02 Oct Merging with the “enemy”
By: Brian Biddulph-Krentar
My favorite founder story occurred after my company, CareFlow Student Health was acquired by Magnus Health in August 2015. Magnus Health was our fiercest competition, but I was friendly with their founder and we talked every so often about merging. Right before that finally happened, the 3 Magnus Health founders and leaders had a falling out with their investment partner and exited the business. Little did I know I was walking into a disaster.
The Magnus founders had a cult like following and were gone, there was an interim-CEO (James) with a very different personality, and the competition was now a part of their daily life. There was even a presentation put together by a former sales manager called “Killing CareFlow.” Magnus was losing employees on a daily basis. Ian, my right-hand man and technology genius for multiple companies and I were supporting our competitor’s clients, BEFORE we even signed all of the acquisition agreements. All told, we lost 75% of the Magnus Health employees. Our technology team was left with no product documentation and had to learn everything on the fly, including a whole new programming language. Looking back, that may be the best thing that ever happened.
James and I had different skill sets that complemented each other very well. James had the perfect demeanor to handle the mass exodus and find capable people to fit in. Within a couple months, James, Ian, and I were able to stabilize the company.
In 2016, we found a strategic investment partner in Turn/River Capital, and with James’ blessing, I took over as CEO within 4 months.
With the new backing of Turn/River, I was able to lead us in the creation of a lean, scalable SaaS business that took off. We created a sales engine, repeatable marketing campaigns, a market-leading product, and a client success team that experienced top-level NPS scores. We were lucky enough to have an amazing investment partner and experienced a very successful, planned exit in April 2019, 3 years after I became CEO.