Person of the Year – Bill Korowitz
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Had fate not intervened at three precise moments in Bill Korowitz’s life, he would’ve never found the ad specialty industry. The first occurred as he was set to enter West Point after high school, when his father – the latest in a long line of Pittsburgh steelworkers in the Korowitz family – looked at his son, who’d so often had the word “hellraiser” written next to his name by teachers, and with a critical eye said, “Son, you aren’t military material.” The second time, he was in his third year of med school at his hometown school, the University of Pittsburgh, and literally – after a particularly rambunctious late night – stumbled into the cadaver room, nearly losing his lunch.
“It was then that I thought, economics… why not?,” Korowitz says with his trademark booming, aged-in-the-cask laugh. “Not many Pitt econ grads have minors in biology, chemistry and math, but then again, not many Pitt grads make 300,000,000 magnets a year, so it evens out.”
The Pirate of Pittsburgh
“Bill is outgoing, charismatic, large and in charge. He’s also down to earth, engaged at the customer level, has great ideas and fantastic stories.” – Juli Sinnett, SwervePoint
His entrée to this industry was the direct mail business, selling newspaper advertising right out of college for a whopping $150 a week plus commission. Then came the third intervention of fate. “In late 1982 I got a call from a company called Advo Systems, which was a $50 million direct mail house,” Korowitz says. “They basically put labels on the Sears and Montgomery Wards catalogs … so you can see the carbon date stamp on that company. But a bunch of young kids with more guts than brains and money – not unlike in The Wolf of Wall Street – suddenly found themselves in a $400 million company, and growing at a rate no one could believe. In a pre-Internet, pre-social media world, to get to $800 million inside of six years was nothing short of astounding.”
He eventually left for Magnet when Advo achieved $1.3 billion in revenues. “The company went corporate, and I wasn’t the type to justify everything I did to 500 people in a corporate office,” Korowitz says, in a masterpiece of an understatement. “However, I give my Advo mates 100% of the credit for teaching me the skills I have today. There was no better training ground for learning selling strategy, technique, and marketing across a wide range of customers.”
Today at Top 40 supplier The Magnet Group, which was named Counselor’s Supplier of the Year in 2013 and continuously wins the Counselor Distributor Choice Award for magnets, Korowitz runs the show with 450 employees, and three production facilities, operating under seven different brands. “We’ll finish up 10% this year,” he says, mentally calculating numbers at a frighteningly fast speed.
“Something tells me Bill will drive the industry’s changes in the coming years rather than react to them.” – Robert Fiveash, BrandFuel
As if his business life doesn’t sound harried enough, last year Korowitz and some partners started TMG Capital, with the sole purpose of acquiring underfunded industry companies, giving them the resources they need and then standing back to let them shine. Witness what they’ve done with Castelli, one of the group’s first acquisitions: Its sales are up 25% from this time last year.
Since the formation of TMG Capital was announced, Korowitz maintains he’s had “no less than 20 conversations” with people in the industry who want him to buy their companies and says he plans on having two more deals documented in the next 12 months.
“We feel our best opportunities exist with companies in the $5-10 million dollar range,” he acknowledges. “We believe we can partner with companies of this size, and leverage our strengths in sales, customer service and marketing to help them get to a place that would offer them an exit strategy.”
Ultimately, the goal of creating TMG Capital is to capitalize on further acquisition opportunities that Korowitz believes are available in the market today. “We see a lot of suppliers in the industry right now that we think could benefit from additional capital or partnerships. We formed the company so we can more easily close on mergers and acquisitions moving forward.”
Regarding his goals for his own company, they match the perception of the 6’5” Korowitz – go big or go home. “I want to build Magnet into a world-class company – not just a best-in-industry-class company,” he says. “I love to work, and the strategy of business and the execution of well-thought-out plans. We’ve been steadily adding talent to the company with the eventuality that we’ll home-grow a president to engage more in the operational level of the business.”
Out of Chaos Comes Cash
“It’s always refreshing to listen to Bill. He speaks frankly, with great enthusiasm and from the heart. His style is to tell it like it is.” – Jo-an Lantz, Geiger
Ever the studied economist, Korowitz believes as the industry moves forward, the lines and loyalties of the supply chain are going to get tangled. “It will be fun to see how it evolves, but it could get messy,” he says. “A core belief of mine is ‘out of chaos comes cash – if you’re paying close attention.’ But this is what I always say to my team: keep debt low, cash high and learn about the industry, because when it changes, you’ll know when and where to pounce on the opportunities.”
His passion in the business is creating new products and ideas to take to the market, but his pet peeve harkens back to his formative years as a direct mail rep. “While at Advo, we spent millions of dollars each year training our 700 salespeople on various aspects of selling, marketing, overall business acumen, verbal and non-verbal communication skills, negotiating tactics, etc. I’m not sure any supplier or distributor company in this entire industry has ever spent $1 million in the last decade. All businesses have a relationship component that’s important, but understanding actual sales and business is most important.”
And Korowitz’s advice for those who look at his career and ask what he’s learned? “Don’t buy six companies in 18 months,” he laughs. “Unless you have a psychiatrist and bartender on staff.” – MB