping on Amazon and handling the logistics by hand.
The hustle paid off. In 2015, several years after that initial rejection, Amazon reached out and invited Awardco to partner with its business marketplace.
"Start, [then] pivot, pivot, pivot, pivot: That's the story of Awardco, with my back against the wall," Sonnenberg said.
The Ingredients of Resilience
Building something successful after watching a previous company dissolve requires a particular kind of psychological fortitude. Sonnenberg credits several factors for his ability to push through.
First, there's pure persistence. "I just keep going," he told CNBC. "I don't know what it is, but anything I've ever done it's been successful, but it's failed [first]. It's the consistency of keeping it on the track."
Then there's domain expertise. Sonnenberg grew up watching his father manufacture plaques and physical awards for major corporations like McDonald's (MCD). That early exposure gave him insights into an industry he knew was overdue for disruption.
"I just knew the space," Sonnenberg told CNBC. "I knew that this industry is old school [and] ripe for disruption. I was 100% confident that we were going to find success."
Finally, and perhaps most importantly, there's what Sonnenberg calls his naivety. Not knowing all the reasons something might fail can actually be an advantage.
"[I was] a bit [of] a naive entrepreneur," he said. "And I think that's a trait of successful entrepreneurs: They don't get in the way of themselves."
Translation: Sometimes the best business strategy is not thinking too hard about why your idea might not work. Just start, figure it out as you go, and keep moving forward. For Sonnenberg, that approach turned a $5,000 domain purchase into a company worth 200,000 times that amount.