What’s good, VaynerNation?
I hope you’re all doing super well.
If you follow fashion, you may have heard that VF recently acquired American lifestyle brand Supreme for 2.1 billion dollars. The news was impossible to miss, with everyone asking different questions about what this acquisition could mean for the future of the brand. Keep reading to hear my answers to some of the most commonly asked questions on this matter.
Question: What do you think the biggest challenges for VF will be as they try to scale a brand that’s known for their niche, underground roots?
This is a great question. I’m writing this blog post because I know my Instagram is getting more “business oriented”. A lot more established executives are following me, but I also want every up and coming entrepreneur to know this as well: the biggest challenge in any merger and acquisition (M&A) is losing the DNA of the organization. The biggest challenge for VF, in regards to Supreme, is going to be having empathy. However, this answer leads to a bigger question.
How can a large company support the audience and employees of the smaller company they acquire?
A lot of you are thinking of buying small companies even though you’re a small company. Due to Covid, many small businesses are hurting and looking to sell. Therefore, some of you are starting to think about M&A. To take this more macro, now that the Supreme team, their executives and rain makers, have cashed out, (because they probably have contracts that keep them at VF for a while) how does VF keep them motivated? And more importantly, how does VF not mess up what Supreme has done?
My answer: it’s like an organ coming into a body. My friends if you’re buying somebody else’s cleaners, law firm, or landscaping firm, and incorporating it into your world–it’s a culture game. Just because you bought them doesn’t mean you get to boss them around. You’ve got to figure out how to make them work in your world.
The biggest challenge for VF with Supreme is going to be having empathy. Empathy that’s structured in a professional manner. Practical, professional, empathy is the biggest challenge for big companies when they ingest. It’s an even bigger challenge for small companies when they ingest, because small companies are founder-led. She or he says, Hey! I just bought your company so you’re gonna do this. A lot of times, that’s the thing that messes them up.
Big companies tend to sometimes look for efficiencies. They cut some costs, change a rule or two, change the technology stack maybe. I know of startups that have gone into companies where they have to use Microsoft Teams instead of Google Hangout. Those kinds of things. I’ve seen startup brands that use Shopify Plus have to go into companies that use Magento or big commerce.
When you’re forcing culture changes, the speed is an issue. Smaller brands tend to be fast when it comes to changes. Regardless of the size, having empathy and respect can solve a lot of problems–both in business and in life.