Fluid Logic, LLC
Transaction Profile
Fluid Logic, Portland, OR, was 100% owned by Larry Lindland the Company’s founder. Explosive growth in a large market made it imperative for this small specialty chemical producer to find a solution to successfully launching a new industry disruptive process technology for CPM slurry.
Responsiveness
In the summer of 2005, Riverlake successfully completed the purchase/recapitalization of Fluid Logic LLC. Several months earlier, Riverlake was contacted by the Company’s founder, who had a successful prior investment relationship with Riverlake’s principals in 1993 through 1997 in a similar business and industry. In effect, the owner had developed a superior product and production process and was in the process of growing a similar business focused on larger end markets. Essentially, the founder had come to the end of his ability to capitalize the Company properly and was in need of a partner. Riverlake teamed with the owner to structure a transaction whereby Riverlake maintained control while the founder stayed deeply committed and would be rewarded when the business was ultimately sold to a larger buyer.
Vision
Riverlake saw the opportunity to team with a proven leader in an industry where it had met success in the past. Riverlake believed that the core process technology and the Company’s ability to produce products that were industry disruptive provided a compelling reason to invest. Riverlake believed that its ability to help properly capitalize the business combined with providing critical internal process and reporting disciplines would mesh well with the creative efforts of the founder.
Ingenuity
As with most smaller rapidly growing organizations, it is extremely important to maintain a balance between growth capital and cost controls. The one constant is strong leadership and a watchful eye toward utilization of precious resources in both capital and talent. Riverlake has effectively bridged the individual dynamics prevalent in a privately owned company with proper internal controls and corporate disciplines necessary to maintain consistent growth.
Creativity
Developing a tactical path to market in an industry dominated by large players can be a tricky process. Through a keen focus on productivity and process improvements the Company has established itself as flexible provider of solutions that, prior to Fluid Logic, are not attainable by other suppliers. Additionally, Fluid Logic, because of its very unique position of understanding and supplying multiple lower end markets, has developed a built-in recapture program that creates significant value-add to its end customers in dealing with waste.
Results
Since Riverlake’s involvement, Fluid Logic has grown revenues over 100% and is now in a position to supply some of the world’s most demanding electronic materials customers with colloidal silica products that have ultra clean purity and uniformity levels unachievable by the Company’s competition. Specifically, Riverlake, in conjunction with management, has initiated several value-add activities, including: transitioned business from pre-production to commercial production; developed complete internal reporting and controls processes; developed and initiated come-to-market and project prioritization systems; and instituted SPC systems.