Thomas J. Blakeley of San Clemente rode the technology boom six years ago with his e-mail marketing company, MindArrow Systems Inc.
Now he’s hoping to cash in on mold.
His American Mold Guard Inc., based in San Juan Capistrano, hopes to raise $12 million to $14 million in an initial public offering.
The company, which recently moved from the Irvine Spectrum, offers mold prevention services to homebuilders.
The public offering is small.
Last year, mortgage lender ECC Capital Corp. raised $354 million in the county’s largest offering,and one of its few.
American Mold has a twist: It’s targeting the waterlogged Gulf for growth.
The company has a radio advertising campaign under way in Louisiana and elsewhere in the Gulf region. TV spots just debuted.
The company has 130 workers at 11 service centers in California, Texas, Louisiana and Florida.
Profits aren’t growing like mold,through Sept. 30, the company had an operating loss of $2.5 million on sales of $4.1 million.
Even so, Blakeley, the company’s chief executive, contends the time is ripe to go public.
Blakeley said he launched his mold business three years ago out of personal frustration. He said he got the idea for the company when he tried to sell his $1.2 million San Clemente home in 2001.
When prospective buyers sent out inspectors to look for mold, fungal spores were found in a dividing wall between the master bath and bedroom.
“It killed the deal,” Blakeley said. “I went crazy.”
For the next year, he said he struggled to lift the “black mold cloud” from his home.
The experience prompted Blakeley to research mold problems for homeowners who also saw houses fall out of escrow.
He discovered what many already knew: Insurers were getting socked with billions of dollars in mold and water damage claims in California, Texas and other Gulf states, considered hotbeds for claims.
Paying Debt, Expanding
Proceeds from the public offering are set to go toward debt and to open service centers,particularly in the Gulf and in the Pacific Northwest, Blakeley said.
Homebuilders have taken to the idea. Customers include Miami-based Lennar Corp., Warmington Group of Cos. in Costa Mesa, Fort Worth, Texas-based D.R. Horton Inc., and Dallas-based Centex Corp.
For now, there are few rivals, according to Blakeley. He said his aim is to grab business quickly.
The company charges about $700 to treat new homes with chemicals and other coatings, such as baking soda.
“We think this is essentially a land grab,” Blakeley said.
American Mold works with builders to remove mold contamination from wood, concrete and other materials. It also applies surface coating that prevents microbes from growing.
“There is a big distinction between remediation and prevention,” Blakeley said.
American Mold is Blakeley’s second major venture.
At the height of the tech boom, he said he had an estimated worth of $114 million from his Aliso Viejo-based MindArrow Systems.
But then everything crumbled as an audit turned up a discrepancy between shares held by investors and those authorized.
Gave Up Shares
Fingers were pointed at a transfer agent. Blakeley and another executive ended up contributing about 1.1 million of their shares to offset the shortfall.
The company eventually combined with another software business in Provo, Utah, and filed for bankruptcy reorganization in 2003. It emerged in early 2005.
Blakeley left as MindArrow Systems’ co-chairman shortly after the audit.
“Our personal stock contribution settled things,” he said. “It was quite a painful experience because the company was a victim to a fraudulent transfer agent. The company, nor its employees, were ever investigated.”
