Bootstrapping a Two-Sided Marketplace to $10M: Sal Akbani, CEO of Gateway Classic Cars (Part 7)

Sramana Mitra: Where to from here? More of the same?

Sal Akbani: More of the same. We’re also incorporating a few other items out there into the product mix. As part of one of our themes, we have partnered with a very famous NASCAR personality Kenny Wallace. We are producing a mini-series on TV and negotiating with Fox Business News to do a half season series where we advise viewers on how to make classic and exotic cars part of their investment portfolio. There’s an investment component to some of these products, which have been inspired from the products on www.justcarchecks.co.uk

Sramana Mitra: Interesting.

Sal Akbani: We are doing that on a one-to-one basis. We have several clients that work with us, especially ball players and artists. We advice those clients as to which one will make money in the future and which ones won’t. Now we’re taking that advice to the next level which is a TV series.

In our St. Louis operation, we’ve also started an events marketing company called EMS. They are producing shows. We just did our first big show. It was a fashion show in St. Louis. We mixed classic cars with local designers and even designers from Los Angeles. We invited different dignitaries in this area to be present at the show. Next year, we’re going to produce 10 events of our own and are also inviting others to produce whole days events here.

Sramana Mitra: What sounds interesting is you could actually charge for providing investment advice. Is that a revenue-generating business or is it pure marketing?

Sal Akbani: It’s pure marketing. It’s, more or less, to get our name out there. We would also end up getting some sponsors that would eventually generate positive revenue for us from the show.

Sramana Mitra: What about all these events? Is that marketing?

Sal Akbani: That’s a revenue generator. Last year, we tinkered with it. We generated about $170,000 from it. This year, it looks like we’re going to end up earning about $300,000 to $400,000 in revenue from these events just from St. Louis. Next year, we plan on earning close to $1 million just from St. Louis and we’re going to start copying it into our other locations, especially Atlanta, Denver, and Scottsdale.

Sramana Mitra: Very interesting. You want to hold on to the business as a private business or is this something that you want to sell at some point?

Sal Akbani: I’ve actually set the company up that I would sell it to the employees. The company would be sold to its key managers.

Sramana Mitra: How have you set that up? Can you elaborate?

Sal Akbani: This year, we are giving stocks to employees. With every year, more employees are brought into this program. I get to gain from the net proceeds of those stocks.

Sramana Mitra: You’re actually selling stocks.

Sal Akbani: Yes, we’re selling them at discounts.

Sramana Mitra: What is the reception in your team?

Sal Akbani: Enthusiastic.

Sramana Mitra: What about customers? It sounds like the kind of audience where you have access to a great customer base that would be delighted to participate in a private placement offering like this. You could crowd-finance this kind of a sale. You could bring in a hundred customers as your shareholders if you wanted to do that. Is that something that’s on your radar?

Sal Akbani: I have not considered it, but I’m willing to listen.

Sramana Mitra: You have a very wealthy customer base.

Sal Akbani: Yes, one of my private customers is now the Chief Financial Officer of Boeing. We have sold cars to Kobe Bryant. We have sold cars to Lady Gaga.

Sramana Mitra: If I were you, I would set this up as private placement. You need legal advice on how to structure this right. This could be a very nice private shareholder group that would be great advocates for your company going forward. Thank you for your time.

This segment is part 7 in the series : Bootstrapping a Two-Sided Marketplace to $10M: Sal Akbani, CEO of Gateway Classic Cars
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