Those who break the mold and take the road less traveled

I’m never quite sure how to describe an entrepreneur. It can mean a founder who disrupts an industry, or a second-generation owner who finds new ways to operate. When you read about the winners and finalists from the Entrepreneur Of The Year® 2018 East Central awards, you’ll find both, and more.

One entrepreneur, for certain, is this month’s cover story: Howard W. “Hoddy” Hanna III, chairman of Hanna Holdings Inc. He and his family helped Howard Hanna grow into the largest privately owned real estate company in the U.S.

We spoke mainly about the company’s acquisition strategy because that’s where Hanna is focused today.

He says, before a deal, the price is usually an early decision. However, the company spends time learning about the organization’s people, culture and mission. This includes understanding the reason they want to sell and how they run their business.

“You’re not going to get that on the financial statement a lot of times. You’ve got to talk it through, talk it through, talk it through. So, we seldom do a deal that doesn’t take six, eight months from start to finish,” he says.

This is critical, because the easy part is buying, Hanna says. The tough part comes after the sale: integration.

So, why did I easily see the spirit of an entrepreneur in Hanna? One story, which didn’t make it into the article, perfectly demonstrates it.

In 1972, Hanna took a five-week residential broker course. As he was in Los Angeles finishing up, he took the opportunity to learn about branch office locations. The only places where this was common in real estate was California and Chicago.

So, he called up Forest E. Olson realtors and asked for the owner. That afternoon, Olson took him to a couple of offices, invited Hanna to dinner and asked him to change his flight so he could learn more.

“I told my wife I was coming back Sunday, and spent the next Saturday looking at offices with him and learning his whole system,” Hanna says. “I came back to Pittsburgh and I said, ‘We’ve got to open up branch offices.’”

A desire to learn more, be better and strive for the next great thing — now that’s an entrepreneur.

On to the next challenge: M&A from the experts

Dealmakers who have experience with mergers and acquisitions typically enjoy the challenge. They’ve learned how to navigate the negotiating table, deal terms, integration and more. Often, they’re looking for their next big deal.

Business owners and entrepreneurs, however, may only go through this process once or twice. That’s why it’s nice to peel back the curtain of M&A, with insights from those who know it best.

One of those involved in Columbus dealmaking is featured in this month’s cover story, Jim Wyland, founder and president of WealthStone. He believes in the power of long-term relationships, making connections and proper due diligence.

Jim Grote, the founder of Donatos Pizza, has worked with Wyland for more than 30 years. He says Wyland is an artist in his field.

“Jim has made and art out of displaying his color spreadsheet using a large monitor for viewing, always giving two or three alternatives to a plan. It’s kind of like he’s playing his computer keyboard like a piano, using numbers for notes and after some collective ‘brainstorming’ coming up with a plan that sounds really good,” Grote says.

Wyland is having fun getting involved with new ventures in Columbus’ deal market.

One change he’s noticed is that, pre-recession, the ultra-wealthy typically had one adviser. A decade later, most have multiple money managers helping them invest. They’ve diversified.

This is just the beginning of how Smart Business will explore the ins and outs of dealmaking and M&A. Our third and final ASPIRE conference for 2018 will be held Sept. 25 at the Hilton Columbus Downtown. Mark your calendars now because the event is just around the corner. The day will include sessions that focus on buying and selling a business, raising capital and liquidity events, and there will time for networking and a chance to ask questions of the experts.

I’ve learned a lot about what makes a deal successful, what missteps to keep an eye out for and the key ingredients to try to replicate — and I hope you do, too.

Now that’s impressive

Going from $6 million in annual revenue to $75 million is a big jump. It’s the difference between a small community organization and one that’s approaching 350 employees. But what’s even more impressive is that Equitas Health went through that much growth since 2011.

The nonprofit, featured in Building Stronger Communities, transformed itself to better meet the needs of its customers — people who are HIV positive or at risk of becoming HIV position — because the marketplace demanded a change.

What it didn’t expect was to fill such a large need in another disenfranchised community, the transgender community. Equitas Health serves between 700 and 800 trans patients, who often drive three or four hours to find culturally competent care.

“The organization we were in 1984 or 2010 is not the organization that we are today,” says President and CEO Bill Hardy. “It is certainly critical that we remain nimble, in responding to the needs of the communities we’re serving.”

Hardy, in his 26th year with the organization, is one of the nation’s longest serving directors of an organization like Equitas Health. He has a social work and mental health/behavioral health background, so he’s had to improve his management skills on the job.

“Every day I’m learning new skills, and it does keep me on my toes, to make sure that I’m providing and am able to provide the vision that we need for the organization and the leadership,” he says.

In addition to discovering the story of Equitas Health’s growth, as you read about the 2018 Smart 50 — the executives leading the smartest 50 organizations in Central Ohio — I want to point out one fact. This year’s class, which is the fourth one we’ve featured in our magazine, has only a few people who are prior winners. That’s pretty impressive, and I think it points to the great things business leaders and their organizations are doing in the region.

I always learn a lot as I get to know the winners throughout the judging process, but this year, it’s been especially interesting to see so many new names.

Hard work, reliance and integrity never go out of style

Holly Rowe’s passion is obvious the moment she starts talking about her job at ESPN. But that passion is underpinned by old-fashioned values — hard work, resilience and integrity.

She believes the worker bees in life are the ones who take advantage of opportunities. Because while Rowe is a nationally known reporter and commentator now, that didn’t happen overnight. She says showing up and volunteering to do the extra work is the way to succeed, no matter what your job or industry.

“If you do the work that other people don’t want to do, you will start small and get the opportunities,” Rowe says.

And that doesn’t mean you won’t fail, too. Legendary Hall-of-Fame women’s basketball coach Geno Auriemma of the University of Connecticut recently talked to Rowe about resiliency.

“There are student athletes who have come into his program who have never failed at anything, because their parents, their coaches, the system around them have made (it so) they never fail,” Rowe says.

Another critical value is integrity, which is something Rowe finds true in the media today. If she goes to a college basketball practice and sees they’ve shaken up the starting lineup, it’s important to have the integrity to keep that information to herself when talking to their opponent. Otherwise, she’ll never be let into practice again.

But the pressure of getting information out quickly can lead to mistakes. For example, Rowe and her team saw a tweet that a college basketball star was sick and wouldn’t play that night. The story ran on ESPN, but it was wrong.

Rowe says that’s when you admit your mistake and apologize to the people involved, like the athletic trainer and basketball player. As she’s grown older — and wiser — she appreciates the need for accountability.

“I didn’t research for myself. I went and apologized to them. I don’t think I did a good job of reporting that story,” she says.

 

The Buckeye Ranch is up to the challenge

“If anybody is over 35 years old and has lived in Columbus for any length of time, they still call us the Buckeye Boys Ranch, which is OK with us. I just like the fact that they know us at all,” says President and CEO D. Nicholas Rees.

The Buckeye Ranch, which changed its name when it began accepting girls in 1992, follows best practices and offers cutting-edge behavioral health treatment for children — but trying to do that and make ends meet is a challenge.

“When I came to work here 15 years ago, I thought I understood what was going on at the ranch, but to be honest with you, I had no idea,” Rees says.

Rees worked in the philanthropic arm of the Kroger Co., and he sees similarities between The Buckeye Ranch and where he used to work. Both have challenges with technology and trying to hire and replace staff.

But there’s also a delicate balance between the mission and business margins, he says. You want the children and staff to come first, but if you’re not financially responsible, you can’t do it for very long.

“There’s this whole notion of trying to break even in a nonprofit, but it’s really not like that,” Rees says. “We obviously don’t make profit because we’re nonprofit, but we do sometimes have a successful year and we have reserves. And those reserves help you pay for the things that you can’t either get a donor to take care of or you don’t get reimbursed for.”

For example, The Buckeye Ranch recently replaced its phone system with its reserves.

Rees, the third leader since The Buckeye Ranch opened in 1961, has tried to add a businessperson’s viewpoint. So far, it’s been useful, but funding is always a concern.

Rees has asked Leslie Bostic, Ph.D., the first executive director and a mentor, “Was there ever a day that you did not worry about the funding?” The answer was no.

The good news is that Ohio does a pretty good job of protecting people who they consider to be in mental health, counseling and therapy — even with cutbacks that have forced other behavioral health providers across the state close, Rees says.

“We have a great track record of helping these children find success and restoring the hope that that family had,” he says.

Do what you can, when you can

Leroy M. Ball, president and CEO of Koppers Inc., who is featured in this month’s cover story, is deeply involved in the community.

He serves on the board of directors of the Allegheny Conference on Community Development and the Leukemia and Lymphoma Society of Western Pennsylvania and West Virginia. He is also an honorary board member for the National Kidney Foundation of Western Pennsylvania and West Virginia, and a trustee of Robert Morris University. A champion of the United Way of Southwestern Pennsylvania, Ball is also serving as the 2017 Allegheny County Campaign chair and 2017 co-chair of the Helping Families Thrive Investment Strategy and Action Plan Committee.

When I asked him how he makes time for so much philanthropy, he says you have to accept the fact that it will ultimately infringe upon your personal time. Even if Ball attends meetings during work hours, that work doesn’t go away. It means staying later, coming in earlier, working the weekend, etc.

But it’s important enough to be worth it in Ball’s eyes.

“The corporate community and folks that are in my position have a responsibility for helping to build and strengthen the communities that support their companies,” he says.

“There are a lot of great organizations out there that do a lot of great things. I personally have been very fortunate in my life to have the job that I have, to have had the other jobs that I’ve had, and I get paid pretty handsomely to do that. The least I can do is find a way to make a positive impact,” Ball says.

No one is an island, and everyone has family and friends who are touched by the different things that are served by these nonprofits.

“I’m a strong believer in doing everything I can to help where I can. Someone in my role can bring a lot of influence, and I don’t want to waste the opportunity,” he says.

When you have a short window of opportunity, you should try and make the most of it, Ball says. I’ll second that.

April issue has something for everyone

The 2018 Smart Women award winners were particularly impressive, and it’s nice to read some good news in the wake of the #MeToo movement. I was inspired — and a little envious — by the great things these 16 women, two men and two organizations are doing.

I also want to encourage our readers, both men and women, to attend the breakfast event on April 17. Not only will we recognize our winners, the panel discussion should be thought provoking.

This year’s theme is about what it means to be an authentic leader — someone dedicated to building and fostering a strong culture for women in the workplace. How do women in business get to a place where they are comfortable in their own skin, no matter what their industry or position? How can executives build a workplace culture that provides opportunities for everyone? How can you be a leader who is authentic, yet still culturally conscious?

One of the most inspiring leaders in this issue is Nancy Kramer.

I caught up with her to discuss what she’s been up to since selling Resource/Ammirati to IBM. She may no longer be the top decision-maker, but she’s gained new insights through different experiences. As part of IBM iX, she now has access to exciting new technologies like machine learning, quantum computing, artificial intelligence and blockchain.

Kramer also spoke specifically about two global studies by IBM, which may be useful for your business. One looks at the importance of brand belonging, and the other examines how established companies can digitally transform their organizations to stay competitive. You can find links to those in the story.

On the subject of transformation, exciting things are happening in Columbus’ restaurant scene. It’s not just a hub for restaurant corporations, so don’t miss the Uniquely, which explores some of the area’s strengths.

In addition to restaurants, Columbus has traditionally been a retail powerhouse. ELOQUII, featured on page 18, has a different take than most, as it’s an online retailer adding brick-and-mortar locations.

I also recently saw a statistical databyte by Thoughtwell (formerly Community Research Partners) on this very subject for the Columbus metro area. Check out “Brick & mortal retail: Are reports of its death exaggerated?”

Hard work + discipline = success

Last month, hundreds of area dealmakers — business owners, private equity investors, entrepreneurs and service providers — came together for Smart Business’ first ASPIRE conference in Pittsburgh. Experts talked about buying and selling businesses, raising capital, and liquidity events, including the trends they’re seeing in the market.

It was an educational and exciting day. However, if you missed the Pittsburgh event, don’t worry. We’ll be holding ASPIRE events in Cleveland in May and in Columbus in September, and I know some Pittsburgh attendees will be heading out to those, as well.

Merger and acquisition activity remains high, which is part of the reason why I asked John J. Engel, chairman, president and CEO of WESCO Distribution Inc., about his advice on the subject.

WESCO has completed more than 40 acquisitions since it spun out as a standalone company in 1994, and Engel says it’s an important topic for him and his team.

WESCO’s largest acquisition, EECOL Electric Corp., a Canadian company, was finalized in 2012 and cost more than $1 billion. WESCO, however, worked on its relationship with EECOL for well over five years before the deal.

In general, Engel says the majority of acquisitions never close because even if the deal makes sense strategically on paper, the cultural and integration aspects get in the way.

“I’ve seen other companies that don’t spend the time on that pre-acquisition close,” he says. “They worry about the financial model. They worry about the strategic rationale and all that stuff, how to finance it, but they don’t spend the time getting to know the talent and then figuring out exactly how will this talent integrate in. And will it even fit culturally?”

It takes a lot of hard work and discipline behind the scenes before an announcement is made.

One organization that isn’t afraid of hard work is Fort Ligonier, featured in the Uniquely. The fort is at the tail end of a renovation with new exhibits, more hours and an education center. Executive Director Annie Urban says the fort’s staff got it all started by putting together their ultimate wish list for what an optimal visitor experience would be like, and then stuck with it to make much of the list a reality.

Bring the walls down; bridge the divides

Nine years ago, when Creative Director David Brown founded the Harmony Project, his idea of Columbus was not very diverse — mostly white, affluent and educated. But that only scratches the surface.

Brown says diversity isn’t just about race or religion. It encompasses education, socioeconomics and life experiences. Harmony Project connects all types of people through the arts, education and volunteer community service.

“We have to figure out how to connect people across those divides. The divides are not going to go away. We’re not about trying to get people to vote the same way or even to agree on political hot button issues,” Brown says. “We’re about setting those to the side and saying, ‘A playground doesn’t care if you voted for him or her. A community garden doesn’t care if you believe in God or don’t believe in God. Meals that need to be served don’t care if you have a doctorate or if you didn’t graduate from high school.’”

If everyone rallies together, more gets done, and if you work with people who are different, your fears naturally decrease, he says.

Brown sees this, too, with the business leaders who are part of the organization.

When Harmony Project paints a community mural, he says a CEO of a major Fortune 500 company could be on one ladder, while the next ladder holds someone who just got out of prison. They have no idea who the other is, but they’re both there helping. And if they happen to have a conversation, it’s not forced or guided; it’s organic.

Developing a true community where everyone buys in — whether throughout the city or within your office — means getting out of your comfort zone.

“It’s important that you get out of your company. It’s important that you get out of your own neighborhood. It’s important that you get out of the schools that are familiar with you, and the communities that are familiar with you,” Brown says. “And it’s important that each organization and each company find ways for the mail clerks and the janitorial staff and the senior VPs to interact.”

Learn about M&A from the experts

Dealmakers who have experience with mergers and acquisitions typically enjoy the challenge. They’ve learned how to navigate the negotiating table, deal terms, integration and more, and are always looking for their next big deal.

Business owners and entrepreneurs, however, may only go through this process once or twice throughout their entire career.

That’s why it’s so interesting to peel back the curtain of M&A, with insights from those who know it best. The cover story in this issue does just that with an array of perspectives from Pittsburgh investors, business executives and dealmakers.

The elements of a successful business deal seem to be similar to what makes a strong business — knowledgeable, enthusiastic, hard-working people; a culture where everyone is going in the same direction; a well-thought out and clear strategic business plan; and innovation and creativity to inspire new directions for the company.

In addition, if the cultures don’t align, too much energy can be expended debating and resolving conflict. That’s energy that’s better spent executing the strategic plan and providing the products and services that are central to the business.

I learned a lot about what makes a deal successful, what missteps to keep an eye out for and the key ingredients to try to replicate — and I hope you do, too.

However, this is just the tip of the iceberg. Our daylong ASPIRE conference on March 8 will include even more experts, and the attendees will have the opportunity to ask questions. So, even if you’re not attending this year, please watch the magazine for future opportunities to learn from the best.

One of the highlights of ASPIRE 2018 will be a lunchtime panel discussion on the state of Pittsburgh’s technology sector. That’s why I asked three experts to name their top five hottest startups in the region as part of this month’s Uniquely. Imagine my surprise when I received 15 different answers, with no repeats.

It goes to show that the technology and startup scene is booming, and there will be a lot to talk about at lunch on March 8. I hope to see you there!