The Telecommunications Act of 1996 enacted during the Clinton administration was designed to create new competition in the broadcasting and telecommunications markets. And while some today debate its success, there is no debating its impact on New York City entrepreneurs Marshall Aronow and Andoni Economou.
The pair founded telecom services provider MetTel that year. Neither knew much about the sector but were willing to risk their successful careers to try and take advantage of the new competitive environment. Aronow is co-founder and CEO and Economou is co-founder and COO.
Of his company’s improbable bootstrapped beginnings, Aronow says, “We were rank outsiders. I was a Wall Street trader and Andoni was a young lawyer. Frankly, nobody would finance us because we were not telecom professionals. We started at the bottom offering residential service. We were literally working out of a three-room office, which grew into a call center. And I think we started off literally signing up customers at street fairs for the residential side and evolved from there. We just moved up the food chain to business.”
The odds of a Wall Street trader and lawyer building a successful telecom business were not great. Yet, from those humble beginnings, Aronow’s and Economou’s MetTel has survived and thrived, reaching its 25th anniversary having built a fast-growth, profitable, mid-sized business.
The New York City headquartered business now operates in nearly every state, expanded into overseas markets, has nearly 650 employees and has experienced double-digit growth for the past fourteen years, according to Economou. The company was recently named a Gartner Magic Quadrant leader for Managed Network Services and has built a burgeoning public sector division having garnered $2 billion since 2020 in federal government contracts from the VA, State Department and GSA.
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How does a relative newcomer compete with telecom Goliaths like AT&T, Verizon and Comcast? “The larger companies fill a great role, but as you know, the larger you get, the harder it is to adapt and be nimble and offer new services. The landscape is huge. There's a tremendous amount of opportunity. And companies like ourselves could come to the forefront with new technologies,” says Aronow.
MetTel partners with all of the major telecom providers and has an extensive partner ecosystem, allowing them to offer best-of-breed solutions across the spectrum of telecom, broadband, networking equipment and software. “We've developed great relationships over the years with our initial partners, the carriers, AT&T's, the Verizon's. We've automated our business operations with our partners out of necessity. Before APIs were a common word, we were integrating with Verizon and AT&T, and the other service providers. We developed a tremendous degree of software development and automation, which enabled us to really support the 100 different partners we have today, which really gives us a unique advantage,” says Aronow.
Aronow and Economou both point to the company’s agility in meeting customer needs as another key to their success. “A lot of enterprise customers are faced with a dizzying array of choices and companies to interface with and a lot of these things take them outside of their core competency. We try to make it simple. If, for example, you want to get internet access for your enterprise and you have 1000, or 2000, or 3000 locations around the country, it becomes complicated to buy broadband or ethernet or fiber from AT&T, Verizon, and Comcast. You can just come to us and we're fully automated with these carriers. We can order it, we'll deploy it, we'll send our techs, we'll professionally manage it, and it keeps the process simple,” says Aronow.
Perhaps because the company began as an outsider to the telecom industry, Aronow believes MetTel has been better at anticipating and investing in new technology developments and partners because they are not wedded to any one legacy system or vendor, allowing them to innovate in areas like SD-WAN (software defined wide area network) network AI and Mobility and Communication Data as-a-Service. As a result, the company is often brought in as a key digital transformation partner.
The company is private and intends to remain so. From their bootstrapped beginnings till today, the co-founders never sought venture funding or private equity to finance the business and, according to Aronow, the company has little debt. Though in the early years, they had taken on loans based on receivables. “Financing is not a problem. We have a tremendous amount of access to as much liquidity as we want, but we don't need it. We have a very healthy practice and I think that really underscores how methodically and thoughtfully we built this business. And if you build it to serve your customers, you're going to have a great platform and a great platform to move forward with all those customers. So, we're very proud of our business in that regard,” says Economou.
While the company doesn’t have a publicly traded stock to offer as compensation and incentives, the company has been able to retain and attract top talent. Economou points to Aronow’s trader background to create compensation plans that reward success. “What his background brought to the company that's helped us succeed so well is the ability to price everything and every function in this organisation. He's been able to roll out compensation plans that have done an incredible job incentivising employees and keeping employees happy here. The other thing is his ability to pivot. As a trader, he recognises his wins and his losses, and our success has been our ability to just make change happen. When we see something better come along, we don't take in on the legacy, on the past, we embrace the future and it's his leadership,” says Economou.
As for the future? Aronow says “I think the next leg of our journey is going to be not just coordinating and orchestrating access and managed solutions. I think creating a data-as-a-service offering is the next step. We have so much data going through our organization, we could make that data easier for our customers to digest. We have all their physical assets, all their circuits, everything centralised through our portal, and once you've gathered all that information, there's a tremendous opportunity to leverage that data and analyse it to optimise your operations.”