Yesterday I was having lunch with a friend just a few years younger than my own Dad. Over 25 years he built a business through franchising to 70 locations spread out throughout the Midwest. He cashed out for a pretty penny selling 60 of the locations to a Venture Capital firm two years ago while retaining 10 Chicagloand stores as pet projects.

He is a wise sage and he said something that really hit home I thought I’d pass along. He made the statement that the new owners have “no organizational memory” The Venture Capital firm that now owns what he built is on its third installed CEO in two years! They have closed 28 stores and haven’t added a single new franchise in a year and a half. Talk about a failed acquisition! My buddy is getting out too winding down his remaining ownership in his ten locations this year by either selling them back to the VC firm or simply shutting them down and selling off the real estate.

Sad

His comment regarding the new owners having “no organizational memory” really struck a cord with me. You may recall from my Pondemonium keynote I mentioned meeting with a large international VC owned water feature manufacturer who was interested in acquiring Aquascape. What struck me most about my meeting with them was their lack of knowledge of the water feature industry. To put it bluntly they knew sh*t!

I wasn’t surprised.

This company is more than twice as large as Aquascape. Their North American sales however, are a fraction of ours hence their desires for an acquisition. This 80-year-old company has been bought and sold three times in ten years. The man I met with was a perfectly nice fella but he’d only been at the helm for a couple of years. He was a babe in the woods. Simply put he couldn’t know what he couldn’t know.

Here’s what I know as Aquascape enters our 25th year in business (Woohoo!!!) The organizational memory of our team goes back decades! Mhammer Aquascape was hired as a professional to come alongside us and help us grow at a greater clip than we have been. Key words “come alongside us” He has been questioning everything we are doing and he keeps coming up with the same conclusions. We’ve done or tried everything he has been able to throw at us so far.

I wish success was as simple as flipping a switch, but rarely, if ever, it is.

In reality I’m good with that. I’m loving seeing our team come together to work on this latest challenge. Like you I’m an entrepreneur at heart. I’d die working for someone else but would probably be fired well before that happens! Thank God I’ve always known that and respectfully declined the couple acquisition offers over the years.

As for my buddy he has money in the bank but I broken heart for what he created and someone else is destroying. The saddest thing of all is he’s on the sideline watching helplessly as the train wreck unfolds before him. He knows what they should do to be great again.

His organizational memory though is worthless. The last two installed CEO’s never even asked him his thoughts.