Sean Frank is the mastermind behind Cloud Equity Group, a multi-strategy investment management company specifically focused on the cloud and hosting sectors. The firm has been in business for almost a decade and invests money on behalf of its individual investor, high net worth individual, and institutional investor clients. Much of the firm’s success as a reputable boutique investment manager stems from Sean’s extensive M&A and executive level background as a strategic operator within the web-based services sector.
It’s not uncommon for entrepreneurs to have a long list of companies that they’ve built from the ground up over the years, but what makes Sean uniquely stand out is that he was only 12 years old when he started his first business. Similar to the stories many have heard about Silicon Valley giants that were founded in garages, Sean started his business in his parents’ living room.
It all started as a hobby. The internet was just becoming readily accessible and Sean was interested in website coding. While other students were learning how to touch type in school, Sean had already mastered this skillset and was teaching himself HTML and PHP coding – the main programming languages required to build websites at the time. Sean’s talent quickly caught the attention of his peers and people began asking him to make their websites. Recognizing this demand, Sean started making websites for his friends in exchange for a small monthly fee to keep it online and so his first business venture began.
“It really just started off as a hobby where I was making money for doing something that I enjoyed. I liked that I could spend a week or two developing a website for someone, and then I could charge them a monthly fee to keep it online for them,” said Sean. “A lot of people today talk about the importance of creating passive income – I had mastered this before I even got to high school.” By the time Sean was in high school, he was known by his peers as the student who was making more money than any of his teachers.
While Sean was embarking on this first venture, the internet was beginning to grow exponentially as most households were getting a computer and some type of a basic internet connection for the very first time. Back then, there were no content management systems or social media platforms that would make it easy for individuals or small businesses to create a web presence. Instead, if someone wanted to get online, they needed to either learn how to code the website themselves or hire someone to do it for them.
“Business started to boom because there was such a large market of individuals and small businesses looking to get a web presence for the very first time. I really enjoyed being able to help people do this while charging money from them at the same time,” Sean explains. “As a young kid living with his parents, I had no real need for money. I reinvested every penny I made back into my business to accelerate its growth.”
Over time, Sean was making more money than he could reasonably reinvest in the business in a meaningful way. It was at this time that he became interested in buying out other businesses.
“My first acquisition was small, maybe only $1000. I had absolutely no idea what I was doing but trusted myself enough that I could figure it out as I went. My strategy was to buy the company, merge it into my existing company, and squeeze out as much profit from it as I could,” said Sean. “I became so good at acquiring similar businesses and maximizing economies of scale that I was able to make my money back on most investments in less than 6 months.” Over time, Sean kept acquiring more businesses, each time slightly larger than the last.
By the time Sean graduated high school, he was running a conglomerate offering a very wide range of web-based services through its subsidiaries ranging from web hosting and web design to outsourced staffing services and game server rentals.
Sean attended the University of Pittsburgh and received a degree in Finance. After graduating, he received a Chartered Financial Analyst designation. He then combined his formal education in finance with his already lengthy experience in M&A to start Cloud Equity Group in 2013. Today, the NY-based private equity firm is one of the most active investors in the low/mid-market cloud and web hosting sectors.