Investor Brad Jacobs has launched the building products distribution company QXO Inc., a standalone platform for future acquisitions.
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QXO was part of an initial $1 billion cash investment into SilverSun Technologies; after selling off the existing SilverSun business, he plans to use QXO to build what he estimates will have a $1 billion revenue run rate at the end of Year One.
“QXO’s strategy is to create a tech-forward leader in the building products distribution industry through accretive M&A and organic growth, including greenfield openings, with the goal of generating outsized stockholder value,” Jacobs said. He aims for $5 billion within three years.
He is pinning the growth expectations in part on the use of technology, particularly ecommerce, which he says is only in the mid-single digits now in the industry. He also said that tech adoption by distributors has the potential to be transformative through price optimization, demand forecasting, warehouse automation and robotics, automated inventory management, route optimization for delivery fleets, supply chain visibility and end-to-end digital customer connectivity.
“These market dynamics, together with the fragmented nature of the industry, offer a significant opportunity to unlock growth potential through scale and technology,” according to the press release.
