Middle Market Growth Conversations

Terry Graunke, chairman and CEO of Erie Street, an independent advisory firm based in Chicago, spoke with Middle Market Growth last week about how he's leading his firm through the economic disruption caused by the coronavirus outbreak. Graunke launched his first business in college. He has gone on to found 11 startups and has been involved with 43 separate operating businesses over the course of his career as an operator and investor. He describes what he's learned leading companies through past downturns and how he's applying those lessons today—from offering fitness perks to employees to communicating difficult news honestly and transparently. Erie Street recently rebranded from Erie Street Capital and Graunke explains the value creation philosophy behind that change, and how the firm supports businesses through its advisory and consulting services and capital investment. *** The Middle Market Growth Conversations podcast is brought to you by the Association for Corporate Growth. To learn more about the organization and how to become a member, visit www.acg.org.

Today's episode is brought to you by RSM US LLP, a provider of audit, tax and consulting services focused on the middle market. It features Kevin Depew, RSM's deputy chief economist and leader of the firm's national industry eminence program. Depew provides an overview of the monetary and fiscal policy response to the coronavirus outbreak, and how it compares to the stimulus package implemented during the financial crisis over a decade ago. He also describes the unique challenges facing midsize businesses and the programs that could help them stay afloat. Ahead of Thursday's jobs report, Depew offers a preview of what we should expect, along with other real-time indicators that he's watching to gauge the economic damage. He likens current events to a natural disaster and makes the case for a rapid recovery for the middle market, once the public health crisis is addressed and businesses can reopen their doors—although when that will happen remains unclear. Middle Market Growth will continue to report on the fallout from the coronavirus and its impact on the economy, so check middlemarketgrowth.org regularly. Meanwhile, ACG and its chapters are also offering content and resources for ACG members. Visit acg.org to see the latest. RSM is also providing information for middle-market business leaders. Check out the Real Economy blog at realeconomy.rsmus.com, where you can subscribe for daily updates. RSM will also be increasing the frequency of its Middle Market Business Index to monthly for the next several months, and it has built a COVID-19 resource center with insights for midsize businesses. All of that is available at rsmus.com

After the ACG Chicago Middle Market Manufacturing Conference, Middle Market Growth sat down with Craig Smith, an enterprise executive with Plex Systems, to talk about cloud-based systems, leveraging data and the skills gap facing midsize manufacturers today. In this episode, Smith describes how Plex’s solutions can help manufacturers cope with supply chain disruptions, something that’s especially relevant today because of the coronavirus outbreak, which has had a major impact on manufacturing and global supply chains. Find more content about trends facing midsize businesses and deal-makers at middlemarketgrowth.org.

During the ACG Chicago Middle Market Manufacturing Conference, Middle Market Growth sat down with Jon Walker, business development manager at EOS North America, a provider of 3D printing solutions that include systems, software, materials and services. Walker explains how 3D printing and additive manufacturing differ from traditional manufacturing techniques, and how they can be used in applications ranging from aerospace and automotive to medical devices. The U.S. is the No. 1 market for industrial-grade 3D printers, and according to Walker, additive manufacturing is the “great equalizer” for American companies in the face of international competition. He also describes how the technology is evolving with respect to applications and materials, and he points to areas of opportunity for additive manufacturing in the future.

Jennifer Fondrevay, founder and chief humanity officer of Day1 Ready, describes her research into why so many mergers and acquisitions fail, and how acquirers and investors can address workforce considerations earlier in the M&A process. Fondrevay has interviewed a number of C-level leaders, HR professionals and PE investors, and she's written on the topic for Harvard Business Review. In late 2019, Fondrevay published her book, "NOW WHAT?: A Survivor's Guide for Thriving Through Mergers & Acquisitions," currently available for order on Amazon. https://www.amazon.com/NOW-WHAT-Survivors-Thriving-Acquisitions-ebook/dp/B07ZQ7SXDP This episode was first broadcast in August 2018. Learn more about Fondrevay and her research at https://jenniferjfondrevay.com/.

This week's episode features Chris Voss, the FBI's former lead international hostage negotiator and CEO of The Black Swan Group, which advises Fortune 500 companies on performing complex negotiations. Voss addressed the key elements that all negotiations share, from a middle-market M&A transaction to a high-stakes hostage crisis. He also suggested strategies for setting up a negotiation for success, red flags to watch for, and the best way to relay bad news. Plus, he shared real-world anecdotes from his time in the FBI. To learn more about the topic, pick up Voss' book, “Never Split the Difference: Negotiating as if Your Life Depended on It,” or subscribe to The Black Swan Group's newsletter, "The Negotiation Edge," at blog.blackswanltd.com/the-edge. This episode was originally released on Dec. 18, 2018.

During the Toronto ACG Capital Connection, Middle Market Growth sat down with Elmer Kim, who has spent more than 25 years working with family offices. He currently serves as chief investment officer for the Hyatt Bangia Family Office. In this episode, Kim describes how he works with families to craft their investment strategy. He also spoke about how the family office model in Canada has evolved and the growing trend of direct investing. For advisers looking to work with family offices, Kim offers his perspective on how to break into the space, and he outlines some of the challenges faced by young investment professionals who work in a family office environment. Visit acg.org to learn more about the family office programs offered by ACG chapters, and check out intergrowth.org for details about the Family Office Summit on the final day of InterGrowth, ACG's annual conference.

Kevin Depew, deputy chief economist and industry eminence program leader for RSM US LLP, spoke with Middle Market Growth about recent trade developments and the underlying issues impacting U.S. economic growth. The U.S. recently agreed to a "phase one" trade deal with China and signed the USMCA with Canada and Mexico to replace the North American Free Trade Agreement. Depew explained what those deals mean for the U.S. economy and midsize businesses in the year ahead. He also addressed challenges beyond trade, including the tight labor market and the reluctance of U.S. businesses to make much-needed productivity-enhancing investments. Uncertainty caused by the trade war and the 2020 U.S. presidential election have made business leaders cautious, a sentiment reflected in RSM's latest Middle Market Business Index, published on Dec. 19. Depew discussed the MMBI's findings and what they reveal about how middle-market leaders are planning for the future. The full index is available at rsmus.com/economics/rsm-middle…ness-index-mmbi.html To read more about trends in the middle market, visit MMG's website, middlemarketgrowth.org.

Jim Owen, a managing director and head of engineering and construction in Stout’s Investment Banking group, recently sat down with Middle Market Growth to discuss industry trends. Owen outlined three primary areas driving interest from buyers in the construction and engineering space: aging infrastructure, demand for resilient construction that can withstand severe weather events, and green initiatives. He described which types of businesses are best positioned to capitalize on these trends, as well as the valuations he's seeing for construction and engineering firms. As we head into 2020, Owen offered his outlook for M&A activity in the industry in the coming year and shared suggestions for how firms can prepare for an economic slowdown. A Q&A with Owen will be featured in the January/February print edition of Middle Market Growth magazine, which ACG members will receive at the end of December. An online version will be available in early January on middlemarketgrowth.org. Read more about Jim on Stout's website: https://www.stout.com/en/professionals/jim-owen/ The Middle Market Growth Conversations podcast is brought to you by the Association for Corporate Growth. To learn more about the organization and how to become a member, visit www.acg.org.

During the Association for Corporate Growth's Strategic Acquirer Summit, Middle Market Growth sat down with two corporate development leads to talk about their roles and how they approach M&A. The first interview explores corporate development in the tech space and features Kate Anissimov, who recently joined Google, having previously worked in corporate development and strategy at Twitter. Anissimov described how she identifies and evaluates technology businesses, and what unique challenges are associated with tech M&A. The second half of the podcast features Peter Troup, vice president of corporate development at Veritiv, a publicly traded B2B distributor of packaging, paper and janitorial and sanitation products, based in Atlanta. Troup described what Veritiv's M&A activity looks like, how the company's deal team is structured, and what competition and disruption look like in its space. Anissimov and Troup both spoke about how they measure success in their deals. To read more about trends in the middle market, visit our website, middlemarketgrowth.org.