An insider's guide to the Hostech deal

What were the emotional aspects of selling off something you have built?

I don't think there's any. I think if you get too emotionally attached to a business then you probably have your priorities wrong. People do talk about that a lot but ultimately what you want to do is something you think is worthwhile, making a difference, using your skills. Do you care if you're the boss or not? Maybe people get so emotionally attached because they want to be the boss.

But in some ways my skills aren't used in the best way at AXXIS because as the owner I have to deal with staff issues and I'm not a great HR manager. One of my other guys in sales gets stuck doing ad layouts and he'd be better out in sales all the time. Because in small business you're a jack of all trades, you're not using your skills in the best way.

The two things I'd love to be involved in is strategy and the long-term planning of the business; the strategy of getting into NSW and the rest of Australia. And I want to be involved in high-level strategy with clients (rather) than the client who says they want a notebook for their daughter because she's going into year 12; that's something any of my staff can handle. I want to get involved with the stuff that's harder and the big picture stuff.

In some respects, it's better emotionally because you can better utilise the talents you've got and do things you enjoy more.

 What is your new role and how you will segue into that?

In five weeks when the transaction occurs [subject to shareholder approval] my title will still be the same but that's when the integration process will start. They say do what you do now, and that will take a couple months, then my role will be involved in an advisory board for them and really my focus will be on how do we get more of a footprint of regional NSW.

How does the business best take advantage of its full structure to get into the whole NSW (SMB) market?

I see some shocking work [from small resellers] ... so I get a bit frustrated with the SMB space not being looked after. In combination with that, one of the things I find where I add most value to clients is helping them plan strategy for business. We sit down with our SLA clients every three months and talk about SLA structure, the relationship with AXXIS and their IT structure. It's really about planning the best way to utilise IT and make their business more efficient. It's simple stuff sometimes, I talk to them about cloud services and then I talk to them three months later and they say that they implemented it and it worked fantastically.

What are your tips for a reseller considering being acquired (or seeking to buy a competitor)?

1. Set your structure in such a way that it makes it easy to be acquired. If you owned the shares in the business, think of yourself as just another shareholder on the ASX and as if you were a public company and be transparent.
2. Make sure you treat your business as a business. Don't just turn up at 10:30am because you're the owner; treat it as if you were an employee.
3. Use your skills in best possible way. If you think there's someone in your organisation who is a better manager than you, make them the manager. Employ yourself as if you were a public company. That makes it easier for someone to acquire you because they can find someone else with those skills.
4. Make sure your clients are dealing with the company, not you. Don't make you the central component to those transactions. Don't put yourself in the ad; it might be great for the ego to see yourself in a spread but let people see the business not the individual.
5. Get to the stage where you're generating guaranteed, recurring revenue. That made our business of much greater value; that gives buyers greater confidence. Anyone with a managed services operation I would see selling for a [annual revenue] multiple of four and minimum of three. Managed services gives you a lot of security and if you want to sell it gives you a much better end price.