No employees No problem. Stein happy to be home again

May 15, 2011
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Martin Stein has lived in Chicago, St. Louis, Washington, D.C., Paris, Boston and Los Angeles.

In the 20 years since he left Grand Rapids, the Blackford Capital LLC managing director has battled the Los Angeles freeway system while making the 12-mile drive to his office. He’s visited the Louvre, gazed at the Arch and driven by the White House. Fine dining, spectacular shopping and the experience of sharing a sidewalk with 200 of your closest friends have all been checked off the list.

“It’s great to be home again,” a smiling Stein said from the new Blackford Capital offices on Ionia Avenue SW in downtown Grand Rapids. The new digs — which have an urban feel, separate offices, lobby and even meeting space — must feel worlds away from L.A. and its chrome-and-glass structures, tightly compacted working spaces and eternal sunshine, but Stein said he wouldn’t have it any other way.

“Now that we’ve started a family, we want to be close to our extended family,” Stein said of his wife, Rebecca, and their children.

“Southern California has a lot of compelling attributes, but (leaving there) didn’t bother me at all.”

Blackford Capital is a private equity firm focused on leveraged buyouts. Its employees have a specialized investment skill set and accumulate reams of knowledge about hundreds of companies, mostly in the manufacturing arena.

Many of the firm’s recent investments have taken place in the Midwest and on the East Coast, so Stein thought a Midwest base of operations in addition to one in San Francisco made sense.

Unfortunately, his employees didn’t feel the same way.

Stein offered jobs to each of his California-based employees if they would move to Michigan, but none took him up on the offer. Undaunted, Stein made the move anyway.

“There are a lot of local schools here — Michigan State, Western Michigan, Grand Valley — with a lot of good, really capable people,” he said. “I just had to find them.”

When Stein first arrived here last summer, he set about the task of finding those good people and matching their skills to Blackford Capital’s needs. With only a couple of exceptions, Blackford’s talent is culled from West Michigan and the local and regional colleges of which he thinks so highly.

Martin Stein

Company: Blackford Capital LLC

Position: Managing Director

Age: 39

Birthplace: Pontiac

Residence: Grand Rapids

Family/Personal: Wife, Rebecca; children Cooper, 6, Noa, 4, and Asher, 1.

Business/Community Involvement: Chairman: Amtech Corp., Staging Concepts, Key Health; board member: Best Security Industries, Industrial Piping, Source International; Harvard Business School, Coro and University of Chicago alumni associations; Association for Corporate Growth; Grace Episcopal Church.

Biggest Career Break: Getting a job in 1995 at Corporate Decisions Inc. in Boston, where he was selected to work with the founders to lead the research and writing team for “The Profit Zone,” later selected by Business Week as a top 10 business book of 1998.

Now Stein is thinking of expanding the work force. Judging by a recent experience, that shouldn’t be a problem.

“We had 300 applicants for four internships this summer,” he said. “Do we feel the talent is here? Absolutely.”

Talented employees, proximity to family and business location all played roles in Stein’s decision to come home, but they weren’t the only reasons.

“Grand Rapids has got so many families that have committed themselves to the community,” Stein said, mentioning the DeVos family, the Van Andels and the Kellers, among others. He met Fred Keller while still a high school student 22 years ago, and that favorable impression has never left him.

Stein wrote a paper in school on George Heartwell, who is now the mayor of Grand Rapids. Bert Bleke, then an administrator for Forest Hills Public Schools, also had a favorable early influence on the budding entrepreneur who would go on to be valedictorian of his graduating class at Forest Hills Northern High School.

“These are all people who did it the right way,” Stein said. “That’s the way that I want to do this — in a way that’s good for the communities we serve.”

Stein said Blackford Capital does not work with any West Michigan companies, but if things go as planned over the next few years, that could change. He also said Blackford currently has 60 limited partners, but none of them are in West Michigan, either.

“Our goal, in the next 10 to 20 years, is to have limited partners and portfolio companies right here in West Michigan,” he said. “Part of that will be just getting the word out.

“I know everybody talks about the economy (in Michigan), but that doesn’t bother us. We believe this is a tremendous place. It would be wonderful if, in a year or two, we could say we have companies right here in West Michigan that we are working with.”

Blackford Capital works with what Stein calls “mature” companies — between 20 and 80 years old with revenues of $20 million to $100 million — and has clients in places ranging from South Florida to North Carolina to Minnesota.

“We don’t do turnarounds,” he said. “We’re looking for good, solid companies that we can help reach the next level. We have a lot of experience and provide governance and a board of directors. We are actually in there at least a day a week helping to drive strategic initiatives.”

Stein knows a little bit about learning from experience. He tells a funny story about a summer job his dad got him while the elder Stein was plant manager at Knape & Vogt in Grand Rapids. On the new kid’s first day, he decided to use a forklift to hoist a pallet with an 800-pound box of ball bearings to the top shelf of a storage unit. When the more experienced employees saw what he had done, they told him the box was too heavy for the top shelf and he would have to use the forklift to bring it back down again.

“I was so proud of myself for getting it up there,” he said. “Of course, when I went to bring it back down, I punctured the box, and it must have rained these little ball bearings for about 45 minutes. I mean, they just kept coming!”

When young Martin asked how he should clean up the mess, the old hands smirked and gave him a magnet.

“I must have spent three hours with that magnet,” he said, laughing. When they’d had their fun, the older guys gave him a broom with a magnetic metal strip across the front.

“It probably would have taken me 45 minutes with that broom,” Stein said. “That’s what experience will get you.”

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