- Marsden Holding Sees National Growth
Unique Acquisition Strategy Pays Off For Contract Cleaner
- Remembering Customer, Employee Concerns When Buying Businesses
Part two of this three-part article looks at how Marsden’s acquisition strategy has resulted in national growth.
Kruse’s motivation for selling Scioto Services to Marsden Holding was in part because he wondered if he was capable of success on a bigger stage.
Mingo wondered, too, and gave him an opportunity. After spending about a year and half transitioning Scioto into a Marsden Holding company, Kruse moved over and began working alongside Mingo for the parent company. He began assisting Mingo with other acquisitions, and he eventually created his own position tailored around the role.
“I learned the right way to do it from Guy on the other side of the table,” says Kruse.
In addition to taking his cues from Mingo, Kruse’s experience as a seller, having been purchased by Marsden Holding, is critical to his success in identifying, acquiring and transitioning other companies into Marsden Holding.
“I do not believe that I would be qualified to do this position that I have, had I not the 360-degree view of the thing,” says Kruse.
As an entrepreneur, selling a company is a difficult and deeply personal experience, as Kruse knows firsthand. So now, when negotiating with potential sellers, he always tries to remember what it was like in their shoes.
“We take very seriously that these people have one opportunity to monetize their life’s work,” says Kruse. “We take a lot of responsibility to make sure that’s done the right way.”
Mingo says corporate America has created an image that all acquisitions are negative for one side or the other. In reality, or at least in Marsden Holding’s reality, that isn’t the case. Mingo and Kruse think of the negotiation as a relationship with the seller. They want to get as much out in the open as they can, so that there are no surprises — for either side — down the road.
“Nobody likes change,” says Mingo, “but what people like more is just honesty.”
By the same token, says Kruse, it’s a bit of a misnomer that Marsden Holding wouldn’t want a potential seller to have sophisticated counsel. Indeed, the better the seller understands the process, the more likely it is that a deal will take place.
Marsden Holding will even give advice to a potential seller in certain circumstances. There have been a number of deals where Marsden Holding has told the a potential seller that the value of the company for sale would be much higher if the seller were to diversify its customer base or implement better software solutions. In some cases, that seller has even corrected the issues and worked out a sale with Marsden a year or two down the road.
Sure, there have been cases where such a seller took Marsden’s advice, then turned around and sold to a different company. But Mingo and Kruse stand by their strategy. In fact, Kruse says it’s really not that different than sharing successful business practices with another member of Building Service Contractors Association International, of which Kruse is currently the president-elect.
The Marsden Holding team is a firm believer that the smaller, independent BSCs are good for the industry.
“Competition is a big part of this industry not being overly commoditized,” says Kruse.
Besides, Marsden’s mergers and acquisitions strategy was never about becoming one of the largest contract cleaning companies in the country.
“It’s not our ambition to take over the world,” says Kruse.
For Mingo, the acquisition growth model was always about creating longevity and sustainability for the Marsden companies.
And Mingo hasn’t forgotten the reason for Marsden Holding’s enormous success. At the Marsden Holding headquarters, the board room walls are covered in placards memorializing each of the companies Marsden Holding has purchased.
Marsden Holding Sees National Growth
Remembering Customer, Employee Concerns When Buying Businesses