Russ: This is The BusinessMakers Show, heard on the radio and seen online at TheBusinessMakers.com. It's guest time on the show and I guess actually it's repeat guest time on the show because with me now I have Roy Marsh, who was also our Featured Guest on episode number eight back in 2005, also, a subsequent episode talking about selling the company that we talked about in episode number eight. So here you are in episode number 360, the new owner of eSigns; Roy, welcome back to The BusinessMakers Show.
Roy: Thanks for having me.
Russ: All right, let's start by you telling us about eSigns.
Roy: eSigns online producer of vinyl signs and banners, chloroplast signs magnetic signs; whatever you want, we've got it,
Russ: Okay, we just talking about, like small signs?
Roy: No. We can go up to ten foot wide and even go larger than that seaming, however many ten foots - together.
Russ: okay, okay, so you go ten foot wide, what's the maximum length?
Roy: Whatever length you want.
Russ: Okay. eSigns, and it's an online seller so describe the online process. I mean, do I just go in and kind of choose a template and type in some text and say - see what you guys can put together for me.
Roy: You can load up your artwork or you can use our proprietary design package to design your product and we've got thousands of stock images that we own or license for you to use.
Russ: Oh my goodness. Okay, for those of you who don't know Roy's background is very entrepreneurial but had nothing to do with signs. In fact, we're gonna talk about that a little bit later. So, I'm right aren't I? Signs is a brand new business for you and your brother.
Russ: Okay, and this time it's an acquisition so you actually found a company that was doing this and bought it, right?
Roy: Yeah, the whole process of, finding somebody that's doing something right and,our seller was doing something right, growing very well, but was looking for somebody to take it to the next level so we're stepping in with a good cash flow and looking to make it better.
Russ: Well how did you find that? Did you go hire one of these brokers that does this sort of thing?
Roy: No, actually a friend of ours brought us the opportunity back in September, looked at it and said we don't know anything about signs, came back in October, we don't know anything about signs, came back in November and it's like, well there's a good cash flow there, maybe this is something that'll work for us. And as we looked at it offered - it hit us where our sweet spot was; a consumer product but that's also small business and one that's a mass market and one that we can utilize the internet for and also utilize certain forms of advertising we love. So the more we looked at it, the more we liked it and made put in a letter of intent, called up a few friends say hey, you wanna throw a few dollars this way we've got, you know, bank financing lined up, let's give it a go.
Russ: Wow, sounds like a smooth deal the whole way.
Roy: Oh, yeah, right, which you know it's not.
Russ: Right. Well what was the I mean, is the seller compatible with you? Is the seller gonna stay involved? Did the seller just say here's the business and you read it and wrote them a check? How did it go?
Roy: oh of course, we just walked up and wrote them a check, yeah. No, no, no, no, he's involved for about six months with we've got some developers for that proprietary software that I talked about, the design part of it. Very important and he's, providing an interface while we transition to our team, folks that we've worked with at EV1 in the past. No, the process of going through the due diligence, lining up the financing, getting - working making - stepping through all the hoops for SBA, and meeting with all the different investment advisors for our investor to dot the I's, cross the T's, get everybody happy.
Russ: How old was the company?
Roy: They've been in business since '08 and.
Russ: Okay, wow, so it's not that old really, no, wow.
Roy: No, no, young, young.
Roy: I would put his, we're stepping in like we were at EV1 and let's say late 2000 or 2001, profitable, doing a lot of things right, but the opportunity to do a lot more things right and really grow it and, make a lot more from it.
Russ: Okay, cool. So the due diligence, uh, probably was easy, the guy just turned over, you know, his Quick Books if he was a small business and you guys just took off, right?
Roy: Absolutely, he turned over his shoebox that had his, checks and, you know, a few bank statements and...
Russ: Okay, so it was a real small business then, a genuine small business.
Roy: Well, operated by the check book and so we recreated 2011, took his tax returns from the prior years, to do some modeling and, used that data for our due diligence.
Russ: Wow, now I'm somewhat up to date on the printer technology that's, sort of been successfully connected to the internet mainly in kind of printing smaller scale; what's the printer technology that can connect to the internet and print on this huge scale? What's that like? Who makes it?
Roy: Well Electronics for Imaging, EFI, Hewlett Packard are among a few of the ones that Robert's been talking to and he's visited with numerous vendors, numerous trade shows. It's great technology; fabulous digital technology friendly on the environment, uses a lot less ink than in the past, no waste like you've got in screen printing. But order's placed, my wife went online.
Russ: Okay, and placed the order.
Roy: She designed a banner, she miss-spelled something, one of our folks caught it, calls me, says do you, you know, is this really what you want? So they revised the spelling, it goes through a review overnight for artwork; every piece is every submission is reviewed for artwork to make sure that the artwork works not only on a small scale that you saw on the screen, but on a large scale, life size. It printed the next day, was boxed up and shipped out and she chose two day shipping from Michigan so it took two, you know, she got it on - she ordered on Monday, got it on Thursday.
Russ: Okay, wow, that's impressive. Now, you mentioned Michigan; I've read in doing research for this that - that you guys were gonna move the company to Houston, I didn't know where it was from, so it's located in Michigan today?
Roy: Right, it's in Brighton, Michigan, about an hour outside of Detroit, and our original thought was we'd do the Mattress Mac philosophy, one location, much easier to manage things. But as we looked at it, as we got into it and we were around the production team up there, we found that they were producing copious amounts of work; these guys are machines. Great guys and we felt like that, keeping them and keeping that production facility, splitting the production as far as, making it geographic based so that we could send the product out and get it to the consumers faster would be a better thing.
Russ: Okay, I bet that was well-received in Michigan.
Roy: Yes it was.
Russ: Okay, wow, really cool. So what about this company was it and this business that attracted you? I mean, there's gotta be, Roy, lots of competitors. I mean, there's franchise retail outlets, I would assume there's other online versions of the business; why this business and why this sector?
Roy: Volume among other things. There's a lot of opportunity. Every computer is a retail store front for us, so we're not limited by bricks and mortar. Yes there are a lot of competitors out there; you've got the Mom & Pops, you've got the national chains, you've got, great online competitors. We have entered crowded market places in the past with Everyone's Internet we were told that our business model didn't work and we feel like we build a better mouse trap.
Russ: Okay, really cool. Now you mentioned EV1, that's what we talked about in episode number eight in '05; for those that don't know the background of that story, share it with us.
Roy: '98 timeframe, we were in the beeper business and looking to make a transition to, something else. So we got into the internet, did it very poorly to start, fortunately we had great employees, great partners improved the product created a cult following because basically we would tell our customers if we had a problem, we'd be straight up with them. So, the just ten bucks philosophy flew and, uh...
Russ: And that was just ten bucks per month for internet access, right, but it was dial-up, right? Yeah, okay, all right.
Roy: Dial-up, DSL was a debacle, could not get into the high speed so we got into web hosting, quite accidentally. My brother the entrepreneur and of course the first forays into it were very expensive and we lost money. But we achieved economies of scale and became a leader in that field. Then at some point we had to sell.
Russ: All right, now, this very successful sale. But when you say web hosting, I mean, in the beginning you hosted other people's servers or you sold them servers and put their web on them or - I mean, you weren't the precursor to the Cloud were you?
Roy: We were to a certain extent. We would do was either lease out a server or a part of a server and, to small - basically to small business. Folks that may have been doing web hosting or media type enterprises that you might not be able to mention. These were small businessmen, that was our forte, that's what we love about eSigns is that so much of the opportunity there is to small business.
Russ: All right, but you got real big too at EV1, right?
Roy: EV1, we entered the dial-up access, we were just another one of thousand of people up there doing it we did it very poorly, but we learned how to do it well and we advertised and marketed and grew our base and treated our customer right, treated out employees right and through that we were able to grow it to three, four hundred thousand subscribers and grew the web hosting from nothing to - we had almost thirty thousand servers under management when we left.
Russ: All right, and when you left, you sold the company to really a venture capital firm that was putting together several of these, the company became The Planet for a while and has now merged and gone down the path and got bigger and bigger, right?
Russ: All right, cool. All right, so before I let you go, let's say that we roll back to today's business, eSigns, that's what matters to you today, right?
Russ: All right. And they're interested, how will they find the company?
Roy: eSigns.com and we have a special offer I found, this is not the offer that I wanted for you, but it'll give you ten percent off, use the discount code esigns-club during your checkout at www.eSigns.com.
Russ: Okay, wow.
Roy: But check back to The BusinessMakers website later for much better discounts.
Russ: All right, cool, cool
Roy: We'll see what we can do.
Russ: Cool. Well thank you, that's a neat surprise there at the end. You brought some samples too, why don't you describe these before we let them go because all they know is that you can go ten feet by whatever.
Roy: And you've got a full color pallet on a vinyl sign. It you can do grommets in it, you can do other ideas to adhere - have it adhere to stuff, we've got stuff that will last for years outside mesh banners to allow for in the wind. Oh yeah, and you can see the difference in what a mesh will look like, but you're gonna get your image across. The chloroplast the banded signs political opportunity signs is what they are. I love the smell of money in the morning, and that's what this is, this is for businesses to grow. Then, for - you've also seen the magn-magnetic signs for the vehicles, we do that as well.
Russ: Cool, cool. Well Roy, I really appreciate you coming in and sharing the story of your new venture; wanna stay connected to you so we hear about how it evolves.
Roy: Great, look forward to it.
Russ: You bet. That's Roy Marsh, the owner of eSigns and this is The BusinessMakers Show, heard on the radio and seen online at TheBusinessMakers.com.