Serial entrepreneur enjoys investing in others’ ventures

Karen Booth Adams never intended to own a piece of nine companies. It simply evolved that way over the years.

At age 23, she started the Richmond branch of Computer Professionals Inc., an information-technology company, in partnership with founder Thomas Hoshko.

Two years later, they sold it and she became a millionaire.

She next bought an Internet development company, Tekna Interactive, and sold it a year later. Then she started an investment holding company, Hot Technology Holdings, and became an angel investor -- someone who invests in, and nurtures, other people's ventures.

Since then, she has invested in several more companies, all operating profitably today.

In 2000, Adams started her signature luxury children's furniture e-tailer, PoshTots.com, with partner Andrea Edmunds. They sold it in 2006. (Edmunds bought the company back this year.)

That's nine businesses -- three sold to public companies -- by age 39.

What motivates Adams to keep starting and investing in businesses? It's the thrill of it, she said.

She's addicted to the excitement of starting a business and passionate about the businesses that she starts or helps nurture. She concedes that she's a serial entrepreneur.

"I love the energy of a startup," she said. "I love working with other entrepreneurs -- other people who like to create something great. I just can't help but want to help them."

. . .

Starting a business at a young age would buck a trend today.

The Ewing Marion Kauffman Foundation reported in a June study that the highest rate of entrepreneurial activity is among those in the 55-64 age group. The 20-34 age bracket has the lowest.

Two-thirds of nearly 5,000 founders of firms are 35 to 54, it said. The average age of the founders of technology companies in the U.S. is 39.

Adams fits the profile of the young entrepreneurs that Mark Victor Hansen describes in his new book, "The Richest Kids in America."

"They bring radical innovation," he said of young entrepreneurs. "They see stuff in a different way than anyone else sees them. They are fine-tuned to find a need and fill it. They can take their passions and purify them and make them into profits.

"Young kids don't even think about the downside because they say, 'Well, I have nothing, and if the business goes south, I will have nothing. So it is no different.'"

. . .

After college, while working in North Carolina as a recruiter, Adams showed a jump-into-it spirit when, at a networking event in Charlotte, N.C., she met Hoshko with Computer Professionals.

He asked her what she wanted to do with her life. At the time, she worked for a company in Raleigh, N.C., but wanted to return to her native Virginia.

Hoshko asked her if she would like to start a Richmond office of Computer Professionals as a 50-50 partnership, which he would finance.

She jumped at the opportunity, but not before consulting her entrepreneur father, Tommy Booth, owner of Mid-Atlantic Irrigation in Farmville, an agricultural irrigation business.

"I was very fortunate to grow up with a dad who was an entrepreneur," Adams said. "He is my hero."

She recalls calling her father from a pay phone in the lobby where she worked to discuss Hoshko's offer.

He asked: "What's the worst thing that could happen?"

She responded, "We could fail."

"What then?" her dad asked.

Adams replied, "I'd have to move back with you and Mom."

Then "I hung up the phone, went upstairs, gave my notice, moved back to Richmond and started the business," she said. "My initial job was sales and recruiting and selling IT services."

By the time Hoshko sold the business in 1995, the Richmond office had revenue of about $30 million, Adams said. The pair hung around for a few years and grew Computer Professionals for the new owners through about 28 mergers and acquisitions.

Hoshko, now president and CEO of The Experts Inc., a Fort Lauderdale, Fla.-based IT firm, said he was willing to take a chance on Adams even though she was young and inexperienced in sales and management.

"She excels so quickly," Hoshko said. "She has a lot of high energy. She won't slow down. She had the education, the motivation and drive. I can teach people the business. I can't teach people to be motivated."

Adams said that over the years, even though all her ventures became profitable, she made mistakes.

"With a couple of our businesses, we were a little too conservative in growth" and missed opportunities to expand, she said. Also, "we made the mistake of giving too much equity away too early in the businesses."

. . .

Becoming an angel investor happened gradually, she said.

"Once we had several ventures under our belt, we started getting calls from other entrepreneurs who were looking for advice or a sounding board to help them think through different venture ideas. A lot were looking for funding."

Even in a down economy, it's a good time to be an angel, Adams said. "The talent you can attract now is just phenomenal."

She has seen a surge in requests for angel financing and guidance in the past year as area companies laid off workers or shut down operations.

"I probably looked at between seven and 10 new opportunities a week over the last nine months on average," she said.

Before that? "Probably three to five," she said.

The companies she owns today in partnership with others are Hot Technology Holdings, her main angel investment group, and Fahrenheit Technology, an IT consulting firm.

She is invested in and helped start Ironworks Consulting, a business consulting firm; Raceit, an Internet registration/payment-processing firm spun off from Ironworks; Genesis Consulting, a technology products/services company; and PartnerJD, a legal staffing and partner placement firm. All are based in the Richmond area.

Adams would not disclose her percentage ownership or any financial information about the businesses. Collectively, they employ about 330. Ironworks is the biggest.

Several of her 13 partners have been with Adams since she opened Computer Professionals' local office 16 years ago. They grew up together in the businesses and still socialize outside work.

Mary Fowlkes, managing partner at Genesis Consulting since its inception in 2008, was hired by Adams as a technical recruiter at Computer Professionals.

"She was my boss, but we were a very collaborative team," Fowlkes said. "She believes in empowering her people. That's how we all became partners."

Adams has separate partnerships within each company she starts, she said.

"When she puts the partners together, it's really about assigning people with certain strengths to certain areas," Fowlkes said. "Everybody's able to play off each other. That's what makes her partnerships work so well.

"It's great" working with Adams, she said. "She's very laid back but also a very strategic thinker."

. . .

One of Adams' most recognizable ventures was PoshTots, the online retailer of chic children's furniture and accessories.

PoshTots, when Adams owned it, featured furniture including a carrot-shaped dresser, a bed shaped as a horse-drawn coach and a cottage-style playhouse.

Adams said she was emotionally attached to PoshTots. "That was just a fun business," she said.

Edmunds, her partner at PoshTots, said working with Adams was a wonderful experience.

"And, honestly, [I learned] so much from her. She still is a very good friend -- and like a sister to me," Edmunds said.

"If it had not been for Karen, I don't think I would have had the guts to step forward and be the type of leader I am today of PoshTots," Edmunds said.

Yes, they clashed sometimes and had disagreements.

"We had a few over the years that were very horrible," Edmunds said.

"But at the end of the day, we hugged each other. Karen wanted you to stand up to her. She made you think. She's one of a kind. From a business standpoint, Karen was very smart and very driven."

. . .

Adams says she learned many things over the years, including how exciting and rewarding it is to grow a business from the ground up.

Also, "I learned to hire people based on personality," she said. "We learned the value of really establishing a personal relationship with our employees and our customers."

Contact Iris Taylor at (804) 649-6349 or .