Via International Seeks Funding; Founder Randy Stearns Moves On
Randy Stearns, founder and former CEO of the six-company merger known as Via International, has left the organization; business is strong but capital is needed to fund growth.
In 2013, six leading integrators merged to form one international brand, VIA International. With combined revenues of roughly $70 million back then, the group was looking to achieve what has never been done before – a national aggregation of independent systems integrators. It’s been tried many times, but never successfully.
Now the founder and former CEO Randy Stearns is leaving the company, but remains a “major shareholder” with a seat on the board of directors, he tells CE Pro.
Late last year, VIA brought in Gregg Holmes—who has experience with mergers, acquisitions, turnarounds, capital raising and business operations – to serve as CEO and run the organization. Meanwhile, Stearns would focus on “outward-facing” tasks such as industry relationships, business development and M&As.
Speaking with Stearns last year about the arrangement, he said the heavy lifting for launching VIA was largely accomplished.
“We’ve virtually completed the integration of all companies,” he said, noting centralized IT, marketing, human resources, rack production, project documentation and proposals.
During the transition period, the original founders shifted roles, “moving ourselves around into higher and best uses” such as district managers and buyers, according to Stearns.
“We had the foresight to know we’d be shifting roles,” he said. “We [founders] each gave ourselves two-year employment agreements.”
In addition to Randy Stearns, his brother and longtime project manager Bob Stearns left the company. VIA also reshuffled its marketing department, leading to the elimination of Josh Christian, who had handled marketing for one of the founding companies, DSI Entertainment.
VIA Today: Supremely Busy, Capital Needed
In an interview this week, Stearns and Holmes reiterated that the transition was just a natural course of events, meshing with Stearns’s and VIA’s game plan all along.
They tell us that business is strong, up 18 percent last year, which jibes with word on the street from competitors.
At the same time, the company needs capital, having invested a huge chunk of money in the transition, which included erecting a rack-building operation in Utah.
“Getting the merger done was very expensive,” Stearns says. “Integrating the business is costly. Business is healthy but we’re pushing through our excess cash reserves.”
“Getting the merger done was very expensive. Integrating the business is costly. Business is healthy but we’re pushing through our excess cash reserves.”
- Randy Stearns
VIA is earnestly seeking capital.
Murmurings of VIA’s slow-paying subcontractors and manufacturers are not unfounded.
There have been a “couple instances of credit holds but those are very isolated,” Holmes says. “It’s not a routine occurrence and has not inhibited our ability to deliver on projects.”
He adds, “Thus our desire to get out and get funding.”
Without the funding, growing VIA is a challenge, says Stearns: “We can’t afford to go any faster.”
In fact, after Stearns ceded his CEO role to Holmes, he moved into a business development role, “bringing in opportunities that we weren’t in a position to support,” he says. “These were potentially very large contracts.”
With capitalization nigh, VIA hopes to move into acquisition mode perhaps late in the year.
Efficiencies recognized through the merger also should help VIA to improve its balance sheet.
All of the rack-building production has moved to a central location, for example, resulting in dramatic efficiencies in the latter part of 2014.
“The cost of labor in Utah versus Southern California or San Francisco is about half, Stearns says. “Neither of those locations had the need to build racks full-time so they were not as efficient.”
Consistency across-the-board also has enhanced efficiency with strict checklists that all system designers must adhere to.
Stearns has not announced his next move.
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Julie Jacobson is founding editor of CE Pro, the leading media brand for the home-technology channel. She has covered the smart-home industry since 1994, long before there was much of an Internet, let alone an Internet of things. Currently she studies, speaks, writes and rabble-rouses in the areas of home automation, security, networked A/V, wellness-related technology, biophilic design, and the business of home technology. Julie majored in Economics at the University of Michigan, spent a year abroad at Cambridge University, and earned an MBA from the University of Texas at Austin. She is a recipient of the annual CTA TechHome Leadership Award, and a CEDIA Fellows honoree. A washed-up Ultimate Frisbee player, Julie currently resides in San Antonio, Texas and sometimes St. Paul, Minn. Follow on Twitter: @juliejacobson Email Julie at email@example.com
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