Kessil

BRS To merge with Neptune

Bertram Capital is the one doing the buying and calling the shots, not BRS. BRS was just the first company they bought in our hobby to get their foothold. They took out Marine Depot quick to decrease competition. Now they are branching out to acquiring add-ons to solidify their position.

They are not doing it to improve the hobby or bring extra value to hobbyists, they are doing it to make money. Luckily they claim to be playing the long game, not just the quick pillage. Hard to tell if it will turn out well for the hobby or not, because that is irrelevant to their goals, and by extension to the new goals of the founders they are buying out. If you want to see what Bertram’s stated acquisition strategy is:

www.bcap.com

Strategy | Bertram Capital

Bertram focuses on reinvestment and technology enablement to drive growth and expansion
www.bcap.com www.bcap.com
 
Keep your eyes on your junk mail. I received a $20 off postcard with a code from BRS over the weekend. It's cobranded with Marine Depot and BRS logos and mentions the merger.
 
Both companies are super users of their own products with offices full of reef tanks and have excellent customer service, so I think we can expect that to continue. I hope this helps Neptune push out the “Trident 2.0” with nitrate and phosphate measurement.
 
JVU said:
Bertram Capital is the one doing the buying and calling the shots, not BRS. BRS was just the first company they bought in our hobby to get their foothold. They took out Marine Depot quick to decrease competition. Now they are branching out to acquiring add-ons to solidify their position.

They are not doing it to improve the hobby or bring extra value to hobbyists, they are doing it to make money. Luckily they claim to be playing the long game, not just the quick pillage. Hard to tell if it will turn out well for the hobby or not, because that is irrelevant to their goals, and by extension to the new goals of the founders they are buying out. If you want to see what Bertram’s stated acquisition strategy is:

www.bcap.com

Strategy | Bertram Capital

Bertram focuses on reinvestment and technology enablement to drive growth and expansion
www.bcap.com www.bcap.com
Click to expand...
That is correct. Bertram is the company that purchased our company. Not BRS.

They are definitely doing it to make money. Why else would a private equity firm do anything. All of us are trying to make money.

However, in order for BRS and Neptune to continue to be successful, we have to keep doing what we've been doing and improve on it. As far as I can tell (from various meetings I've had), that is the plan. The added resources we will have access to will allow us to develop more products at a faster time frame and devout more manpower to each project. Increase production and support. Meaning MORE of what we already do well and will also allow us to improve on all aspects of our business.

There are many new products on the horizon so stay tuned! It is going to be AWESOME!
 
sfsuphysics said:
So Betram bought BRS? Or they partnered in some way to let BRS be the knowledgeable partner in the things?
Click to expand...
These things are always framed as a partnership since they partner the money from the people doing the buying with the experience, effort, and institutional knowledge of the people doing the work at the company. And it is a partnership in that respect, in the sense that both have a say and affect how things are done. But in the end the partner with the money makes the final decisions, and can replace anyone on the other side of the partnership they want to in the name of “alignment of strategy” or “improvements in efficiency” or whatever. One thing it is not is an equal partnership like most people think of partnerships being.

To be clear, I am not predicting anything bad or good from the hobbyist perspective. It definitely could go either way. And probably will go both ways in different respects. I’m just saying that things are changing, and the forces driving the change don’t care about the hobby or hobbyists any further than the bottom line. You can say that is all companies but I disagree, there are lots of hobbyist companies that truly care about the hobby and their customers in addition to needing to make money.

If Bertram thinks it will help profitability to have amazing customer service and funnel more money into new great product development, they will do that. If they think of generous customer support and long term product development as underperforming returns on investment, they will cut back on those. We’ll see, but we will likely have to wait a while. When they acquire a company they usually wait several months before they start firing people and becoming more ”efficient” with the expectation that the masses will have forgotten about the acquisition and lost interest by then.

I am going to watch closely with the above in mind, and if I see things get better (in ways that I define for myself), I’ll buy more stuff from the Bertram family of companies. If I see things get worse, I’ll drop them and order from their competition. That’s the only real vote we get.
 
JVU said:
These things are always framed as a partnership since they partner the money from the people doing the buying with the experience, effort, and institutional knowledge of the people doing the work at the company.
Click to expand...
So similar to how Ecotech bought, "partnered", with Aqua Illumination? (or vice versa?)
 
I'll chime in here..There is no requirement that a partnership needs to be 50:50. Partnerships are entirely driven by the capital structure of the enterprise, which then drives corporate governance. So, as an example, Ryan may have 20% ownership in the new BRS structure. Yes, he may still be outvoted on things, but only at the Board level, not day to day operations. But, it is still a partnership...and yes, he could be outvoted and get fired if he doesn't do his job.

Consolidation in any industry is part of a free enterprise system. And, an industry such as this one is highly fragmented, highly inefficient, and most small enterprises are poorly capitalized. While Private Equity has a had a bad reputation in the past, this was in part because they used leverage. That is much less the case today given the crazy amount of capital available both in the private and public markets. (Although, have no idea how Bertram is structured). Importantly, Private Equity injects capital into the industry and can provide much needed capital which is required to, amongst other things, develop new products (in a technology innovation industry like ours). Yes, competition is good, but if the industry is highly fragmented and poorly capitalized, then product innovation will be slow or non-existent. Or worse yet, enterprises stagnate or go under because working capital requirements increase as businesses grow. A lot of people have misconceptions that as businesses grow and become profitable, their capital requirements go down. But, it's actually the opposite. The bigger you get, the more capital (cash) you need on the balance sheet. Anyway, I'll stop there...overall, I have absolutely no concern with these acquisitions. And, as Vincent already stated, we should see new prodiucts come more quickly from Neptune.
 
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