Apr 8, 2024 | Featured Entrepreneurs

Wendy Simmons: Navigating the Path to Selling Successfully

Wendy Simmons

Former President and Founder, Prism Energy Services

Logo for Prism Energy Services
Wendy Simmons

Former President and Founder, Prism Energy Services

Logo for Prism Energy Services

Most entrepreneurs envision selling their business one day or passing it on to their children as a legacy. Wendy Simmons, Founder of Prism Energy Services is living that entrepreneurial American dream, having successfully launched and grown her own business, which she recently sold to Environ Energy. Her journey from educator to businesswoman and successful entrepreneur provides inspiration and some practical advice for those who also dream of selling their business.

Decarbonizing the Planet
Prism Energy Services, based in Quincy, Massachusetts, offers engineering and construction management services with the goal of helping commercial enterprises improve their energy efficiency. “We perform energy audits,” Simmons explains. “Then we recommend changes to the facility, to their systems, and then we actually install what we recommend.” Services include completing energy audits, specifying new equipment that is energy efficient, retrofitting existing equipment to optimize energy efficiency. Simmons likes that in the energy services field doing well also means doing good: “We’re reducing the production of greenhouse gas as a byproduct of burning fossil fuels. Our work decarbonizes the planet, addressing climate change.”

Accuracy and Honesty
As she built the company, Simmons focused on two pillars. “Our values are, first, technical accuracy above all else. It is literally about the work and doing it correctly. Second, being honest with clients.” She goes on to explain that if she and her team don’t feel like they can provide a recommendation that will meet the client’s goals or their own standards, then they will walk away from the project. She concludes, “We would prefer to do the right thing, as opposed to just doing volume for volume’s sake.” This approach has fostered trust with clients over time, as evidenced by a high level of repeat business relative to the industry.

A Gradual Path to Entrepreneurship
When Simmons went to college, being an entrepreneur was not part of the plan. “I got into this field completely by accident,” she smiles. She graduated with a degree in teaching, but after some time in the classroom, she decided she would rather try a job in business. “I got a job in an office as the office manager in an engineering firm.” She stayed at that company for fifteen years, gradually learning all of the parts of the business. Eventually, the firm decided to relocate, making her commute much longer. “It was difficult, so that was part of it, but I also wanted to make more money and have more autonomy, so I went out on my own.”

80 Hours a Week
Since she was starting a business in the same field as her previous company, Simmons had a good idea how to run it. As a result, she avoided some of the stumbles that are typical for new entrepreneurs. However, like most new business owners, she discovered that everything requires either time or money: “I didn’t want to borrow a lot of money, and I didn’t want to invest a lot of money, so I did a lot of things myself.” She worked very long hours in the beginning. “I didn’t realize how many hours I would personally have to put in,” she recalls. “I worked about 80 hours a week until I had saved some money in the company.” Although the work was hard, she enjoyed making the decisions and watching the business grow. “I won’t say it was easy, but I made it work.”

Highs and Lows
Simmons loved the freedom and flexibility of entrepreneurship, especially as it enabled her to spend more time with family. She recalls, “I had to manage a large warehouse of product for contractors to install. When my father retired, he used to meet me at 6:00 in the morning to drive 45 minutes to receive deliveries, organize and distribute the product to contractors.” She explains that the boxes were heavy and the work was hard, but “I used to spend some really good quality time with my dad doing that, which is a very fond memory.” On the flip side, there was pressure: “The hardest part of running my own business was having all of the pressure when there was a really big challenge – a difficult problem. I lost a lot of nights of sleep. I’m above average at worrying.”

A Panel of Advisors
Simmons credits her local chamber of commerce for making a big difference in her company’s trajectory. She was selected for the South Shore Chamber of Commerce ATHENA PowerLink® Mentoring Program. This national business mentoring program is designed to increase the growth and profitability of women-owned businesses. “It kind of comes across as an award, but in reality I won an advisory panel of twelve ‘captains of industry’ to work with me for a year on my business.” Simmons recalls that the advisors were presidents of banks, CEO’s of relevant businesses, marketing experts, and professionals like attorneys. “I learned so much, got so many insights from them,” she recalls. She feels that this program accelerated her path to success.

An Early Offer
Another important experience that guided Simmons’ decision-making was an early offer from a potential acquirer. “It was always my endgame to sell in order to be able to retire, but I didn’t think about it much initially.” She goes on to explain that she thought that in order to sell her company she would need to be making a lot more revenue. However, she received an early inquiry from a potential buyer. “I had an offer in the first few years. It wasn’t enough money to retire on, and I was a little bit worried about what would come after that.” Her advisors encouraged her to go through the process anyhow and learn what the acquirers valued. Ultimately, she did not accept the offer, but learned a lot about what a business needs to do to create enough value to be saleable. “What I really learned was that you have to have systems that are replicable for growth; you have to have really good people; and, yes, profitability, but you need to be ready to grow because it’s always the goal of an acquirer to grow.” She felt that understanding the buyer’s perspective helped her make the right decisions as she grew the business.

Preparing Yourself
In most cases, when a business is sold, the owner must stay engaged so that the buyer can learn how to run the business. This period of time when the owner continues to work after the sale – called an “earnout” because the seller can often earn more money by hitting agreed-upon financial goals – can last as long as five years. With this in mind, Simmons advises that the entrepreneur must not only prepare the company (so that it is attractive to a potential buyer), but also prepare oneself: “The biggest thing you need to do is get your mind zen with the fact that you’re not going to be in control and you’re not going to be in charge anymore.”

The Right Buyer
Having sold Prism Energy Services, Simmons now works as part of the Environ Energy team. She comments, “We are still providing the same services; it’s just that we’re doing that as part of a multi-disciplined energy company.” When a company finds the right buyer, the transition is smooth for the seller and the buyer – and the employees who will carry the company forward. “Most of my staff have been with me for ten years or more. We have a nice culture, and we have integrated into a very similar culture in the company that acquired us.” She comments that she feels fortunate to be able to give her staff a solid future.

Structuring the Sale
There are many ways to structure a sale. Simmons recalls her priorities in the process: “I did not want an earnout, meaning that I would perhaps have a higher payout after some period of time.” She wanted to retire sooner and did not want to be committed to working for a number of years. “I structured the deal to be able to exit after about a year, and that precluded having an earnout.” Simmons explains that this choice may have lessened her total payout, “I may have left a little money on the table, but I was more interested in the time and the peace of mind.” That said, she is enjoying working with the new company and may stay engaged after her formal commitment to the buyer ends. She smiles, “When I retire, I’ll probably still consult.” However, she also has other goals. “I want to do some more of my charity work,” she says. “I want to be more active, work out more, and spend more time with family and friends that I haven’t had as much time for when I’ve been very busy working.”

Smelling the Roses
Looking back, Simmons is grateful that her path took her to entrepreneurship. “The choice to become a business owner affected my life positively. It made me happy. It challenged me. It probably also challenged my family.” However, working for herself gave her flexibility to work close to home and to her children’s schools, so she could duck out to attend things like soccer games and school events, which she didn’t want to miss. And, owning her own business put her in charge of her own career development: “It allowed me to grow my income when it had flattened. I knew that every hour, every minute I put into my business would come back to me, if not in the short term, then in the long term.” Asked what she will miss about owning the business, she responds, “The people: I’ll miss my staff. I’ll miss the people at the new company. I like working for them.” And, she will miss the daily excitement of entrepreneurship. “I’ll miss the busyness,” she laughs. “I think that will be an adjustment – for me to slow down a bit – but I’m getting ready to stop and smell the roses.”

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