Boeing, Starbucks, Microsoft, and Chateau Ste. Michelle are corporate stories of success that are familiar to people that read the Seattle Times, Puget Sound Business Journal, and/or Wall Street Journal. However, in the world of IBA, the Pacific Northwest’s oldest business brokerage firm, stories about publicly traded companies are not told in our conference rooms. In our conference rooms, the stories are about entrepreneurs who had the courage, vision, business acumen, and perseverance to start their own businesses. The following are entrepreneurial stories involving planes, coffee, computers, and wine that were shared with us by past clients that demonstrate the spectrum of types of people that can successfully climb America’s ladder of economic opportunity as entrepreneurs.
On April 16, 1971, real estate agents Bob McDonald & Jim Youngren put the words “Will the Last Person leaving Seattle – Turn Out the Lights” on a billboard at South 167th Street and Pacific Highway South near Sea-Tac International in response to the massive layoffs that were occurring at the time at Boeing. The Boeing layoffs of the 1970’s impacted many people directly & indirectly. Employees were impacted directly with the loss of jobs, but also impacted were the spectrum of businesses that supply & serve the Boeing community from the companies that manufactured parts to the pub near the plant where employees socialized after work.
One couple impacted by the layoffs was Graham & Barbara Hollingsworth. Graham & Barbara as a young married couple had moved to Seattle from Manchester, England to facilitate Graham taking a “dream” job at Boeing to help design the Supersonic Transport (SST). Unfortunately, the SST and Graham’s career with Boeing were not meant to be and he was let go by Boeing when retention decisions needed to be made based on seniority. Graham, whose father had owned a company in England, desired to stay in his adopted country of America, so like many entrepreneurs before him elected to use personal setback as a spring board to control his own destiny and start a business. Several decades later Graham & Barbara Hollingsworth had built Lancs Industries, a manufacturing company specializing in single use & environmental shielding products for the nuclear industry, into an internationally recognized company serving the Navy, Department of Energy, and foreign nations. Graham & Barbara are symbolic of two common stories shared by our clients. The stories are of “one of the best decisions ever being made being the decision to stop being an employee and to become a business owner” and the story of someone either born domestically or in a foreign country recognizing the unique entrepreneurial opportunity offered by the American economy, starting a business, and climbing the ladder of opportunity available to all in the United States.
Recognition of the next “Big Thing” is the dream of many entrepreneurs. The next “Big Thing” can come in many forms. The story of Howard Schultz and Starbucks starting with store #1 across from Pike Place Market is known internationally with a pseudo pilgrimage occurring regularly by coffee lovers visiting the first store for a cup of java. A less well known coffee story, but one told at IBA is the story of Tony Hoyt. Tony Hoyt grew up in Seattle embracing everything the region had to offer from music to fishing. As a young adult, Tony was working as a valet parking cars in downtown Seattle when a fellow employee introduced him to quality espresso from one of the city’s first coffee carts. A love affair with coffee was born. Tony decided he wanted to be part of the “coffee revolution” and opened his own coffee cart. One cart quickly evolved into multiple locations and from there into Java Bean coffee houses in West Seattle & Ballard. Ownership of the coffee houses has changed in the last couple of years, but they remain community favorites featuring organic, fair trade coffee, two new trends Tony embraced before general society was aware of them. Tony is symbolic of the many entrepreneurs IBA has represented in the sale of their businesses who had the courage to invest in themselves and pursue an entrepreneurial idea in the competitive world of small business.
The story of Bill Gates & Paul Allen getting up in the middle of the night to use the computers at the University of Washington as computer “wunderkinds” is probably better known in Seattle than the story of George Washington admitting he chopped down the cherry tree. Bill Gates & Paul Allen changed the world with Microsoft. They also put the Pacific Northwest on the map as a computer & technology city. This identity resulted in an influx of domestic & international talent into the region and helped companies ranging from Amazon to Concur germinate in the technology space. A technology story in Seattle you are likely not aware of, but one that has been told at IBA, is the story of Mohamed Lahlou. Mohamed grew up in Morocco, studied electrical science in France, and immigrated to the United States for opportunity & love. Mohamed identified that a need existed to offer component level hardware repairs to laptops to address “real world” issues like cracked computer screens and spilling coffee on a keyboard. This need, over the years, has resulted in his creation of five, successful computer service centers in the Seattle metropolitan area. Many of which have been transitioned to a second generation of entrepreneurs. Mohamed symbolizes two common stories told in IBA conference rooms. The first group of stories is of new immigrants to the country not being able to find employment at Boeing, Microsoft, or Amazon, but needing to start a business to find employment and generate the income necessary for their family. It is commonly observed in our office that it is often first generation immigrants who see the ladder of economic opportunity available in America and not families that have been in the United States for generations. The second set of stories is of entrepreneurs who enjoy creating businesses, but not managing them. IBA regularly represents entrepreneurs like Mohamed in the sale of their businesses as a means of creating an equity generating exit event and facilitating the ability to start their next business.
Chateau Ste. Michelle was instrumental in introducing Washington wines to the world. Today, Chateau Ste. Michelle is one of the best known wine brands in the United States and Walla Walla, the Yakima Valley, and the Columbia River Valley are recognized as premier wine grape growing AVA’s in the world. The wine industry has been an attractive entrepreneurial venue in the Pacific Northwest for multiple decades with many stories existing of individuals using knowledge, vision, and business acumen to create fortunes and internationally recognized, award winning brands. IBA has a reputation for positively supporting the Pacific Northwest wine industry as business sale intermediaries. One wine industry story told of entrepreneurial vision at IBA is the tale of Joel Tefft. Joel Tefft’s story is not one of pursuit of gold medals, although he is an excellent winemaker, especially for champagne. His is a story of bringing quality table wine to the public at a reasonable price. Today, box wine is a common household staple, but that was not the case when Joel Tefft first approached Costco with the idea of selling quality box wine. Joel’s box wine featuring the iconic Tefft Cellars heron was the first to debut in Costco and was soon found in Costcos throughout the region. The issue as an entrepreneur for Joel Tefft was not demand for his product; it was quality supply of product to meet retail sales, a common experience for successful entrepreneurs. It is also common at this stage for entrepreneurs to recognize that the skill set needed to navigate future growth is not one they possess. Smart business owners who recognize this evolution in management knowledge & ability often contact IBA to sell their companies. In Joel’s case, he collaboratively sold Tefft Cellars and the associated real estate with IBA in a significant equity creating event and used the capital to start a small batch distillery, Black Heron Spirits. Joel symbolizes a common story from IBA clients. It is a story told by first generation entrepreneurs in a new industry. The story frequently has a happy ending when the entrepreneur sells a business prior to company needs exceeding their management skill set and capital resources. It can have a sad ending if innovation & competition, often from publicly held companies, is not identified and addressed accordingly. IBA business brokers welcome the opportunity to meet with entrepreneurs in evolving & developing business segments to strategically plan for the future. It is guidance we have provided entrepreneurs who owned internet service providers (ISP’s) and travel agencies in the 1990’s and give cannabis entrepreneurs today. Cannabis is an entrepreneurial niche where IBA business brokers have facilitated more transactions in Colorado & Washington than any firm in the region.
There are many motivations for entrepreneurs to start businesses. The stories provided in this article illustrate common themes for starting businesses for clients of IBA. Motivations to sell also come in a spectrum of flavors. IBA, as the most selective business brokerage firm in the Pacific Northwest, traditionally represents clients that are motivated to sell for one of four reasons. The most common motivation for sale for our clients is retirement. Following retirement as a motivation are the parties that either enjoy creating a business more than managing one or who recognize a business has grown beyond their personal skill set as an executive manager. The final motivation of our clients are distressed sales created by partnership breakup, divorce, illness, or death. This final group of motivations can create an emotionally & mentally challenging environment for our client, the buyer, and the IBA business broker facilitating the transaction. However, these need based projects are ones our business brokers take with honor because they easily align with our corporate mission to represent each client like a family member with knowledge, experience, and professional skill. The ability to represent parties in need provides our business brokers with rewards that cannot be quantified, but create memories that last a lifetime for the business broker who facilitated the transaction. I encourage any business owner thinking about selling their privately held company or family business in the Pacific Northwest to contact IBA. I am confident, if included in the interview process, the entrepreneur will recognize why IBA has sold more businesses in the Pacific Northwest than any other firm since 1975 and is the favored referral partner for business brokerage transaction services by legal, accounting, and banking professionals.
IBA, the Pacific Northwest’s premier business brokerage firm since 1975, is available as an information resource to the media, business brokerage, and mergers & acquisitions community on subjects relevant to the purchase & sale of privately held companies and family owned businesses. IBA is recognized as one of the best business brokerage firms in the nation based on its long track record of successfully negotiating “win-win” business sale transactions in environments of full disclosure employing “best practices”.