In 2000, when Gary Erickson, founder and owner of Clif Bar and Co., told reps from Quaker Oats – the fourth largest consumer goods company in the world – that he needed to go for a walk before signing over his company for $120 million, they thought he was bluffing to secure a larger payout.
"He literally had his pen this close to the contract," recalls Sheryl O’Loughlin, outgoing CEO of the company, as she poises the tip of an ink pen a couple inches above a notepad at her desk. "The way he described it was that his hand started to shake. Something just didn’t feel right."
Erickson chewed over the life-changing dilemma as he walked the block surrounding his Berkeley office building. Did he honestly want to exchange an eight-year enterprise to produce and successfully market an appetizing assortment of energy bars and drinks for the life of an instant multimillionaire and all the attendant comforts it yields – mansions, shopping sprees, and exotic trips?
And how could the company founder not sell when the consensus among consultants, Erickson’s now ex-partner, and even some of his employees was that Clif Bar’s competitors would eat them alive if he didn’t? Deserting the Clif Bar empire before its fated downfall seemed to be the only logical move.
"Nestle had just bought PowerBar, which was really big at the time, and then Kraft bought Balance Bar," O’Loughlin explains. "So naturally there was a ton of pressure to sell, because we [supposedly] couldn’t make it on our own."
In spite of the risk or perhaps because of it, Erickson returned to his office with a new resolve and announced to the investment banker, lawyers, and his stunned partner that the deal was off. He then literally told them all to go home.
"I went from the darkest of dark to the highest of highs the moment I realized I didn’t have to sign that contract," marvels Erickson during a phone interview. The company founder – with his wife and partner, Kit Crawford – is resuming leadership of their company with just under 200 employees.
"I was more excited at that moment than probably any other moment of my life, aside from having children."
A year after ditching Quaker Oats at the altar, Erickson could identify another important reason why he did it. Although he and his partner were promised postacquisition roles in the company, as signing day neared it became clear that this was merely a typical sweet nothing often whispered in the midst of a seductive corporate takeover.
But once Quaker Oats unveiled its plan to move the Clif Bar operations to its offices in Chicago and told Erickson that his people in Berkeley would basically be out of their jobs, he got a whiff of the company’s true oats.
The decision invigorated Erickson and motivated him to define Clif Bar’s bottom line beyond its profits. He came up with what the company now refers to as the Five Aspirations: business, brand, planet, community, and people. This new mission galvanized the creators of Luna, Nectar, Mojo, and Builder’s bars to make 70 percent of each product organic and use biodiesel trucks between their bakery and destination centers.
On the community tip, Clif Bar donates approximately 1 percent of its net sales in the form of food, money, and volunteer time. Each employee volunteers at least 20 community service hours per year during paid work time, which can entail anything from assisting Habitat for Humanity in New Orleans to planting community gardens in Hunters Point.
Though a commitment to green practices and community service has boosted company morale, masseuses, salons, in-office rock climbing walls, personal trainers, and laundry facilities, among other staff perks, also serve to sustain Clif Bar’s people. How’s that for ulterior motives? (Angela J. Bass)
CLIF BAR AND CO.
1610 Fifth St., Berk.
1-800-254-3227