The Sweet Sound of Business Growth: How Sweetwater Sound Became a Legend for the Music Industry

A few years ago, if you had asked Chuck Surack, the founder of customer-centric Sweetwater Sound, when he planned to sell his Fort Wayne, Indiana-based empire, he would have confidently declared, “Never.”

As a teenager, he built Sweetwater from a small recording studio in a Volkswagen bus to a billion-dollar business–the nation’s unrivaled e-commerce site, with more than 2,000 brands representing more than 60,000 products for musical instruments and audio gear. The notion of selling his life’s work, crafted over 40 years seemed absurd. Or so he believed.

But in late 2020, estate planning realities challenged his position. If he stayed on as owner, his beneficiaries would be stuck with a hefty estate tax burden upon his eventual passing. Motivated by a deep desire to provide for his family and loyal employees, Surack made the weighty decision to sell the company but protect the company’s legacy and what Sweetwater signifies to its employees and the music community.

Surack’s journey to find the right buyer for Sweetwater Sound taught him valuable lessons about searching for the right financial partner while securing his family’s future. The process also needed to allow him to contribute to the community that supported Sweetwater Sound’s evolution.

Committed to Fort Wayne

Sweetwater Sound comes from humble beginnings: recording local speakers and musicians on a reel-to-reel tape recorder from his Volkswagen bus in 1979. By 1984, Surack bought a life-changing piece of equipment–a prototype of the Kurzweil K250, the first piece of equipment to play back digital recordings of other instruments and sounds. Surack’s early adoption of the tool caught the eye of artists like Kenny Rogers and Stevie Wonder, catapulting Sweetwater Sound from a mobile recording studio to a recording equipment dealer powerhouse. “By 1990, I had five people working for me. I could have never envisioned 40 years later, it would explode into nearly 3,000 employees in Fort Wayne, Indiana,” he says. Talent has been attracted from across the country and even outside the U.S. to call Sweetwater and Fort Wayne home. Decades of hard work and passion made the decision to sell an emotional one. He was uncertain he would go through with it until the very end, but he was sure of two things from the start: Sweetwater Sound must stay in Fort Wayne, and a new owner must respect the company’s processes and people as a force in supporting the creative economy. As part of his due diligence, he personally interviewed potential buyers and called their references.  

“I wanted to make sure my baby was good for a long, long time, and I wanted to make sure all the employees would be taken care of,” he says.

Surack could afford to be discerning. His company has a 42-year history of profitability, thanks to a strong team. About half of Sweetwater’s employees moved to Indiana from other states for their roles. Because Indiana has a reputation for being affordable, family-friendly, and pro-business, getting people to relocate there was usually easy.

“Indiana is a very easy state to do business in,” he says. “The rules, regulations, and policies are not particularly onerous. It’s also nice being centrally located. When we ship via FedEx or UPS, a good portion of our country can get products in a day or two or three.”

“At every level, I have been given support by our city and our state,” Surack continues. “Every ribbon cutting we’ve done, anytime I needed the governor or mayor to show up, they’re just here.” 

Recording of a new track

There was a strong interest in acquiring Sweetwater, and out of 16 interested buyers, Surack chose Providence Equity Partners. In addition to agreeing to his criteria, the company had experience in entertainment and music, which was important to Surack. 

Since finalizing the deal in August 2021, Sweetwater Sound hasn’t missed a beat. Surack maintains partial, but not majority, ownership and is chairman of the board. He credits Providence Equity for pushing the company to move forward with growth initiatives in tandem, such as opening a warehouse on the West Coast and expanding offerings to include band instruments. While Surack is still involved with the company, Sweetwater is no longer his sole focus. “I’ll be 67 next January, and I am busier than ever. I’m not retired at all. My life has expanded dramatically,” he says. It’s evident that his entrepreneurial drive is stronger than ever. He splits his time between his family, philanthropy, and Surack Enterprises, which consists of 15 Northeast Indiana companies, including an aviation business, helicopter corporation, coffee shop, theater, car dealer, and eye care stores. The common denominator is exemplary customer service and strong values, both ingredients of the Sweetwater foundation and track record of success.“ I knew Sweetwater’s customer-service skills and values would work in any business. Treat people the way you’d want to be treated and try and do the right thing all the time, and any business will be just fine,” he explains. In addition to allowing the Sweetwater Sound founder to take care of long-time employees and optimize his estate plan, the windfall gain from the sale allowed Surack and his wife, Lisa, to expand their charitable giving. The couple founded the Surack Family Foundation to make a difference in Northeast Indiana.

Recent gifts include funding a music technology center at Purdue University Fort Wayne, which continues to support education and careers in the industry. Because of his new ventures and the peace of mind the sale created for his loved ones, Surack believes his decision to sell was a smart one. For founders getting ready to sell, or thinking about selling, Surack offers some advice: take your time and do your due diligence. Think about what your business represents to your family, employees, and industry, and find the right partner who believes in supporting the continued growth with the company’s legacy in mind.

“I spent almost three years talking to every high-net-worth tax advisor and attorney to figure out what steps to take,” he explains. “I would just encourage people to explore the options. You can always say no or change your mind, but gathering the facts is important to the decision making process

The transaction has had an overwhelmingly positive impact on Surack’s lifestyle, family, and team, but he does miss the company, and its people, more than he thought he would. The good news is he is staying in Fort Wayne, where his baby was born, so he can visit his colleagues whenever he likes and enjoy a front-row seat to the company’s continued success. “I have more faith in the future of Sweetwater with this new generation of leaders than I did with myself in control,” he says. “I’m looking forward to seeing what they do over the next couple of years.”