Thiel Acquired by Private Equity Firm


Just saw the news regarding Thiel's acquisition. I have an outsider (and mostly uninformed) opinion that the company was very much driven by Jim's vision and that after his passing, something had to happen to replace the energy and focus he had. When the owners could not find a suitable replacement with their own resources, they opted to sell the business. Any thoughts as to what happens now? I am concerned that we will not see future innovations in the same vein as the past (maybe the will move more downstream to grow market share). I also worry that they might lose expertise which could impact their ability to honor warranty work...
miles_trane
While I'm still relatively new to this hobby (7-10 years), it didn't take long to realize that the individual designers are the leaders in this industry. Everyone else follows. Professionally speaking, Jim's passing dealt a serious blow to Thiel Audio. Jim was Thiel Audio.

That said, I think it is a given that Thiel Audio will never be the same. I'm not suggesting the demise of the company, just suggesting that it has to be different because the leadership will be different.

The acquisition of Thiel by a PEG is a good thing; without it Thiel probably closes and locks the doors.

The question is, what direction will the leadership steer this company? Without a doubt, a positive return on investment will be the number one priority. I suppose, though, that the PEG could be managed/owned by audio enthusiasts with more money than sense.

Two comments made in the press release to keep in mind: new product categories and manufacturing efficiencies. Will the new categories take away resources from the current line of speakers? My guess is that the R&D facilities will be leveraged to introduce the new products. In theory, this will allow the company to sell at current prices with an increased margin or to sell at the same margin but at lower prices. Secondly, can they improve the efficiency of the manufacturing and keep the quality constant? Cabinet construction is a significant portion of speaker manufacturing. Do they try to "cut corners" by outsourcing?

Thiel Audio is a rarity these days as they are an American company which actually still designs and manufactures it's products. This PEG needs to have engineering, branding and manufacturing expertise if they want to be successful long term.

I too find it odd that the PEG only identified themselves as being from Nashville. Any information we can learn about the PEG history and expertise will probably be telling.

Thanks for the post. I will be watching closely.
Stringreen: Please explain why this was a dumb comment? There are countless examples of vulture capitalists, PEF and hedge funds taking over companies loading them down debt, and deleveraging them all the while extracting enormous management fees and not exaclty acting with the noblest of intentions. I'm not saying this is going to happen with Thiel but to dismiss something like this outright is a little foolhardy.
Could be a good thing, old companies need pushed sometimes. As a process engineer i can tell you faster does not always mean lower quality.

I am a big fan of the latest Thiel products (not so much their older stuff). My only complaint about Thiel is how slow they move getting new products out. It would be nice to see a successor to the 7.2.

I liked seeing the 2.7 come out, it is probably pretty good but not sure about the market. It is pricy for a cheap speaker and pretty close in price and size to the 3.7.
>>Thiel Audio is a rarity these days as they are an American company which actually still designs and manufactures it's products.<<

Nah, there are plenty of American companies designing and manufacturing high-end audio products. Here's just a few:

Conrad Johnson
Wilson Audio
Atma-Sphere
Shunyata
Lamm Industries
Ayre
 
... and a few more:
 
Magnepan
Tri-Planar
Graham Engineering
Magico
VPI Industries
Silent Running Audio
Walker Audio

Before he passed on, founder William Zane Johnson sold Audio Research Corporation to an Italian outfit, but to this day ARC continues to design and manufacture their components in America.