News

Thiel Audio Acquired by Nashville-based Private Equity Firm

John Atkinson  |  Nov 29, 2012

Thiel co-founders the late Jim Thiel (left) and Kathy Gornik (right) at the 2009 CES

We received the following press release last night. No more information was available and there was no word when this story was first posted on whether or not Thiel cofounder Kathy Gornik will remain with the company. Since then, however, CEPro.com has reported that Kathy and her daughter Dawn Cloyd, who was director of international sales, will both leave Thiel. Why the sale? Our suspicion is that while Thiel remains a great brand, it is too small a company, with no access to a significant source of capital, to be able to compete effectively in today's market.

Press Release: Thiel Audio, winner of over 60 prestigious awards for loudspeaker design and performance since 1978, has announced that the company has been acquired by a private equity firm based in Nashville, TN. New Thiel CEO Bill Thomas has indicated that the brand focus will continue to be on premium quality phase and time coherent loudspeakers, with long time Thiel employees Brad Paulsen, Gary Dayton, Lana Ruth and Rob Gillum all remaining onboard.

"We identified Thiel as a brand with an unmatched heritage in performance audio and it is our intent to invest in the company's infrastructure, strengthening the engineering department first and foremost," stated Thomas. Thiel has just launched the CS2.7 and the CS1.7 is in the final stages of development, rounding out the CS series with the award-winning CS3.7. "We can improve efficiencies here at Thiel in the product development and manufacturing stages, shortening the time to delivery for new products with zero compromise in product quality," added Thomas.

New product categories will also be explored for Thiel; with an expansion of the architectural series an immediate priority serving to further establish the brand as a leading supplier of premium distributed audio solutions. "We will invest considerable time and energy speaking to our distribution channels worldwide, gathering data about the marketplace from those who know it best before making any decisions about new product direction," Thomas stated. Resources will also be allocated to improving the company's website and other marketing initiatives.

In addition to Paulsen, Dayton, Ruth and Gillum remaining with Thiel, the entire factory team has been retained and the existing sales channel—comprised of reps and dealers—will remain in place. The R&D and manufacturing facility in Lexington, KY will continue to operate at full capacity as well—there are no plans to close Thiel's renowned Lexington, KY operation . . .

Thiel Audio Products Company of Lexington, Kentucky is a privately-held, engineering driven organization that performs research, design, and manufacturing of loudspeakers for the highest quality music and video sound reproduction in the home. The beauty of Thiel loudspeakers can be traced back to design concepts born from powerfully innovative thinking. For over 30 years, Thiel has woven a nearly magical synergy between engineering brilliance and an unfailing passion to create the most lifelike reproduction of recorded music. Along this quest for sonic perfection, Thiel’s customers, music aficionados, and audio press from around the world have lauded Thiel’s loudspeaker designs as some of the best ever conceived. Thiel manufactures ten individual products ranging in price from $1090 each to $14,700 per pair.

COMMENTS
mrplankton2u's picture
Submitted by mrplankton2u on November 29, 2012 - 5:36am

I hope they can keep up the good fight and keep their facilities out of China. Good company. Good people. Good products.

kevon27's picture
Submitted by kevon27 on November 29, 2012 - 6:11am

And how many Chinese people you've offened with that comment? I would like to know how the Chinese readers feel when their country gets bashed time and time again.

mrplankton2u's picture
Submitted by mrplankton2u on November 29, 2012 - 6:21am

Ever been to China? Ever see a video of all the happy faces of Taiwanese and Chinese workers at a driver factory gluing dust caps on an assembly line? I think the average Chinese citizen is more concerned with where his next meal is coming from than what US citizens think about outsourcing entire industries to China. I give Thiel a lot of credit for keeping most of its operations and IP inhouse. Too many companies like JBL/Harman have taken operations overseas (to allegedly be able to compete - more likely to fatten the profit margin but thats another story altogether) and have been burned - finding copy cat products popping up out of factories a few miles down the road - with no patent or copyright protection from the host country. Btw, JBL's entire production facilities are now outside of the US - mainly South America. Contrary to what the fictional character (ironically, he's not that fictional) Gordon Gecko said - "greed is (NOT ALWAYS) good".

greatsound's picture
Submitted by greatsound on November 30, 2012 - 5:48pm

With some money, I see this small company moving ahead.  An investment in Jim Thiel's engineering philiosphy could move them into the 21st century.  A new model or 2 released every year that keeps the integrity of Thiel speakers might now be possible..  Wow!  Good luck!!

JohnnyR's picture
Submitted by JohnnyR on November 29, 2012 - 6:00am

"Our suspicion is that while Thiel remains a great brand, it is too small a company, with no access to a significant source of capital, to be able to compete effectively in today's market."

 

What has that got to do with how well a product Theil can produce? If they are already having good sales and a great reputation and are satisfied with their market share, then who cares if they can expand or not? All companys reach a maximum growth spread after a certain amount of time.Not everyone can be a WalMart I think they are "competing" just fine.

mrplankton2u's picture
Submitted by mrplankton2u on November 29, 2012 - 6:09am

It makes the vulture capitalists feel better/more important. No company should shy away from investors provided that whatever strings are attached (should there be any other than a basic return on investment) don't force the company to compromise on its core principles which in Thiel's case have been a strong committment to product improvement, value, and long term growth - as well as a stable, rewarding place of employment for its staff.  I wish them well and hope they don't go the way of Snell.

John Atkinson's picture
Submitted by John Atkinson on November 29, 2012 - 7:43am

Quote:
Quote:
While Thiel remains a great brand, it is too small a company, with no access to a significant source of capital, to be able to compete effectively in today's market.
What has that got to do with how well a product Theil can produce? If they are already having good sales and a great reputation and are satisfied with their market share, then who cares if they can expand or not?

A relatively small, closely held company like Thiel can only "grow out of its check book," ie, if it wants to undertake any major change or venture or make a major investment in in new plant or facilities, it has to seek outside capital. These days acquiring such capital may well result in an ownership change, as happened at Krell a few years back. This has nothing to do with the quality of the product.

John Atkinson

Editor, Stereophile

JohnnyR's picture
Submitted by JohnnyR on November 29, 2012 - 11:59am

Always wanting to GROW. They have to be reasonable and accept that they have a growth limit according to what they sell and who wants to buy it. Like I said, not eveyone can be a WalMart. Stick with your niche in the market and make a great product and don't screw yourself out of a living. This just smells of someone wanting to make a quick buck by cutting corners. I hope that isn't the case.

Lofty's picture
Submitted by Lofty on November 29, 2012 - 6:17am

Is Mitt Romney involved in this?

GeorgeHolland's picture
Submitted by GeorgeHolland on November 29, 2012 - 6:56am

Uh Oh

 

"We can improve efficiencies here at Thiel in the product development and manufacturing stages, shortening the time to delivery for new products with zero compromise in product quality," added Thomas.

Translation: Hire lower paid part time workers and slowly phase out the higher paid loyal workers.Cut or eliminate any benifits.Hire some new "hotshot" engineers fresh out of college with ZERO experience and make one of them the head engineer and pay him 1/3 of the current pay. Find excuses to get rid of the current staff and replace with low paid staff.Speed up the assembly lines and make a once great place to work a hell hole. Profits!!!!!!  Then the quailty takes a nose dive and no one wants Theil speakers and in 5 years they close the doors.

mrplankton2u's picture
Submitted by mrplankton2u on November 29, 2012 - 7:15am

Such a jaded view from you George.....LOL!

Well, perhaps we should give Kathy and Bill the benefit of the doubt first. They do have other examples to look at (like Snell) that hopefully will serve as lessons in which to avoid pitfalls. The "free trade" mantra that Ronnie gave us and George Senior used to call "voodoo economics" is not an easy paradigm to live under for small manufacturers. Thiel has so far resisted the urge to morph into a "boutique" brand and has stood toe to toe with much larger organizations for many years. I won't be too quick to sell them short. And that shouldn't come as much of a surprise since it takes an extreme eternal optimist to want to hold up the mirror to the audiophile industry as a warning of where things are heading. To that obvious charge, I have to plead guilty.

Lofty's picture
Submitted by Lofty on November 29, 2012 - 7:25am

Making a statement about keeping  the manufacture of Thiel products in the USA is not an offensive (racially pejorative) comment. Whether it be China, Malaysia or Mexico, I, as a US citizen, would hope  these jobs stay here in this country.  Is there anything racist or hurtful about that?

attilahun's picture
Submitted by attilahun on November 29, 2012 - 9:52am

Down with the man!

jrmandude's picture
Submitted by jrmandude on November 29, 2012 - 10:49am

If they could get little green men on Mars to make speakers this good for a fraction of the price, then I would gladly kiss the cheek of the capitalists that make it happen.  Growth is not necessary for survival, unless of course it is.  I for one don’t have the knowledge to judge, and regardless only choose to judge that they make fucking great speakers.

Paul Luscusk's picture
Submitted by Paul Luscusk on November 29, 2012 - 11:11am

I lived through the NHT AR. Recton  and Rockford nightmare.Production moved from Benica to off shore and the QC went to hell almost overnight. 

jmsent's picture
Submitted by jmsent on November 29, 2012 - 4:12pm

and no amount of investment will ever bring him back. Development that was painfully slow while he was alive turned to almost total stagnation after he died, and that had to be a serious drag on the company. The only question now is what will the buyers do with the company. Nobody will ever be able to live up to Jim's laser like focus on the tiniest of details to get his speakers to conform to his vision. He knew as much about driver design and system integration as anybody in the world, and was light years ahead of most speaker companies in this aspect alone. In many respects, he was as integral to Thiel as Steve Jobs was to Apple. Whatever the new owners do, it won't be a return to the old Thiel. That's gone forever.  I just hope they don't succomb to the usual "name selloff" strategy that seems to plague our industry of late. Thiel car audio, anyone?

kevon27's picture
Submitted by kevon27 on November 29, 2012 - 6:03pm

I can see it now.. Next ThanksGiving door buster at Costo.. Theil 5.1 (5000 watt) hometheater system for $600.

Regadude's picture
Submitted by Regadude on November 29, 2012 - 9:39pm

That HTIB would be great for Johnny and his buddies. It's dirt cheap. 

deckeda's picture
Submitted by deckeda on November 30, 2012 - 6:37am

Thiel is a premium audio brand. Not Costco, Best Buy!

Slap them down right next to the Polk and Klipsche and when the less-sensitive Thiels are revealed to not "play as loud" disconnect them. Silent display. Then RMA the leftovers back to Thiel and drop them.

Then Costco.

Amazon?

JohnnyR's picture
Submitted by JohnnyR on November 30, 2012 - 6:03am

........just keeps chugging along.

kevon27's picture
Submitted by kevon27 on November 30, 2012 - 8:33am

Hey bro.. don't put yourself down like that..People can be mean and it does not matter what you look like on the outside cause inside, You are beautiful... So keep chugging along with your head held hi..

jk

ppgr's picture
Submitted by ppgr on November 30, 2012 - 11:52am

The bets are on... ah well. 

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