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Do You Have The Stomach To Be A $100 Million VAR?

Want to become a $100 million VAR? Take advice from NWN, which is on the path to becoming a $250 million powerhouse.

Mont Phelps, CEO of NWN, a Waltham, Mass.-based powerhouse solution provider, had a difficult task: Tell a group of solution providers who are already growing at a rapid clip how to build a $100 million business.

"Everybody in this room is successful in their own right," Phelps told a room full of solution providers at CRN Fast Growth in Boston on Thursday.

NWN epitomizes fast growth. The company grew from one location and 30 employees in 2005 to 11 locations and roughly 460 employees just five years later through a delicate mix of acquisition and organic growth. Phelps said NWN is on track to be a $250 million business come the close of 2010.

Phelps said solution providers seeking to grow fast have to answer three key questions: How do you build a $100 million VAR; why bother; and how do you build a sustainable business model?

It's not easy. There's a certain amount of risk. "Do you really have the stomach for it?" he asked.

Next: 'It's A Process'


And Phelps said the first $100 million isn't an endgame, it's a stepping stone. "It's not a destination, it's a process," he said. "There's no limit."

For NWN's part, the company has made nine acquisitions in the last five years while also growing organically. In 2010, the company will grow $100 million, half of which is organic, half of which is through acquisition. Acquisition targets, Phelps said, must have five key attributes: a strong culture, solid technologies, solutions-based offerings, be poised for growth and have a geography that makes sense for NWN. From there, integration into NWN's business starts with the employees, customers and partners; then NWN renames the business and builds the brand, integrates the back office and looks at areas to cut and synergize costs.

Skip Tappen, NWN's COO, added that NWN operates on a mantra abbreviated as AIM, short for acquire, increase and maintain, which drives business and keeps NWN focused.

"Whatever we're doing today has to be better than yesterday and that isn't good enough for tomorrow," Phelps noted.

Phelps said it takes a trio of key attributes to be able to become a fast growing success: technical competence; sales competence; and business skills. He also said it takes a strong team, focus and process that drive repeatable results. "Do it right the first time," he said. "Don't do it over again."

Next: Know What Business You're In


Equally important is knowing where you stand and the business you're in. "Our job is not to make things, but to make things work," Phelps said, saying that NWN is a services company that works in IT, not an IT company, and customer focus is paramount.

It also doesn't hurt, Phelps said, to have an edge over the competition. "Life is much better when you have an unfair advantage," he said.

And despite how clich� it may sound, Phelps said fast growth takes hard work, but must also be fun. "If it isn't fun, you have to wonder why you're doing it," he said.

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