Jay Sachetti joined Jeff O’Brien, partner at Husch Blackwell and Dyanne Ross-Hanson, president of Exit Planning Strategies talked about the market for mergers and acquisitions, exit planning opportunities for companies that don’t end up for sale and how companies can maximize their eventual sale price during an early October panel at the first Upsize on Tap event at Summit Brewing Co. in St. Paul.
When the state Legislature passed a law requiring employers to provide paid leave and safe time for employees, Justin Bieganek started hearing differing details from friends, colleagues and peers.
Elam Baer faced a big problem when Uber and Lyft threatened to leave town over a Minneapolis City Council ordinance dictating pay for drivers this spring. What he did next—create a rival rideshare service in just weeks called MyWeels—is an impressive example of leaping before you look.
Baer has epilepsy and depends on rideshare services for his 20-minute daily commute to work. “So, to me, it really struck home. At a professional level, I had just sold the largest company that I owned (Corporate Technologies),” he said. “So, I personally had some time to put against it myself.”
“I decided to make a run for it. And run is the right word. We had to move really, really fast to get ready to launch,” he said. “We had our app developed in really four weeks, so by the middle of April. We had some drivers we actually paid to get test drives. We had on May 1st, we got regulatory approval in Minneapolis to provide service and we launched right away.”
Baer’s main company is North Central Equity in Eden Prairie, which for three decades has invested in some 20 companies. “We deal in what, to put it nicely, are distressed companies. Many of them are on the verge of bankruptcy and we buy them and try to fix them up,” Baer said.
Corporate Technologies “was on the verge of going under at the time we got it,” 16 or 17 years ago, he said. “We kept growing it, and we just treated it as though we were never going to sell it. And in the end, a private equity firm that likes to buy nice businesses” made a handsome offer, the terms of which he declined to specify.
Other businesses he owns are unusual. “We have an egg-processing plant that has machinery that breaks shell eggs and sells tanker loads of liquid eggs. And I’ve got a business that manufactures large-scale industrial wood saws. That is a very, very asset-heavy and engineering-heavy business,” he said.
His startup MyWeels is different—born in a hurry from Lyft and Uber’s threatened pullout and attracting multiple other would-be competitors. The Minnesota Legislature ultimately passed a compromise that placated the giant rideshare services. But Baer believes MyWeels has something better to offer drivers: a “favorite driver” program that allows them to build their own customer base.
“Our difference is that we are not taking Uber and Lyft on in a head-on way. What we are doing is building a platform where individual drivers can build their own business on top of it,” he said. “You get 50, 75, 100 people who have named you as their favorite driver, and you’re kind of a mini-rideshare driver unto yourself.” He figures MyWeels will turn profitable by the end of next year.
“I’ve been thinking about this for years in my mind. So, when I got the chance to do it, it required an incredible amount of focus to do it fast enough to be relevant,” Baer said. “I’m uniquely able to do that because I’m able to command resources that other people in the company can’t.”
Ride on, MyWeels, and all the other entrepreneurs ready to jump when needs arise.
