When news came out this week crowing that an area company received $32.5 million in new financing — no small task in this tight-wallet economy — it all sounded like champagne and caviar.
But Barry Shevlin, CEO of Vology Data Systems in Oldsmar, begs to differ. It took years for this young and private telecommunications equipment sales company to finally raise that kind of dough. And Shevlin's got the scars — or at least the frequent-flier miles — to prove it.
This is a tale about one Tampa Bay business — $73 million in sales and 120 employees — that's growing fast, has big dreams but had to claw its way through the severe recession to find some investors willing to help fund its growth.
Vology's investment bank, Tampa's Hyde Park Capital, helped find that new money, stitching together financial groups from Boston, Nashville and Miami to become Vology's newest investors.
Hyde Park senior managing director John Hill used to work at Raymond James Financial and helped finance bigger-name companies like Sykes Enterprises and Danka Business Systems.
Hill calls Vology an up-and-comer, the type of middle-market company with the drive and potential to perhaps emerge some day as one of Tampa Bay's next generation leaders, as Tech Data Corp. and Jabil Circuit are today.
The Vology deal bodes well for growth in general and a better year for companies seeking new capital, Hill says.
In the end, he adds, it's all about more jobs.
Vology, formerly known as Network Liquidators, was doing well enough in late 2006 to acquire another business that bumped the company up to $40 million in sales in 2007.
"It sounds great," Shevlin recalls, frankly. "But we probably almost went out of business three times that year. It was a perfect storm of not doing the right things."
The company lacked the right team in place to manage a bigger company.
In 2007, the economy started to drag, and Shevlin's business lost money.
The bigger company needed new capital that year. That's tough, Shevlin says, when you're losing money.
By 2008, when Wall Street began its meltdown, Shevlin was seriously on the hunt for fresh capital. While his new management team worked to fix the company and improve operations, Shevlin cut deals just to keep his business financed for 24 months at a time. But finding the big bucks to help put Vology on solid ground and primed for bigger things was elusive.
"I spent three months of the year on the road seeking new financing," Shevlin said. "It was a tough process."
The good news is that years of knocking on doors of venture capital firms, investment banks and even the Florida Venture Forum eventually paid off. A lot of investors of every stripe are now familiar with Shevlin and Vology.
The $32.5 million finally delivered to Vology came from several firms: a renewed credit line with Bank of America; capital from LLM Capital Partners; and financing from Banyan Mezzanine Fund and Harbert Mezzanine Partners.
Now it's up to a replenished Vology to strut its stuff. This isn't the last we've heard of this company, or of sidelined investors finally getting into the game.
Contact Robert Trigaux at firstname.lastname@example.org.