Rocco DiLillo has lived the entrepreneurial experience. He's operated 10 companies — five he founded, five he acquired — taken a company public, rescued struggling businesses and realized successful exits. His passion for building businesses compelled him out of his first retirement in his mid-40s. Today, he's begun to divest himself of his business holdings. One of those recent divestitures was from PCX, a company he sold to Hubbell Industrial Controls.
PCX is a North Carolina manufacturer of prefabricated modular data centers for which one of DiLillo's younger brothers had been hired to grow their declining sales. There were rumors, he learned, that the company was up for sale. So, his brother asked DiLillo if he'd make an inquiry. PCX had become a part of Integrated Electrical Solutions, a public entity out of Houston that was a roll up of about 140 electrical contractors across the country. DiLillo called up the CFO of the company and I asked if there was any truth to the rumor that the company was for sale.
"And he said to me, are you interested? I said, I may be," DiLillo says. "He said how soon can you be here? I said, I can be in Houston on Monday morning."
Once there, DiLillo learned that the company was scheduled to close on Thursday.
"I was rather shocked, but I was lucky to ask a couple questions," he says. "I said, how much will it cost you to close PCX? And he had a whiteboard in his office, he stood up and he started to list the expenses that were on their docket, you might say. Lease was the biggest — it was a six years lease for a 75,000 square foot facility in the Raleigh area. And then he went through severances, a bunch of other contraction things. I believe it totaled $2.3 million dollars."
DiLillo made him an offer: $50,000 for the company and the promise to close in 30 days.
"He goes, you're offering me $50,000?" DiLillo says. "I said, actually, I'm saving you $2.3 million and the jobs and the people that work there, and I'll close in 30 days. I'll assume all those liabilities."
The CFO spoke with the CEO and about a half hour later told diLillo he had a deal as long as he could close in 30 days.
"The long story short is that happened — I closed in 30 days, went right away to meet with the landlord of the building and restructured the lease to shorten the time frame and the commitment, and then worked about building the company," he says. "I brought on another brother, frankly, who was more talented in the engineering world and in manufacturing. And so the two brothers and myself work to build the sales, build the company, and it grew considerably over the next 15 years."
Dilillo spoke on the Smart Business Dealmakers Podcast about the many businesses he's built, bought and sold, and offers advice to entrepreneurs looking to experience similar successes.