Ohio DJ Uses The Art of The Acquisition
Oakwood Village, Ohio—One look at Matt Radicelli’s pedigree and you can see why his decision to pursue DJing as a career was somewhat preordained, in the cards: His mom and dad ran a nightclub, where his dad was the DJ, while mom was the bartender/controller.
“All throughout middle school and high school, I was getting paid to do school dances, teen events, and private parties,” says Radicelli. “When I was a junior in high school, I decided to tell my mom that I wasn’t going to go to college, and besides DJing, I opened up an audio/visual installation company.”
This was 1997, and it wasn’t until two years later, after he did his first Bat Mitzvah, that his “eyes were opened to the world of possibilities for interactive mobile entertainment.”
That was the year Radicelli started his now-multi-op company, Rock the House Entertainment (RTH), and also when he realized that quality of performance and customer service were the keys to success in his Northeastern Ohio market.
“I realized early on that I would rather compete on quality than compete on price,” he says. “I also learned that having the right team members in place made growth and competition much easier to manage.”
Radicelli lacked a business plan, but he did know what markets he wanted to pursue, and, by adding services like lighting, photo booths, casino and inflatables, he saw steady growth year over year. He added systems and hired DJs, MCs and support staff, and with the exception of a relatively small growth phase during the 2008-09 downturn, RTH has grown consistently, as much as 40-percent, and no less than 20-percent. Over the last four years, RTH has increased the number of bookings each year by 10- to 30-percent. By handling big-market events from Cleveland to Columbus and Pittsburgh, RTH books more than 1,000 events a year. Says Radicelli: “It’s the mentality of taking one step at a time and continuing to increase as we go.”
One practice that Radicelli believes separated his company from the competition was to snap photos at their events and post them on their website the next day. “As far as we can tell we were at least four to five years ahead of the curve on this practice,” he says. “And it’s one of the things that catapulted our brand to the top of the list locally.”
One other leap Radicelli took to separate his business even more from the competition was attending the Goldman Sachs 10,000 Small Business program. “It was a game changer for me,” he says. “When one of my customers cornered me on the dancefloor during his son’s Bar Mitzvah and told me that I had to join this program, I knew he was serious and I needed to look into it. Once I found out that the program had been compared to a masters-level course for entrepreneurs and small business owners, I knew it was a great opportunity.”
The accelerated nature of the program—crash courses in management topics like HR, accounting, leadership, marketing, and negotiation, with workshops curated by Goldman Sachs team members—kept him interested, and provided motivation for him to take the next steps for his business.
The takeaways, which all DJ business owners can benefit from, Radicelli describes thusly:
- “One of the most important roles of a leader is to spend a considerable amount of time on marketing and sales innovation. The Goldman Sachs 10,000 Small Businesses Program put me in a position where a regimented schedule gave me the opportunity to spend considerable amounts of time on the business.”
- “All entrepreneurs have an inner need to create something from nothing or to continuously create and improve those around them. This program has helped to reinvigorate and to remind me of the things that I really enjoy doing and that I need to delegate everything else.”
- “The program allowed me to develop new contacts with other Cleveland-based entrepreneurs that also led to the creation of friendships with more than 40 people, including my classmates and the program faculty and staff.”
- But it was during one of the financial clinics, when a quote flashed across the video screen, saying, “Anyone Who Can Be Your Competitor, Can Be Your Partner,” that Radicelli had his epiphany.
“That ah-ha moment led to me offering to buy one of our competitors that very same day,” he says. “We closed the deal to purchase it before I graduated from the program.”
The acquisition of Zone Entertainment reflected Radicelli’s belief that businesses can grow in a multitude of ways. “We realized a few years ago that while we certainly are going to continue to work hard at growing our brand and strengthening our position, if we really wanted to take a leap forward, we had to take into consideration buying portions of our market share. With that said, you generally buy a business for one of two reasons: for market share and for cash flow. In this case, this deal should provide both.”
With the purchase, RTH, now billing itself as Rock the House Entertainment Group, gains approximately 20- to 30-percent more market share than they currently have. Jeff Dick, the past and current president of Zone, will continue to operate the brand in parallel to RTH and will not be consumed by the company. Says Radicelli: “He essentially will continue to operate as a competitor,” says Radicelli, applying business laws of scale to his industry.
“That’s our plan for future growth,” he adds. “Continue to stay the course with regards to our entertainment division and to grow and scale the production side of our business. We are just now just realizing the potential and growth opportunities for weekday work in the corporate and non-profit sectors, and since we know quite a bit about the DJ business in general, it’s likely that we’ll attempt or continue to attempt to acquire other reputable competitors. The more we can surround ourselves with great people, the more job security and stability we have in all of our futures.”