Surviving an Acquisition
My 6-year-old presented it most appropriately when she told her teacher that she hadn’t seen much of mommy lately because she had been “preparing for a murder.” It wasn’t murder— it was a merger. Merging my advertising agency with an international design firm was, without a doubt, the learning experience of a lifetime.
I’m a marketing gal. I know pretty pictures, strong messaging and how to make people buy things they never knew existed. I had never done a merger before, and I didn’t realize that it could mean a forced partnership and giving up more than I was gaining. With my Forum backing me, I leapt into the venture, trusting that the answers would come through experience sharing. Overall, it was a success, but it wasn’t without its hiccups:
Due. Diligence. This goes beyond financials. I was 20 days into my new venture when I realized everything wasn’t roses in the land of client service. I inherited several clients “on the books” that didn’t have well-written contracts (or contracts at all). Some clients were experiencing service issues, and others weren’t paying their bills. What’s more, items that were missing from the books started creeping up, and when the bills weren’t getting paid, the client was getting called by the vendors directly. I was forced to pay the bills or lose the clients. I wound up loaning the company money. If I had it to do over again, I would have contacted their top five billing accounts and their bottom five billing accounts to inquire about the service. I would have also contacted vendors to inquire about their history of timely payments.
Lawyer up and hire a third-party strategist. One of the best things I did was have a third-party strategist manage negotiations separately from my attorney. No offense to the lawyers out there—we love you and need you—but in my experience, things tend to get tied up a bit longer and negotiations can feel more heated with legal involved. My strategist (a fellow EO member) diffused situations that arose in the course of negotiations and kept me in the driver’s seat as much as possible. Think of it like this: The strategist is there to help you play a strong game of chess when you’re a little too excited to make the right moves, and the lawyer is there to make sure everyone plays by the rules.
Don’t give up on your passions. I gave up my company name and my love of the work. I was Red Frog Marketing— a fun, quirky brand that resonated with clients. After the merger, I became The Clear Agency, an ultra-luxurious agency in a less-than-luxurious market. We’ve since fixed our market positioning, but I miss my old brand. The worst part was forgetting who I was to this industry. I spent 2003-2011 building Red Frog and being the “go-to” gal for marketing and creative solutions. After the acquisition, I watched ideas go out the door to clients I knew would lose the job, and I didn’t stick up for my instincts. I should have been more upfront in the beginning, telling my partner that my motivations are non-negotiable.
All in all it was an interesting journey, and I’m happy to say that my business is now worth three times what it was before the merger. More importantly, the knowledge I gained will continue to carry me through a successful and profitable future. With the education, support and confidence of knowing I had gained these items from EO, I truly changed from marketing gal to entrepreneur.
Jenn Greacen is executive director of The Clear Agency. Fun fact: Jenn’s first business was selling “Snoopy snow cones” door to door at the age of 5.