Frederick Hutson was always entrepreneurial. As a kid growing up in Brooklyn, he did odd jobs for neighbors, and after receiving an honorable discharge from the Air Force, he bought and sold a series of small businesses. When an old friend told Hutson about a marijuana smuggling business he was involved with, Hutson thought he saw a smarter way of running the operation. As he told The New York Times, it seemed like a way to make enough to start a few legitimate companies. He shipped the drugs through his Las Vegas mail store using DHL, UPS, and FedEx—netting upwards of $500,000 a year—until 10 Drug Enforcement Agency officers showed up with guns drawn. He was sentenced to 51 months in prison. Hutson was 24.
Hutson became part of the 2.3 million people incarcerated in the U.S. He felt the isolation personally, but also began to notice how that isolation made it difficult for fellow inmates to rebuild their lives on the outside, once they were released. According to David Fathi, director of the ACLU’s National Prison Project, successful reentry to society is linked to how well an inmate keeps in touch with the outside world while incarcerated.
But doing so isn’t easy. Snapshots sent to offer a physical memento of home are likely to be confiscated. Long-distance collect calls are expensive for families on the outside. These simple realities set up barriers to prisoners’ basic ability to communicate with loved ones.
But Hutson saw these hurdles, and the prisoners dealing with them, as an untapped and, quite literally, captive market.
When Hutson was released into a halfway house in March 2012, he began working on the first version of Pigeonly, an online platform that lets friends and relatives of people in prison search for their loved ones in the first centralized national database of the incarcerated. From there, users can upload photos and have them sent through the postal service for a flat 50-cent-per-print fee.
Hutson received help with Pigeonly’s business model from San Francisco accelerator NewME, which works with entrepreneurs in underrepresented demographics in technology. Seed funders included Lotus creator Mitch Kapor.
Although the obvious stigma that comes with being a felon proved to be a roadblock with some potential investors and partners, with others, sharing his personal story proved Hutson really knew the system, and perhaps most importantly, the needs of prisoners. He had domain experience. And while Pigeonly stood to be beneficial to both the incarcerated and their families, it also seemed likely to be quite profitable.
Last December, Pigeonly also launched its phone service, Telepigeon, which taps internet phone service providers to circumvent the usual long distance collect calls (and charges). Doing so can reduce prisoner phone costs from 23 cents to only 6 cents per minute.
Every year, on average, inmates are allowed $300 for the prison commissary, and their families spend about $600 on each prisoner. Hutson figures that if 10 percent of the prisoners he markets to tell their loved ones about Pigeonly, and they send 10 photos a month, that—combined with phone service—could be bringing in $22 million in annual revenue within three years.
Next for the business is a venture aimed at inmates scheduled for release, helping them get cell phones, set up bank accounts, and find employment. It will build upon the relationships Pigeonly has already created with the prisoners while they served their time, and in the long run, the company hopes, even help reduce recidivism.
