Doug Putman is a relatively unknown figure on Bay Street. The Globe recently revealed the identity of a retail turnaround artist and empire builder.
“I don’t buy anything if I don’t believe it has unlimited runway if run correctly. I’m an excellent buyer but a dreadful seller. I’ve never sold anything I’ve purchased.”- Putman, D.
Beginning with the purchase of a dozen music stores in 2014, Doug Putman has quickly built a vast retail empire. Doug is the driving force behind Ancaster, Ontario-based Putman Investments. He is a 37-year-old university dropout who owns hundreds of stores employing over 20,000 people with total sales in the billions of dollars. While he is now the world’s leading music retailer, Doug clearly sees himself as a generalist wheeler-dealer.
Much of Doug Putman’s fortune has been built in recent years by purchasing broken or underperforming companies and unloved brands at rock-bottom prices, often out of bankruptcy. For example, when he bought HMV UK, it was losing $9 million per month. Among Putman Investments’ notable holdings are:
- Canadian Sunrise Records
- The HMV chain in Canada and the United Kingdom
- The For Your Entertainment chain in the United States
- The DavidsTea chain, based in Montreal (rebranded as T.Kettle)
- In Canada, Toys “R” Us and Babies “R” Us
Doug Putman is a deal junkie who is always looking for new acquisitions. One reason for working on the Globe’s recent profile was to increase his dealflow. Due to his anonymity, he had to cold-email Fairfax Financial CEO Prem Watsa in order to acquire Toys “R” Us. Sad! Doug also owns a variety of businesses other than retail, such as restaurants and toy manufacturers.
The family business began with Everest Toys, which is now a nine-figure toy manufacturer and distributor. Doug’s parents, Karen and Bob, who also own a portion of Putman Investments, founded Everest. All three continue to collaborate closely. The Putmans also have a large real estate portfolio in the Hamilton area.
Putman admires Buffett and Munger, so you can expect the company to follow Berkshire principles. For example, he employs extremely low levels of debt. Putman Investments’ headquarters only has six direct employees. Jesse Gardner, a former Deloitte accountant who joined Sunrise Records as controller in 2017, is Doug’s right-hand man and the current CEO of Putman Investments. In addition, they are currently seeking a financial controller. Jesse Gardner here:
Putman believes that retail isn’t dead and that providing the right experiences and support will bring back customers. It’s like having Geoffrey the Giraffe at Toys “R” Us. Or hosting live music performances at his record stores.
His retail turnaround strategy entails quick intervention to stem losses over a sixty-day period, renegotiating leases with landlords, and attempting to negotiate better deals with suppliers. Then he capitalises on nostalgia and hot trends, such as collectibles, which are expected to grow 28% in Canada by 2021, according to NPD Group.
Doug’s first business was starting a fruit stand at the age of 16 and growing it to five locations. He eventually enrolled in Wilfrid Laurier’s business programme, but dropped out after his first year because he felt he wasn’t learning how to be an entrepreneur. He then began working in Everest Toys’ warehouse. His first major step towards forging his own path was the acquisition of Sunrise Records.
Doug has a number of growth initiatives after stabilising his most recent acquisitions, including expanding store count, establishing a European toy distribution company, and establishing a toy store chain in the United States. He is also open to new investment opportunities, stating:
“There are only a few industries in which we are not interested in investing. It all comes down to the opportunity. Obviously, we’ve done well in reviving some businesses. That’s a nice touch. We can buy very strong, healthy businesses, but we’re also willing to buy ones that are in a little bit of distress and require some assistance.”
His previous transactions have ranged between $10 and $20 million. Tony Gioia of Aird Berlis is his lawyer. Doug Putman can be reached at [email protected]
If you have something to sell him, you should know that as he has risen through the ranks, his hobbies include collecting luxury watches and Canadian art, including Group of Seven pieces and works by Saskatchewan landscape painter Ivan Eyre. He also collects vinyl records, of course.