How Limos.com Became a Multimillion-Dollar Business

[tincho1492]

How Limos.com Became a Multimillion-Dollar Business | Entrepreneur.com

 

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[theBiz]

I know it would of been capital/technology/labor intensive but sometimes MJ has to be asking himself if it was a good decision financially. I understand his means to an end were met, but still. While i agreed with 5 points in his blog, one did not settle well with me:

6 Reasons Why I Sold A Business With A 6-Figure Monthly Cash-Flow

Reason #3
I predicted that my revenue model would be unsustainable.

Due to technological advancement, I didn’t think lead-generation in my particular space was sustainable longer than a few more years. This meant, in order for my business to grow, I would have had to switch revenue models to a reservation based service. If you’re not familiar with the limousine business, a reservation-based service is both labor and technology intensive. My objective was to sell a majority interest (I still own a tiny % of Limos.com) to a capable investor group who shared this same vision of a reservation-based model and sit back and watch them do it. This is exactly what happened — the new management is slowly phasing out the lead-gen model. With this transition and based on the latest funding round, the company is probably now worth 5X the valuation at which I sold it. My effort in this growth has been nothing.

This is life though. All new businesses have to deal with the changes in technology quicker and quicker today, this should be more of a reason to hold onto the business and not sell because of the "do what you know best". You already have solid brand recognition, reputation, fully understand the market, and know the ins and outs. Wouldn't it have been easier to deal with the challenges in your current market rather than approach a new market and deal with those new evolving issues? This learning curve would be much steeper for you.

Did you need outside funding? Couldn't you self fund it at this point? You could have gradually moved your way into it not had to dump millions due to your strong brand recognition and loyal customer base.


100% respect the decision but these were the honest thoughts running through my head when i read that. Not sure if that was a personal opinion or trying to justify financially how it made more sense to sell or keep it.

 

[MJ DeMarco]

MJ has to be asking himself if it was a good decision financially.

Financially? How about happiness? Does that variable come into your decision making process?

Wouldn't it have been easier to deal with the challenges in your current market rather than approach a new market and deal with those new evolving issues?

The decision was a human decision. You are making a decision from a business perspective.

Did you need outside funding? Couldn't you self fund it at this point?

No funded was needed; it could have been self-funded.

You could have gradually moved your way into it

And be miserable in the process? I didn't want to put forth the time and mental investment needed to make it happen.

Again, you have carefully extracted happiness out of your decision making model. I was tired of the industry. I was tired of the business. I morphed from an entrepreneur into a manager. I wanted to do something new and everything I set out to accomplish in this particular space I accomplished. Evolving the website into a reservation model might have made me richer (long term) but at a detriment to my happiness. Obviously you hold different values.

Did T.J. Clarke buy it from MJ? I never heard of T.J. Clarke until just now

Sorry to bust Mr. Clarks' fairy-tale-world but Limos.com was a multimillion dollar business way before he showed up.

If I sold the "url" why on earth did I have 4 employees? To manage the GoDaddy account?

At the time of sale I was on pace for $3M in revenues and had approximately 1,200-1,300 advertisers. (That's some URL they bought!)

Additionally, Mr. Clark was NOT apart of the acquisition team to which I sold the company to... I never met him in the acquisition process... he only appeared after the business was acquired and he installed as CEO. (Months later.)

It appears that Mr. Clark likes to rewrite history and fabricate a narrative that befits himself. BTW, he resigned earlier in the year.

 

[theBiz]

Obviously you hold different values.

Not sure whats up with that above, just voicing my observation on your article... will not do that again, apparently you do not like perception of your writing to one of your readers. I agree with you, i would of sold as well, i get it, it was enough, you worked really hard and want to do it anymore, you wanted to LIVE. That is the goal, but i felt you were trying to justify that point how financially it made more sense, which i didnt agree with, that is all, thanks.

100% respect the decision but these were the honest thoughts running through my head when i read that. Not sure if that was a personal opinion or trying to justify financially how it made more sense to sell or keep it.

 

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[socaldude]

I read this article this morning and I was disappointed. First the article didn't answer its own topic question and I think it would have been appropriate to give MJ some credit just like they give credit to any other founder of any internet company that was taken over. MJ's name did not appear once in the article(help me out if i missed it). They make it sound like the dude built the company from sweat and sand.

 

[MJ DeMarco]

I read this article this morning and I was disappointed.

Yea, imagine how I feel. This appears to be the internal company policy to which I've voiced my displeasure and frankly, I consider libelous. As the founder (and also a current owner/investor) it is at the point where a legal consultation on my part may be required.

Not sure whats up with that above, just voicing my observation on your article... will not do that again, apparently you do not like perception of your writing to one of your readers.

No worries bro; you might have viewed that particular challenge differently than I did. For me, writing a book was the next challenge.

 

[CryptO]

A devestating one liner from MJ in the comments would take the wind out of there sails!

 

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[Pixpax]

Yea, imagine how I feel. This appears to be the internal company policy to which I've voiced my displeasure and frankly, I consider libelous. As the founder (and also a current owner/investor) it is at the point where a legal consultation on my part may be required.



No worries bro; you might have viewed that particular challenge differently than I did. For me, writing a book was the next challenge.

You've written a book about the whole thing read by presumably 100k+ people, this site is presumably visited in large numbers. I think its pretty hard for this guy to re write history when there's a substantial amount of material available to anyone interested with showcasing the details.

In any case...it's only words, I'm more interested in the £€$ than what corporate suit types think..you sold and got paid

 

[socaldude]

In any case...it's only words

Not everybody has read MJ's book. This is kinda like plagiarism. You work hard and invest time and effort to build something great and somebody turns around and packages it into his own. You need to give credit to the original author or in this case the founder of limos.com: MJ DeMarco.

Yeah you have the money but history is revealed in a false light.

How would you feel if you bust your a$$ to build a website and later the new management makes it sound like they bought a URL from a domain squatter or for $10 at a domain registrar and built it from the ground up with sweat and tears? As if joe blow swooped in to save the day and turn the non-multi-million dollar company into a million dollar success by working his magic and business acumen.

 

[LamboMP]

Yea, imagine how I feel. This appears to be the internal company policy to which I've voiced my displeasure and frankly, I consider libelous. As the founder (and also a current owner/investor) it is at the point where a legal consultation on my part may be required.

This whole article pisses me off. I can't even begin to imagine how disgusted you must feel. They make it seem like they started the whole thing from scratch!

"In early 2008, he and his team bought the Limos.com URL. They set out to build a network of providers who would agree to the company's strict standards in return for inclusion on its website."

They were there when they bought the website! They didn't buy a "URL" they bought the company.

Sounds like a bunch of idiots there now. No wonder they have pissed off customers.

 

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[Thrive]

I wonder how many more articles on Entrepreneur.com are like this. It doesn't make them seem very reliable.

 

[Yussef]

I read this article this morning and I was disappointed. First the article didn't answer its own topic question and I think it would have been appropriate to give MJ some credit just like they give credit to any other founder of any internet company that was taken over. MJ's name did not appear once in the article(help me out if i missed it). They make it sound like the dude built the company from sweat and sand.

It's a harsh truth but history is told from the perspective of the one whose flag is flying in the end.

 

[kwerner]

I read that article the day Paul posted it to your Facebook wall and left a comment on the article about what piss poor journalistic homework they did and that they they should look into who actually *founded* the company. I told them *that's* the true entrepreneur story, not an acquisition company buying out a successful startup.

But apparently the moderator choose not to approve my comment, lol.

 

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[Yussef]

I read that article the day Paul posted it to your Facebook wall and left a comment on the article about what piss poor journalistic homework they did and that they they should look into who actually *founded* the company. I told them *that's* the true entrepreneur story, not an acquisition company buying out a successful startup.

But apparently the moderator choose not to approve my comment, lol.

When money is involved you can expect anything. Fortunately one thing MJ has is thick skin. As long as those who value the truth know the true story then that should be sufficient. In business, people will say (or in then case not say) all kinds of untrue things about you and your company. When people envy you or think you owe them a handout or hell just plain dislike you because they aren't you, they will say some pretty amazing things. MJ is very successful, financially set and has us and the book to propagate the real story, no need for us to be angry. "Success is the sweetest revenge."

 

[Darkside]

Seeing how they treated MJ in this article by not even mentioning him and how he built Limos.com into a multi-million dollar business makes me wonder if there are other founders who get the shaft in the same way. How many other people who built a company, then either sold it or were replaced as the boss by investors who then go on to pretend that the original founder never existed when they do interviews for news/business sites.

 

[911Carrera]

i wouldn't waste energy on this MJ. You made your money and most of us know you're telling the truth. Since you're no longer a majority owner of the company, the new owners have the rights to put out any press they feel would benefit them the most and not the guy that sold them the company and made his millions already. Big business is cutthroat and I'm sure we are all aware of this.

 

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[mayana]

Wow, that's crappy journalism if I've ever seen it. Pretty disappointing from a big website like that.

At least we know how it really happened!

 

[CarrieW]

I would do exactly what Mj is/wants to do. consult a lawyer. I would also have the lawyer send a letter to the owners of the website demanding a correction of some sort!

 

[CarrieW]

2 peoples comments went thru about them buying the company and not just the domain...everyone should go like it! I bet its someone from here!
lol

 

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[andviv]

Added comment about them buying a URL with 4 employees... how is that not a company?

 

[kwerner]

2 peoples comments went thru about them buying the company and not just the domain...everyone should go like it! I bet its someone from here!
lol

Good catch! My comment never got approved though, haha.

 

[Kak]

Any appologies yet? Lol, douchebags.

I bet it was more entrepreneurs fault, they had to try hard to make a non entrepreneurial story sound entrepreneurial.

 

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[mayana]

I bet its someone from here!

I think I did recognize one of the names of the commenters... lol.