Winner
Consumer Products
Osman Rashid has come a long way from cleaning bathrooms at the student union in college.
As co-founder and chairman of Chegg Inc., he’s helped college students across the country, giving them a venue from which to rent textbooks instead of buying the expensive tomes. The company began as a Web site for student classifieds at Iowa State University, but although its growth was strong, the model did not lend itself to profitability. While researching why, Rashid and the company’s co-founder, Aayush Phumbhra, discovered that there was a strong response on the site to textbook classifieds and hit on the idea of renting books.
With the company nearly out of money, the co-founders were racing the clock to overcome hurdles in technology, logistics and customer service. But their perseverance paid off, and Chegg is now the No. 1 player in the market: In 2008, Chegg grew 300 percent over revenue projections, and in January 2009 alone, the company surpassed revenue for all of 2008.
Renting textbooks sounds simple, but actually doing it is difficult because it requires technology, physical infrastructure and strong management to execute. To meet the challenge, Rashid changed the inventory acquisition model that had been a staple of the textbook industry by introducing just-in-time sourcing methodology. In the industry, bookstores, wholesalers and publishers stock their warehouses, then hope to move books. Chegg turned that model on its head, first taking a rental order, then acquiring the book, allowing it to serve a wider audience and avoid upfront spending on inventory.
Also contributing to its success is technology the company created to select which books to rent, how to source them, how to rate the best sourcing partners and how to get the books to the customers as quickly as possible — technology that Rashid expects will keep the company growing by leaps and bounds.
How to reach: Chegg Inc., (888) 992-4344 or www.chegg.com
