Unlocking Growth through Acquisition: Q&A with Alexander Jekowksy, CEO of Cents

Founded by Alexander Jekowsky and Gilli Cherrin, Cents is an all-in-one business management platform used by thousands of garment care and laundry businesses to improve operations and customer experience. Cents recently announced their acquisition of Laundroworks, a hardware-based payments system, alongside their $40M Series B funding led by Camber Creek.

Henri Deshays was first introduced to Alex in 2020. A few years prior, Alex had recognized both the demand shift towards value-added services as well as the operational gap in laundry businesses to meet this need. Since Newfund’s initial seed investment, Alex has continued to demonstrate a deep understanding of the customer and a commitment towards the highest level of execution. Cents has grown to include solutions for previously overlooked challenges for garment care businesses, such as the need to chase customers for payment, the inability to capture and market to self-service customers, and lack of tools for flexible route management and promotional pricing.

Here, Bri Wang speaks with Alex on how he thinks about acquisition strategy, vision to execution, and Cents’ growth trajectory.

BW: Tell us about the evolution of Cents over the years and the key decisions that brought the company to this stage.

AJ: Our path for scale and growth has always felt linear, despite the many twists and turns we’ve taken to get to where we are. With no venture-backed competition, a huge and recession/pandemic-proof market, and great access to capital, our own ability to execute is our greatest risk of failure. The key decisions that have driven our progress stem from thinking critically about how we can accelerate our growth, while eliminating as much of our execution risk as possible.

Guided by this principal focus, Cents has executed on acquisitions, partnerships, and new products that have deepened their connection with their customer base, driving transformative growth and further strengthening their market position.

Hardware Acquisition as a Growth Strategy

BW: In what ways has a combined hardware and services model improved the customer experience?

AJ: Our strategic goals have remained the same since day 1; for the first time in the history of the garment care and repair industry, create a full all-in-one hardware and software offering to enable SMBs to grow, manage, and understand every element of their business. Laundroworks and our existing Cents Connect product line provide the tools to track and analyze the most important component of a laundry business: the equipment.

BW: What key conditions helped determine the right timing for the acquisition?

AJ: At the beginning of 2023, I started to see the real growth of our hardware business, Cents Connect, which converts coin-laundry machines to pay-by-card and pay-by-phone. While exciting, I also knew the continued capital requirements and resources needed to meaningfully scale our hardware business unit. The integration of our industry leading POS with on-machine hardware was delivering unparalleled value to our customers. We knew that if we could fully commercialize our all-in-one software and hardware products, we’d be on the path to building a generational business in our industry. Though I had complete confidence in our team, we needed to accelerate that product line and distribution, while de-risking the execution needed to mature and grow our hardware business unit. The fundraising and public market landscapes were constricting. I believe that with dislocation in the market comes unique opportunities, particularly for accretive acquisitions - and that’s what led us down the road of acquiring Laundroworks.

BW: What strategic advantages does Laundroworks bring to Cents, and how do you see the acquisition accelerating Cents’ growth?

AJ: Laundroworks has 100% customer retention over a decade, a metric I had never seen in a verticalized hardware or software business. They are a team of engineers who are extremely passionate about their product and customers, and do not care about the flashiness of startup or tech companies. They bring a culturally aligned group of executors, who are a constant reminder of what is most important in our industry: build a product that is extremely durable, provide industry leading customer support, make it an accessible price point - and the path to success becomes much clearer. They’ve dramatically accelerated our path to success when it comes to hardware development, distribution, and expertise, with no execution risk to scale that business 100%+ year over year.

M&A can present risk for some businesses and potentially take a series B company off its course. But 6 months into the Laundroworks acquisition, Cents has seen zero customer churn from the transaction, maintained profitability, experienced no employee attrition, and continues to hit record revenue and sales months.

AJ: We’re now at the real starting line on the impact we know we can make in this industry, are grateful for the unrelenting support of our shareholders, and excited for what the future holds!

Newfund is a sector agnostic early-stage venture fund investing in North America and France. If you are a builder with similar bias towards execution, we would love to meet you! Contact us: bri@newfundcap.com.