While many reminisce about middle school as a time of questionable fashion, awkward school dances, and weekend sports, for Ron Johnson, those days marked the foundation of his digital empire: CyberOptik.
Over the years, Ron invested a significant $188,976 in acquiring four businesses via Flippa, with Prism Design Co. being his most notable acquisition, seamlessly integrated into the CyberOptik brand.
Ron Johnson, Flippa Buyer
We sat down with Ron to understand his approach to acquiring businesses, his integration blueprint, and his strategies to propel CyberOptik to its current success.
Igniting the Digital Spark
While his peers were navigating the trials of adolescence, Ron was navigating the world of web design.
“My parents would say growing up that I never had a real job. I was always doing my own thing,” he said.
His parents never pressured him to follow a traditional career path; they watched their son take to software like Dreamweaver and Photoshop, crafting websites from scratch.
Being a community of its own, the internet began recognising his talent. With every website he designed, he caught the eye of more and more people. He recalls the early days when he’d attend meetings in person. “It was always fun to see people’s reactions when some kid showed up,” he laughs.
Ron’s early journey into the world of web design was characterized by self-taught lessons.
From SEO to pay-per-click campaigns, Ron donned many hats, sharpening his skills and expanding his digital arsenal.
Today, while he has taken a step back from the nitty-gritty of design and coding, his role in business development keeps him tied to the ever-evolving industry he loves.
While Ron started out as a one-man show, CyberOptik has grown to 15 team members. Interestingly, he mentions that many on his team, like him, don’t have formal backgrounds in IT or design.
Though the business grew steadily after he went full-time post-college in 2010, his recent ambition for aggressive expansion led to several strategic acquisitions.
Ron’s Journey with Flippa: Refining His Acquisition Approach
The top priority for Ron was compatibility, something that would easily fold into his parent company. He had a clear preference for businesses that were centered around WordPress, aligning with CyberOptik’s operational focus.
While profitability was essential, the profit margin wasn’t set in stone. Ron saw the potential of integration and the capacity to optimize processes, even if it implied overhauling the existing team.
The sweet spot was a business with at least three years under its belt.
“It indicates they’ve secured traction, have a loyal client base, and a robust web presence. Established websites tend to offer more, from backlinks and traffic to positive reviews,” Ron said.
Geography also played a role in his decisions. Primarily, Ron leaned towards US-based ventures.
When he’s actively seeking to acquire another agency, Ron frequents Flippa every week. After completing two sizable acquisitions over the past year, each taking up to two months to finalize, there’s usually a subsequent adjustment period. While he’s currently feeling the urge to explore again, he typically limits himself to one major acquisition a year, given the complexity and effort involved.
Ron’s Biggest Acquisition to Date: Prism Design Co.
Ron’s acquisition journey with Prism Design Co. was a significant milestone for him, marking his largest transaction on Flippa thus far. With transactions totalling $188,000 on Flippa, the Prism Design Co. acquisition was a standout.
With the purchase of Prism Design Co. being his biggest leap, there was no shortage of nerves.
“There’s always a level of uncertainty; once the seller gets their payment and meets their contractual obligations, they can exit the scene,” he said.
For Ron, this demanded rigorous due diligence and a lot of questions to ensure a genuine fit.
The acquisition of Prism Design Co. took place in August 2022. It presented itself as a prime opportunity, even if it was at the upper end of what Ron was willing to spend.
The primary draw was the alignment of services offered. Prism Design Co. was a WordPress-focused entity, ensuring a smooth transition for Ron’s team in taking over client sites.
Additionally, Prism had been delving into digital marketing campaigns, which meant a bonus for Ron in the form of an SEO contractor, Laura, who transitioned over post-acquisition. Laura’s addition bolstered the marketing side of Ron’s existing operations, which had previously received less focus.
Ron’s conversations with the seller spanned a week or two, with Ron intent on understanding the operational specifics to ensure a seamless client transition. Comprehensive documents detailing clients, their packages, and fees were shared.
It wasn’t just about the numbers, though. Beyond the financials, Ron’s clear understanding of the industry and operations made him stand out as the best-suited buyer.
Ron said the seller was keen on ensuring her clients transitioned into competent hands rather than just making a quick sale.
“She didn’t want to just get the money and bounce. She wanted to know that somebody competent was taking over her clients,” he said.
“I got access to everything, got to poke around, things looked good, and then we closed it and started moving everything over.”
Integrating Prism Design Co. With CyberOptik
Upon acquiring the company, everything was promptly branded under the CyberOptik umbrella, from the billing portals to the emails clients received. Within the first month, clients knew the new ownership and management well.
Ron shared the acquisition news in a company blog post, keeping a positive synergy between the merging teams. Including a note from the seller.
Here are the steps Ron took to encourage a seamless transition:
- Establishing initial trust: One of the key strategies Ron employed was a systematic approach to ensure a warm introduction and establish trust with the new clientele. This involved the original seller (Victoria Avallone) contacting each client to introduce Ron.
- The follow-up: Ron followed up with a standardized yet personalized email template for each client. As a gesture of goodwill and to build rapport, he always offered to engage in a Zoom call, giving clients an opportunity to familiarize themselves with the new management.
- Complimentary services: Ron went above and beyond by offering complimentary services to foster trust and demonstrate value. Since their primary business is web design and management, they would typically offer a comprehensive review of the client’s front and backend website. If there were any gaps or overlooked aspects, this review would highlight them.
Ron’s approach also included offering free consultations or comping the first hour of service for any subsequent changes requested by the clients post-review.
CyberOptik would even cover the hosting fees for clients who were hosting elsewhere, ensuring they experienced the benefits of their integrated services without any extra financial burden.
Despite these efforts, as is typical with any transition, there were some challenges. Not all of the original clients from Prism Design Co. stayed on board with CyberOptik. Some chose to move to other vendors for various reasons, while others may not have felt a compatibility fit with the new management.
Ron recalled one particularly challenging situation with a client that required a significant amount of communication. However, instead of forcing a partnership that wasn’t beneficial for either party, Ron ended the working relationship with this client amicably.
His philosophy is clear: while profitability is essential, it should never come at the expense of a healthy working environment.
Yet, most clients transitioned smoothly and continued their business relationships with CyberOptik. Some even expanded their engagements by requesting new websites or increasing their retainer values.
Reflecting on the acquisition six months in, Ron felt positive about the numbers and the overall growth trajectory.
“I forget whatever the earn-back timeline was going to be, but I remember checking in at the six-month mark, and I was like, “Okay, these numbers look good.”
Although acquiring businesses is an intensive and sometimes taxing process, Ron hinted at the possibility of returning to Flippa for future acquisitions. As for an exit strategy, he’s not in a rush. He sees at least another decade in the game, enjoying the growth and evolution of CyberOptik.
Under his guidance, CyberOptik has grown substantially, with a team of around 15 for over 400 client websites. If you want to learn more about his approach to acquisitions and business development, you can check out his detailed blog on how to sell your WordPress Agency here.
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