Entrepreneur Owner-Manager Background
To understand Jay Jacobs, you have to understand that even as a young kid, he was always interested in making stuff. Whether it was 1/35 scale models of military battles—or complete towns for that matter-- he was using his imagination to innovate new ways of seeing things, and then making what he saw. When he took a string of jobs after college, it was all with businesses that had to do with being a maker—sometimes selling manufacturing equipment, sometimes making the actual parts themselves. In a way, he was really getting an advanced degree in being a maker because he was studying manufacturing processes and manufacturing companies which benefited him when he led the digital transformation of his own businesses.
If you think of life as a series of “chapters” like Jay Jacobs the founder of RAPID Manufacturing does, it’s only natural that there is a beginning and an end to the founder’s most effective role in the company. Or at least to the founder’s ownership control of the company. By viewing life this way, Jay has been able to put his focus and passion into what he is working on one chapter at a time.
Jay started RAPID from scratch after concluding there was a need, and the time was right, to form a different kind of prototype parts manufacturer. Technology had matured enough to create digital tools which reduced set up times, minimized error, increased successful replication of machine shop’s output—in short, make better parts at lower costs and most importantly—more rapidly.
From the very first hour, the only goal was to make prototype quantities of parts (small numbers of an item) at high value, low cost, with a very, very fast delivery time. Customers may take a long time creating, innovating, and designing a prototype part. But when they decide they want a working prototype, they want it immediately (usually because they are going to iterate). Starting out, it was just Jay and some coders, so Jay acted as everything from salesman to customer service to Guy Friday—he did what it took to attract customers, keep customers, and keep the lights on.
Jay and Pete Worrell of Bigelow first met in Los Angeles at Abundance 360, an entrepreneur business owner’s group of which they are both members. As they traded business cards, they agreed to meet sometime back on the east coast. In the interim, Jay read Enterprise Value (McGraw-Hill) and had some aha moments realizing other EOMs had questions like the ones he had. Jay quickly decided the time was right to create a small market for the company and select the best new majority owner.
“We couldn’t have done it without Bigelow. The breadth and experience of the Bigelow team was indispensable—if we didn’t have your skill set, I don’t think the deal would have gotten done. Thank you for keeping us sane.” Jay Jacobs, Founder and CEO Rapid Manufacturing Group
“Without your coaching and guidance, this deal would never have happened. What a great fit with Proto Labs!” Tom Pursch, Chief Operating Officer Rapid Manufacturing Group
Being a high-performing Entrepreneur Owner-Manager requires a very different skill set, experience, and capabilities than capturing the Enterprise Value that an Entrepreneur Owner-Manager has worked so hard to build. Developing the go-forward plan, showcasing some non-Jay organizational leadership, and illuminating what made RAPID unique (its Intellectual Property) in such a way that didn’t jeopardize its secret sauce, Bigelow operationalized a highly experienced engagement team that understood “staged disclosure”: what needed to be revealed or explained at what time. Bigelow worked with RAPID’s management team to create the positioning needed to attract not just one, but several qualified, interested, and more important, potentially great fit investor candidates.
For Jay, bringing focus and passion was energizing at the start-up stage more so than in this mature stage. The right answer was to find a next majority owner that would not only shepherd the business into its next configuration, but also be a steward to the business’ past.
Ultimately, Proto Labs (NYSE:PRTL) met all of Jay’s must-have characteristics for that best new owner. The Enterprise Value ultimately paid was a high-water mark in the industry. His management team continued to run RAPID with some synergistic benefits. He now had a liquidity transaction and was set free from his role at RAPID, allowing him to focus on his new venture Paperless Parts.