Venture 7 Advisors recently announced that private equity firm Camano Capital has acquired a majority stake in Turtle Fur of Morrisville, Vermont. Venture 7 served as the exclusive financial advisor to Turtle Fur in the transaction.
We sat down recently, after the closing, for conversations with Turtle Fur President Richard Sontag, and with Taylor Hanson, a Partner at Camano Capital.
From our conversation with Richard Sontag:
About the decision to sell the company
After about 18 and a ½ years of owning Turtle Fur, I came to the realization that I had taken my beloved company and brand as far as my skill set would allow. I could coast and maintain status quo, but that would be a disservice to the company. After a few sleepless nights and talking it over with my wife, I decided to seek a financial arrangement that would allow me to stay and be a part of the place I love and garner the needed injection of capital, new ideas, and energy into the business. The end result, selling the majority interest to Camano Capital, allows me to remain an active participant with the company, provide for my team, and benefit from the strategies, resources, and expertise that Camano will bring.
I've loved working at Turtle Fur for these past two decades, and I have no intention of leaving any time soon. But at a certain point, I realized that a new ownership structure could help the company grow by adding to the skills and the talent we already have. The arrangement with Camano Capital allows me and my team to stay on and benefit from the strategies, resources, and expertise that Camano brings.
About the decision to go public about the intention to sell the company
Once I decided to sell my beloved Turtle Fur, it became clear that I would not be able to accomplish what I wanted (a proper valuation of the business, to provide jobs and a secure future for my team, and to present the company in the best light), without the assistance and support of my team.
My team is the future, not me. My team runs the day-to-day business, not me. Who better to tell our story than my team. Do not misconstrue; I am an active owner, but why ask a new owner to invest in the past when they could easily meet the future. Another important reason behind my decision to go public with this information is that it is consistent with the brand's integrity. I was not about to sneak around, hide the truth from my people, and be fearful of potential side effects.
I understand many business owners would feel the opposite. The fear would lie with everyone knowing and what that would mean. I was not scared of that. I believed in my people; I felt that after 21-years, they trusted me. My stated goal of protecting them and providing an opportunity for continued employment, career growth, and participation would be persuasive enough for everyone to stick around and see what happens. – And everyone did.
I even sent a press release to the industry, thus advertising my intentions thus getting ahead of industry gossip.
Another reason for going public with my intentions was a simple one. How better to advertise that the business was for sale than to shout it out to everyone we can. I knew Venture 7 would function as a filter for information, which eliminated any fear of my information getting into competitive hands.
How did you go about hiring advisors to help sell the company?
The most integral piece of my seeking advisors was to align myself with advisors who have the same kindness and integrity that we have at Turtle Fur. I looked for real people. People who cared about the company and its people. People who would feel they were participating in building something rather than just making another impersonal deal.
Second, it was important to hire advisors who were local to New England and, if possible, to Vermont. This signaled to everyone that I was serious about ensuring the company stayed in Vermont. I hit a home run with all of the advisors that helped in this transaction.
The sale process
The entire process took longer than I thought it would. It was longer than I would have liked but not longer than I was told it would take. Guided by Venture 7, my team and I spent significant time documenting our business, and then Venture 7 put together a first-class book. It was complete and well-organized; it looked great. It beautifully captured the heart, flavor, and ethos of Turtle Fur. Many told us that it was the best book they had ever received.
The book generated tons of interest—authentic, quality, interested prospective buyers. The first step after Venture 7 filtered through and did their magic were video calls to meet the potential buyers. After narrowing the pool of potential suitors and subjecting them to more intensive conversations (because, as my whole team participated in the visit, I wanted to be incredibly careful who I brought in), we had quite a few groups come through the door.
Once we signed a Letter of Intent with Camano Capital, we dove into the due diligence process. I was again very happy for the transparency, as due diligence impacted every department. There was a deep dive into financial reporting, a (QoE) quality of earnings and supply chain evaluations, legal work, site visits, etc. The process would have been overwhelming had it not been for Venture 7 focused, step-by-step process of their own, walking us through everything.
It was the intent of all parties involved not to make the deal adversarial. Venture 7 took point on this, setting the tone, and established excellent working relationships with all parties involved. There was never any animosity between the teams. It was always very professional.
I am thrilled with the results. I was able to take care of my family, take care of my Turtle Fur family, maintain my connection to the brand and the people, retain an ownership piece, and position Turtle Fur with a bright, energetic team who will help unlock Turtle Fur's potential.
About working with Venture 7
When seeking a firm to represent me in the sale process, I interviewed four M&A advisors, two of them high-powered New York firms. Venture 7 stood out from the rest for its combination of blue-collar work ethic and white-collar presentation. They were the perfect combination of tough businesspeople and someone I wanted to work alongside. My people felt the same. Venture 7 didn't just represent my business; they became part of our family.
Venture 7 brought the same level of heart and integrity that we have at Turtle Fur.
The guys at Venture 7 had experience starting, running, and selling their own companies. They weren't just deal makers. They have each been on both sides of a transaction many times. The other firms did not have that kind of background.
Venture 7 understands marketing a company for sale isn't just about financial analysis and spreadsheets. It is about a living, breathing entity. People are not names on a ledger; they are real and have lives and families. Selling a company, especially one that cares about people and the environment is storytelling; it's about emotion. They took the time to engage with us to really understand our history, our pride, and our social and environmental commitments.
The resulting marketing materials were top-notch and at a level unlike anything I had seen before. I'm convinced that the way Venture 7 helped us present Turtle Fur added real financial value to the transaction.
Through the sale process, the Venture 7 team became my professional colleagues, guides, and confidants. It was like working with old friends. It was an open, collaborative environment and, dare I say, fun at times. The same can be said for all the top-notch professionals they brought to the table to help assist in this transaction.
If I had to do it over again, I would still choose Venture 7.
From our conversation with Taylor Hanson, Partner at Camano Capital:
More often than not, what you’re investing in is the people, not just the business itself. It’s the people who give voice to the what the brand stands for. You can have a great business plan and great products, but you need to have people who can execute on that plan, and who can keep a shared vision in mind when they come to work every day. If we're going to invest in a company, we need to make sure that we’re also aligned with that vision.
The decision to make an offer
From day one we saw Richard's passion and the passion of everyone in the business about the social, environmental and sustainability values that brand stands for. These are the things that Turtle Fur’s customers value about the Company. In today’s world there’s a lot of lip service - a lot of businesses say they stand for certain things but their actions don’t back that up. The kind of commitment that we saw from everybody at Turtle Fur is pretty rare in today’s world. You can see in the way they operate the business that they really do stand by the values that they profess.
A breath of fresh air
Going public the way Richard did almost never happens, and the open communication was a breath of fresh air. It made everything so much easier – we never had to dance around topics, and we could talk to everyone at the company to understand the business better. And we were able to build relationships with people all across the company before the closing.
After the closing
We’re generally hands-on in terms of diving in and working with the Company which is what we’ve done post-close. While we’re still in the early phases, we’ve kicked off various planning and process initiatives, focusing on both short term (first 60 days) and longer term (3 to 5 year strategic planning). And because we already got to know the Turtle Fur team, we’ve been able to really hit the ground running.
About the process
Investing in businesses in comes in all flavors, and we were fortunate to work with Richard and Venture 7 through this process. We know that this business opportunity attracted a lot of interest, and that you guys at Venture 7 and Richard did a lot of work vetting potential buyers. While the process took some time, we think the outcome was stronger, as it allowed all parties to spend more time together and get to know one another, a huge plus post-closing. After we signed the Letter of Intent, the due diligence process for a transaction of this size was a very significant effort which the Turtle Fur team and Venture 7 did a great job facilitating.
About working with Venture 7
We thoroughly enjoyed working with everyone at Venture 7, and the team did a great job acting as trusted advisors for Richard and shepherding the process along. There were a lot of details to pay attention to, but the Venture 7 team nailed it, and there was a feeling of openness all along the way. I think you acted just as Richard would want his representatives to handle things. We’d love to work with you again.