How much is a Cisco distribution franchise worth?
This article was first published in September 1998. How much is a Cisco distribution franchise worth? At least £30 million, according a surprising source, The News of the World - the UK's best selling newspaper, but not one noted for its business or technology coverage. It reveals that RBR Networks founders Rory Sweet and Ben White are on the verge of 'another mega-deal which could net them nearly £15 million each'. That would be the acquisition of the company by DataTec, the South African serial buyer of networking resellers and distributors, then? White and Sweet are forecasting sales at RBR to top £80 million this year. The company has seen turnover jump from £3 million in 1994 to £7 million in 1995, £23 million in 1996 and £50 million in 1997. Not bad for a company that spent much of its short life trading grey Cisco kit. RBR was so successful that Cisco had no choice but to dole out a franchise. But the outcome could have been very different, as the News of the Screws reveals. 'They admit that their fun-loving antics nearly put their mega-bucks deal at risk before it had even started. Instead of agonising over balance sheets, the night before the meeting with their US client, they hit the town and got drunk over a curry. 'Ben said: "It was a huge drinking session and when we woke up in the morning, neither of us could remember where we had left the car. When we got to the meeting we must have created a terrible image as we were still in our clothes from the night before. My T-shirt was so stained with curry and wine that I had to swap it for my senior manager Michelle's blouse".' It's hard to see the duo staying on too long after the sale of the company. People who pose naked for their own marketing brochures are not the sort to enjoy spending their time composing management reports for corporate bosses. Still, with £15 million each their pockets, they'll have more than enough to fund what The News of the World dubs a 'wild playboy lifestyle'. Although I'm not sure that driving expensive sports cars (a Ferrari 355 in Sweet's case, and a super-charged Jaguar XK8 in White's) makes you a wild playboy. But the chums do appear to have a knack for making money while taking it easy. Before flogging Cisco kit, they ran a second-hand computer broking business from the basement of their 'tiny flat in Pimlico'. White recalls: 'Businesses such as BP, Shell and Esso were buying computers for millions, then throwing them away when they got something new. We bought them for virtually nothing, put them in the basement and sold them for loads. 'Half the time, we didn't get up until 11am and only worked until 1pm. But suddenly, at 25 years of age, we were earning £100,000 a year each.' The pair showed impeccable timing by quitting the business when 'hundreds of wannabes flooded the market' and the sale of RBR shows they have lost none of their sense of timing.