In this era of inflation and the growing gulf between executives’ compensation and everyone else’s, a story of a business owner giving his employees a cut of the profits from the sale of his company stands out.
Elia Wallen sold Denver-based Travelers Haven, which provides temporary housing for business people nationwide, to Blueground, a worldwide provider of temporary lodging. The two privately held companies declined to disclose the terms of the sale, which closed in October.
Travelers Haven, which operates in about 20,000 cities across the country, continues to do business independently, so employees’ daily work hasn’t changed. But Wallen’s decision to share 20% of the sale’s profits with employees has changed some of their lives.
“In my mind it was the right thing to do,” Wallen said. “I didn’t have a stock option plan. I didn’t even know what that was back in the day.”
The business grew out of Wallen’s real estate work in Naples, Fla., where he grew up. He helped arrange temporary lodging for traveling nurses and doctors and then began lining up furnished apartments for people in other businesses who were on out-of-town assignments for at least 30 days.
Wallen moved to Denver in 2008. Travelers Haven grew from a handful of employees to roughly 130 when Blueground bought it. Wallen said the company’s revenues totaled about $100 million in 2022.
From the start, Travelers Haven was a bootstrapped operation, Wallen said.
“We never went out and raised a bunch of money,” he added. “Every dollar we got we reinvested in the business. That was just kind of the story for those 14 years. We’d grow a little bit and any money we got would go back in and we’d hire a few more people.”
Wallen stepped back from day-to-day involvement with Travelers Haven in 2020 to run Hotel Engine, another startup the 39-year-old Wallen founded. The company, with about 500 employees, books hotels around the world for business travelers.
“(Travelers Haven) has really been running without me, with the exception of me being on the board,” Wallen said. “This team was a big part of the success. They were the success, I should say.”
Wallen has worked with more than a dozen of the employees for more than a decade.
“Going back 10 years, the company probably had only 50 people. I’ve seen them get married. I’ve seen them have kids. I’ve seen them buy houses,” Wallen said. “The second person I ever hired is still with the company.”
When Travelers Haven was sold, “pretty much everybody” got a share of the profit, Wallen said. The longtime employees’ shares were bigger. “It was done on a weighted scale.”
Ellis Hugunin, who joined the company in 2011 and worked his way into a vice president’s position, declined to say how much he received when Travelers Haven was acquired.
“It’s almost difficult to talk about because it really did change my life,” said Hugunin, now senior director of project services at Hotel Engine.
Hugunin said he will be able to fully contribute to his children’s college fund and get a head start on saving for retirement. He’s looking at buying rental property.
And Hugunin, who has been diagnosed with multiple sclerosis, said the money will help as he faces an uncertain work future.
“I don’t know how long I’ll be able to work. That’s why it’s important to me,” said Hugunin, who’s 36. “I have confidence I’ll be doing it for another 10 years, but will I be able to do it for another 20 years?”
Hugunin remembers Wallen calling him into his office in 2017. He had paperwork that he said showed Hugunin’s potential stake in the company.
“He said ‘You’ve been a key part of this. I want you to be part of it,’” Hugunin recalled. “It was something my wife and I would talk about.”
When the company was sold and the talk became a deposit in his bank account, Hugunin said it was surreal. He thinks back to the time when there were about 15 people on staff.
“Your benefits are minimal: two weeks vacation,” Hugunin said.
As the company grew, the benefits grew to include health insurance, maternity and paternity leave. The first office was one open space with no cubicles or separate rooms.
“We upgraded the office twice in my time there,” Hugunin said. “The first move, boy, we thought we were in a Cadillac. We got a fancy office on Colorado Boulevard. We got these new desks.”
Hugunin said through the years, Wallen motivated the employees through working hard, investing in staff development by providing mentors and coaches and recognizing employees’ successes.
“I believe culture is something that’s established from the top down,” Hugunin said. “Elia’s always had that mentality, that we’ll keep growing, whatever we need to do. We’re scrappy.”
Wallen said he doesn’t hold himself out as an example. He said the decision to share the fruits of the sale stemmed from wanting to give back to those who gave to the company.
“It just comes back to doing the right thing for those that have been with you for a long time,” Wallen said. “A lot of companies do that through stock options. We didn’t have that. This was a choice we decided to make and I think it’s the right one.”
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