Jon S. Wright | Executive Profile | ATLANTA TREND
Building from Scratch
By Robert Green
When Jon Wright first learned his company, Access Point Financial, Inc. (APF) had been named the 17th fastest growing private company in the country for 2015, by Inc. magazine, he was both humbled and gratified for the honor. “It’s extremely important to me that the management team receives the recognition that they deserve when such well-regarded counter party assessment as Inc. Magazine determines such results,” he said. Ranked number 17 nationally by Inc. 500, APF had surpassed such well known Atlanta “unicorns,” such as Kabbage and Cardlytics (they were number two and number three respectively) when measured as a “metro” vs nationwide stratification.
Born and raised in the college town of Fayetteville, Arkansas, Wright was one of two sons of post grad educators (Library Science and Musician). “My mother earned a Masters in Library Science, after herding my brother and I to lower school, and my father was a brilliant musician who taught music in the high school, church and University of Arkansas,” he says. “Growing up, my entire existence consisted of sports, music and church.” Jon’s father handed him a guitar at age fifteen, informing him that, “the gals will be able to see you better without that helmet on your head,” (after suffering a spinal injury, which ended his football aspirations). He now lives vicariously through his son, who is currently a quarterback for the University of Kentucky and his daughter “who is academically predictable on her way to Alabama”. Wright worked as a vendor at Razorback Stadium, as a pre-teen, on game days selling Cokes and kept a steady lawn care business which was his means to pay for his first car. During high school and college he worked at the local mall (Sears) from 5:00pm – 9:00pm. “I was always doing something. I was compelled to stay busy, it was in my DNA,” he says, “and I knew I wanted to run my own business one day, and in order to get ahead, I would have to work harder than others to accomplish those goals.” At Sears, he was soon promoted to the electronic and automotive departments, where he was compensated primarily by commission on gross sales. Jon was mesmerized by the fact his income had surpassed that of most recent college graduates or those serving the public sector, (part-time no doubt).
For college, Wright elected to remain in Fayetteville attending the University of Arkansas. Jon was rushed to join a fraternity (Sigma Nu). “I liked the idea of joining a fraternity and instantly meeting roughly a hundred new frat brothers, but unfortunately, couldn’t afford the full tab or so I thought. My parents termed it ‘Sigma Sin’ and made sure I was aware that all financial obligations were on my account. A couple of the older members/officers suggested that I work part time to help with the landscaping for relief of monthly dues. I mowed the lawn and assisted the landscaping and gardening crews for two years while also maintaining my 5:00-9:00 shift at Sears,” says Wright, “more importantly, I swallowed a lot of pride.”
In the meantime, Jon’s brother was fully entrenched into the music business in Nashville and producing artists such as Clint Black, (who he found in a Houston honkey tonk and later produced his first album). Interested in the music business himself, and being best friends with his brother, Jon traveled to Nashville after his college graduation with the intent of working in marketing and public relations. “I was nervous, yet excited, and then even more thrilled when my brother said that he had found a job for me, recruiting new artists for BMI (one of the largest music rights companies in the world).” Then Jon learned the reality of starting out in the music business - that he was only going to make $400 per month. “I loved music, and I loved my brother even more for helping me out,” Jon states. His brother made some great arguments about how this BMI gig was just the beginning, and that most folks did the work for free, just to break into the business. But Wright realized he didn’t love it enough to work for free and that he could still hang out with his brother afterhours and “socialize” in the “biz.”
Instead, Jon accepted an offer from Pitney Bowes, where he worked in their equipment and finance division, followed by corporate real estate and ABS financing for Ford’s commercial ABS leasing division. In 1988, he was recruited to Holiday Inn Worldwide in Memphis to work for its Real Estate financing arm.
“Fortuitous timing for me, indeed, and launched my career in commercial real estate and specifically the hotel financing business. I was blessed to meet the first generation of hotel developers. Most of them were in their sunset years, and were in the process of successfully passing their investments to the next generation. I got to know them intently and learned a lot from them.” What was most surprising to Jon was how easily he got along with these businessmen away from the nuts & bolts of business. “I found that they were similar to the people I knew in the entertainment business. It takes a charismatic individual to break into the music industry, but it also takes a charismatic person to get “heads into beds” every night in the hotel industry. “We got along splendidly. A lot of them had garage band mentalities, working hard to do just that little bit more to impress the audience. They had amazing passion for work and family.”
At that point in time, Bass PLC (Bass Ale) of the UK, bought Holiday Inn brands and kept the financing arm that Jon eventually led, whilst Bass promptly moved the company to Atlanta in 1990. Jon moved to Atlanta with his then girlfriend and found that he loved Buckhead/Atlanta more than a committed relationship. “She was homesick and our plans changed 360 so we promptly and civilly broke up.”
In fact, the break up inspired Jon to write a country song, “Going through the Big D” (Don’t Mean Dallas).” Jon’s brother co-wrote the song and produced Mark Chestnutt, who recorded it. The song went to number two on the Billboard Country chart and number one on Radio and Records Charting Service. “The song ended up being a humorous look at a tough situation,” says Wright, “and while it was very satisfying to write a hit song, it also helped me impress my future wife (now of 22 years).”
In 1997, Jon was persuaded to leave Holiday Inn to launch a new hotel financing unit for GMAC. He was recruited by one of the top finance managers, and a mentor at the time, at GM because he knew Jon had been successfully making hundreds of loans during his ten years at Holiday Inn. Now he could make loans to the entire hotel industry (not just Holiday Inn hotels). He would literally be starting from scratch and taking a fifty percent pay cut. But he had great upside potential as a Jr partner if the new venture was successful growing to $4 Billion of assets. “And we were successful,” he stated.
In 2005, GM found itself in financial trouble and Jon ended up selling his division at a profit when the unit was purchased by an Atlanta based banking consortium, yet after a fantastic 4 year stint and roughly $2 Billion of loans, the parent bank had problems of its own, ended up being closed and placed in receivership by the FDIC in 2009. Jon’s unit, though still highly profitable, was now owned by the FDIC and remained operational for the next two years. Jon found an entity that would buy his unit from the receivership for a premium when the parent company shuttered, however, “the FDIC was a tad bureaucratic, to say the least,” and could not get the FDIC to act fast enough on a stellar Wall Street proposal. Two years later, Blackstone bought the bulk of the unit’s assets for eighty-two cents on the dollar, which Jon says was still the highest value obtained by the FDIC for the bulk sale of assets in receivership.
By 2011, Jon exited the receivership entity owned by the FDIC and formulated his next steps. The big decision that he had to make was whether or not to start all over again. He was very fortunate that his corporate insurance (Director and Officer, Errors and Omissions) coverage was in force and available from his insurer. He never had a lender liability claim in all his years in business – but to keep his policies in effect he would have to pay the six figure premium out of pocket.
“I knew without a doubt that our team was the best in our space” he said, “so it ended up being one of those hard decisions that are easy to make. I covered the premium, subsequent startup costs and overhead out of my own pocket and got back to work.”
Jon closed with a well-regarded private equity firm for funding the enterprise within forty-five days, initially putting up $50 million and Access Point Financial was born. He rented office space for the team and bought furniture from the FDIC for ten cents on the dollar. “I told the landlord to leave our space “as is”. We were ready to go, and I had a great management team in place. My CFO and management team had been with me for over a dozen years, long enough to know they were passionate to keep moving forward as well.”
Starting over in 2011, business was a bit slow at first. “The volume and velocity of transactions was not there,” Wright said. “Customers seemed to be frozen by the hangover from the financial crisis. The good news during this time was that we had a standing relationship with Wells Fargo which joined again as a debt partner.”
“Our biggest milestone was when I was able to tell the team that we had broke even and made a profit of $100,000 for the month. We had a brief celebration and immediately got back to work,” Wright says. The profits each month continued to mount and today Access Point is projected to earn nearly $50 Million revenue in 2016. That’s why we have such a high ranking on the Inc. 500 magazine list I suppose,” he says, “we actually reorganized very efficiently.” In three and a half years, the company has lent $1 billion on 550 assets (with $1.8 billion in asset valuation) and has combined debt/equity of over $1 Billion. Access Point makes hotel loans that range from $250,000-$25 million. They make bridge loans with capital improvements.
Wright believes that the future for his company is bright. “Asset trading velocity on the buy/sell side is robust and the stronger hotel developers undertaking major refurbishment every five to seven years, so we enjoy meaningful, recurring client activity,” he says.
The company’s expertise make the loans they originate quite liquid since they are so well respected in the financial market place. “One thing that I’m very proud of is that we recently produced the first hotel only asset backed security and is “A” rated by two agencies. We have a stable of well-regarded Investors who appreciate the quality, velocity and integrity of our product delivery and the fact we remain as principal in all executions. ” APF issued “A” rated securities and increased its stable of bank leverage partners to include JP Morgan, Key Bank, East West Bank and several other world class banks.
Due to their success, (which Wright always credits to his management team) unsolicited offers to purchase the company are not uncommon. Banks are especially interested in APF because its loyal customer rapport of high net worth. Cross-selling financial products to such individuals is very important to banks today, so at least one path to a major liquidity event is clear for the company.
“We’re delivering exceptional returns for our investors (including APF management team) as stockholders by partnering with hardworking people to achieve the American Dream,” he said “what could be more satisfying than that?”
Social Media Corner
Subscribe ATLANTA TREND
Coca-ColaCompany ID [NYSE:KO] Last trade:43.15 Trade time:4:00PM EDT Value change:▲0.14 (0.33%)
HomeDepotCompany ID [NYSE:HD] Last trade:156.10 Trade time:4:03PM EDT Value change:▼0.02 (-0.01%)
DeltaCompany ID [NYSE:DAL] Last trade:45.44 Trade time:4:00PM EDT Value change:▼0.30 (-0.66%)
NCRCompany ID [NYSE:NCR] Last trade:41.25 Trade time:4:01PM EDT Value change:▼0.39 (-0.94%)
- BlueLinx Completes Three Property Sales
- First Data to Acquire Acculynk
- Blackstone to Sell 49 Percent of NCR Stake
- The Coca-Cola Company Announces Senior Leadership Appointments
- PulteGroup Names Todd Sheldon General Counsel
- Luxottica Group to create 1,000 jobs in Henry County
- Global Payments Promotes Cameron M. Bready to Senior Executive Vice President and Chief Financial Officer