Jordy Kool already has some forty acquisitions to his credit with Infotheek, Urban Gym Group and through Iron Asset Management, among others. He always executes his buy & build strategy with extreme precision. "I still evaluate each acquisition on the assumptions I had beforehand.
Jordy Kool is what you might call a self-made man. The former sports instructor climbed through various sales and management positions at companies including KPN, Hewlett-Packard and Reed Elsevier. In 2009, he realized his entrepreneurial dream. Through a management buy-in, he bought into Infotheek, a supplier of new and refurbished PCs, laptops, servers and smartphones. Initially as chief commercial officer, then as chief operations officer, and in 2013 Kool became general chairman of the board.
Under his leadership, Kool managed to multiply the revenue of the Leiden-based business in nine years from 55 million euros to eventually 800 million euros when he stepped down as CEO in 2018.
He achieved that rapid growth through a mix of buy & build. 'My strategy is very simple: build or buy. I don't sit and wait, I want to keep going,' Kool explains. 'There are entrepreneurs who think they can build everything from their own businesses, but that's not a done deal for me.'
Sowing for years
One of Kool's larger acquisitions was Centralpoint, an industry peer he acquired with the help of capital from Swedish investment company Altor Equity Partners in 2017. The acquisition of Centralpoint, with revenues of 120 million euros, was the result of years of seeding by the Infotheek CEO. Because of every business he acquired, he often spoke to the director-major shareholder several times a year.
My strategy is very simple: build or buy. I don't sit and wait, I want to continue
Kool: "I tried several times to convince Centralpoint founder Brian Speelman to sell his business to us. It wasn't until the third time that we hit it off. Then they were open to an acquisition, and because I had kept in touch with Speelman for years, he immediately thought of me. That Speelman could have done another deal where he could have gotten more money, but still chose Infotheek, says it all. He had known for years that I would be an open, honest and reliable buyer.
Defensive strategy
Kool has now completed many dozens of acquisitions, the counter, according to him, stands at over forty transactions. Not only with Infotheek did he execute a buy & build strategy, also with Urban Gym Group - known for the brands Trainmore, Clubsportive, Renessence and BTY CLB - he has been repeating this tactic since 2016.
When acquiring a fitness club, it's all about location. That battle with competitors in a desirable city, village or neighborhood has sometimes caused Kool to make an acquisition not so much for growth, but to stay ahead of the competition. "We bought two fitness clubs for too much money, but we knew that in advance. There was a defensive strategy behind it, because if I don't buy those clubs, someone else will buy them and there will be a competitor in my district.'
Cultural click
What Kool always does is evaluate each acquisition on the assumptions he had beforehand. As a result, he has become much more cautious about counting on synergy benefits in the form of lower costs and higher revenue and margins. 'I can now estimate the costs reasonably safely. But the wishful thinking about higher revenue and margins is weighing less and less on my mind when I decide to give a takeover the green light. Many acquisitions have gone wrong based on these assumptions. That is why it is good to keep evaluating, even if it is your hundredth acquisition.'
Experience has taught Kool that there are generally two things that every entrepreneur making acquisitions must always be extra alert to: culture and IT. Does the culture of the company to be acquired match the own business and how complex is it to integrate the IT of both businesses?
Culture is such an important aspect and often so difficult to 'measure' in an acquisition. At Infotheek, for example, I once wanted to add the 'networking' product group through the acquisition of a relatively small business. But service provision requires a completely different corporate culture than buying and selling PCs, phones and printers. So over time a number of people left because of that mismatch and we were left with a severely understaffed business. I would have been better off buying a large competitor with a hundred employees, so to speak. Then if thirty people leave after the acquisition, there are always seventy left.'
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