Fred Voccola discusses his experience in scaling companies to over $1.5B in revenue and navigating M&A, including Kaseya's $150M sale.
Fred Voccola discusses his experience in scaling companies to over $1.5B in revenue and navigating M&A, including Kaseya's $150M sale. He shares insights on building a multibillion-dollar business and the critical role of strategic acquisitions.
You know, I wouldn't do anything different. I made tons of mistakes, man. Tons of mistakes. Cost myself tons of money. Made tons of mistakes. But enjoy the ride more. [music] All righty. Hello everyone and welcome to the Deal Maker Show. So, today we have an amazing guest. You know, a guest that has done it many times. you know, I think that we're going to be learning quite a bit on on building, scaling, financing, exiting, you know, the whole thing. Um, I think you guys are going to enjoy it quite a bit. You know, there's different stories here that we're going to be touching on. You know, whether is 911 down cycles, uh, also how to go from from zero to like one of the biggest employers in the city or even starting, you know, a company doing during a downturn and how to be able to bring it all the way uh to a nice outcome. So again, you know, brace yourself for a very inspiring
conversation. And without further ado, let's welcome our guest today, Fred Bola. Welcome to the show. >> Oh, well, thanks for having me. I really appreciate it. Super excited to be here. Big fan of your show, by the way. So, it's actually really cool for me to be on it. So, I'm looking forward to talking with you. >> Thank you. So, originally born in New Jersey, so give us a walk through memory lane. How's life growing up for you? >> Yeah, man. New Jersey is great. Anyone on the call is from New Jersey, you're clearly awesome because we are from the greatest state in the world. It's not really that nice of a place. It's kind of a interesting state as many people say it. New Jerseyy's the the butt the butt of many jokes for a reason. But, you know, I loved it. I I grew up in New Jersey. I had the best parents anyone could ever hope for. I was very blessed that way. And I
I never forget that. And I was just so lucky. Um, couple of brothers, two knuckleheads, but I love them to death as well. And I was lucky enough to I still have many of the same friends from childhood. Uh I just I was very very fortunate in where I grew up. And you know it was a it was a great place. And New Jersey's interesting. It's the most populated state per square mile in the country. So you have to fight for everything in that state. And I think uh >> talking about fighting talking about fighting and talking about luck. I mean, when you were in college, it doesn't sound like, you know, doors were opening when it came to applying for jobs. So, you really needed to engineer your own. So, what happened over there? >> Yeah. So, I I went to college. I went to college on a scholarship. I I played sports and I was lucky enough to be able to go. And, you know, I thought I
wanted to be a Wall Street guy when I was 19, 20. That was the cool thing to do back then, you know, be a Wall Street guy, go and do whatever Wall Street guys did. None of us really understood it then. So, I applied for internships and I couldn't even get an interview. I uh I just I guess I wasn't like the pretty boy, Wall Street, Ivy League, Silver Spoon kind of kid. So, I I had to start a company and I always liked computers. So, I started a little software company and you know, one thing led to another. I got really lucky and my senior year of college, I was able to sell that company. Now, as as I I tell many people, if I had known when I was 20 what I know now, I would have sold it for a lot more money and done a lot of different things, but the world was different in the early 90s. You know, the world was very different. So, I was lucky enough to sell it and it was an incredible
lesson. You know, I tell people this a lot. >> What what visibility did you get there, Fred, when it comes to the full cycle of a company? Because look whether I think that at the end of the day the price you know obviously you know is nice to get more than than than than anything right you know we always want more but I think that an outcome is always an outcome uh and I think that as a founder too it gives you visibility into what the full life cycle of a company looks like and that's a lot of power that's that's that's a lot of knowledge and and really good to use for the next one. >> Yeah. And and for me I think the biggest lesson was necessity. I had to do it. I couldn't get a job and I'm a man. So you have to find a way of putting things together and and it necessity is one of the greatest motivational tools, tools for innovation. And necessity created in me the ability
to understand a problem, create a solution for that problem, create value for that solution, and go and get it. And back then there were no venture firms. There were there was probably $200 million of total assets under management in venture firms and technology back then. It wasn't anything at all like it is now. So you had to build it. You had to build a real company with real customers and real revenue and and make it work. And it was just a fantastic lesson. I got very lucky. I was lucky about all the people around me, but it was just a fantastic lesson. Well, the company that the bought that bought it ended up going public, ended up getting acquired by IBM. How how was that um journey too of um of seeing a company going from private to public? >> Yeah. So, this is a long time ago and the the world was very different. The public markets were very different. You know, what
required to go public was different. The regulation, the oversight, there's no Sarbain Oxley. None of that stuff was there. It was the capital markets back then were literally there to provide liquidity. You know, going public was a means of getting access to capital in the early 90s. It wasn't a means of a liquidity event for shareholders as it is today. Today, there's so many private sources of capital that you don't need look at what OpenAI is doing. You don't need to go public to have almost unlimited access to capital. So I got to see the the pure definition of what public markets were for and it was fascinating. I mean remember I I was you know I was very young. I was in my I was in my early 20s. I was like 21 years old 22 years old yet I was exposed to things that you know many people never see in their career. I wasn't the CEO but I was along for the ride with them. And it was
just it was really fascinating to see the company was 40 45 million or 20 25 million in revenue I believe went public. Think about that for a second and you know we're doubling every year and it was it was it was really interesting and it was an absolutely incredible experience to see it as a kid uh and it it just I probably probably accelerated my professional learnings and career maturity by 20 years. So right after this you got into another company that I think it gave you the opportunity to experience to certain degree Silicon Valley you know being an east coaster but on this one you know which was in the in the web hosting space I think that that the one part that really you know stacks out for me obviously you guys sold that to to to IBM I think it was going through the through the dot bubble and and also to be able to experience different cycles in the market. I guess from from
from an experienced perspective because there's a lot of people now, you know, listening that maybe they haven't experienced those different cycles. What what was the biggest lesson as an operator when you go through one of those cycles? >> So the dot era, we were a web hosting company and web hosting in the mid to late to late 90s was the sexiest stuff in the world. Internet applications were brand new. didn't really exist. Uh this was it was cra a crazy time. We raised hundreds of millions of dollars. We built data centers. It sounds you know like today people are building data centers. We built data centers back in the 90s and we were so irresponsible financially as was the whole industry at the time. I mean how many online pet stores were there in 1998 advertising on the Super Bowl, right? It was ridiculous. So we literally burned through hundreds of millions of dollars. Our
recurring revenue, we were over 50 $60 million of recurring revenue in a couple of years, which was great, but we didn't even look at things like customer acquisition costs. We didn't think about capac. We were just financially irresponsible because that's what we were told to do. Lesson I learned was the financial professionals do not have all the answers. They're not the smartest people in the room. They are trend followers. They are not creating value. Raise more money. Spend more money. Unlimited money. Raise it. Grow. Grow. Grow. What the right answer was was for us to slow down to grow 70 or 80% instead of 300%. And generate cash and not take on every dot in the world that was a customer who weren't financially viable. I mean, it was such a good lesson in business 101, which is revenue, profits, expense management. forget hype, focus on value for customers, and focus on a
sustainable business. And at at…