Walter Penny had a good job with steady income working for a pest control company, but he'd always had this nagging desire to start his own business.

So, he did. The problem was, he started it as the economy started lurching through one of its worst cycles in history.

"As usual, my timing was impeccable," he said with a laugh.

But he's banking on two things. One, that he believes he's a pioneer in Colorado with this business and secondly, there is no shortage of the element at the center of his business model — bedbugs.

Standing in his Denver townhome, he holds a small vial with what looks like giant pieces of redwood sawdust. They are dead bedbugs. And eagerly trying to sniff them is his long-nosed, tail-wagging business partner, Macaroni.

Macaroni, a labrador retriever mixed "with something else," has been trained to sniff out the bedbugs by one of the kings of canine smelling experts — Bill Whitstine, the founder of the Florida Canine Academy in Safety Harbor, Fla.

Whitstine, who was featured in a New York Times story about the proliferation of bedbug detecting dogs on the East Coast, is known to train dogs in a variety of olfactory specialities and pulls the animals from rescue shelters.

Penny said he got Macaroni about a week ago for about $8,000 — which included the training.

"He might be the most expensive rescue dog in the state," Penny said.

Starting the business, however, was simple — though a leap of faith as well. He got a license to operate a business in Colorado, incorporated it and called the company Colorado Bed Bug K9. Now, he's trying to secure contracts with hotels, assisted living houses, apartment complexes, furniture rental businesses and any other business that could get infested with bedbugs.

Reports of bedbug problems in big cities such as New York are well-documented, and there have been some high-profile cases such as last year's case at Denver's Halcyon House, an affordable-housing residence for disabled and elderly people.

Aaron Doussett, a zoonosis field specialist with the Colorado Department of Public Health and Environment, said because bedbugs don't transmit disease, they don't track them. He said it is unclear how big a problem there really is in Colorado.

However, Doussett said they get enough inquiries that they created a Web page that provides photos and information about bedbugs.

"Bedbugs, like lice or scabies — they take a blood meal and they deliver bites and so that's a concern," he said. "There are some reports that under incredibly controlled lab conditions, they can pass along pathogens, but it's not anything we've observed in a practical manner."

Penny said he observed enough bedbug infestations in his time working for the pest control company that he believes the demand is out there. But there is the risk that all of the industries his business would cater to could be scaling back as the economy tightens.

And if the business doesn't work, Penny figures there's an upside.

"I've always wanted a dog," he said. "My wife is allergic to them, but she agreed to it when I started the business. Letting me do this — well, she's a saint."