From the Wilkes-Barre, PA Times Leader newspaper, Sunday, May 10, 2009.
Entrepreneurs to be honored Tuesday
By Ron Bartizek email@example.com
Business & Consumer / City Editor
Gerald Ephault is neither shocked by nor concerned about the recent acquisition of Solid Cactus by an out-of-state buyer. To the business development manager for the Pocono Northeast Region of Ben Franklin Technology Partners, the sale is a logical stage in the evolution of a fast-growing company in constant need of capital to fund expansion.
“That’s not a surprise to us,” Ephault said last week, as he prepared to present Solid Cactus founders Joe Palko and Scott Sanfilippo with the organization’s 2009 Entrepreneurial Achievement award. “We’re trying to grow companies that are attractive.”
Palko and Sanfilippo announced last month that Jacksonville, Fla.-based Web.com had purchased Solid Cactus. No terms were announced.
Ephault said many client companies look for an exit strategy of being acquired or merged. Another was TMG Health, acquired late last year by Health Care Service Corp., which operates Blue Cross and Blue Shield plans in Illinois, New Mexico, Oklahoma and Texas. Dunmore-based TMG Health is the nation’s leading provider of business process outsourcing for Medicare, Medicaid and group retiree health plans.
Similarly, Solid Cactus is the largest builder of Internet retail Web sites on the Yahoo! Store platform. That kind of industry leadership is something Ephault says can raise the chance that offices and jobs will stay in Northeastern Pennsylvania.
“We want them to stay here,” he said. “A lot has to do with employees” that are skilled in their field. Solid Cactus reached a peak of about 140 workers last year, before the sluggish economy forced 40 layoffs in November.
Palko and Sanfilippo will remain with the company they started in 2001 and the name, Back Mountain headquarters and 125 employees will be retained.
Ben Franklin Technology Partners will present awards in eight categories on Tuesday, during its annual i xchange event. The award Palko and Sanfilippo will receive is given to “individuals who best exemplify the quintessential entrepreneurial spirit: a combination of ingenuity, hard work, and innovation that has resulted in the creation of a successful and growing business venture,” according to a press release describing the event.
Ephault brought the duo to the award committee’s attention. “I as the regional manager nominate who I believe are the ‘best of class’ for each award,” he said.
Nominees are reviewed and winners selected by a panel of key parties on the BFTP board. “It goes through an extensive analysis,” Ephault said.
Sanfilippo was quick to spread credit across his entire company.
“Joe and I are both humbled by this award and are accepting it not for our work, but for the work of our entire team,” he said by e-mail. “Solid Cactus was started by two guys with an idea; the credit for our success goes to all our team members who work day in and day out to make sure that Solid Cactus is the best it can be. We thank everyone for their support, encouragement and help along the way.”
Ben Franklin Technology Partners, whose mission is to provide support to early-stage technology firms and established manufacturers, has worked closely with Solid Cactus for several years.
“We’ve become not only investors of state funds for the benefit of the region and the commonwealth,” Ephault said, “we bring other resources,” such as assistance in developing a strategic plan, marketing and other areas where a young company may not have its own infrastructure.
It’s all done, “in a friendly manner, meeting with them very often” about their needs, he said. “(This is) not head in the clouds; it’s really about what can we do to help you grow the company.”
One example of funding was $150,000 used in 2006 to hire programmers to develop the company’s Feed Perfect analytic tool for online retailers that measures both how often a particular item is clicked on by a potential buyer and whether a purchase actually takes place.
“We reached out to them,” Ephault said at the time, because Solid Cactus had caught the organization’s eye as a growing company that could provide good jobs.
“Our relationship will continue,” after the award is handed over, Ephault said.