(FORTUNE Small Business) – It started in the 1970s with an Oregon hippie named Ted, who made a business of screen-printing psychedelic wallpaper. As wallpaper's popularity waned, Ted's business failed. But in 2003 real estate developer Jon Sherman, wowed by the designs, bought the company's assets for an undisclosed amount and dubbed it Flavor Paper. Sherman preserves the paper's mysterious pedigree by saying little else about Ted. The tagline: "Est. 1970 (sort of...)." Last year at the International Contemporary Furniture Fair, New Orleans-based Flavor Paper unveiled eight of Ted's 125 original multicolored designs. Each 34-square-foot roll runs $150 to $250. While the first six months of sales yielded only $100,000, Sherman, 35, remains optimistic. "In only the first month of this year, we matched half our total sales in all of 2004," he says. "We're still pretty green." And yellow. And orange. --JULIE SLOANE