A 54-year-old woman lost her children's $60,000 college fund after spending it on her side hustle. She shares how she managed to recover the money and more.

Kim Vaccarella was so confident in her business idea that she risked her children's $60,000 college fund to bring it to fruition.

The move backfired — dramatically.

In 2008, Vaccarella, 54, was a mom of two with an idea for a more practical beach bag. She created two limited runs of stock, which "flew off shelves," and now Bogg Bag, the waterproof tote bag-maker based in Secaucus, New Jersey, is on track to top $100 million in annual sales this year, with Vaccarella as the CEO and founder.

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In 2012, Vaccarella decided to take a risk and invest all her savings, including her children's college funds, in ordering over 1,000 bags. Despite arriving perfectly functional, each bag had unsightly black streaks.

Despite the manufacturer's refusal to waive payment, the lack of liability insurance left her with no recourse, she claims, resulting in inventory she couldn't sell and an inability to purchase more.

"I spent my kids' college money on bags that turned out to be bad, causing my heart to sink. This realization made me realize I didn't know what I was doing," Vaccarella tells CNBC Make It.

The pivotal 'oh s---' moment

In 2012, Hurricane Sandy hit the U.S. East Coast, prompting Vaccarella to distribute defective Bogg Bags filled with supplies to local families in need, believing that this act of charity would signal the conclusion of her business.

"A year had passed since they were donated, and the recipients were like, 'I need more of these,'" she says. "It was one of those 'oh s---' moments when I realized I had to do this."

In 2016, Vaccarella, who had been working full-time as a real estate lending controller, spent the previous year saving money for a trip to visit new manufacturers in China. She discovered a factory, secured $120,000 from a family friend to restock her inventory, and revived her business.

Vaccarella's company experienced a significant increase in annual sales, reaching over $1 million, two years after its inception. She recently shared this information with Entrepreneur, stating that she left her job to focus on Bogg Bag full-time. The sturdy and easily washable bags gained popularity on TikTok and Instagram this year, further boosting sales.

For that family friend, says Vaccarella, the $120,000 investment turned into a $10 million windfall.

'Somewhere in my mind, I think that I can do anything'

Although Vaccarella now considers her decision to invest her children's college money as "crazy," she remains firm in her stance. She and her husband, who did not attend college themselves, wanted their kids to have the opportunity to go to college, but they had limited savings to fund their business venture.

Taking a risk taught Vaccarella to trust her instincts, she says. Despite Bogg Bag replenishing the fund, her 25-year-old son dropped out of college, while her 21-year-old son is currently attending community college.

She was confident, adding, "I believe I can accomplish anything."

The study published in the New England Journal of Entrepreneurship in 2020 found that while unshakeable confidence is a common trait among entrepreneurs, overconfidence can lead to business failure.

Jeff Bezos, the founder of Amazon, advises taking risks freely that can be recovered from. He categorizes risks into two types: "one-way doors," which are irreversible decisions, and "two-way doors," which have recoverable stakes.

When evaluating a risk, consider the potential loss in a worst-case scenario. If you can accept that loss, the risk may be manageable, as you can always "choose another door" and move on.

"Be very deliberate and careful when making decisions that could result in a worst-case scenario," advised Bezos.

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