What do you get when you mix a red Beetle, a legion of pocket protectors, and an innovative business model together? You get Nerds On Site.
What tech-savvy investors get is an established, global IT solutions company with sound, experienced management providing an investment opportunity that appears to be a real-world value buy.
Nerds On Site (NOS) (C.NERD, Forum) is a soon-to-be CSE-listed company that has been a major player in the mobile IT business in Canada for more than 20 years. Over that time, the company has provided a variety of mobile IT and computer support solutions to over 130-thousand Clients. Now, NOS is seeking $6 million to finance its sales and marketing, working capital, and expansion into the US. It’s a big move, but the company thinks big.
Nerds On Site: The Story
Nerds On Site is a mobile information technology support company offering small to medium-sized enterprises (SMEs) with various services, including computer network installation and support, PC setup and tailored software services, plus other IT-related services.
NOS also provides its services to residential and corporate users. A notable corporate Client of theirs is Canadian Tire. The company is currently operating in more than 10 cities across Canada, plus 10 countries around the world, and is now planning a “major expansion of their business into targeted areas in the US.”
The company was established by John Harbarenko and Dave Redekop in 1995, who developed the Nerds On Site idea while working together at a now-defunct electronics retailer in London Ontario. In 2001, Charlie Regan, now acting CEO, came on board and brought his business model of independent contractors with him. Within a year, Nerds On Site grew from London Ontario to across the country.
Today, the company uses a revenue sharing model in Canada where their independent contractors – aka ‘EntrepreNERDS’ or ‘eNerds’ – share between 37% to 50% in revenue from each contract they sign. This unique business model has resulted in the company producing an annual revenue of between $8 to $10 million. In total, the company has generated over $160 million in revenue since its inception in 1995.
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Nerds On Site: Expanding into the Giant US Marketplace
Now, the big news – Nerds On Site’s plan to expand their revenue sharing model moving south. The company will be selling franchises to approximately 150 eNerds in 10 cities in the US, rolling-out an ‘Area Developer franchise’ model. The company says they expect this to double their revenue to $19 million annually.
The company also says it plans to initially target cities in Florida and Arizona, utilizing their ‘IamaNerd’ interface to communicate with their IT specialists and are expecting the majority of their costs to be associated with recruiting and training their eNerds, advertising and marketing, plus the leasing of NerdMobiles™.
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According to the Company, eNerds will be obligated to pay a $2,500 franchise fee that will include ‘BootUp’ training. eNerds in the US will also reflect the Canadian model, receiving the similar percentages in revenue from each contract. They’ll also be responsible for their own Client origination and maintenance. Additionally, eNerds will be able to use their NerdMobile for marketing and Client services. Nerds primarily cruise from job to job in the highly-recognizable bright red Volkswagen Beetle.
Eventually, the company will be deploying an American Area Developer franchise model. Each consultant for the company will become a franchisee and geographic franchises will be offered for purchase once these areas are established.
Nerds On Site: IT Business Partnership Model
Planning and strategy are paramount for any company initiating a public raise. Company director Eugene Konaryev says the Company’s streamline business model takes all of the superfluous duties away from the Nerds so they can focus on their main task – mobile IT solutions for SMEs:
“One of the most important milestones and steps the company has taken is building out a platform which we call ‘IamaNerd’. This is an online, on-tablet smartphone platform that runs day-to-day operations for all of our Nerds. It takes all of our administrative, inventory, and invoicing tasks – most of the things Nerds don’t like to do. All they need to do is perform the service call or manage their regularly-scheduled IT visits in the field.”
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And he went on to say it’s all about offering their Clients an entire network of technical expertise with one simple phone call. “We also have something that is extremely cool and important and separates Nerds On Site from any small IT shop…it’s our continuing education system that is built into the IamaNerd platform. We call it our University of NERDology™. Here, each Nerd has to continually educate themselves and develop their skills and knowledge base in order to stay current and stay afloat in a rapidly changing IT marketplace.”
In addition to the interactive online University of NERDology, each nerd has real-time access to the entire Nerds On Site pool of talent. Up to 250 certified nerds will be part of the assessment, implementation, and solution team for each and every Client, as a result.
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NOS says they’ve worked to make their ‘Collegial Group of Nerds’ a more enjoyable and effective partner of choice for Clients everywhere. Today, the company has a global network of IT providers in more than 10 countries around the world – including Canada, the US, UK, Australia, South Africa, Bolivia, and Mexico – serving more than 100,000 Clients. Nerds On Site offers a vast array of business solutions, including disaster recovery, remote storage, IT help desk, and workplace collaboration services. NOS team members can rely on the company network of fellow IT providers, constantly proving that no problem is too big for a team of Nerds.
At a time when many businesses across the IT spectrum are struggling and cutting staff, the iconic computer system repair and technology company is “desperately seeking” technicians to help service a growing list of Clients.
According to Mr. Konaryev, NOS has no direct competition in Canada as they are the only large-scale company that offers complete onsite IT services and solutions for businesses and their residential Clients. While Best Buy’s Geek Squad provides similar services to Nerds On Site, they’re targeted more towards the installation of audio-visual systems rather than onsite IT solutions.
Recruiting the Nerds
Charlie Regan, Nerds On Site CEO and one of the company’s three managing partners, said his company is always looking for people with a passion for technology but “more importantly, the ability to ask questions and the willingness to listen to the answers.
“It’s a people business,” said the CEO. “We develop relationships with our Clients and we need people who can do more than just service computer systems. We also need people with a passion for technology who believe it’s sad and frustrating that technology doesn’t do enough for people.”
All prospective Nerds are also encouraged to take Dale Carnegie courses to help them learn communications skills in addition to receiving training, marketing advice, mentoring, access to the company’s call-in centre, and ongoing technical support.
The company says Nerds can earn anywhere between $3,000 and $10,000 a month depending on how hard and how smart they work, contending it’s no different than any other small business…it just depends upon how much time you’re willing to put in.
As Mr. Regan puts it, “Our enterprise focus has always been our Client. They are the boss. We work to build a long-term relationship with them. It may be corny, but we always capitalize the ‘C’ in the word Client as a matter of practice. A key NOS axiom is ‘We don’t service computers… We serve People, with computers’. We enjoy a 96.5% Client Satisfaction rating but are most humbled with the 80,000 plus written messages our Clients have shared with us. I'd be happy (and proud) to share a sampling of these with anyone who’s interested this liquid gold!”
Nerds On Site CEO Charlie Regan on what it takes to be a Nerd
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Nerds On Site: An Apple Mobility Partner
Two years ago, Nerds On Site announced it was doubling down on its iOS (Apple’s mobility operation system) expertise by becoming an Apple mobility partner. As a mobility partner, NOS and their Canadian team members now assist small and medium-sized businesses identify and implement industry-specific work solutions that are optimized for iPhone and iPad.
"Our mission has always been to drive up the pleasure, productivity and profitability of technology in the lives of our Clients,” said CEO Regan.
Nerds On Site works with other Apple mobility partners to help businesses increase productivity, efficiency, and ease of collaboration using iPhone and iPad. These unique products revolutionize work processes in fields ranging from retail to manufacturing and from farming to health care.
"When you've got an entire team of Nerds on your side, there's no problem we can't solve," added David Redekop, Nerds On Site cofounder. "We're very excited to help drive this change. Our goal is to help businesses across Canada find greater success, by making the most of their iPhone and iPad solutions."
Mr. Redekop went on to say, “Today some organizations are struggling to keep up with the transition into a mobility-driven work culture. We're eager to help Clients discover and implement the solutions that will lead them to success.”
With the Apple partnership, NOS also helps Clients leverage these products while providing Apple-certified technicians to assist in application onboarding and training. The team members are not only experts in iOS, but they’re also long-time business IT experts. According to a company press release, “Nerds On Site has helped more than 100,000 small and medium-sized businesses harness their technology assets”.
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Nerds On Site: Investor Summary
Stadnyk and Partners, a Vancouver BC-based international venture capital investment group, is a notable shareholder in the company and is providing their marketing acumen and experience. Go Capital, a private equity firm, is also significantly invested in Nerds On Site.
Major investment players like these two companies usually know a good thing when they see it. Mobile IT solutions is a rapidly growing market segment and, according to NOS, is significantly underserved in the massive US market.
For tech-smart investors looking for value and opportunity, these Nerds may be a not-so-awkward play.
www.nerdsonsite.com
FULL DISCLOSURE: Nerds On Site Inc. is a paid client of Stockhouse Publishing.