|| Print ||
|Articles - Jan/Feb 2012|
|Thursday, January 19, 2012|
Page 4 of 5
In the global market, mergers and acquisitions are a regular part of the business practice, and historically venture-backed companies are built to sell. And although stories about buyouts make the headlines, there are still hundreds of Oregon-owned companies that haven’t sold. So any imbalance between big and small, between the eaters and the eaten, begs the question: So what? Does it matter if Oregon-owned companies are acquired by out-of-state firms? What kind of impact does this have on Oregon business and community?
The answers are complex, and among business leaders, there isn’t necessarily agreement. From an individual business perspective, a focus on exit strategies “is harmful,” says Raghu Raghavan, CEO of Act-On Software, a Beaverton-based provider of marketing automation software that last summer became one of Oregon’s acquirers, buying the assets of California-based Marketbright, also a marketing automation provider. “If you’re thinking about being acquired, you don’t optimize the company for growth,” says Raghavan, pointing to Nike as an example. "A company getting to that scale is not thinking about exits, they’re thinking about markets.” Act-On has grown from eight to 58 employees in two years and is on a path to triple revenue in 2012.
If thinking about getting out too soon is harmful, so is an exclusive focus on starting up. “There’s a love affair with starting new companies that can be very damaging,” says Andrew Nelson, a professor of management at the University of Oregon. “We need more attention to the very difficult stage of actually growing them.”
Nelson cited as an example the popularity of Startup Weekend Portland. “What happens after that weekend?” he asks. That love affair with the new, the small and the not necessarily directed extends to the state level, Nelson suggests. Unlike Seattle or San Diego with their vibrant biotech industries, “Oregon has been reticent to place bets in certain sectors,” Nelson says, preferring instead “to be all things to all people.”
Such diverse offerings may explain why Portland is such a buyer’s market. Danone acquired YoCream because the company was a “center of excellence,” with “expertise” in frozen products, unchartered territory for the French conglomerate, says spokesman Michael Neuwirth. The acquisition also reflected Danone’s “glocal” approach: “global in scale, local in business, tied to the earth and land in which we work,” says Neuwirth.
There’s no data showing what happens to Oregon companies after they’ve been sold, whether as a group they get bigger and better, or smaller and disappear. According to Tim McCabe, director of Business Oregon, the impact is wide-ranging. He cites companies such as Hermiston-based Snack Alliance and PV Powered in Bend, firms that were acquired but then continued to grow in Oregon.
Then there are financially struggling companies such as Jeld-Wen, “where outside purchase kept the business going and employing hundreds here in Oregon,” says McCabe. Tazo Tea falls into yet a third category, companies “that are purchased and do leave the state down the line,” he says.
For McCabe, the acquisition dynamic is almost irrelevant. “The bottom line is we work to keep companies and jobs growing in Oregon, whether it’s an Oregon-owned firm or not,” he says. Sean Robbins, CEO of Greater Portland Inc., echoes that view. Eighty percent of job growth comes from existing companies, he says. But in the global M&A marketplace, and in a city and state that isn’t a hub of private equity or venture capital, the critical factor isn’t so much maintaining local ownership but identifying opportunities to grow jobs even in the case of an acquisition — an approach he says is part of Greater Portland Inc.’s 2012 Work Plan.
Others take a less sanguine approach to the loss of some of Oregon’s most iconic companies, with even those who sold expressing some ambivalence. “A lot of the values that we created are still there, but it’s not the same family-owned company,” says Gun Denhart of Hanna Andersson. “It’s corporate culture focused on the bottom line.”
Dave Chen is more explicit about the downside of becoming a corporate colony. “When something is acquired, it becomes a division or unit, you lose that company’s contribution to the community and their investment in the community. The impact is terrible.”
Tuesday, February 25, 2014
Health care and vacations rule. That’s the consensus from our reader poll on workplace benefits that help retain and recruit employees.
Friday, February 28, 2014
The 21st annual 100 Best Companies to Work For in Oregon list was announced Thursday night at an awards dinner at the Oregon Convention Center.
Thursday, April 10, 2014
BY JESSICA RIDGWAY | OB WEB EDITOR
SEMpdx hosted a workshop this week for entrepreneurs, website developers and others interested in search engine optimization (SEO). Here are a few tips and tricks aimed at bumping up your search engine rankings.
Thursday, February 27, 2014
Our 100 Best Companies project turned 21 this year, so pop open the Champagne. Our latest survey gives us plenty to cheer.
Thursday, February 27, 2014
BY ERIC FRUITS
Because they have little chance of working for someone else, today’s teens need to be entrepreneurs. But, first, we must teach our teens that entrepreneurship starts small.
Thursday, February 20, 2014
BY VIVIAN MCINERNY | OB BLOGGER
As retailers consolidate and newspapers fold, the business of modeling shifts to ad agencies, apparel companies and new media.
Thursday, March 06, 2014
BY HANNAH WALLACE | OB BLOGGER
The founder of Pacific Foods talks about why his company has flown under the radar in Oregon, how saving a family-run chicken hatchery has helped his bottom line and why he thinks organic food is anything but elitist.
|How Doug Badger spends his downtime|
|Port at a crossroads|
|100 Best awards 2014|
|Our man in Congress|
|U.S. consumer inflation rises: higher food, rent costs|
|U.S. Airways apologizes for tweeting explicit image|
|Bubba Watson wins second Masters Tournament|
|Excessive TV linked to poorer sleep in children|
|Obama names new U.S. health secretary|
|Google Glass on sale for one day|
|U.S. jobless claims at lowest since 2007|
Marketing the state brings new business, new jobs and a better quality of life for everyone.
Living in the beautiful Pacific Northwest means enjoying our wonderful surroundings, while remaining aware of the multiple types of natural disaster threats that we face: winter storms, windstorms, floods, landslides, earthquakes, volcanoes and tsunamis.“
Oregon State University's hospitality degree program invests in next-generation leaders.
NAI Norris, Beggs & Simpson just completed their newly rebranded First Quarter Market Reports. Not only does it feature a brand new format, but the report ensures accuracy due to the annual truing up of their database.
Samuel Hernandez, an Associate at Barran Liebman, is the recipient of a 2014 Oregon State Bar Litigation Section Rising Litigator Award.
On March 14, 2014 Governor Kitzhaber signed House Bill 4050 into law. Introduced by the Oregon Association for Health Underwriters (OAHU), HB 4050 gives small businesses the option of self-insuring for their health benefits.