“Acquisitions can be disruptive and the outcome unpredictable.”
This is a reality that QuinStreet Senior VP Alan Godfrey understands well. So in mid-July of 2020, when the performance-based marketing company announced the acquisition of Modernize, a home improvement services organization, he was determined to ensure a smooth transition — especially since the pandemic prevented employees from meeting the parent company’s executive team in person.
“The entire announcement process was done virtually without the benefit of in-person communication, which can be critical with such a significant change in company strategy,” Godfrey said.
Fortunately, the two businesses aren’t strangers to working in tandem. They have been doing so for more than a decade. As leader of a cross-functional team of 150 employees, Godfrey said that aligning long-term goals from the start has been key to making sure both parties feel comfortable in their new roles — many of whom now fall under Modernize Home Services as a QuinStreet-owned vertical.
Four months post-acquisition, the VP shares his goals for building new tools to support additional contractors. But for now, he’s taking a step back to appreciate how far they’ve come.
“We appropriately spent as much effort on the post-acquisition planning process as we did on the tactics of the transaction, and it’s paying off,” he said.
How did the Modernize acquisition come to be? What was the internal reaction?
Modernize and QuinStreet have been partnering in the home services industry for more than a decade, complementing each other’s homeowner demand and contractor networks when the need arose. For many years, QuinStreet recognized the market opportunity for connecting homeowners to home improvement contractors.
After selling several divisions in other verticals, QuinStreet decided it was time to double down in home services. In doing so, it made the largest acquisition in the history of the company.
Ironically, due to COVID-19, we completed the acquisition without ever meeting the QuinStreet executive team in person (which might be a first in tech M&A), so we didn’t have the immediate opportunity to build personal relationships. Because of such limitations, we emphasized an ongoing meeting cadence and a deliberate focus on inclusion across the company. As a secondary development, we quickly moved to more informal means of communication such as calls, texts and internal chats to accelerate decision-making and issue resolution. Over time, we also took the time to get to know each other via an occasional, informal, and of course virtual, happy hour.
While the Modernize team was surprised, especially given the timing, the compelling rationale for the acquisition and the plan to retain the vast majority of employees, as well as the Austin headquarters, served as a huge benefit.
What has been your role throughout the acquisition?
Since the acquisition, I have taken over the leadership role for Modernize Home Services, the newly branded, combined client vertical wholly owned by QuinStreet. My primary responsibility is to deliver the planned business targets (revenue and gross profit margin) to the company while leading a cross-functional team of more than 150 employees.
During the early days of the acquisition, I spent most of my time collaborating with other QuinStreet executives to align the resources needed to drive a successful integration between the existing home services vertical and Modernize. Specifically, we established a centralized project management office utilizing project management tool Wrike. We also aligned on the primary swimlanes of activity and target dates that would drive us toward the acquisition’s long-term goals.
Today, four and a half months into the process, I’m proud to say that we are exceeding our original plan.
We spent as much effort on the post-acquisition planning process as we did on the tactics of the transaction.’’
What preparation do you think paid off most? Why?
Given the disruptive nature of acquisitions and unpredictable outcomes, we kept our deal/diligence team limited to a small number of people at Modernize to minimize the distraction and overall impact on the business.
And fortunately, we had the benefit of working with an experienced M&A team at QuinStreet. We appropriately spent as much effort on the post-acquisition planning process as we did on the tactics of the transaction, and it’s paying off.
Where do you see the company six months and a year down the road?
Our six-month mission is to continue servicing our homeowners and contractors and offering more services, including bathroom and kitchen remodeling. We’re excited to combine efforts, build new tools for homeowners and support more contractors. And over the next six months, we will integrate our technology platforms, migrate clients to one standard system, and expand our sales and account management teams to accelerate the growth.