Machine Shop Mastery 92. Are PE Firms Ruining Machining? A New & Better Model for Buying Shops with Mark Hillenburg
Over the last decade, I've watched private equity surge into the machining world — and I've seen firsthand how often the short-term flip-in-five-years strategy ends up hurting shops, people, customers, and entire supply chains. While the capital can help, the incentives often drive decisions that weaken the very businesses PE firms acquire. But every now and then, someone comes along with a model that stops you in your tracks because it actually makes sense for our industry.
That someone is Mark Hillenburg, co-founder of Collective Manufacturing Group, a company built on a radically different vision: buy great machine shops and hold them forever. No flipping. No short-term targets. No cultural upheaval. Just long-term stewardship, disciplined investment, and a deep respect for the people who built these businesses in the first place.
In this conversation, Mark and I dig into his incredible journey — starting a tiny shop with his father in a 700-square-foot garage, learning machining the hard way, living through major turnarounds, scaling multi-site aerospace manufacturing, and ultimately becoming disillusioned with traditional PE models. His experiences shaped a philosophy that aligns closely with the heart of American manufacturing: protect the legacy, empower the people, and build a business that lasts.
We also talk about how his team is already reviving shuttered shops, empowering internal leaders, gaining trust from OEMs, and receiving deal flow from customers who don't want their critical suppliers bought by traditional PE firms. If you care about the long-term health of the machining ecosystem, you'll want to hear this one. Mark's approach gives me real hope for where this industry can go.
You will want to hear this episode if you are interested in...- (0:00) Mark Hillenburg's background in manufacturing
- (7:07) Exiting the family shop and transitioning into sales/business development roles
- (9:10) Rebuilding MSP Aviation during a downturn and rising to President/CEO
- (13:25) Reconnecting with Matt Ritchie to pursue a new vision: Collective Manufacturing Group
- (22:38) Finding and acquiring the three shops they purchased
- (26:59) Why owners chose Collective over traditional PE buyers
- (32:09) Identifying "hidden gem" employees and future leaders
- (35:22) Culture-building and becoming an employer of choice
- (38:34) Collective's four-pillar stakeholder philosophy
- (39:00) Deal flow
- (48:13) What matters to Collective when it comes to PE and acquisitions
- (51:50) How shops create strategic value—not just parts
- (53:17) Why going deep with customers beats being transactional
- (56:44) Collective's financial backing and long-term capital structure
- (58:31)) Buying three shops in nine months: challenges and lessons
- (59:33) Is the industry moving away from traditional PE models?
- Connect on LinkedIn
- Collective Manufacturing Group
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