All dressed up and no place to go

Spring 1996

This was going to be Jim Peters’ day to strut, and he planned to do it in style. He reserved a party room at Don’s Pomeroy House in Strongsville and ordered up more than a dozen bottles of chilled Dom Perignon. Then he invited his eclectic circle of friends — from business acquaintances to fishing buddies — to serve as witnesses to the climactic moment of his entrepreneurial rite of passage: cashing out.

Now 37, the former Xerox and Johnson & Johnson salesman-who later stumbled into a partnership that would roar into a $9 million information-technology business in just eight years-had become the first in his circle to reach the promised land.

He’d begun the day as so many other business owners do: prosperous, yes, but with his wealth almost entirely on paper, wrapped up in the daily operations of his company, Adams & Reynolds. And he would drift off to sleep that night a certifiably wealthy man, a millionaire several times over.

The paperwork had been signed. The lawyers and investment advisers (including the $800-an-hour M&A specialist he felt obliged to hire to look over the perfectly capable work of his $150-an-hour attorney) had returned to their offices. But for Peters, there was only one thing left; a most important element keeping the champagne corks in place: confirmation that the wire transfer for his half-share from the sale of his business had cleared.

As the lunch hour slipped into early and then late afternoon, there was still no word.

“I had no idea where it was and what that might mean,” Peters recalls. “Does it mean that some $20,000-a-year clerk just didn’t move the sheet of paper from one file to another [yet]? What are the chances of it really going wrong? Probably very low. But if you’re a guy like me, who’s gotten where he’s gotten by thinking he’s managed all his risk, this is a very uncomfortable situation.”

His friends gingerly treated him like a pitcher nursing a late-inning no-hitter, anxious to avoid jinxing him. “The last thing you wanted to talk about is the deal,” one recalls, “so what happens is you talk about everything but that: some hunting stories and what’s going on with everyone else’s businesses.”

Finally, as the dinner hour beckoned, Peters’ lawyer, Kevin Kehoe, strode in, silently wrote the figure on a napkin and showed it to Peters. Out came the corks. “We were drinking [bottles of champagne] like water. They just had to keep bringing them,” says Peters.

Who knew what might lay ahead for this young and newly minted millionaire, a father of four? In coming weeks and months, Peters would muse aloud about the unimaginable freedom: to travel, to luxuriate in family time, to leisurely plot his future. All that lay just over the horizon now that he had converted sweat equity into cash. Now, Jim Peters liked to say, he had poker chips with which to play the game of life.


May 1997

It’s now a year later and Peters has decompressed from 15 high-stress years in business. “I feel like I’ve shed about five skins,” he says. Now, he shows up to lunch appointments in a gun-metal safari shirt, close-fitting jeans and cowboy boots. “I still have my suits, but I got rid of all my white shirts,” he says.

He might have spent the morning wading into the collected works of the twin pillars of investment guruship, Peter Lynch and Warren Buffet, looking for clues on how to manage his nest egg and perhaps find just the right venture to bankroll.

He talks occasionally about “spiritually fulfilling adventures,” clearly a counterpoint in his mind to the brass-knuckled Darwinism of business. The son of a speech therapist, Peters now thinks aloud about doing volunteer work with disabled children. “I feel a calling coming,” he says, laughing at how bizarre that might strike his former business associates, who, he assumes, considered him more carnivore than do-gooder.

“They would probably fall off their chairs, because my personality in business was very driven. No personality; just go out and conquer.” But that was merely an outfit, since discarded, that he donned for battle.

Certainly, he indulged himself with his new windfall, plunking down $100,000 for a red Mercedes coupe not long after selling the company. But that touched off so much neck-craning from neighbors in his working-class suburb southwest of Cleveland that he ultimately thought better of it. “I was just trying to see what it was like being able to afford those kinds of things, but it didn’t appeal to me,” he says. “I prefer to drive down the street in anonymity.” Besides, when he hit a deer with it, “I thought that was God’s way of telling me to keep it in perspective: I gave it to you, buddy, and I can always take it away.”

He sold the Mercedes and bought a kelly-green Yukon, an oversized sport-utility vehicle more hospitable to family life and less likely to prompt unwanted attention.

For the first time in his life, he has not only excess cash but plenty of time. His lifelong attraction to the outdoors helps fill much of that. A member of both the National Rifle Association and Safari Club International, he has poured himself into hiking, camping and fishing. He visited gun shows, and went bear-hunting in British Columbia. He took the family to Alaska. And he’s plotting his biggest challenge yet: an African hunting safari.

In the African bush, even in the company of an experienced guide, one might just as easily become the hunted rather than the hunter, he says. That kind of rush would forever top the comparatively pallid experience of hunting woodcock in the marshy stillness of northern Maine.

His only true business venture-with the possible exception of helping a friend find a broker to sell a company-has grown out of an addition built onto his home.

At the time, Peters was impressed with the father-son team that performed the work, and grew to trust them so much that he shared with them not only his house keys but the code to the home security system. The son, who has an MBA, “told me he had this dream of buying houses, fixing them up and selling them. I talked to my attorney about it,” and the wheels were set in motion.

Peters staked the pair in buying a fixer-upper in Shaker Heights, then another in Gates Mills. “I know nothing about houses, nothing about home remodeling or real estate,” Peters says. “But what I like is the people. That’s the key. If you read Warren Buffet, it’s always the people.” In the son, he sees himself. “This guy is where I was many years ago. He’s coming from nothing.”

Eventually, Peters says, he thinks the business can do $1.5 million a year, with pre-tax profits of 35 percent. “It’s a no-brainer,” he says. Tellingly, he has named it Hunter’s Realty, casually ignoring the fact that a well-established East Side player, Hunter Realty, might object.

“We’re small potatoes to them” he says, adding that he knows eventually the name will have to change. This informality-surprising, given that he once went through a distracting trademark scuffle when building Adams & Reynolds-perhaps signals that the venture feels more like a hobby at this point than a real business.

Mostly, though, he revels in having time with his four children, who range in age from 8 to 15. Just after selling the business, they finally complete a model they had laboriously been building together in fits and starts for five years.

Formerly the kind of dad who was lucky to make it to half their sporting events, he is now immersed in their lives. He has taken to shepherding them and large groups of their friends to various events, coaching several of their Little League teams. He redirects his empire-building impulse into becoming commissioner of the league. He finds a nurturing side in coaching, likening the satisfaction of watching a bottom-of-the-order kid get a hit to that of seeing a junior sales rep blossom. He takes a special liking to a hard-nosed kid on Ritalin, who clearly reminds him of a younger version of himself. “I was probably borderline A.D.D. (attention deficit disorder),” he says.


Fall 1997

That immersion in his children’s lives has taken a few improbable turns, none more bizarre than when he helped prepare a French dinner for 200 nuns, to mark the 500th anniversary of their teaching order (whose members teach in a school his children attend).

“It was probably scarier than anything I had ever done before,” he says. In fact, after a year as a father who had no particular place to be most days, he had spent so much quality time with his children that his then 8-year-old son took to boasting: “Gee, how many other dads would sell their business to spend more time with their kids?”

Despite such satisfying feedback, one could detect in more than a dozen conversations after he sold Adams & Reynolds an undertone of regret, a creeping question he felt lingering over his head: Am I becoming a dilettante, and if so, how long am I going to keep this up?

The feeling may have first crystallized one day late in the spring of ’97, when he was in the basement doing the family’s laundry. “And it occurred to me: I’ve been down here the last seven days, doing laundry! And it’s just not me.” He could sense the itch was coming back. But how to scratch it? And on what?


Sometime in the late ’80s

In many respects, Jim Peters was the last person one might have expected to become a millionaire before the age of 40. To this day, he thinks of himself as a “working stiff who just happened to be successful.” That’s not false modesty as much as a residue of his working-class upbringing.

Peters grew up squeaky-clean conservative, a true countercultural for a late-’60s adolescent: a Young Republican Nixon supporter. He took to the outdoors with relish from a tender age, without prompting from his family, which had no interest in hunting or fishing. His father, a salesman of business forms, developed early kidney disease and died when Jim was 21. With the attendant financial difficulties, Peters says, he managed to attend Baldwin-Wallace only because his mother worked there.

On reflection, his dad’s professional universe uncomfortably reminded him of the movie Tin Men, about conniving, streetwise aluminum-siding salesmen in 1950s Baltimore. “Salesmen used to play cards; IBM changed all that,” he notes, by introducing the concept of an educated, polished, professional sales force. But with only his father’s wan example fresh in his mind, he says, “I vowed I wouldn’t be a salesman.” Xerox foiled his plan, though, by doubling every other offer he received upon graduation. He says he prospered while based out of the Akron office, but only after negotiating his way past a dubious gatekeeper. “The branch manager in Cleveland didn’t think I had what it takes,” he recalls. “The Akron guy loved me.”

Peters didn’t stay long, though. Johnson & Johnson recruited him away to sell surgical supplies to surgeons and hospitals.

“While I enjoyed the glamour of it, I realized that my job was the equivalent of selling knives and forks. … I had to sell, like, 20 of these instruments a day. That’s more brainpower than I’ve got, so I had to get out of that.”

Restless, he hung out a consulting shingle with a friend, and four years later met Jenny Zamberlan, an introverted whiz with computer networks. Together, they formed Logica in 1993. The work began coming in from BP America and other blue-chip clients, and it never stopped.

Peters’ abbreviated odyssey through corporate America was frequently complicated by distracting background noise. Always, he seemed to hear what sounded, to him at least, like blatant class snobbery. He heard it in the medical community’s icy response to his sales calls, “treating me as half-human,” he says. Later, he detected a similar tone in the British executives at Logica who pressed a trademark claim (prompting Peters and Zamberlan to change their company name to Adams & Reynolds, their respective mothers’ maiden names): “So British, so arrogant-they thought we were using their name as leverage to sell fake Rolex watches or something.”

He even heard it when he called Compuware executives in Michigan to pitch them on the sale of his company.

An observer might suspect that Peters is a man haunted by the possibility that he could never measure up to the coldly impersonal demands of the corporate world-what he calls the “mercenary” nature of business. “If you look at most people in business, all they’re after is a buck,” he claims. “It doesn’t generally matter how they make it.”

Eventually, he found a comfort level in business by drawing parallels to his off-hours passion. “I finally started treating business like hunting. I just said, ‘This is no different than staking out my territory in the wilderness, defending my ground, conquering competitors. It’s the same thing, capitalism is the same as nature.’ When I concluded that, then I didn’t mind the two-faced political bullshit that I had to put up with in business. I just looked at it as getting rained on when you’re hunting. Political bullshit was just a wet shirt that you had to wear around.”

Peters shows every evidence of having learned how to compensate for that lurking sense of personal inadequacy through scrupulous, at times extreme, preparation. “If I had a business lunch with a guy at 11:30, I would come to the restaurant at 10 o’clock, and I would look over the place, pick out the table,” he says. “And I would come back and walk in there like I lived there. It was just a matter of wanting to know what I was walking into. I just always do it that way. Teach your mind what to do, the body will follow.”

That rigorous self-discipline, combined with a technically sound partner and a torrid IT market, helped A&R achieve the “hockey stick” growth curve-50 percent annual growth rates for several years running-so universally beloved by venture capitalists and investment bankers. The company landed on the national Inc. 500 and local Weatherhead 100 lists of fastest-growing companies several years running. The larger world was beginning to signal its embrace of this oddly mismatched pair of 30-something partners (who never socialized a moment outside of the office) that started with little but guile and hustle.


The mid-’90s

But just beneath the astonishing numbers and the uniformly rosy public story they implied, Peters knew the ominous truth: The company’s fortunes were about to stall, meaning there would never be a better time to sell than now. A&R was growing so fast that a seasoned industry consultant the pair retained as a mentor was warning them that the company would “implode” without adding management structure. Retaining skilled programmers was becoming such a chronic problem that the company was forced to make as many as five hires for every person who stayed.

At the same time, A&R had grown to an untenable size. No longer a small shop, but not large enough, either, to land the biggest contracts in a field increasingly dominated by the Big Six accounting firms and other major national players. (“Companies think twice about awarding you a project equal to your annual revenue,” Zamberlan told another publication at the time the sale was announced.)

Peters, meanwhile, was haunted by the example of several local IT consultancies that quickly went from hot shops to also-rans. He was especially rattled by the experience of one local competitor, whose owner went from passing out fat annual bonus checks at the corporate Christmas party and huffily rejecting lavish buyout offers to (according to other industry sources) personally billing clients for his own time, having watched his payroll shrink from 75 people to fewer than a dozen.

“The value of a company is very tenuous,” Peters says. “There’s no light that comes on and says, ‘The value of your company will never be more.’ I would advise anyone with a business who can realize one or two million dollars, sell it now. Go out and start something else. Otherwise, you might be holding worthless paper.”

So Peters and Zamberlan quickly accepted a purchase offer from Compuware Corp., a $600 million Michigan company Peters had called when he heard it had been sniffing out opportunity in Cleveland. The partners would split $12 million, about 1.3 times A&R’s revenues. Zamberlan would stay with the company, while Peters would be shown the exit sign, barred from re-entering the industry for a few years by a noncompete contract.

He struck a cocky public pose-“I’m not a corporate kind of guy; I build businesses and I go on,” he told one writer at the time, ignoring the fact that his grand total of businesses built, then as now, was exactly one.

Whether he admitted it or not, he was emotionally bruised, or at least seriously ambivalent, about selling out. When the subject of his former partner arises, for instance, Peters careens wildly between expressing deep admiration and corrosive bitterness. “She had a martyr complex which reminded me of my mother,” he says of Zamberlan’s refusal to delegate while simultaneously whining about overwork. “When I was done with Adams & Reynolds, I was so sick of the political bullshit with partners that I don’t think I’d want partners again. … I find that most businesses evolve into skirmishes after awhile; they’re not really adventures anymore.”

He also had a residue of anger with Zamberlan over issues arising from the sale. “She turned on me about a couple of things, after I had built her up,” Peters says. Today, he lashes back by referring dismissively to her current role: “Now she’s a corporate manager.” Zamberlan “respectfully declined” an interview.

At the same time, Peters seems to fully recognize that Zamberlan’s lighter touch with people was a key to building the company, and ultimately to making him financially independent. She was good at dealing with people, he admits, “but I was never that sympathetic about people that were not performing, that were not capable. It’s not just that winning is everything, but losing is just unacceptable.” On the whole, he seems genuinely grateful to her.

He always planned to sell, he says. But even he couldn’t have predicted how well they’d do.

“There are a lot of businesspeople who are overly impressed with themselves. There’s a lot of luck involved in this. Could I say that I had some brilliant plan that allowed us to get 12 1/2 times earnings-projected earnings, by the way? Could I write you a formula that could ensure that? No way.”

The partners, he says, “were fortunate to have interested buyers at a time when we were about to hit a plateau, when we had to work so hard just to maintain what we had.”


Spring 1998

In recent months, having passed his second anniversary of clocking out from the traditional working world, Peters is finally beginning to sound as if he has reached a kind of peace about his future. Previously blessed with the wiry, athletic build of a hyperkinetic salesman, he has developed a pronounced paunch. His moment of reckoning in the laundry room turns out not to have been an epiphany after all. “I just don’t do laundry anymore,” he says.

He recognizes the limitations of his temperament. “I’ve never been a detail man,” he admits. That and his financial independence-stoked by outsized returns from the recent bull market-make it extremely unlikely that he’ll ever get back into business in a daily capacity. “I may not be super rich, but I don’t ever have to work again,” he says. And he seems to understand that that has changed everything, although he continues to very nearly apologize for not having re-entered the fray after two years.

For now, at least, the fact that he’s bankrolling one entrepreneurial venture and remains alert for others provides sufficient balm to his slightly wounded pride. “You find me another guy who’s got a driven dream, who’s got integrity you can see in the dark, who’s got discipline that’s evident, and I’m going to probably get involved with that guy, whether it’s making sandwiches or making auto parts,” he says.

Certainly, there was no lack of things claiming his attention in the interim. This spring, he took his family on an Easter skiing vacation in Aspen, Colo., then dropped them off at home before heading back out with his buddies for fishing in Mexico. “They were carousers first and fishermen second,” he says, almost sheepishly. “I learned.” And three weeks after that, he was set for the big one: his long-awaited African safari. “I don’t want to watch the Discovery Channel and think I know what it’s like,” he told a friend who asked why he was doing it. He had to admit to himself that “I don’t know if I have what it takes. I might be wetting my pants.” Metaphorically, at least, he would be taking along his talismanic spiritual guide, Death in the Long Grass, a brooding autobiography of a 30ish stockbroker who abandons it all to pursue big-game hunting in Africa.

His wife, Diane, a teacher who is only now retiring from the classroom, has signaled an interest in moving the family to Colorado, so taken was she by the Aspen area. For now, at least, Peters says he’s reluctant to uproot his children from their structured, conservative surroundings for a place so full of adolescent temptations. But it’s clear he’s not ruling out a move, either.

As he approaches his 40th birthday in October-full of obligatory denials that the number has any meaning to him at all-his quirky cycle of intense family engagement punctuated by private indulgence, coaching and funding other ventures, is beginning to sound as if it might constitute an interesting life.

“What you see now may very well be what I’m going to be for the rest of my life,” he says. “Seeding things and working with people. That wouldn’t be such a bad life. I’d be happy with that.”