Bob Brown sees potential for improvement at Thiel Audio, or he wouldn’t have taken a seat on the company’s board and agreed to serve as its interim COO. The company’s new owners, a three-man private equity group that purchased the brand from Kathy Gornik, hired the former president and CEO of Lenbrook America to add the industry knowledge that the investors lacked themselves.
Brown’s first action, after performing his due diligence, was to hire Stephen DeFuria as national sales manager. DeFuria was the national sales manager for NAD Electronics, where he worked closely with Brown. His diverse business experience also includes time as a Thiel dealer.
“I told [Thiel’s owners], for what they really wanted to do, they needed a full-time evangelist and someone with a multi-discipline level of skill,” Brown said. “I’m not subjective about Stephen, because I know him, but the fact that he was a Thiel Audio dealer for over 10 years is significant. The fact that he split his career between factory and retail… the fact that he’s worked on product development… It seemed like an incredible mix of attributes.”
Brown emphasized that DeFuria needed to be a full-time employee. “What I hadn’t realized was that Stephen’s predecessor had been splitting his time as national sales manager for an independently owners high-end electronics brand,” Brown said. “In my experience with single-brand and multi-brand companies, it’s one thing to split someone over multiple brands that you own, but it’s a whole other thing to think about splitting someone with another brand that you don’t even own, with all of the logistics, etc.”
DeFuria’s appointment was necessary because, Brown said, Thiel’s owners had such wide and diverse goals for him, that he wasn’t going to be able to get it all done by himself. “Having a national sales manager fills a huge gaping hole in the company and allows me to work on all of the internal infrastructure things that don’t relate to dealer communication, rep management, domestic sales, etc.
Brown’s second action as COO was to direct Thiel to rejoin CEDIA. “I didn’t realize the company had dropped out, which is something I corrected right away,” he said. “There’s only one entity in this market that gives you a breadth of potential dealers that sell high-end customers expensive products, and that’s CEDIA. I think the mistake that was made was saying, ‘If we don’t have a good high-end line of inwall speakers, then we shouldn’t be in CEDIA. That may have been true 10 years ago, but now it’s really the only gathering of that ilk of dealer.”
Having recently completed his first trip to the company’s headquarters in Lexington, KY, Brown is already diving deep into Thiel’s financials to figure out what changes need to be made. So what remains to be done?
“There’s a lot to do,” Brown said. “It’s a struggle to be in the high-end audio business where a company not only has to deal with the new world economy and financial crisis, but it also with being in high-end audio [alongside] MP3 audio and digital smart phones. This company has had all of the same challenges that everyone else has, but I see a great brand, a great legacy, and a great center of gravity to build something. The question is how do we build it, how do we execute it, how do we hire the right amount of resources inside and out, and develop a plan for the product and the brand?
In each of those areas, Brown said, the company is in various stages of development. With DeFuria in place, they’ve addressing all of its sales programs, dealer programs, and pricing. He’ll soon release a revised sales program for the U.S.
One of the areas Brown will be exploring is the company’s export business, which, he said, has to be driven by its domestic business. “If you’re an American brand, you have to have a strong domestic reputation to talk about when you go overseas,” he said. “It’s the same for European brands. They have to have a romance or legacy story to tell about their home country, before launching the brand in the U.S. It’s no mystery here, but we have to develop a strong U.S. program and be in good standing with pricing and programs, before we’re really effectively able to deal with exporting long term. These are just a variety of things. It’s going to take a while to get them all figured out.
Regarding Thiel’s current dealer base, all Brown would say was “there are a lot of names on the list and a lot of qualified dealers of various sizes.”
“When you look at the list and the level of support you realize that some are just hanging on because they love the brand, but they’re not buying very much,” he added. “Certainly they could be reinvigorated with a new plan and programs, knowing there’s new investors and that company is going to go forward in a positive way. If they have faith in Stephen and me. There’s a lot of good will on the current dealer list, so I think there’s a whole way to exploit the passion and love that people have for the brand. There’s certain new blood to be had and we need to get a picture of them. I guess CEDIA will be the next big coming out party for the brand.”