M&As Life In The Fast Lane

As founder and president of The I.T. Pros, Doug Ford had promised himself that he would always use his own money to grow his solution provider business and would not--under any circumstances--take funding from venture capital firms. And grow I.T. Pros did, and then some. Fast forward to 2009 and ano...

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Bibliographic Details
Published in:CRN 2010-09 (1301), p.32
Main Author: Wright, Rob
Format: Article
Language:English
Subjects:
Acquisitions & mergers
Alliances
Case studies
Cloud computing
Consulting firms
Economic conditions
Lines of credit
Market strategy
Marketing
Recessions
Service introduction
Small business
Value added resellers
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Summary:As founder and president of The I.T. Pros, Doug Ford had promised himself that he would always use his own money to grow his solution provider business and would not--under any circumstances--take funding from venture capital firms. And grow I.T. Pros did, and then some. Fast forward to 2009 and another recession--and this one was much worse. A financial collapse had struck Wall Street a year earlier, sending the economy into the toilet. I.T. Pros was continuing to increase its revenue, but the rate had slowed in 2009 and, furthermore, fueling the growth was expensive. And here's where Ford's dilemma came in. He could keep I.T. Pros as lifestyle business--one content with the status quo--and settle in as a regional player. Or he could build it out into a nationwide business, which took capital. In Redwood City, managed services player All Covered was growing rapidly as well. Founded in 1997, the company started out as a 10-person IT consulting firm and grew not only through SMB-focused managed services but also through an aggressive acquisition strategy. CEO Todd Croteau had arrived at the company in 2000 when All Covered bought his consulting firm. Like I.T. Pros, All Covered's approach of offering managed services and IT outsourcing to SMB clients was incredibly successful. I.T. Pros survived a turbulent 2009, but the ordeal left Ford wondering about the long-term prospects for his company. For All Covered, I.T. Pros was exactly the kind of company it wanted to add--a growing solution provider with strong customer ties and a highly respected network operations center for managed services offerings. By April, the paperwork was finished, and the two companies announced the deal in May. While the details of the acquisition remain confidential, both All Covered and I.T. Pros seem extremely happy.
ISSN:1539-7343