From providing banking help for corporate petroleum clients in Saudi Arabia during the 1970s oil crisis to creating a temporary employment service in the 1990s that grew to be one of North America’s largest, Erik Vonk has had a decades-long, globetrotting career in a style reminiscent of a hired gunslinger—only Vonk traveled with a briefcase, executing difficult assignments here, there, everywhere.
Now, in his latest career move, Vonk is focused on a new venture that he and his partners call BOTH, an acronym for Back of the House. BOTH offers self-employed professionals support with their bookkeeping, online banking, tax services, healthcare and retirement. The point is to free a professional from the drudgery of office management chores that take away hours he or she otherwise could use to make money.
Vonk estimates that 2.5 million to 3 million self-employed professionals across the country who have annual billings of $60,000 or more could benefit. BOTH’s standard start-up fee for a new client is $1,995 to cover a range of expenses, such as establishing an LLC (limited liability company), creating information technology infrastructure, setting up books and so forth. The start-up fee for a client who already has an LLC would be about $1,500. The monthly fee is $399, a figure that Vonk says is a bargain compared to what some professionals pay for services that do billing for them.
BOTH opened for business in September 2009 and now employs 11 people in its third-floor office in downtown St. Petersburg. Vonk commutes there from his home on the north end of Longboat Key during the week, often accompanied by his wife, Karin, who handles marketing and public relations. Vonk declined to say how many clients BOTH has at this point: “This is a private company, so we are not giving out any numbers; but I can say we have a small but growing cadre of clients nationwide.”
Mary Priolo, an accountant and independent contractor who works from her home in the Hillsborough County community of Riverview, calls BOTH “invaluable.”
“They handle all my accounting and bookkeeping, online banking, 401K plan, everything but health insurance, because we have health insurance through my husband,” Priolo says. She estimates it would take her 10 to 15 hours a month to do what BOTH does for her, allowing her to devote more time to her accounting business and to her two preschool-age daughters.
The idea for BOTH occurred to Vonk more than a decade ago, while he was managing the Randstad temporary staffing agency in Atlanta. “I could see there was the need for services for self-employed professionals,” he says. He even wrote a 250-page book called Don’t Get a Job, Get a Life!, published in 2001, that addresses the “flexible new workplace” and the challenges it poses for employees, employers, government regulators, labor unions and staffing services.
But it has been only within the last two years that Vonk refined his idea, wrote a business plan and transformed it into BOTH. In the process, he drew on the experiences he has had working and studying employment practices for more than three decades.
Born in 1953 in Indonesia, when it was still part of Holland, Vonk is the oldest of three children of a Dutch businessman then involved in the rubber industry. As a little boy, he spoke both Dutch and Malay. He remembers motorcycle rides with his father and the monkeys in the neighborhood. “They were almost like a plague,” he remembers. “There was one monkey that found its way into the attic in our house and then fell through the ceiling into the living room.”
When Vonk was four, the family returned to Holland. After finishing law school in 1977, he landed a job with the Dutch Bank ABN. His first big assignment was to go to Saudi Arabia and manage banking services for “the petro men, the Saudi exporting entity.”
For the next 15 years, Vonk’s international banking career took him from the Middle East to the U.S. to Europe.
In 1992, he jumped into a new industry and a new life. Randstad, a huge employment service provider headquartered in Amsterdam and operating throughout Europe, wanted him to pack his bags as soon as possible and move to the U.S. to start Randstad North America.
“It was my choice to start Randstad in Atlanta,” he says. “Research showed that the Atlanta region was one of the quickest to get out of the 1990-’91 recession and to recover the fastest. And since temporary staffing businesses do very well in economic recovery times because companies want to hire temporary employees, I picked Atlanta as offering the best chance to get Randstad off the ground in the U.S.”
An attorney friend helped him connect with Atlanta lawyer and former Georgia Gov. Carl Sanders. “Carl Sanders was kind enough to lend me an office,” Vonk says. “He wished me luck. With that and the Yellow Pages and a telephone, I got started. I found someone who needed a bookkeeper and after a search I found a bookkeeper who was acceptable to that person. That was my first placement.”
From that modest beginning, Randstad grew in seven years to have 525 offices in the U.S., with $1.5 billion in annual revenues and employing 60,000 people or so on an average day nationwide.
Meanwhile, the big Dutchman (Vonk stands an impressive 6 foot 3 inches) met and married his current wife, Karin, who was then working on her M.B.A. at Emory University.
On Jan. 1, 2000, the Vonks retired to a 1,700-acre farm in south Georgia where they grew pine trees and sugarcane. “Karin and I thought that after moving around so much that we deserved to stay put for a while,” Vonk says.
It took less than 12 months for him to get bored with his life as a gentleman farmer. “There was literally a time when I was on a bulldozer at the farm and I didn’t know what day of the week it was. I couldn’t figure out if it was Wednesday or Thursday,” he says. “I went back to the house and asked Karin, and she said it was time to go back to work.”
Vonk used his connections to team up with an investment company and private equity firm in Chicago and acquire a small five percent personal stake in a Bradenton-based human resource company called Gevity. In 2002, the Gevity board hired Vonk to run the company, which specializes in providing human resource services to small and medium-sized companies. In 2003, Vonk joined with a group of investors to acquire 23 percent of Gevity.
To start his new life, Vonk bought a waterfront home in Longboat Key’s Hideaway Bay, where he and his wife live today with their Dutch pointer dog, Hiske. Their 53-foot red cabin cruiser is parked at their dock.
At Gevity, Vonk found a company in turmoil. “The previous CEO had been fired, the stock was trading low and the company had reported a loss of about $20 million over the previous year.”
After five years as Gevity’s CEO, Vonk retired again.
“The local press was not kind to me because in 2008 Gevity did not do well,” he says. “The stock slipped to a low of $4 or so, and there were these articles in the press that Vonk left the company on shaky grounds. But the fact is that over the five years when I was there, between 2002 and 2007, we were able to drive the company to about 7,000 clients, up from 5,000. We increased profits from a loss of $20 million to a profit of about $35 million. Stock went from $1 to $2 a share to a high of $29 in 2005. When I left in 2007, it was trading $22 to $23.”
The Vonks went back to their Georgia farm. But it was only a matter of months before he had developed a business plan for BOTH, based on what he had learned from his earlier ventures, especially the Randstad assignment in Atlanta.
“I saw a lot of people who wanted to work on a temporary basis, a flexible basis, and a lot of companies that didn’t want to hire regular full-time workers,” he says. “Life is difficult when you don’t have a traditional job. Health insurance is difficult, retirement is difficult. Even getting credit can be difficult because of the question on the loan applications asking how long you have been in your current job. So I thought, ‘Why isn’t it possible to attach healthcare, retirement, credit worthiness to an individual instead of a company?’ I started doing research, and the book I wrote in 2001 was a message saying, ‘Let’s make these things portable.’ Why should a self-employed person be a second-class citizen?”
With his business plan on paper, Vonk consulted an old friend, A.D. Frazier, who was in charge of building a temporary organization of 90,000 people for the Olympic Games in Atlanta in 1996. Frazier “was very enthusiastic,” Vonk says, and agreed to join him as co-founder of the new enterprise. A third co-founder and managing member of the firm is Joe Reiman, an Atlanta advertising executive and the author of a 1998 book, Thinking for a Living: Creating Ideas That Revitalize Your Business, Career, and Life.
The founders decided to locate the company in a St. Petersburg office building when they were offered local and state tax incentives tied to the creation of 100 new high-wage jobs. Pinellas County Economic Development has said that BOTH would be eligible for as much as $850,000 in tax refunds if it creates the promised jobs. The tax refunds, which would be paid over a series of years, would come from the City of St. Petersburg, Pinellas County and the state of Florida.
In addition to their regular commutes to the BOTH office in St. Petersburg, the Vonks say they often work on BOTH business in their Longboat Key home office in the evenings and on weekends. “We are here, huddled up, doing some work. It is great because we are involved doing something we really like and we have no one to answer to but our own bank account,” Vonk says.