Two former 43North companies will continue under new ownership after recent acquisitions.
Neither of the deals qualify as an major liquidity event along the lines of ACV Auctions’ initial public offering in March, but they do provide a clean slate for businesses that once had big plans in Buffalo ... and might reconnect here in the future.
HigherMe
HigherMe has been acquired by a group of private equity investors in a deal that allows its early investors and founders – including former CEO Rob Hunter – to move on from the business.
The acquisition gives HigherMe fuel to invest in growth, especially as its focus on helping restaurants find employees led to significant momentum following the early days of the Covid-19 pandemic, CEO Derek Williamson said. He said 43North will retain its equity stake in the company.
“Now we have strong financial backing, and it’s all about growth and continuing the momentum we’ve had in the last year,” said Williamson, who is staying on with the company. “We want to own the restaurant hiring space.”
43North invested in HigherMe through its initial $600,000 award in the 2016 competition and then again with a follow-up $400,000 investment a year later. But Hunter moved the company back to Toronto.
RELATED: This is what Rob Hunter said about his decision in 2018
Hunter stepped down from the CEO role about two years ago, according to his LinkedIn account.
Williamson said HigherMe’s nominal hub is in Toronto, but it has become a fully distributed workforce – he works out of New Hampshire, for instance. He said the deal gives HigherMe a “clean slate” to re-engage with 43North.
“This gives us an opportunity to talk to 43North again about how growth could come out of Buffalo,” he said. “They are a good potential partner who we haven’t spoken with in a long time, and we think they can help us as we bring strong momentum into a new chapter.”
Forsake
Forsake set up shop in Buffalo in early 2019 after winning a $500,000 award in the previous year’s 43North competition. The designer of outdoor footwear has been sold to Weyco Group Inc., joining its Portland, Oregon-based BOGS outdoor division.
RELATED: Check out Business First's 2019 Q&A with a Forsake co-founder
The aggregate purchase price was $2.5 million, plus contingent payments paid out annually over a period of five years, according to a Weyco news release announcing the deal.
Forsake co-founders Jake Anderson and Sam Barstow will join Weyco and continue to lead the Forsake business.
They believe Weyco’s “infrastructure, including its design, sourcing, distribution, and e-commerce capabilities, will accelerate our business to new heights,” Anderson said.
Forsake supporters and investors in Buffalo included Tony Manzella, Jack Greco, Pete Augustine and Zack Schneider.
43North comment
43North declined to discuss the financial logistics of the deals, citing its own policy, but it did issue a statement from President Colleen Heidinger.
"We'll be rooting for Forsake and HigherMe in these next phases of their startup journey," Heidinger said. "Having been in the game for seven years now and as our portfolio companies grow, exits are inevitable and often a great opportunity for further growth and development. Having an equity stake in our startups means that in many instances our ecosystem can continue to benefit from their success through such transitions."
