Wednesday, July 11, 2007

And kudos to a big local

1-800 Contacts has taken the last step necessary to be acquired by Fenway Partners. It has split the ClearLab business and sold it to Japan's Menicon Co. and South Korea's Mi Gwang Contact Lens Co. ClearLab has been a cash hemorrhage for 1-800 Contacts since its acquisition, and Fenway wisely wanted no part of it. Instead of pretending that denial is just a river in Egypt, management admitted its mistake, fixed it, and moved on to a merger that may yet save the company (although it's an open question how quickly management would have made these moves without Fenway's encouragement).

Memo to Patrick Byrne: If your company is burning cash by the bale, spend your time working the problem instead of stumping the known universe claiming a conspiracy of speculators is out to ruin you. They aren't controlling your revenue; you control your revenue, and they're investing based on your unwillingness/inability to correct your company's revenue problems.

All business owners should note this well: If you have structural or other internal problems and do not correct them, someone will take advantage of that, and you'll be gone.


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