Mike Hackley woke up in March with a newfound determination to transform his life.
The 54-year old co-founder and CEO of BBQGuys had spent more than a week fighting off the Covid-19 virus that nearly killed him. “I started thinking ‘What are you doing here? You don’t spend enough time with your kids and grandkids,’ ” he told Barron’s.
One of the results of that life-changing experience was Hackley’s renewed enthusiasm to sell his company: BBQGuys, of Baton Rouge, La., an e-commerce platform that sells high-end outdoor grills, smokers, and burners as well as outdoor kitchens and refrigerators. One of the more expensive is a DCS Series 9 Evolution 48-inch Built-In Natural Gas Grill with Rotisserie that sells for $5,899, while a Smokin Tex Commercial BBQ Electric Smoker 1500-C goes for $2,622.
BBQGuys has now been sold, to an investor group led by the private-equity firm Brand Velocity Partners, the company announced on Tuesday. Investors include football’s Manning family (Archie, Cooper, Peyton, and Eli), as well as NFL Hall of Famers LaDainian Tomlinson and Steve Hutchinson.
The price was not disclosed, but people familiar with the matter told Barron’s it was $140 million.
Hackley and his former wife, Ladina, founded the company in 1998 as a bricks-and-mortar store, which later became an online venture. Since 2005, BBQGuys has grown 25% each year. Revenue hit $132 million in 2019 for BBQGuys, while Blaze Outdoor Products, an affiliate, produced $32 million, Hackley said.
When Brand Velocity Partners came calling in January, “I was not serious about selling,” Hackley said.
He had tried selling before. In 2018, Hackley engaged an investment bank and spoke to roughly 28 companies before narrowing on one buyer. He pulled the deal one week before the transaction was set to close.
“I didn’t feel the company I was selling to was good for the employees,” he said.
The coronavirus changed this reticence. Hackley doesn’t remember the seven to eight days that he was sick in March. During this time, his fever spiked to nearly 104 degrees while his pulse dropped to 40 beats a minute. He also suffered from hypoxia with his oxygen levels falling to 60%. When he woke, the normally robust Hackley, who stands 6 feet tall, had lost about 20 pounds. He said he was so weak that walking his driveway was an effort.
“It was a bad case and I nearly didn’t make it,” Hackley said calmly.
He re-evaluated his priorities once he was well. A workaholic, Hackley acknowledges that he didn’t spend enough time with his three children, who are all grown and married. “For 20 years it was all about the company. It was work, work, work, and running the company,” he said. Hackley also encountered a situation common to entrepreneurs. His children were all successful and busy with their lives; he did not have anyone who could take over the business.
Enter Brand Velocity Partners. Founded in 2019, the firm has a growth venture mentality, said Steve Lebowitz, a co-founder and managing partner. BVP seeks to provide more than just spreadsheets for the companies they acquire but also marketing and innovation, he said.
Small-business owners typically need marketing most but private equity is not focused on that aspect, Lebowitz said. “Our revolutionary idea is to give companies what they want, instead of finance, finance, finance,” he said.
In BBQGuys, the firm found a company that was thriving during the virus. The pandemic forced businesses across the nation to close, causing millions of consumers to stay home and seek ways to entertain themselves. This has caused BBQGuys revenue to spike 185% each month from March through July. (In August, it dropped to just a 90% gain.) Calls to the company jumped to 4,000 to 6,000 a day during that time period, up from roughly 1,000 daily calls before the pandemic.
BBQGuys has added 80 employees to handle the surge, bringing head count to more than 250. Revenue is expected to hit $225 million this year, Hackley said.
“People aren’t going on vacations like before so the backyard is the vacation,” said Drew Sheinman, a BVP co-founder, who is a former senior vice president of brand ventures at Endeavor (the former William Morris Endeavor Entertainment), as well as a former vice president for business development for Madison Square Garden, Coca-Cola, and the New York Mets.
BBQGuys is BVP’s third transaction in nine months. The deal included Blaze, which sells premium BBQs and accessories. Other acquisitions include Original Footwear and Magma Products.
Hackley, who has fully recovered, said he would “let the smoke clear” before he decides on his next venture.
For now, he’s spending time with his children and grandchildren on his farm in Sulphur, La. He bought a 70-foot Marquis boat that he plans to take island hopping once the travel bans are lifted.
“My new saying is after Covid-19, I don’t know how I’m going to die, but I know how I’m going to live,” he said.
Write to Luisa Beltran at luisa.[email protected]