University Laundry is the latest Dallas startup to score a big exit. At the kickoff of Dallas Startup Week on Monday, the college campus laundry service announced that it sold to public household care products company Procter & Gamble.
As a result of the acquisition, the company will be rebranded as Tide University Laundry, a name that will be personalized for each campus it serves. The company plans to hire additional employees at its headquarters, located just south of Deep Ellum, and the campuses at which it expands. It currently employs 11 people at its office and 80 contractors at the campuses it serves. The sale to Cincinnati-based Procter & Gamble closed on Dec. 31. Financial terms of the deal have not been released, but P&G has agreed to allow University Laundry to continue operating its headquarters in Dallas.
“This was without question the right thing to do,” said Nathan Watkins, co-founder of University Laundry. “[We’re] married to the most sophisticated company in the business.”
University Laundry is led by husband-and-wife team Nathan and Paige Watkins, graduates of Baylor University. The membership-based service was founded in 2003, after Paige Watkins acquired the local wash-and-fold at Baylor University. She launched the company under the name Oso Clean, with help from Nathan who financed the project with earnings he generated through real estate development. Since then, the company, later named University Laundry, has grown to service 23 universities including Southern Methodist University and MIT. At each campus, the company has localized the name of the service. For example, at SMU, the service is called Mustang Laundry.
But attracting Procter & Gamble wasn’t part of the plan. Instead, it was the result of an email that sat in Nathan Watkins’ clutter folder for several days, he said.
“It was from an almost unmarked email address of investor relations at Procter & Gamble,” Watkins said about the email he discovered in October. “I thought it was a soap salesman.”
So he wrote back, saying he was not interested in a new soap vendor and asked the sender to respond if the correspondence had nothing to do with soap. The response was instant, and shortly thereafter a representative hopped on a plane and headed to Dallas.
At the time, Watkins was in deep discussions with private equity firms he hoped would help grow the business. He had already received a letter of intent from an interested buyer. But P&G was already amid development of a service similar to University Laundry. “I told them, ‘I am going to sign this [letter] if we don’t figure this out quickly,’” he said, adding that large companies can move fast when they need to. “We got the deal done in 4 hours.”
Although stressful, the bet was lucrative, as the company now has the backing of a global conglomerate that generated $38.3 billion in sales and employed 105,000 employees last year.
“We bet the farm on the fact that people hate to do laundry,” Watkins said of his early beginnings. “I’m still blown away that we were able to make that happen.”
So the moral of the story, as Watkins suggested, is don’t let the stress of the deal overshadow the value of the result. And, more importantly, always check your clutter folder.