If Michael Frieze has an underlying philosophy to how he manages the wide-ranging and divergent business that is Gordon Brothers Group, it probably comes down to his radical insistence on running the 106-year-old company like a startup business.

The Boston-headquartered investment firm got its start in 1903 as a jewelry liquidator and has grown into a diverse business conglomerate that manages separate asset recovery and operations, appraisals and operations and investment management businesses. Gordon Brothers now runs ten separate divisions, each one widely divergent from the company's initial focus of liquidating assets. Frieze has told his employees on several occasions that he aims to start a new business every year.

What becomes of all this innovation? There is an aphorism that a person can be a "Jack of all trades, master of none." Certainly, the same assessment can be made of an investment firm as well. In fact, the debate between generalists and specialists has been ongoing in the private equity space for years, as the specialists will argue that the former can't truly own any one market.

If there is any credence to this view, what does that say about a retail liquidator that is also a merchant bank, an appraiser, a lender and real estate firm?

Based on Gordon Brothers' activity over the past few years, not to mention its endurance over the last 106, it's probably safe to say the firm is adept at changing hats. Of course, there's a component to what Gordon Brothers does that's akin to six degrees of separation, as a common thread - be it retail, valuation expertise, or an ability to quickly monetize assets - weaves its way through each of Gordon Brothers' business segments.

As it turns out, from an M&A perspective, Gordon Brothers' history and skillset position the firm perfectly for today's environment, as evidenced by recent purchases of Polaroid out of bankruptcy or its deal to acquire the IP assets of Linens 'N Things. Gordon Brothers is also in the enviable position of having debt capital. To date, the firm has surpassed $300 million in funded commitments.

Even competitors will credit Frieze with having developed a masterful team of industry professionals who steer the company's direction into each new area. Jeffrey Hecktman, chairman and chief executive of The Hilco Organization, credits the "team of executives" as being among the firm's strengths.

Those who have worked with Frieze say the development of Gordon's executive team is a result of his collaborative approach. Matthew Kahn, a principal at Gordon Brothers Group, describes that employees quickly learn it isn't always best too agree with the chief executive. During the firm's brainstorming sessions, he puts anyone to the test, from the most junior employee to those who join him in the C suite, and anyone who agrees with Frieze on a particular issue "is put to the test" just as much as someone completely at odds with his thinking. "It makes everyone feel like they are part of the process, and it makes everyone feel that they are empowered, and it makes them all do their homework," Kahn says.

This collaborative process isn't confined to Gordon Brothers' offices. The firm's approach to dealmaking is also based on finding venture partners who possess a unique skillset and knowledge the firm itself may not have. The joint ventures with Hilco are just one example of this strategy. Gordon Brothers brought the retail background, Hilco was able to add expertise in brand development. Gary Kulp, co-president of Gordon Brothers' retail division, referred to Jamie Salter, chief executive of Hilco Consumer Capital, as a "brand visionary."

Frieze said his first project outside of the jewelry industry developed the same way. "A friend of mine came in and said, 'You've got to help me close my furrier shop.'"

"He would take not "no" for an answer, even though we insisted that we didn't know that business," Frieze recites. With the help of the original owner, Gordon Brothers closed the fur business, which opened the door for the firm to enter into retail liquidations.

The pattern of stepping into a new project, then seeing how it relates to other businesses has also been a theme for Gordon. If you believe the way Frieze tells it, many of the firm's projects were launched almost by accident. "I must admit that a lot of successes in life are because of luck, not because we're so smart," he says, quickly adding, "I think we're smart enough."

In 1996, Gordon Brothers founded GB Merchant Partners, its investment arm that can target private equity, structured finance, and secondary debt. Many of these ideas, says Kulp, start simply by Frieze asking, "What if we got into this business? What would this look like?"

To wit, Gordon Brothers' initial push into private equity took the form of one off deals, such its acquisition of Spencer Gifts, in 2003, or its investment in Andrew Marc, a year later. It wasn't until 2007 that the firm raised its first third-party fund, the 1903 Equity Fund, LP, corralling $320 million, $70 million more than the firm targeted. Last year, meanwhile, the firm jumped to the other side of the capital structure, raising a $250 million structured debt fund. While it seems opportunistic, Gordon Brothers actually launched the debt effort five years earlier.

Not every project has been as fortunate. In July 1999, Gordon Brothers launched two ambitious internet ventures, RetailExchange.com and SmartBargains.com. Neither endeavor achieved the financial results that were initially expected, although SmartBargains.com, which is still online today, can at least claim more success than the heavily funded dotcom peers Pets.com or Boo.com.

Despite the occasional setback, Malcolm Sherman, the firm's chairman, says Frieze has always successfully returned to the firm's core competency. "He really understands our magic sauce," which he says is a thorough understanding of "retail and inventory."

Although Gordon Brothers appears to have ventured into a host of unfamiliar businesses - mitigation, real estate, and asset-based lending, to name a few - Sherman says he has always been amazed by Frieze's ability to bring in managerial expertise to fill in the missing pieces of any new division to tie it back to the company's retail focus.

"Retail is in the DNA of the people and in the DNA of the company," he adds. "If DNA can be structured by anybody other than God, it has been structured by Michael."

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