Why Did I Sell my Business
I was the owner of a telecommunications company called JSS Communications Inc. It was born from taking over my father’s business that was failing. He unfortunately did not have the business acumen to lead the company or get it out of it’s hole. If his company failed, there would be significant consequences for my family, so I stepped in because of duty. I became the sole owner, and over 5 years I learned the industry and grew the company. We handled everything from the wires in the walls to the phones on the desks for companies. Low voltage and fiber optics projects for small businesses and large national retailers. We also provided VoIP and PBX phone systems and worked to create a fully unified communications system. Some days I was in a hard hat and work boots, and others I was in heels and networking - never a dull moment!
One of the key reason I sold was due to industry changes. I unfortunately took over the business in a time when the telecommunications industry was evolving and on a steady decline. Complimentary businesses were absorbing what my company did. Electricians were hiring low voltage technicians, and phones were becoming mini computers, and thus handled by IT companies. I eventually realized I either needed to rapidly evolve, close my doors, or get acquired/merge. At the time, my company still had strong revenues, but they were slowly declining. I too often see companies try to sell when it is the last resort and they are desperate. In those situations, your company will inevitably be lower in value and may not get sold to the right buyer.
I was thrown into this role, so I didn’t have much insight on selling a business. I luckily had amazing mentors in my career and asked for guidance and resources. I decided that hiring a broker was the best option. I received 2 referrals, and found another locally, and interviewed them all. Each was similar in structure (Deposit of around $3-4,000 plus percent of the sale (8-12%). I ended up with the broker who was a bit more expensive than the rest, but I felt I could learn the most from in this process, and I did just that. The broker did the valuation, research, cold calling, prospecting and marketing of my business. We would strategize, debrief calls/emails/meetings, and create plans for targets. We were close on 2 deals, but they fell through. In the process of hiring the broker, I negotiated a 1 year term instead of a 2 year term which helped me in the long run. As our contract ended, the broker kept his deposit, but allowed me to use him as a mentor and resource as I moved forward with trying to sell it on my own.
I took a chance and reached out to a local IT company that I had met in the past, Spark Technologies. The owner and I met for lunch in April of 2018. I felt there were a lot of synergies in his vision, what I could contribute, and knew it would be the right fit. At the end of the lunch, I proposed an acquisition. They were in growth mode, so adding a sales/business development person, 100+ clients, and a new set of VoIP/telco skills was advantageous for them. With a lot of thought, and open/honest discussion, we signed the deal June 1, 2018. I stayed on board as VP of Business Development and we are growing rapidly.
The most crucial piece of the transaction was my attorney and CPA (and bookkeeper), both were integral in drafting the agreement and ensuring I had a plan in place post-sale. This process went so quickly and smoothly because my books were impeccable, my past tax documents organized, and my legal team had the experience in company purchase/sales.
I would also be remiss if I did not mention another important point as to why I sold the business. There were industry changes, and financial concerns, but I ultimately no longer felt joy showing up to work. Since I did not start the venture out of passion, and I spent 4 years head down and charging forward, it eventually started to drain me. I was burnt out, and it was affecting the business. Though it was impossible for it to not affect the business, I knew that it was not fair to my team. Since selling the business, I have found a renewed sense of energy, fulfillment and motivation.
Shannon Hoeg has had an unconventional journey through entrepreneurship. While others create start ups out of passion, Shannon became a CEO overnight to protect her family. Though a roller coaster of events, it afforded her amazing experience and lead to community leadership, public speaking, and great success. Shannon was the youngest female on the South Shore Chamber Board of Directors (SSCC), first female as Chair of the South Shore Young Professionals (SSYP), and presented at the Association of Chamber of Commerce Executives (ACCE). Shannon then sold her telecom business in June of 2018, and stayed on board of the acquiring IT firm as VP of Business Development. She currently lives in NYC, managing the Boston & NYC division for Spark Technologies, and works to help support and mentor entrepreneurs.
From The BizON Blog Team!
Remember, if you are interested in receiving the latest business news, insights and opportunities from BizON, you can subscribe to our newsletter here or join our text messaging list here. Also, if you are not a BizON user yet, what are you waiting for? Click here!
Opinions expressed here by Contributors are their own.
