Brian Elias is to an entrepreneur as water is to wet. Like all great business owners, he has that quality of being absolutely sure of his own vision, and is happy, thrilled even, to share his ideas with you. You might be well served to listen.
Elias is the former owner of 1-800-Hansons, a home improvement jugger-naut headquartered in Troy, Mich. Known in the region for his ubiquitous TV commercials and catchy jingle, Elias grew Hansons from a one-man outfit in 1988 to eight locations and nearly $80 million in revenue in 2017. Today, it’s one of the top 10 home improvement companies nationwide.
So it’s not surprising that when Elias put Hansons on the market, he was soon courted by other players in the home improvement space that wanted to make a strategic buy, as well as private equity companies that saw Hansons as a strong entrée into the field.
The latter won out, and in October, Detroit-based Huron Capital purchased Hansons for an undisclosed amount. For Elias, this is another step on a road he’s been walking for a long time. “The only reason to build a business is to sell it,” he says. “We started preparing for [a sale] three or four years ago, and we said, ‘Let’s get our profits up, and our expenses down. Let’s run more lean.’”
Historically, private equity hasn’t mixed well with the remodeling industry, and what little acquisition activity there was went into a deep freeze during the recession. But that freeze may be thawing. “There’s a whole lot of money out there right now and a whole lot of people who want to place it somewhere where they can make more money,” Elias says.
Huron generally buys into companies with revenue of between $20 million and $200 million, according to Crain’s Detroit Business. Officials with the private equity company say the immediate plan is to grow Hansons by opening more locations in Michigan and Ohio, and by expanding into Indiana.
And Elias is still very much involved. “I am the face of the company, and they bought that as part of the deal,” he says. “I’m actually not allowed to sell any other products on television for the next five years.” Elias will retain an active role with Hansons, although Huron is bringing on a CEO, to be chosen by the board.
As with most private equity business models, the strategy is for Huron to aggressively grow Hansons-—organically and through acquisition—and then sell the company in about five years. Elias’ contract extends to that time.
His advice to business owners wanting to grow? Keep adapting to the times. “Companies that don’t change become stodgy and die,” Elias says. “The nice thing about [the home improvement industry] is that people need our services. But if you don’t think Amazon and Google are coming, watch out. They’re the real deal. They’re going to compete in the marketing costs arena, so we have to think differently and keep ourselves relevant.”
Judging by Elias’ track record, he’s done a pretty good job so far.