Peter Demangos

Peter Demangos has started two businesses in the Human Resources sector. One was a bootstrapped insurance brokerage where they sold employee benefits programs to large clients. The other was an HR software company called Collage, where Demangos and his co-founders raised $3.5 million of investment capital and sold three years later for $15 million.

Given that Demangos was the common denominator in both companies, his story provides a unique contrast of two different approaches to starting and building a business. Demangos retained 100% of the equity in his employee benefits brokerage, and with high margins, more than a million dollars in sales, and just five employees, it funded his lifestyle. When Demangos sold, he was able to get 8 times EBITDA for the brokerage, the majority of which was paid in cash.

By contrast, Demangos held a minority stake in his tech startup Collage, yet it was a much higher sale price, so he still had a healthy windfall.

The combination was enough money for Demangos to hit “his number,” a net worth beyond which he would never feel compelled to work again. This is why the conflicting set of emotions he feels today are somewhat surprising.