Internet-based business started by high school senior brings iPods back from the brink of death -- guaranteed
June 12, 2008 10:00 AM
Kris Pepper, a 2008 graduate of Winchester-Thurston School, in the office of the business he started three years ago.
By Kate McCaffrey Pittsburgh Post-Gazette
"I used to do a lot more paperwork when the company first started, but now I have a guy for that."
Kris Pepper shrugs one shoulder and glances around his work space with the casual air of an owner. He's ready for bigger and better things -- like college.
Kris, of Verona, began his Internet-based business, Kokopelli Music, when he was 16. A friend complained that his iPod wasn't working, so Kris offered to take a look at it.
"I had the battery and the tools and I just opened up his iPod and just messed around till I figured it out," he said. "Unfortunately I wasn't able to fix it because it was a hard-drive problem. But I fixed the battery, so I considered it a success."
Two years later, what started as a favor to a friend has developed into a business in Oakmont with an income of $250,000, thousands of customers, and a guy to handle the paperwork.
Kris' work space consists of two large desks in an L-shape. On one is a soldering iron, several small cardboard boxes labeled "mini-battery," "nano mini-screens" and the like, a magnifying glass, pliers and a tiny electric drill.
Sitting on the other desk are about 10 Ziploc bags. They contain iPods, which are hand-held computerized music devices, of various sizes, colors and stages of disassembly. One is in five pieces.
Next to the bags is a fairly large cardboard box filled with hundreds of broken iPod liquid crystal display screens. A deep, long cardboard box sits on the floor between the corners of the desks, filled with discarded batteries.
"We've emptied these out a couple of times now," said Kris, referring to both boxes, with a touch of pride. The broken screens and batteries are the collected result of hours of work.
The business is largely family-run. His father, Jeff Pepper, is Kris' financial adviser and helps manage the paperwork. His sister, Katelyn Pepper, is a graphic designer and came up with a logo for the Web site.
Kris does the repair work, fixing 15 to 20 each week. His mom, Kathryn Pepper, must occasionally remind him that schoolwork comes first.
He graduated from Winchester-Thurston School Sunday afternoon and will attend Philadelphia University, where he plans to major in industrial engineering.
On the Web site, customers can order the parts they need and try to fix their iPods themselves, or send them to Kris. Satisfied customer testimonials line the screen's borders.
An LCD, which Kris says is the part that breaks, costs $15 to $35, depending on the iPod.
Batteries run about $15. A logic board, or hard drive, costs $180.
The battery and LCD screens come with a lifetime warranty.
When he first began, a battery or screen replacement -- something he now considers simple -- would take about 30 minutes. Under "ideal" conditions, Kris can now make those repairs in five minutes. He's timed himself.
A tiny, third-generation Nano, however, is giving him some grief -- and a few gouges, as the Band-Aid on the tip of one finger indicates.
"The problem is, every time [Apple] comes out with a new iPod, I have to learn how to repair it," Kris said, adding that the new models aren't vastly different from the old ones.
Of course, the occasional iPod that goes under the knife doesn't make it from the operating table. When that happens, the problem is nearly always with a logic board, which Kris replaces.
"It's better than having to admit to someone that we broke their iPod."
Repairs and keeping up with technology aren't the only things Kris has to worry about. Kokopelli Music's advertisements were pulled from Google after Apple complained. Kris goes to the computer nearby and types into Google "iPod battery repair" and points to an ad on the right side of the screen.
"'Replace your I-P-zero-D'," he said, reading from the screen a competitor's ad that uses a zero in place of the "o."
"We actually tried doing that for a while, but they shut off our ads. ... We had to go talk to the Apple people and sent them an e-mail and asked permission. Surprisingly, they gave it to us."
Another problem arose when a Chinese company, Y'All, began undercutting Kokopelli Music and similar companies by selling retail at wholesale prices.
"So we e-mailed them and complained and convinced them that they could make a lot more money selling to people like us and now we buy from them," Kris explained. "They shut off their Web site."
His business savvy recently earned him a $40,000 entrepreneurial scholarship from the McKelvey Foundation. He will get $10,000 per year as an undergraduate.
The foundation awards scholarships to high school students who have started their own businesses or nonprofit organizations.
Despite the company's success, Kris does not plan to continue working for it. His dad will manage the business and Kris will hire a replacement for himself.
But that doesn't mean he'll stop repairing iPods.
"In the entire high school, it's 190-somethin' students and I still manage to get enough business to have some fun," he said. "So I feel next year it's only going to be better, having 3,000 students to work with.