Today, my summer intern asked me about my measure of success. Was my goal to get big enough to go public or get sold, he asked? It was a timely question from him, as there as been a lot of recent merger and acquisition activity in our industry. This is typical for a new industry and is neither good or bad – exits happen! M&A activity simply underscores the need to understand the goals of critical business partners. Some clients of the acquired companies listed below will be thrilled to be part of larger organizations, while others will bemoan the upheaval that comes with a change in control.
Here’s a quick run-down of the M&A and investment activity in our industry:
- PFSWeb, a publicly traded fulfillment and call center operation, took a $15 million “strategic investment” from Japanese outsourcer Transcosmos. After a year in which they lost two big clients, PSFWeb also announced a new CEO and new board members.
- Webgistix, a VC-funded fulfillment operation from NY State, was acquired by Rakuten, another big Japanese firm who aims to challenge Amazon in the U.S.
- Newgistics, a freight company, acquired AtLast Fulfillment. Newgistics pulled an IPO a couple of years ago, citing unfavorable market conditions. Perhaps they acquired AtLast to boost an upcoming IPO?
- Last year, publicly traded software distributor Navarre acquired Speed Fulfillment Company. The interesting aspect of that acquisition is that Navarre had hoped to re-position themselves as an e-commerce fulfillment player. A year later, Navarre is abandoning their 330,000 s.f. Minneapolis distribution center and consolidating into Speed’s Texas facility. It now looks like Speed bought Navarre – more of a reverse merger. (We know a bit about Navarre as they had inquired if OWD was available for purchase two years ago. Nice people. We politely declined.)
- Then there was eBay’s acquisition of GSI Commerce, which was proceeded by GSI’s acquisition of NewRoads and several other marketing companies. eBay most recently invested in Shipwire, who has taken several rounds of outside funding.
I told my intern of watching PSFWeb go public, of hearing about Shipwire’s venture capital investors and of being a bit envious. At times, I wondered if One World Direct should also take outside money to speed our growth. Years later, I’m happy that we stayed independent. I like knowing that I can look our clients in the eye and tell them that we’ll be around tomorrow and that the buck does, indeed, stop with me. I told him that my measure of success was in living up to our name. When I can walk into OWD offices around the world, I’ll be satisfied.
Thomas E. Unterseher
Co-Founder & CEO
One World Direct