Business
8:13 am
Fri August 1, 2014

A Business Idea Incubator For Felons, By Felons

Zer068 is an identifying number for convicts from the 3rd District of Pennsylvania who go to federal prison.

It’s also the name of a fledgling company.

Founder Daniel Bull is trying to walk the line between honesty about his past and giving himself and others a second chance.

Zer068 has been created specifically to help people with felonies or crimes, a past they would like to forget, overcome that past," Bull said. "We get it, we’re there, we understand what you’re about and we’re here to help.”

Zer068 founder Daniel Bull
Credit Ryan Loew / 90.5 WESA

Before he went to prison, Daniel Bull had come from a supportive, upper-middle class family in Beaver. He received a degree in mechanical engineering from Grove City College and had a self-described relentless drive to succeed.

After graduation, Bull chafed at conventional employment at large companies in Pittsburgh. He tried to start his own business. It folded. Then he tried again, but rather than allow it to fail, he doubled down.

“The start-up that I started was Venture Advisors. It’s hard for me to say that name," Bull said. " I made fibs, and little lies and things that are pretty common — like lying about your finances. I took it to a new level with Venture Advisors.”

The company was meant to guide other start-ups entering the marketplace. Close friends and family invested in his company, but when it began to flounder, Bull used investment funds to cover payroll. The problem grew exponentially until a family member tipped off the government.

Bull was sentenced by a federal judge to 21 months at Elkton Prison near Lisbon, Ohio, for mail fraud. In all he misappropriated around $780,000. Bull attributes the short sentence to the fact that the money was used to cover costs, and not for self enrichment. During his stint in prison, Bull realized he was locked up with a lot of intelligent men who had big ideas, but didn’t have a path forward.

“When you’re in there it is breathtakingly impossibly helpless," he said. "But because of it, that just some little tiny thing would make a huge impact.”

So he held meetings with fellow inmates that focused on writing business plans. Inmates’ proposals ran the gamut, from a composting business, to medical devices, to strip clubs. They discussed marketing strategies and fleshed out ideas. But Bull said he always stressed the basics.

“Slow and steady. Get a real job. Start re-establishing strong relationships," he said. "Those are the first parts of their business plans. Not, go and get funding, go and give a pitch, go to Kickstarter. It wasn’t that. It was establish a foundation of trust and loyalty again because those are broken, those are gone, no one trusts you.”

Bull followed his own advice after he was released last July. He attempted to make amends to those he betrayed and to repair torn relationships. Getting a job was hard. A number of studies find that more than 50 percent of ex-offenders are unemployed nine months to a year after they get out of prison. Sympathetic contacts offered Bull opportunities. All but one were nixed by higher ups.

“I get it. If I was in their boots, and a felon came to me with my past of being a manipulator and a liar, and said, ‘I want a shot,’ I would have said ‘no way’ and never thought of him again,” Bull said.

And that’s the crux of the issue facing Zer068, whether the public will be able to see beyond a criminal mistake.

“We’re left with two very distinct roads," said Adam Paulisick, Bull's mentor. "We can continue to diminish his self-esteem and be incredibly unsupportive, or we can recognize that he has a great aptitude and he wants to do better and has made a commitment to really be on the right path, and we can all get behind him.”

Paulisick works as marketing director for a company by day, runs his own start-up by night and occasionally teaches at Carnegie Mellon University’s business school as an adjunct professor. Paulisick said unlike other start-ups - Zer068 has to strike a balance between the backstory and the business side - and on top of that - start-up life is highly competitive.

“Almost impossible to make it," said Paulisick. "Yeah, I think the thing we laughed about is that it’s not like it gets any easier now that everyone wants to high-five him or hug it out, he still has the exact same hurdles to prove.” 

The idea of an incubator run by and for smart felons might seem noble, but when it comes to getting people to invest real money, it’s a barrier. Paulisick said what Zer068 needs is a clean win.

“What you need is to pick one, two, maybe three people who you think have the most incredible potential, and work that process,” he said.

Daniel Bull holds a sure sip straw.
Credit Ryan Loew / 90.5 WESA

One of those people is Jordan Baldrige. He invented a new kind of straw after he had a common and unfortunate incident involving hot coffee.

“In the car as I’m driving out of the parking lot I’m trying to take that sip, and bam, I got nailed," Baldrige said. "It tasted like I had taken a little sip of the sun — it burned my entire mouth.”

Immediately Baldrige’s mind started searching for a way to sip hot coffee without being burned. Hundreds of prototypes and one patent later, he produced the sure sip, a slightly modified stir straw that cools liquid before it hits the lips.

Baldrige lives in Lancaster and is the eternal tinkerer. In high school his busy mind and hands found their focus in motorcycles. But after graduating with a specialty in motorcycle mechanics he couldn’t get a job.

“No matter how good I was, if I didn’t know the right people," said Baldrige. "I knew I wasn’t academically intelligent and I couldn’t buy an opportunity. My path in life had come to an unexpected dead end.” 

He fell in with the wrong crowd and used his abilities to build devices that bypassed motorcycle theft deterrents. Baldrige was convicted of possession of stolen property. He went to prison for a few months in 2000. And while he hated prison, he says using his mind and imagination to create things was an awakening.

“For the first time I had self-worth," he said. "It was almost empowering feeling, that I had this ability or could use it to solve problems in my life.”

Like Zer068, Baldrige wants a clean win. He believes he and Bull have what it takes to make the leap to legitimacy. His goal is simple, but massive:

“The plan now is to replace every single coffee straw on the planet with this straw.”

Zer068 will have a 5-15 percent equity stake in the ideas and businesses it works with. As the company makes its foray into the marketplace, Bull said he continues to wrestle with its messaging: how to brand the company without hiding their prior mistakes. If Zer068 makes it, Bull said he believes there will be jobs waiting for the men behind some big ideas being generated behind bars.