Website Closers® presents a WAN telecommunication services. Since its inception, it has become an authority in the niche, providing a unique combination of computer network services. Their competence lies primarily in:
- designing and implementing local and wide-area networks,
- network security monitoring and management, and
- Internet connectivity and colocation services.
Business Broker Takeaway
Our analysis of this business shows that the value propositions present are strong for a first time buyer looking to get into the online space. We are excited about this business for three important reasons:
- Multiple Service Offerings: Revenue is generated from three primary services, WAN, ISP, and Colocation, accounting for 70%, 20%, and 10% of sales, respectively.
- Recurring Revenue: Client contracts are ongoing. New ISP/WAN clients typically start with 3-year terms, while most colocation clients are on 12- month terms. They are generally renewed on the same structure, evidenced by an exceptionally low churn rate. The majority of clients have remained with the business for multiple years and even decades.
- Broad Customer Base: The service offerings cater to clients of all sizes, resulting in a vast prospective customer base. Smaller contracts can be worth hundreds of dollars, while larger contracts are up to five figures monthly. The business enjoys an average monthly income of $5,000 per client.
Additionally, the company operates its own privately leased data center, not inside an existing one. It has been operating from the space since 2010, manages the space and vendors independently, and has maintenance contracts in place for UPS, cooling units, and a backup generator.
Customer Base
No digital marketing is performed. Instead, lead generation relies on E-rate RFPs and word-of mouth referrals, significantly reducing customer acquisition costs.
The majority of clients are schools in the Chicagoland area, but new industry changes have widened this, and management has recently expanded into new States.
Workload & Team
The CEO/Owner dedicates only 1 to 3 hours weekly to the company. The COO works full-time and runs day-to-day operations. His primary tasks include:
- Managing Clients and Vendors
- Annual SOC Audits
- Responding To RFPs
- Resolving Problems
- Office Management
He also oversees the other full-time employee who works as a network technician.
Growth Opportunities
The business has tremendous room to scale, particularly under the guidance of a well-funded strategic buyer. Recent changes to interstate telecommunications services have opened up a much larger market. Subsequently, almost any school or business is a potential customer, meaning the addressable market is extensive.
Moreover, a motivated new owner could introduce various new services to boost top and bottom-line growth and realize a swift return on investment. These include IT Managed Services, Cloud Hosting and Storage, Backup Services, and Edge Computing. Marketing initiatives could facilitate reaching a considerable untapped audience, and it is now economically 1feasible to connect long-distance fiber network links to the company’s data center.
