Startup success: iPod repair business

By PAUL GORDON  of the journal star
Feb. 22, 2008

That growth for iRepair Squad has been nothing short of phenomenal in its first year and as it moves toward millions of dollars in annual sales and 100-plus employees, it will relocate to larger quarters in East Peoria that can accommodate the expected growth.

Also, he believes the company's growth will be faster if it doesn't uproot itself from the area and existing employees.

iRepair Squad iRepair Squad, a start-up Peoria business that has experienced phenomenal growth in less than a year since it started, announced Thursday it will relocate to a new site in East Peoria that will help it continue to grow. - iRepair Squad was founded by James Scaggs in his Metamora basement. In less than a year it has grown from two employees to 25 employees with sales topping $1 million. - In 2008 the company, which will relocate to the East Peoria Convention Center in May, expects to add 40 more employees and exceed $17 million in sales. - The company received assistance from various groups, such as financing access through the Illinois Department of Commerce and Economic Opportunity and workforce training assistance through Bradley University, Illinois Central College, and Workforce Network. - It started out repairing iPod machines made by Apple Inc. but since has expanded to other small electronics and now buys returned equipment, repairs and resells them. - For more information go to www.iRepairSquad.com.

"It's a blessing to be able to provide opportunities for others. It's part of what motivated me," Scaggs said during a news conference Thursday at the Peoria NEXT Innovation Center.

Through agreements reached with area civic and business leaders, educational institutions and financial institutions, iRepair Squad will take over about one-third of the East Peoria Convention

Center in May.

The company, with more than $1 million in sales already in less than a full year in business, expects to reach $17 million in sales over the next year and grow employment to about 100 people. The company, which at the start repaired iPods, now will repair other small electronics and will sell restored equipment, as well, through its Web site at www.iRepairSquad.com.

The company, Scaggs said, is securing contracts with national electronics retailers and manufacturers to do their repair work, which will fuel the growth. He declined to name them at this time.

Humble beginnings

The iRepair Squad began as the iPod Repair Squad, and it was the winner of the initial Project Springboard business plan competition co-sponsored by Junction Ventures Ltd. and Bradley University. With that win came financial and technical assistance to get the company started. Nobody, Scaggs said, expected this kind of growth.

The company - renamed when iPod maker Apple Inc. asked Scaggs to remove that element from the name because of trademark issues - started in Scaggs' Metamora basement.

After winning the initial Project Springboard competition, it moved into space at Junction Ventures. It was only a few months later, however, that more employees and space were needed, and a move was made to its existing location 169 Thunderbird Lane in East Peoria.

Others take notice

As business grew - $1 million in sales the first year and employment reaching 20 (Scaggs hired five more this week) - venture capitalists and other cities took notice.

Birmingham, Ala., and Nashville, Tenn., were the leading contenders before Peoria-area officials such as the Economic Development Council for Central Illinois went to work to keep iRepair Squad here.

"This was really a team effort, a team save for the area," said Jim McConoughey, president of the EDC. "The person who drew our attention to what iRepair Squad needed to grow here was Alexis Khazzam (president of Junction Ventures), and we went to work quickly to do what we could to keep them here."

McConoughey said a key was "we listened to their true needs, which was people. At the end of the day their greatest assets walks out the door and goes home. We knew they needed access to trained people and capital; we helped them get it."

Cooperative effort

Other than new, larger location, iRepair Squad will be given assistance in training employees and will work with Bradley and Illinois Central College toward that end.

Tom Brimberry, city administrator for East Peoria, said all the entities involved with helping iRepair Squad "are very pleased the jobs will stay in this area. We all worked very well together to make this happen."

Brimberry credited Lee Hoffman, owner of the East Peoria Convention Center, with stepping up with a lease plan that would work for the company.

Khazzam, who brought the Project Springboard idea to Bradley last year, said the news validated the program.

"To have this type of success so quickly in unimaginable. I'm excited. This is a grass roots business that uses new technologies and a very smart founder to sell what it does. I'm very pleased we were able to help them stay here," Khazzam said.

Paul Gordon can be reached at 686-3288 or This e-mail address is being protected from spam bots, you need JavaScript enabled to view it

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