Ed Weinfurtner has seen it all through his career as an entrepreneur, an investor and a dealmaker.
“The driver for me has always been that you see direct results of your effort,” says Weinfurtner, co-founder and managing partner at Blue Olive Partners LLC. “At the end of every year, I look back and say, ‘There are a lot of good things that happened. We had a lot of challenges, but we overcame them, and we feel good about what we’ve done.’ At the same time, there is a feeling that there is so much more we can do.”
Weinfurtner is a Harvard University graduate who has been an owner, investor and operator of multiple privately held businesses across a variety of industries over the past 35 years.
“As things have evolved for me personally, I’ve gravitated into situations or looked for opportunities that are more renewal, renovation or fixer-upper opportunities,” he says.
In this Dealmaker Q&A, we spoke with Weinfurtner about his investment strategy and how it contributes to his success as a dealmaker.
What drives you to seek out challenging investment opportunities?
The challenges in those kinds of scenarios are super invigorating. The first six months are crucial. Your hair is on fire, you’re working hard, and you can see a direct result as to whether you made a difference or not. That part of it is highly engaging. If it works well, there is a return on the investment. The other piece I enjoy a lot is building a team. It’s about bringing people together and finding the right set of people, personalities and skillsets. You need to have clarity on what you want to do and drive together to get things done. It’s about building a high-performance environment, especially in scenarios where one didn’t exist before. As I’ve gotten older, that part is particularly enjoyable.
What’s the key to getting situations like this turned around?
At Great Day Improvements, the parent company for Patio Enclosures, I got involved more than five years ago. The product was great and the perception and view of the product by customers was great. But the company had made some missteps. I was heavily involved in the beginning, and I brought in a guy I knew through the industry to be the president of the company. We essentially built a leadership team of a couple of industry experts, plus people who had been with the company 20-some years. It was a blend of people who had been there and knew how things were done, plus some fresh perspective, and we put it all together.
The business is settled. We’ve opened new locations. What happens for me is the need for me to be involved becomes less and less as the team becomes stronger. I’m not necessary for the business to be successful anymore.
Do you expect more of a return if you’re involved in day-to-day operations?
You get paid for your time to do a job. Somebody could come in and be president of the company, and they deserve a salary for their time. That’s different than an investor, someone who is taking capital and putting money into a business. When you’re an entrepreneur, I think it’s important that you clarify this is the investment piece, this is me as an investor and this is the capital I’m putting in. An investor expects a targeted return on investment.
That’s different than saying, ‘If my time is needed as CEO, I should be paid for my time.’ Or maybe I get involved in a board or advisory role, that’s different, too. What’s happening for me more and more is my time is less as an operating guy and more managing the sum of the investments. But I will always have some component of operations where my time is spent helping to operate or run the business, because that’s where I think I can add some more value.
How do you become better at negotiating a deal?
There’s no deal that works where one guy wins and the other guys loses. It has to be good for the people who work in the company, it has to be good for the owners, investors and customers, and it has to be good for you. Everybody has to benefit. We can help operate, we can help bring capital, we can help create focus on customers and put a strategy together to help identify customers, or do all of the above. The fun part is, I’ve been operating these kinds of businesses for a fairly long time. But you still learn something every day. Success begets more success. One goes well, we generate some capital, and it puts us in position to be helpful on the next opportunity.
Related: Blue Olive’s Ed Weinfurtner Takes Hands-On Approach To Investing