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John K. Lane: A Room with a View

John Lane © 2015 Eric Mull Photography, ericmull.com

John Lane is the CEO/managing director of Inglewood Associates LLC, a 10-person consulting firm in Mentor, Ohio. He is a former board member and former president of the TMA Ohio Chapter. He has nearly 40 years of financial, business, and technology experience, serving clients throughout the United States and in Shanghai, Sydney, and Taipei.

Lane served as interim CEO of American Roll Formed Products (ARF), a custom roll former located in Painesville, Ohio, and as a board member of Knotice Ltd. prior to its sale in 2014. He has served as an operating and liquidating receiver, has provided extensive turnaround services, and has acted as crisis management and financial advisor for debtors and creditors, all in a variety of industries. Lane also has served as damage expert for numerous litigation matters, directed fraud audits, negotiated joint ventures and the resolution of breaches of contract, and provided numerous business valuations, including several in connection with contentious proceedings. 

Prior to Inglewood, Lane was the managing director of The Revere Group-Cleveland, an IT and business consulting firm. He was also a partner at Price Waterhouse, where he worked for 19 years and provided negotiation strategies for a successful $275 million acquisition and actively participated in three IPOs, including that of OfficeMax, the largest retail IPO at the time. He also served in Price Waterhouse's Retail and Real Estate Specialty Practices.

Lane has a bachelor’s degree from the University of Notre Dame, is a CPA (non-practicing), and holds a Series 7 Securities License (inactive). He has served on and moderated a number of industry panels and has authored articles and been quoted in the media on a number of business topics.

Q: How did you gravitate into turnaround/restructuring work?

Lane: I started with Price Waterhouse. As an accountant, you’re auditing past financial statements. I got involved in some turnarounds and bankruptcies back then, and I grew to realize that I was getting tired of looking at life through a rearview mirror and really wanted to be in a situation where I could contribute to my clients’ future. I left Price Waterhouse about 20 years ago. Now, as a recovering accountant, if you will, I can work with companies and make a difference. I’ve certainly worked with and still work with healthy companies, but the need with troubled companies is so much greater. It’s what I get to do every day now and, frankly, there’s not much more rewarding than saving companies and saving jobs. That’s why I do it.

Q: Is it harder 
these days?

Lane: There’s no question. The turnaround world of today is very different than it was five years ago. I’m not even sure the word “turnaround” is appropriate as much these days. The main focus is in trying to position the assets for sale. If there’s a turnaround, it’s to try to make the entity attractive so you can take it to a sale. Most engagements end up either, through bankruptcy, in a 363 sale or a receivership sale. Unfortunately, sometimes you do have to liquidate the business.

Everything’s at a much faster pace than it used to be. You had the luxury, you had the runway, to restructure and reposition the company. Today, even though you might be positioning the company for a quick sale, you’re still ultimately saving the company. You’re still ultimately saving as many jobs as you can. It’s still rewarding all the same.

Q: What have been some of your most gratifying or favorite engagements along the way?

Lane: While I started off in Chicago, I’ve now probably spent about three-fourths of my life in Cleveland. Over the years, I’ve really become a big fan of Northeast Ohio, which leads to the favorite engagement. A number of years ago during the real estate bubble, I had a real estate developer who had some financial difficulties, like everyone else. Their lender was about to declare a default on one of their loans.

This was really a big issue for them because they were working on a very large project that they were co-developing with another developer. If they had gotten tagged with the default, they would not have been able to pursue that development, and they could have been finished in the real estate development area. 

We worked with the company and the lender, and developed a plan to keep the lender comfortable. We were able to keep the lender from declaring an official default on the loan and to help the two parties work out their differences. Ultimately, the company was able to complete that project that it was co-developing. That was a $750 million project called the East Bank Project, which is helping to transform downtown Cleveland. It was a blighted area and now EY’s headquarters is there and a couple of law firms are also headquartered there. They’re building quite a number of restaurants and apartments. So this whole area that was blighted is really becoming a gem.

Recently the client said that the project would have never even started but for the work that we did. So this engagement was nowhere near the biggest that we’ve had, but it’s certainly had the greatest impact on the community. So in that regard, I find it very gratifying.

Q: Do any others come 
to mind?

Lane: I had a receivership that involved a company for which I don’t think anyone gave much chance at all. The receivership ended up lasting longer than we would have liked, but the bottom line was that once we accomplished what we needed to accomplish, we were able to pay off all the creditors in full and return back to the owner a very large check. That was equally as rewarding and certainly changed a number of people’s lives. But it doesn’t quite have the impact of the other project I mentioned.

Q: Who inspires you professionally 
or personally?

Lane: I have to admit I look to a fictional character—and I’d like to emphasize, I’m referring to the original—Atticus Finch from To Kill a Mockingbird. That’s somebody you should model your life and work after. I mean you can’t go wrong with the higher moral path—doing the right thing and caring for and respecting others.

In the real world, I have tremendous respect for and am inspired by two individuals: one is my father, who is also named John Lane, and the other is my partner at Inglewood, John O’Brien. I guess I’d have to say they are my real-life Atticus Finches.

Q: How did you and John O’Brien become partners?

Lane: That’s an interesting situation because my dad was also a partner at Price Waterhouse. Many, many years ago, my dad was John O’Brien’s mentor. My dad was transferred to San Francisco, I came to Cleveland, and John O’Brien became my mentor at that point in time. He and I both left Price Waterhouse, and we went different ways. Then in 2002, I called him, looking for a new gig, and he said, “Hey, I’d like you to join me at Inglewood.” He said there were two conditions, and I asked, “What are those?”

He said, “One, you have to do most of the work, and two, you need to be the CEO.” I said, “I can deal with that.” I’ve known John now since I was a young kid and have great respect for him, as do most folks who know John O’Brien, as well for my dad.

Q: If you could start your career 
over again, would you do anything differently?

Lane: Going back to 1981, I was living in Australia. At that time no one knew that much about Australia. You couldn’t find Australian wines much in the United States. Very distinctly, at that time I remember giving a fleeting thought to importing Australian wines to the United States, but I didn’t pursue it. I think it’s pretty safe to say that I missed the boat on that one. It would have been a great opportunity.

But realistically, I really don’t have much that I would want to change. I’ve enjoyed and learned from all my experiences and developed long-term friendships at each of my stops. You try to make the best and right career decisions based on the information you have at the time. Bottom line, I think things worked out pretty OK for me. I’m good with the way it went—no major missteps, and if I made missteps, I learned from them, so they were beneficial.

Q: What advice would you have for someone who was new to the industry or was thinking about getting into the industry?

Lane: First of all, I think you need to be an advocate for your client, but you need to do so in a collaborative fashion with the other stakeholders. Certainly you need to do the right thing the first time and every time. You should surround yourself with outstanding individuals. 

One key thing, which took me a little while to learn, as hard as it may be, you have to try not to get too emotionally invested in your clients. Sometimes they listen, but sometimes they’ll just not listen to good advice. As the saying goes, you can lead a horse to water. That’s always a tough thing, when you give good advice and they just don’t take it.

My management philosophy is life’s too short. You can’t worry about the things you cannot change. You ought to do what makes you happy. Don’t defer things until tomorrow—a day that may never come. Those are all key things, but one of the last things I’d say is certainly get to know other service providers in the turnaround industry and joining TMA would, I think, be a very positive thing to do.

Q: What role has your TMA membership played in your career?

Lane: It’s played quite a number of roles, but one in particular is it’s allowed me to provide a higher level of service to my clients. Let me give you an example. I had one client where both the debtor’s and creditors’ attorneys, the banker, the other financial advisor, and myself just all happened to be on TMA Ohio’s board at the time. We all knew each other really well and knew that we could trust each other. As a result, there were little or no adversary moments. We got right to it, and focused on what we needed to do. The bottom line in that situation, we were able to bring the case to resolution much faster as a result.

Getting to know other folks in the turnaround industry is really important because you’re dealing with tough times, and knowing the other party on a personal level really helps you deal with them on a professional level. 

Q: Is it as important today as it was five years ago to develop those kinds of relationships through an organization like TMA?

Lane: I think it’s perhaps more important because the world has changed for turnarounds. Things have to go faster. There’s less patience. You need to get to it without a lot of preliminaries. If you’re going into a situation where there’s going to be a 363 sale or a receivership sale and you need to get it done quickly, if you’re spending a lot of time trying to sort out the other party, there’s a problem. So knowing the folks on the other side and being able to get to a quick resolution is even more important.

Q: What are you passionate about outside the office? You had mentioned that you had bought 
some property?

Lane: I am passionate about my lakeside property that I purchased about 1½ years ago. When I was a kid, I spent many summers on Lake Michigan and spent a good bit of time with, and have 
a lot of fond memories, of my grandparents. Since then, I’ve always wanted to live near the water, but I 
never have until recently.

I was very happy when we were able to purchase a three-acre parcel. It’s on a point jutting out into Lake Erie, so we have a 180-degree view of the water. It’s just fantastic. There’s one house on the property for an office and another one is used for the home. As I sit right now, I can look out and see the lake. There are apple trees, cherry trees, and pear trees, and we just planted some peach trees. There’s a walled-in garden and a grape arbor. There’s also a large deck right next to the lake.

I’m finding myself doing all the things I never did when I lived in the suburbs, including running a lawn tractor, figuring out how to get my garden to grow, running a chainsaw, and so on. All new experiences, so I’m building hobbies for the future. You work in the yard on a hot day and at the end of it, you can go jump in the lake and cool off, or sit on the beach and have a beach fire at night. It’s just a fabulous place. The bottom line is this property will allow me to create memories for my grandchildren just like the great memories I have of my grandparents. It’s kind of a full circle.

Q: Does it get a little windy there during the winter?

Lane: In the winter time, depending on which way the wind is coming, the wind travels 50 to 100 miles across the frozen lake without hitting anything. The next thing it hits is you, so it can be, let me say, invigorating at times. But, sitting in the house and looking out, we can see approximately 60 square miles of water. In the wintertime, when the sun rises or sets and the ice turns pink or blue, it’s absolutely a fabulous sight. And of course we have wonderful sunsets during the warmer months as well.

Q: How long did it take you to find 
the place? How patient did you have to be?

Lane: I used all my analytical skills. Going back to my early days, I wanted something with a definite beach feel, so I started looking at the lakefront and saw that it was mostly break wall and cliffs. I used Google Earth to look about 30 miles to the west of Cleveland and went along the shoreline to about 30 miles east of Cleveland. I didn’t find many areas with a tremendous amount of beach until I got to our area. When I saw all the beach in this area, I said this is where I want to live.

I ended up contacting friends to find out who had relationships with people in this area and ultimately found someone who was potentially interested in selling the property but hadn’t really pushed it to the forefront yet. The property never went on the marketplace. I ended up negotiating with them. I ended up studying the property values in the area and put together a presentation of relative value for lakefront property. Ultimately I was able to convince him to sell the property at a price that I think both of us thought was reasonable. It took perhaps a year from inception to getting the deal done.

The other cool aspect of it is he also has property a few doors down from the property that he sold me. We’ve become great friends since. On more than a few occasions, he’s said, “It’s not very often that you get to pick your neighbors,” and he’s very happy with his decision. So it’s worked out very well. 

Q: Do your grandchildren live in 
the area?

Lane: I have two grandchildren, both boys. One is about 2½ and lives about 15 minutes away. My other grandson is almost three months and is not quite an hour away, on the west side of Cleveland. But we have space here so it’s nice that we can have the families visit with us and stay here. And even though they’re not at the level where they can fully appreciate it, we’ve had both grandkids sleep over, and there will be plenty more sleepovers to come.

Q: I foresee a lot of summers at Grandma and Grandpa’s in 
the future.

Lane: Absolutely!

Q: What might people who only know you in your professional capacity be most surprised to learn about you?

Lane: Probably the fact that during my misspent youth I was part of a group that tried to get foreign players here and into the NBA, one of whom was a very tall North Korean. He was 7 foot 8½ inches. At the time he was the tallest living human, going into the 1996 Guinness Book of Records. We got the North Koreans to agree to let him come. The biggest challenge was trying to get the U.S. State Department to let him in. There was and still is a Trading with the Enemy Act, so we had to set it up such that we didn’t violate any laws. The U.S. Treasury Department gave us a call to make sure we weren’t doing anything wrong. We had a group up in Canada handling the initial transactions. The player was being trained up there while we were waiting for the State Department’s decision.

It was really a fun time, a crazy time. For example, I took a photo of him once. I gave it to the Associated Press and the next thing I knew, the photo was all over the national news. I remember watching Peter Jennings and behind his head was the photo that I had taken.

Dealing with the State Department at the time was quite a challenge. In one of the more notable conversations I had with them, a guy from the State Department said to me that I should tell the North Koreans to stop pursuing nuclear weapons. I’m thinking, “Really? This is just basketball.” The North Koreans just want the guy to come and play here in the United States, so it was just kind of an absurd situation with our State Department. Ultimately, the State Department refused to let him in. Two years later, they changed their decision, but it was really too late. 

There was a columnist who wrote about the whole thing. He was talking to some folks in the State Department and the officials admitted that they’d made a mistake by not letting the guy in. If I understand it correctly, some folks in the State Department think that our relationship with North Korea might be different today had they let him in.

Q: How did you fall into 
doing that?

Lane: My brother-in-law had been looking at various foreign players, and he had identified that guy. He came to me—we were sharing an office at the time—and asked me if it was possible to get a North Korean into the United States. I said, “Are you crazy? There’s a Trading with the Enemy Act. It’s against the law. You can’t do it.” 

What was really bizarre is that a day or two later I was talking to someone who said they knew someone who had some interaction with the North Korean government. I called my brother-in-law and said, “You won’t believe it, but I might have connections.” I was able to connect with the guy and work a deal such that we were able to get the North Koreans to approve it. Unfortunately, the more difficult side of it was the U.S. side.

Q: What items are at the top of your bucket list?

Lane: You know, I’ve never created a bucket list. I would hate to create a bucket list, risking disappointment that I couldn’t complete it. Let me just say that I’m truly happy with my today, my here and now. If I were to put something on a bucket list, it would probably be to have way more than my share of todays.  

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