146. Stay young forever

Hi Gerard,

Small companies exploit and large enterprises explore. That is basically in a nutshell what we wrote about in recent columns. We both have more or less small companies, but we have the ambition to explore. And then we see all sorts of obstacles. But now we have found a solution, no matter how simple it may seem. I think we have written before about organic growth or growth through partnerships, mergers and acquisitions. Now, I am in the middle of such a process of merger and acquisition. Not to sell but to buy, to bring the future forward in this manner.It does not surprise me that this is a game for larger companies. Because it requires so much knowledge in fields smaller companies are less experienced in. I can imagine that this overload of information can make someone decide to go no further with it, when the fear of the unknown strikes. Also, in respect of the costs you run into. The smaller the company, the higher the absolute costs are relatively. It also means that if you want to buy a company with an upfront amount on the table, you are not certain that you will earn it back in the next few years. So several moments of hesitation are felt by entrepreneurs in such a situation. After all, you know what you have now in your business, but you have to wait and see what you are going to get after a merger or acquisition. As an employee, I once experienced a perfect fusion of three companies. They were all complementary to each other and the turnover after the merger was more than the sum of the three parts. And there was enough turnover to explore new products and customer groups. The atmosphere was very dynamic. This is something I am searching for again. Everyone thinks it’s fun to work in an environment of growth. Just as everyone finds it enjoyable to see a growing toddler and play with them rather than interact with an older person. This may sound harsh but it’s the truth. If a child comes in during a party, everyone wants to pay attention to the toddler, but if an elderly couple arrives we say hello to them politely and we quickly go on with our conversation in the hope that they do not come and sit next us.

So it is with businesses, everyone wants to belong to dynamic growing companies and not to older companies with just one product or service left on the shelves. These latter companies have mostly older staff and young talent will never choose to work there. And this is the same young talent you need as a company to explore. And exploration has to be developed, otherwise you will soon end up as an older man who can only perform one trick.

Best regards,

Erik