CNE celebrated its 20th anniversary in June 2022, a major milestone for a company with a storied past. In this blog series, Founder & Chairman Paul Knight joins us to reflect upon CNE’s 20-year history, discussing how the company was founded, while sharing stories of the many obstacles and triumphs the team endured to become a full-service IT lifecycle solutions company.
Q: Thank you for joining us Paul. How did the concept to form CNE first come about?
A: The idea behind founding CNE began to percolate on a lazy Sunday afternoon in late 2001, while friends and I were watching a New England Patriots football game in my living room. My longtime friend and co-founder, Chard Corsini, and I had been talking about starting our own business for some time. As the game played on, we discussed potential business ideas and options. Being in the technology distribution market for over ten years, I believed there was an opportunity to help companies recover value from their used laptops, refurbish them, and resell them in markets around the world. We had identified that there were several start-ups servicing this new market, with varying degrees of success, but I felt with my background and experience in technology we could establish ourselves quickly in the market.
Q: How successful was CNE when the company first launched?
A: In June 2002, CNE Direct Inc. was founded, and we introduced ourselves to the marketplace. Unfortunately, we were underfunded and made some early errors that resulted in us struggling as a new company. Even though I strongly believed we had the right business model, I knew it would take time to understand our niche and develop the relationships necessary to help build this new marketplace for used and refurbished technology equipment.
Q: How long did it take for CNE to be recognized in the market?
A: By the end of our second year in business, CNE continued to struggle. Funding for operations was beginning to run low as I exhausted my savings, borrowed against my retirement account, and even placed my house on the market. Although I still believed we had the right business model, I was preparing myself to make a difficult decision. Time was against us as I began to grapple with the reality that I may need to give up on my dream and close CNE. Fortunately, in December of 2004, destiny stepped in, and everything changed.
Q: What changed for CNE to become an established market player?
A: Over our first two years in business, CNE was investing in a small network of salespeople in Taiwan and China that resulted in modest success to date. However, what I did not realize is that the seeds we were planting, in establishing a network of contacts and building name recognition, would need time to grow to pay dividends. At the same time, large computing OEMs and ODMs located in Taiwan began to move production to mainland China and sought to liquidate their inventory of parts used to build laptops and desktops. The CNE team kept focused, working closely with these customers, and closed several large orders in December of 2004. In early 2005, CNE had established itself in the market as a go-to resource and was now a recognized partner for OEMs and ODMs in Asia. A few months later, I was able to take my house off the market and began to focus on leading a growing company.
Q: When did CNE truly become a global company?
A: As CNE began to grow and develop a reputation in the market, the concept of the "reverse supply chain" for computing products became mainstream, presenting an opportunity for almost unlimited demand for the services CNE was already offering. At this point, I realized we were truly onto something special in the technology marketplace. Technology companies were now looking for new ways to expand their supply chains to include channels for the reuse of electronic equipment. The terms "ITAD" and "Sustainable", which are commonly used today, would follow years later.
Responding to the needs of the marketplace, we understood the problems we were solving were global. As a result, CNE established processing facilities in Hong Kong and The Netherlands, hired operations experts, and invested in complex testing equipment. As we continued to grow, CNE added additional sales and account management staff, opening offices in Taipei, New Delhi, Sao Paulo, and many other locations.
As our expertise, footprint and bandwidth grew, CNE began collaborating with larger companies who had technology assets they could no longer utilize and needed help to dispose of properly. CNE began to develop a solid reputation in the market for finding resale opportunities for used technology and components around the world. These markets opened end users to technology that may not have been the "latest and greatest," but it served the user’s needs at a price point they could afford.
Continue reading part two and part three of our CNE 20th anniversary blog series.
Continue to part two in our CNE 20th-Anniversary Series when Founder Paul Knight discusses the challenges CNE faced during its early years - including a devastating fire at its corporate headquarters and leveraging Hollywood to find a new warehouse.