A 54-year-old man lost his children’s $60,000 college fund by using it for himself – how he got it back, and more.

Kim Vaccarella was so convinced of her business idea that she drained her children’s $60,000 college fund to bring it to life.

The process backfired – a lot.

Today, Vaccarella, 54, is CEO and founder of Secaucus, New Jersey-based Bogg Bag, a maker of waterproof bags with more than $100 million in annual sales, he says. But in 2008, she was a mother of two with an idea to buy a more practical beach bag. After finding a manufacturer who built a prototype, Vaccarella created two limited stocks — first 300 bags, then 600 — that “flew off the shelves,” he says.

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The initial success gave Vaccarella the courage to try something drastic in 2012: putting all of her money, including her children’s college savings, into ordering more than 1,000 bags. Each bag arrived in perfect working order but has a nice flaw, it has some ugly black lines.

The developer refused to cancel the payment, and the lack of mortgage insurance left him with no way to support himself, he says – leaving him with property he “cannot sell” and no have the ability to buy more.

“I got a down payment and used my kids’ college money to buy a full container’s worth. [of bags]and they were all bad, so my heart sank,” Vaccarella tells CNBC Make It. “The realization that I didn’t know what I was doing really set in very quickly.”

Around the same time in 2012, the US Coast was hit by Hurricane Sandy. Vaccarella decided to order his Bogg Bags for the disabled and give them to local families in need, confident that the act of charity would mark the end of his business.

He says: “Six months to a year later, all the people who received them as donations started reaching out for help, and they were saying, ‘Where can I get more?’ It was one of those ‘oh s—‘ moments. [where I was like]I have to do this.”

Vaccarella, who worked full-time as a real estate loan manager, spent the next year saving up for a trip to visit young developers in China. He found the firm, got $120,000 from a family friend to fill his inventory and get his business back “on the ground” in 2016, he says.

Two years later, Vaccarella’s company brought in more than $1 million in annual sales, he recently told Entrepreneur, and he quit his job to run Bogg Bag full time. The sturdy, easy-to-wash bags went viral on TikTok and Instagram earlier this year, contributing to another significant boost in sales.

The $120,000 investment turned into “a $10 million investment” for the family friend, says Vaccarella.

In retrospect, Vaccarella says her decision to invest in her children’s college money was “crazy” — but she says she stands by that decision. She said neither she nor her husband had gone to college, and they both wanted their children to have that experience, but they had very little money to keep the business going. when they believed in it.

She says the simple act of taking risks taught Vaccarella to “relax” and trust her gut. Bogg Bag eventually filled the fund, helped his 25-year-old son go to college for a year — he chose to drop out, he says — and his 21-year-old son attends community college today. .

His hope was unwavering, he adds: “Somewhere in my mind, I think I can do anything.

Unshakable confidence is a common trait among many entrepreneurs – and sometimes necessary, given the challenges of starting a new business from scratch. But overconfidence can cause businesses to fail, found a 2020 study published in the New England Journal of Entrepreneurship.

Advice from Amazon founder Jeff Bezos: Take risks with the freedom to recover from them. He categorizes risks as “one-way doors” — essentially, irreversible decisions — or “two-way doors,” with levers you can handle.

In other words, when you think about risk, think about what you could lose in the worst case scenario. If you’re comfortable with that loss, the risk might be easier to take — because you can always “go back and pick another door,” Bezos told the “Lex Fridman Podcast” last year. ago.

If you are not comfortable with the worst case scenario, be very careful about jumping. “You went through that door, you’re not coming back,” said Bezos. “Those decisions have to be made very deliberately, very carefully.”

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