Broken iPhone? Call iCracked, the Aspiring “AAA of Smartphones”

In the underappreciated 2000 M. Night Shyamalan thriller Unbreakable, Bruce Willis played a security guard with powers of invulnerability and super-strength, and Samuel L. Jackson played his brittle-boned archnemesis, Mr. Glass. Imagine that you were recasting the movie with Apple’s iPhone in a starring role—which part would the device play?

After AJ Forsythe’s iPhone had an unfortunate collision with a ceiling fan back in 2010, the former Cal Poly wrestler realized he was looking at not just a shattered screen, but a business opportunity. It turns out that 30 percent of all iPhone owners manage to break their phones within 12 months of purchasing them. For people under 35, the rate is closer to 50 percent. (Which explains something about Forsythe’s accident. “That was a function of being in college,” Forsythe says. “It was an underhand toss to a roommate—‘Hey, the phone’s for you’—and the ceiling fan intercepted it.”)

A shattered iPhone screen can provide a good excuse to upgrade to the latest model, but many consumers can’t afford to do that, or aren’t eligible yet under their wireless contracts. For them, the options used to be very limited: they could tape their cracked phones back together and try to keep using them, or go to the Apple Genius Bar and pay $150 or more for a new screen assembly.

Anthony Martin (left) and AJ Forsythe, co-founders of iCracked

Anthony Martin (left) and AJ Forsythe, co-founders of iCracked

But in 2010 Forsythe and his UC Santa Barbara friend Anthony Martin came up with a new alternative. They founded a network of local iPhone, iPad, and iPod repair technicians called iCracked.

Key your ZIP code into iCracked’s desktop or mobile site, and you’ll hear back within minutes from one of 310 “iTechs” around the world who will schedule a repair visit, usually for around $100. (The exact charges are up to the technicians, who are self-employed and pay iCracked only for parts.) If there’s no iTech in your region, you can order a DIY iPhone screen replacement kit from iCracked for $65 to $75.

If you prefer to simply sell your damaged device and put the cash toward your next phone, iCracked can handle that too. An iPhone 4 with a cracked screen fetches around $105. The startup fixes those devices and resells them on the secondary market.

Overall, repairing iOS devices is a growth business—Apple has sold more than 85 million iPhones in the U.S. since 2007 and more than 34 million iPads since 2010, and the statistics dictate that tens of millions of them will need repairs at some point. With just 12 employees and less than $1 million in seed funding from Y Combinator and other investors, Redwood City-based iCracked is already earning enough revenue to be self-sustaining, Forsythe says. But the company is about to start raising Series A funding, and has big plans to introduce new services and evolve into what Forsythe calls the “AAA of smartphones.”

“We’ve been telling people we’re already one of the world’s largest iPhone repair companies,” he says. “The cool thing is, it’s an incredibly low bar, because there are no other worldwide iPhone repair companies that we know of, except for Apple itself. And I don’t think they really want to be in the repair business—they want to put all their time into creating new products.”

Forsythe and Martin are both born-entrepreneur types. A banker’s son who grew up mainly in Dallas, Forsythe quit wrestling after his sophomore year at Cal Poly and took a job with the campus entrepreneurship club raising bees and selling honey. Martin, a former star of the UCSB baseball team, came from a Southern California home where his father ran a … Next Page »

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Wade Roush is a contributing editor at Xconomy. Follow @wroush

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