By Jonie Larson, Correspondent
A 1960 Les Paul sunburst guitar, valued at more than $100,000 by its previous owner, passed through the hands of this Springfield-based company last month. Now it belongs to James Hetfield of Metallica.
That’s just one transaction of thousands that Treasure Hunters Roadshow has encountered, catapulting it from a struggling company of the ’90s to a powerhouse business model after a reinvention in 2007.
The company, which touts the employment of 100 local employees and 200 others making up 44 teams throughout the U.S., grossed $18 million in the first six months of 2009 with only 12 to 14 teams. In the second half of the year, business improved. The company closed out the year grossing $54 million.
The company expects to hire 1,000 employees this year, about 60 in Springfield, the rest in its expanding territories in the U.S. and abroad. There are already five teams in place in the U.K. One of the next targets is Canada. By the end of this year, CEO and President Jeff Parsons said the goal is to have 200 teams. A team constitutes a group of people in an area, which plans shows, appraises collectibles, works the show and more. These teams host around 44 shows a week or 4,000 per year, spending $1 million a week in advertising.
In the second week of January, 17 new managers were hired, with 10 to 15 people being hired nearly every week.
The hub of the operation is located on Springfield’s west side. Parsons explained the birth and progression of the business overhaul. The company, he said, started out in 1995 selling antique toys. But with the success of e-bay, business grew tough. Collectors were lured to e-bay and the worldwide access made it easy for them to get what they wanted at a low price. In 2004, Parsons threw in the towel on that business plan.
In 2007 things changed drastically. Parsons met up with two brothers in Indiana – Jason and Mike DeLong. Soon after, the three would plunge into a bigger plan, one that nearly took them by surprise.
“It really flourished,” Parsons said. “It grew at an alarming rate … almost too rapidly in 2008.”
This time the business model was diversified, which was key, according to Jason DeLong. The company would buy and sell gold and other precious metals, diamonds, coins and all types of antiques and collectibles. It all came together at breakneck speed after the company got its venues and gold refineries in place.
So, how does it work?
Area residents who went to the fall show at the Prairie Capital Convention Center in 2009 are well aware of the structure. That October show was classified as a “mega show,” which constitutes an expected attendance of 100,000 or more. To fortify attendance for the show, the company will spend around $100,000 in advertising prior to the show. For those who didn’t venture out with their treasures, an event works like this.
• Transport your “treasure” – whatever it is – to the event location.
• Register.
• Wait for your number to be called.
• Present your treasures to the experts.
• Get paid on the spot for the item(s).
The chance of getting top dollar or trade-in value for an heirloom or for scrap metals is excellent, according to Parsons.
“We work on a pretty small percentage,” Parsons said.
The buyers working for Treasure Hunters Roadshow have diverse knowledge. Many had previous careers in real estate, insurance, investing, and some were jewelers. Consequently, within the confines of a show, there are many employees on hand – experts in different fields. In addition, the organization uses technology to verify values. Cameras, cell phones and the Internet make it easy to research and compare. Even authors of books will be contacted because of their vast knowledge in specific collectibles.
Just like the Les Paul guitar, another recent find was the bed of Johnny Cash and June Carter. Parsons said a fire claimed the famous couple’s home, but this bed had been saved. Treasure Hunters Roadshow paid $30,000 for the bed. Like the Les Paul guitar, it is then marketed again.
“Collectors are our forte,” Parsons said.
While the company obviously has to make a profit, Parsons said the percentage paid to the owner is high. He gave an example. He said someone coming in right now with 10 silver dollars would get about $18 each. But a rare date could bring $5,000.
Parsons said the merchandise redeemed from the shows is primarily cataloged and stored in an Indiana location. He said it’s quite impressive. But the Springfield location is impressive in its own right. A tour through the facility found workers non-stop busy, focused but having fun.
It appears the company has operations down to a science. One row of employees was working to arrange hotels and venues in targeted cities. The next row of employees in their cubicles – many with headsets – was speaking with city officials to get the proper permits. In another location of the building, advertising copy was being proofed and then proofed again, making sure that each dollar spent represents quality. From public relations – print media and radio – to accounting, Treasure Hunters Roadshow appears to have the bases of the business model covered.
An accountant in the business office said she is now working in the fastest-paced business of her career, but said she loves it. That attitude appears to resonate throughout the building, located on Pleasant Run.
Perhaps that is due to Parsons’ appreciation for his hired talent. “We have awesome people,” he said.
Jason DeLong, executive vice president, backed that statement up, saying the company has had next to no turnover and that employees are making good money.
“We have great people out there representing us,” DeLong said.
The three men at the helm believe they are operating on a unique, long-term success model. They do not believe the poor economy is driving the success of the business and despite a booming precious metals market, they are not worried about a window of time in which to grab market share.
“There is no end to what we are doing,” Parsons said. The company establishes a reputation every time it works a show in a territory. Parsons said he calculates that 1- to 2 percent of the population shows up the first time. The next year the show cycles around, those original attendees have told others about the show and their payoffs, and new attendees come, in addition to the original ones.
He said it’s generational, too, with new attendees coming who have just inherited items.
As for the gold and silver market, the company has established a conservative forecast in its business model. Should gold prices drop significantly, the company would still be secure, Parsons said, noting that a drop is contrary to market rumors.
“The industry says gold will never drop again,” with the current floor being around $1,000. He said some analysts even predict it could go up to $2,500 an ounce. The same is true for silver. With its current value around $19, he said its been suggested it could rise to the $30 to $40 range.
In months to come, the Treasure Hunters Roadshow could become a household name. While in Nashville, Tenn. in January, Treasure Hunters Roadshow shot a pilot for a cable television, filmed by Pixel Brothers in Chicago. Treasure Hunters’ agent in California is shopping it around. About a dozen networks have shown interest in it so far, among them, “The Discovery Channel.”
Parsons said Treasure Hunters expects to have a cable network show by fall, with 26 episodes featuring the face of the company’s Internet star Elliot Bambrough, a Chicago actor cast by Pixel Brothers. They will be pitching it at the upcoming National Association of Television Program Executives trade show in Vegas.
Michael Torchia, one of two partners in Pixel Brothers, detailed the pilot and its unique content. Bambrough, according to Torchia, is kind of a “zany and whacky” guy – “not starched.” He takes that enthusiasm into the show’s three-tiered format, which includes a thread about a specific treasure, then talking with a potential buyer, followed by nuggets about the city and where one might find hidden treasures in that city.
Torchia said it’s not your typical reality show – which has only one way to go, he says – and that way is not up. On the contrary, he thinks this new show would appeal to younger audiences, too, and get them into the passion of collecting.
The format is like a game show of sorts, Torchia said.
“If it’s of value and they (the owner) wants to part with it, it’s like winning a game show. You walk away with money.”
Of all the things his company produces, he said he feels good about the future of this. “We’re pretty excited about it,” Torchia added.
Jonie Larson is a freelance writer from Springfield. She can be reached at jonie@springfieldbusinessjournal.com.
BREAKOUT:
Tentative Roadshow return date for Springfield: Oct. 8 – 16, 2010.
BREAKOUT:
Company Profile: Treasure Hunters Roadshow
CEO and President: Jeff Parsons
Headquarters: 3200 Pleasant Run, Springfield, Ill.
Square feet: 12,500
Previous location: 4132 N. Peoria Road
Employees: 302, nationally and internationally; increasing weekly
Employees in Springfield: Around 100 with more expected
Money grossed in 2009: $54 million
Growth expected: New hires and a TV pilot
Jonie Larson is a freelance writer from Chatham.
