FIEGEL: I fell into this business more than planned to be here. My education is in industrial engineering, and I found that I didn’t like that, so I was searching for something. Before that I was doing architectural lighting systems. I was designing nightclubs in the mid-1980s.
In the late 1980s my sister’s then-husband had a small local auction firm that I would help out from time to time, which became more full-time as I became more interested in the business. I realized I really liked the commercial and industrial part of the business, which his firm was not well-suited for. In 1996 I joined a national firm and things took off from there.
FIEGEL: The thing that I enjoy most about the auction business, and particularly what Blackbird does in the auction business, is that we rarely get bored with what we’re asked to work with. It’s not repetitive. I may see similar equipment over and over again because I’m regularly in manufacturing facilities. But week after week, it’s always different. One week, it’s metals. The next, it might be plastic. Then it’s on to food processing. Every single project, whether it’s an appraisal project or an auction project, is always different.
That diversity provides me with an extraordinary opportunity to learn and grow with every project. Over the course of my career, I’ve been in factories that make pretty much anything that you can see or think of or touch. I’ve appraised or sold the equipment that makes the stuff that we consume. Everything. I think that’s cool.
FIEGEL: It’s tough to say as they are always so unique. Since most of the auction work involves distressed situations, we have to be super-sensitive to the feelings of the principals involved, to the extent they are still around.
I remember a conversation with my father from way back, and he expressed some displeasure with me seeming to make a living from others’ misfortunes, and he did not approve of that. I was able to change his perspective, because I explained that I was not the cause of this person’s situation and had no responsibility for it. However, I did have a responsibility to recover as much as I could for this person, which, when done well, can make a big difference for these people. Redeploying useful equipment to end users keeps the assets we sell in the economy, generating revenue. This is a good thing too.
The most gratifying engagements are those where we have a sale that exceeds not only presale estimates but also actual purchase offers to buy a company as a going concern. A year ago, we sold the assets of a trucking company that had been in negotiations to be sold to an end user as a going concern. Things fell apart with this buyer, and we held the auction and almost doubled what they were about to sell their entire business for. Quite a win. Last month we had a similar outcome for a bank client, where the bank avoided taking any losses and the borrower has avoided having to file bankruptcy. Sometimes the sum of the parts equals more than the whole.
FIEGEL: In the case of the trucking company, the company had been bequeathed to five cousins. They weren’t business people. They all had their own careers. They had the business for many years, and it was a successful business. They paid a manager and at the end of the year, they got a dividend.
Along the way, there was some mismanagement, allegedly some theft, and the profits started to deteriorate. They also had some real property that might have had some questionable environmental issues. So, all these unsophisticated people were watching this business slowly unwind, and they got scared and tried to sell it. Some guy comes along and says, “I’ll buy it,” and it was appealing.
I came in on the advice of a consultant 1½ years before our auction sale and said, “I think we can get more than that in an auction sale.” At the end of the owners’ dealings with their potential buyer, it became clear that this guy was really trying to take advantage of this ownership group. They finally came to their senses and put the skids on the bulk sale, and contracted us to liquidate the assets.
As fate would have it, the market had actually picked up for the asset class they owned between my first visit and the time we conducted the sale. On my first visit, the oil patch was in trouble and some of this equipment was usable in that space, so prices for that equipment were depressed a little bit. When the oil patch picked up again, 18 months ago or whatever now, all of a sudden there was a huge demand for these trailers. We were getting incredible prices for these trailers.
Sometimes the stars need to align to get these results. We almost doubled what they were going to sign the deed for, so they were very happy with how it worked out. But you can’t predict those kinds of things. Sometimes the pendulum can swing the other way, too.
FIEGEL: Starting Blackbird. I was quite settled in for 15 years with what started as Michael Fox Auctioneers and, through a series of mergers, had become GoIndustry-DoveBid at the time of my departure. I was secure and was making a comfortable living. Of my four kids, I had two daughters headed to college when I decided it was time to leave that comfort zone and open my own firm. I’ll never forget my eldest daughter Kelsey’s response when I told the family that I was quitting my job: “Are you kidding me? You have two kids heading to college this year, and you decided it’s a good time to quit your job and start a new company? What the hell are you thinking!”
The company was legally formed in the fourth quarter of 2010, and we opened the door for business January 1, 2011. I never looked back.
FIEGEL: In or around 2008, I was questioning how long I wanted to stay in this big corporate structure, particularly the one I was in. I started talking to some competitive peer companies about maybe changing hats, and I realized that the grass would certainly not be greener on the other side if I went to another company. So, I stuck where I was. Things were good. I worked with great people. We had great market presence, and we did business. It was a great career.
But, still burning behind the scenes was the fact that I wasn’t happy at some level. I was having trouble sleeping, and I’d wake up in the middle of the night thinking about this. I kept waking up with lyrics from this Beatles song in my head, “Blackbird singing in the dead of night.” This went on for a few weeks, and it’s the same song, Blackbird.
Then one night I sat up in bed, and I worked through the lyrics in my head, the lyrics I knew, “you were only waiting for this moment to arise.” I shook my wife Margaret and said, “Wake up. I’ve got it! I have to quit my job and I have to start a company. I’m going to start an auction company, and I’m going to call it Blackbird.” She looked at me and said, “That’s great. Can I go back to bed?”
Within the next several days, I settled on the name Blackbird Asset Services. That was it—I gave my notice, and I started a company. That’s literally how it happened, in late November 2010.
FIEGEL: Not one. I’ve never looked back. I had solid relationships in the business world and in my network, and those relationships trusted what I was doing. Right out of the gate, we had good appraisal business and good auction business. Are there slow times? Yes, but our business is cyclical.
FIEGEL: A huge one. I’ll never forget Hugh Larratt-Smith from Trimingham Inc., at a new-member roundtable, said that “TMA is like jet fuel for your business.” It’s so true. I have met so many friends and contacts along the way that I feel like I am 1 degree of separation from a personal introduction on so many deals. It’s amazing.
That said, you reap what you sow, and I am an advocate for being involved. Along with still serving on our chapter board of directors, I was fortunate enough to be elected and serve as chapter president for two years in 2006-2007. In 2008, I was elected to serve as chairman to the Presidents Council, which at the time, I believe, was in its second year. Chairing the Presidents Council came with a seat on the Executive Committee for TMA Global, which I recall fondly.
What advice do you have for someone who is new to the industry or is thinking about getting into the industry?
FIEGEL: Whatever you might pursue, I like to believe that the harder you work the luckier you get. This could be modernized to include working smarter, too, but I believe that when you focus intently on whatever you’re trying to accomplish, it’ll happen. Aligning yourself with the professionals who are members of TMA provides an instant network to the movers and shakers that make up the core of what happens in the turnaround world—distressed or not.
Get involved, volunteer on committees and boards, and meet people, but by all means, when you do these things, do the best job you possibly can. I recall a conversation with Sheila Smith from when she was at Deloitte (now with Gordon Brothers). We were talking about serving on TMA boards or committees, and she said something like, “Just imagine what your peers will think if you do an incredible job as a volunteer—they will have every reason to believe you’ll perform even better as a paid professional.”
Giving your all as a volunteer provides a window for what people can expect on professional projects. I believe this is true—and so is the opposite.
FIEGEL: CrossFit. Those in the cult already know. For those outside, it’s hard to explain. I started CrossFit in November 2013, and it quickly became a lifestyle change. I had always been active in running, doing triathlons and similar activities, but I also have a compromised disk in my spine. This was a problem and I realized I really needed to focus on my core strength to help make my back pain manageable.
Enter CrossFit. In its simplest definition CrossFit is “constantly varied high-intensity functional movement.” Nothing comes easy, especially at “the box”—”gym,” in CrossFit-speak. My wife Margaret started coming to CrossFit shortly after I did, and it has become our social fabric, our group of friends, and our lifestyle.
We’re both in the best shape of our entire lives and have a real firm perspective on our diet and fitness. We manage to work out a couple of times a week together, which is fantastic for our relationship. Last weekend, we were on a master’s team with another couple and competed in The Liberty Games, a competition sponsored by a local affiliate. We took third in our age division, and when considering the competition, I was quite surprised we made it there!
If you would have asked me when I was in my 40s if I would ever compete in an event like that, I would have laughed. I didn’t know about thrusters, burpees, doubles, and cleans then. Now it’s the vocabulary. I would encourage everyone to check out their local CrossFit affiliate. There is a modified or scaled version of everything we do that allows all fitness levels to become involved and find new levels of fitness.
FIEGEL: I guess it would have to be our backyard chickens. We live in a typical suburban neighborhood outside of Buffalo, New York, and have six hens in our small backyard. Around six years ago, we had a little egg hatching experience with our youngest son. After the hatch, we had these little chicks running around. We heard our town had recently passed legislation allowing backyard chickens, so rather than take them back to my friend’s farm, we decided to keep them.
People come over to the house, and they’re always checking out the chickens. The big question we always get is, “Do you eat them?” My answer is usually, “Well, no. They’re pets. They all have names, and if your pet has a name, you usually don’t eat it.”
FIEGEL: I guess it was my decision. My wife thought I was crazy. I said, “No, it’ll be fun.” She said, “It’s like puppies. They’re not always this cute.” “But then they grow up and give us eggs!” I argued. So, we got a little chicken coop, and we kept, I think, six out of that batch—we hatched 12 and kept six, I think. There’s always attrition—predators come in and get them. We’ve had hawk attacks and other attacks by owls, skunks, and racoons. They get in there at night and create a whole ruckus, and we have to go out and chase them out.
FIEGEL: We dispatched with the inexpensive coop, and I designed and built something that’s a little more suburban friendly, I’ll call it. You don’t want to have some pile of pallets screwed together for a chicken coop and have the neighbors complain. So, we built one out of redwood, and it’s 4 feet by 12 feet. It has wheels, so I move it 40 or 50 feet every few days so they have fresh grass. I open the door during the day, so the chickens have free run of the yard. The only time they’re in the coop is at night.
FIEGEL: I have a friend who built one of those. People get into it. There’s a whole subculture of urban chicken owners. There’s even a magazine called Backyard Poultry. You can really take it to extremes. People say, “You really save money on eggs.” Well, I’ll tell you what: my eggs are really expensive at the end of the day. But they’re really good. You can taste and feel the difference, and you know the food source, too, which is important to us.
We have learned a lot about urban farming since we got the chickens, and I’ll say the girls are a lot of fun and do provide a nice supply of fresh eggs. Your dog can’t do that trick.