Re: [Harp-L] Harrison Harmonicas - a voice of experience

[Pic2318834@xxxxxxx]

Maybe he should go on the Shark Tank TV show
 
 
In a message dated 8/7/2011 1:35:23 P.M. Eastern Daylight Time,  
mlefree@xxxxxxxxxxxxxxxxxxxxxx writes:

Some  notes on the Harrison Harmonicas situation from someone who has 
been in a  position very much like that of Brad Harrison.

In the late 80's and  early 90's I had a small self-funded medical 
software company that had a  hot product. My company was too small to 
exploit the market so I sold out  to a larger company with far better 
resources to market the product. They  hired me for several years to 
transfer the technology and help in its  engineering and marketing 
efforts. It all ended well for all parties. The  existing and the new 
customers had better product and better service. The  new company had a 
fine product that was ready for a hungry built-in market  -- no R&D or 
initial product development required. My partners,  employees and I had a 
nice "exit vehicle" with tidy little sums in our  pockets to show for our 
years of sacrifice and hard work. And a couple of  us from the old 
company had high-level positions in the new company. This  sort of thing 
happens every day. I admit that it was a bit of a let-down  for me in the 
sense that I had pipe-dream hopes of becoming the Bill Gates  of medical 
software, but in the end everyone lived pretty happily ever  after.

So Brad may not be the new Matthias Hohner, but he did fine in  my book. 
There's one possibility about Harrison Harmonicas that hasn't  been 
mentioned. Every entrepreneur who starts a company has in mind an  "exit 
vehicle," or an end-point goal. Frequently that is selling out to  
another entity. In that respect, maybe we should be happy for  Brad.

Also, as someone said, the new company will very likely want to  hire 
Brad to help "transfer the technology." If this is the case and if  they 
are successful in making Brad's innovations work, everyone could come  
out happy. Brad would have a strong position in the new company (and a  
bit of a personal nest-egg for his future). The company would have an  
excellent product, ready for a market that is already primed and ready.  
Most likely one of the first things the new company would do is to  
fulfill all those back orders quickly and take other steps to repair  
their image (that was sullied out of the gate by HH's poor public  
relations).

When a company purchases another company, it is purely  a matter of 
dollars and cents, with the new company assuming all the old  company's 
resources and all of its liabilities. Those back orders added up  in the 
"plus" column for HH, appearing as part of their resources in the  deal. 
They are appealing to the new company because they are already  
"built-in" to the deal -- customers that they have "in the bag" so to  
speak. Of course, in assuming the HH debts, the new company would assume  
the liability of all those down- and pre-order payments. They fall into  
the "negative" column. Realistically, though, in comparison to the  
machinery, patents, innovations and other HH assets, those down- and  
pre-payments are likely pretty small. It would take a ton of pre-orders  
to pay for the 3-D CNC milling machines and specialized fixtures to make  
those ultra-special HH reeds.

This kind of resolution may not  happen over night and there may be a 
period of further uncertainty on the  part of those pre-order holders (of 
which I am not one). But I'm confident  that the new company has done 
their "due diligence" prior to making the  deal, and that such due 
diligence revealed all the gems as well as all the  warts at HH. 
Honestly, my bet is that the likelihood of the pre-orders  being filled 
is actually greater now than it would have been had Brad made  another 
choice as to the future of his company (other situations could  have 
easily been far less appealing to those owed down- or pre-payments).  So 
I urge patience and understanding on all sides. In the end, Brad  
probably did the best he could for you loyal "pre-customers" as well as  
himself.

At least that's the way I see  it.

Michelle