Hey Joe, Give It a Go!
By Andy Birol

While I am usually keen on most business’ growth prospects and would defend any owner’s right to choose his or her own destiny, sadly, I am seeing too many owners abusing this. Over the last six months a number of companies with fabulous growth opportunities are selling out to larger corporations just when their ships can start coming in. For example:

• A software services firm pulls up its stakes, abandons it vendors, and sells out to a national player leaving many constituents, their money and needs high and dry.

• A distributor overcomes tough economic conditions and embarks on building an exciting growth plan. Just when their commitment to growth is needed most, they start biting at offers from large players they know want to buy their business only to eliminate the competition. While the suitors swear that loyal customers won’t be hurt, everyone knows better.

• A component manufacturer wins a decade-long lawsuit, clearing the way to fully devote itself to growth only to take a deal from a competitor they know will buy and mothball their superior technology.

While these are all legitimate choices made by owners who have worked for decades to earn and protect their investments, it is a dismaying trend for our region.

Because none of these homegrown companies were sold to heirs, employees, or local entrepreneurs, three more healthy NEO companies have been assimilated, dismantled or relocated.

A company either grows or they are sold. If their owners don’t grow them, someone eventually will buy them for their technology, customers, or, in the worst case, only for their hard assets, often through bankruptcy. This means the incumbent owner has run out of confidence (and thus the willingness to invest more personal energy, time or money) in their ability to change their status quo. A much more favorable outcome would be for these owner/operators to sell their businesses to other local owners with resources and vision for enhancing the Best and Highest Use of the business. I ask every lawyer, deal maker, accountant, and consultant to advise owners of companies in this region to try to sell their businesses to a local entrepreneur. It is only through this type of effort that pre-existing, successful local businesses can truly continue to contribute to our economy and region. To do my small part, if you have or know of a company in this position, I will donate my time and energy to meet with the owners and convince them of the potential of their business. Perhaps a few will decide not sell out. Instead they may recommit to growth or at least sell to an energetic, local player with fire in his or her belly. Just email me at abirol@andybirol.com and I will do my best to convince your Joe to give it a go!

by Cool Cleveland columnist Andy Birol, Birol Growth Consulting
http://www.andybirol.com/Cool_Cleveland.asp

 (:divend:)