Kelly Grindle took over in January as CEO of Hatteras Yachts, a builder of convertible sportfishing and luxury motoryachts from 45 to 100 feet.
Before joining the company, which is owned by Philadelphia-based private equity firm Versa Capital Management, Grindle was president of outdoor products at Vista Outdoor in Overland Park, Kan. — a $2.3 billion designer, manufacturer and marketer of consumer products in the outdoor sports and recreation markets.
Hatteras, which Brunswick Corp. sold to Versa Capital Management in 2013, grew 37 percent in dollars and increased its backlog by 49 percent last year. “We have a great foundation to build on here,” Grindle said at Yachts Miami Beach in February. “We’re going to continue to grow and lead this industry. I enjoy rolling up my sleeves and being involved with customers.”
Attendees at that February show had the opportunity to take a virtual-reality tour of the M90 Panacera (at the time dubbed the Hatteras 90 Motor Yacht), which is scheduled to debut in November at the Fort Lauderdale International Boat Show.
We caught up with Grindle to ask about his months at Hatteras and discuss what the builder has learned through the recession and the subsequent sale.
Q Can you start by giving us your background? First, on a personal level, where did you grow up? Do you have a background on and around the water?
A My family moved around quite a bit when I was young, but I generally grew up in the Midwest. As a family we spent a lot of time on the water — fishing, skiing and boating. I have great memories as a kid fishing with my dad and brothers.
Q Can you give us your professional background? I know you have experience in the marine industry.
A I attended Indiana University, where I received a degree in finance from the Kelley School of Business. I started my career in financial roles at S.C. Johnson & Son, a large consumer products company in Wisconsin. From there, I went on to work directly for the Johnson family before moving to Johnson Outdoors. I had decided early in my career that I wanted an opportunity to run a business, and it was at Johnson Outdoors that I got my shot, as the head of their marine electronics business. This was a dream job for me — running a business with great brands, full of incredible people, in the fishing/marine industry. When I started, the business was relatively small and consisted primarily of Minn Kota trolling motors, but we dramatically grew the trolling motor business and acquired and grew other brands, like Humminbird electronics, Cannon downriggers and Lakemaster cartography. While running the marine electronics business at Johnson Outdoors, I also took on the responsibility for the watercraft business, which included Old Towne Canoe and Ocean Kayak, as well as the diving business, which included Scuba Pro, a full-line brand of diving equipment. I left Johnson to become the president of the outdoor products division of Vista Outdoors, a billion-dollarplus business made up of over 40 brands. Which brings us to Hatteras Yachts. I am thrilled to be a part of such an iconic brand and strong team, with a side benefit of getting the chance every now and then to experience fishing from the best boats made, period.
Q When we spoke in last winter, you’d just come on board as the new Hatteras president. Can you discuss your goals then and now, what you’ve accomplished and where you see the company heading?
A I see great growth opportunity for Hatteras Yachts, which will be driven by new products and building even stronger engagement between our customers and the Hatteras brand and organization. We have developed a five-year new product plan and are making excellent progress against this plan. We are particularly excited about our new M90 Panacera, which will debut at the Fort Lauderdale International Boat Show. We have also recently announced upgrades to and the renaming of our 70 Motor Yacht to the M75 Panacera, [and] more is coming. We have also made improvements to our yacht-building process and service as we strive to ensure that every interaction with a customer, from signing to building and delivery to service, exceeds their expectation and builds their trust in our brand. We have also launched Hatteras Club Experience, which is a series of exclusive customer events throughout the year.
Q Can you tell us more about that? I know several companies are using events to keep customers engaged with the lifestyle and the products.
A The first event takes place in New Bern, N.C., on Sept. 15 and 16 and provides customers opportunities to interact with 25 of our vendors, tour the factory, partake in food and drink crafted by chef Vivian Howard from the hit PBS series “A Chef’s Life” and sea-trial yachts from a broad range of our product line, including the new M90 Panacera.
Q Also in Miami, we’d discussed HattCON, a ship management system that integrates a yacht’s navigation and the vessel’s monitoring and automation systems, designed to make ownership easier. Can you talk about how that is developing?
A HattCON is on our new M90 Panacera and is functioning flawlessly. It is standard equipment on the M90 Panacera and a second series of HattCON will be standard on the M75 Panacera. We are excited about this new development in total ship management, which seamlessly integrates navigation, vessel monitoring and automation functions. HattCON has generated significant customer interest.
Q Hatteras has been doing some innovative things in terms of virtual reality. Can you tell readers about that and how that is progressing?
A With the significant time and cost of developing a new yacht, VR can be used to visualize a space early in the development. This is not only be a great selling tool, but also a development tool, as it can effectively serve as a means of quick prototyping early in the development process.
Q Can you talk about recently launched models? I know the 90 is slated to debut in Fort Lauderdale. Can you also discuss the Fort Lauderdale show and what else Hatteras has planned for that?
A Hatteras Club members will get a sneak preview of the new Hatteras M90 Panacera at our Hatteras Club Experience at our facility in New Bern in September, but the yacht’s official world debut will take place at the Fort Lauderdale International Boat Show at the Hatteras Yachts in-water yacht display in the show’s Bahia Mar Yachting Center venue, C-Dock 335A-E. We also will launch our GT 45X with Flybridge Option model at the show — a great new version of our popular 45 Express with the optional flybridge helm station, in addition to the lower helm. We are still firming up the list of other Hatteras models that will be in Fort Lauderdale, but they will represent our full range of convertibles and motoryachts.
Q Hatteras, like many builders postrecession, has been through some transitions. What has been learned, and how has the company improved as a result of some of those changes?
A You are correct. Hatteras has been through transitions, as have many builders post-recession. While change can be difficult, market challenges force us to look at new processes, new tools, new structures, new go-to-market strategies, and new methods which ultimately can serve to make the organization better, the business stronger and the brand bigger. The most fundamental result is forcing us to consistently challenge ourselves to find a way to do what we do better — to initiate change rather than react to it.
Q How is the company doing? What are some of the models that are resonating with consumers?
A The company is on track for a good year. We will show good growth, but of course I have higher expectations. The first half of the year has been marked by strong interest and results in the sportfishing side of our business. This high level of interest in our sportfishing yachts continues, but recently we have also seen a significant jump in the motoryacht side of our business as we complete the first hull and ready the debut of our new M90 Panacera and launch the upgraded M75 Panacera.
Q Where do you think the market is heading? Where do you think consumers are today? Do you think the strength in the industry will continue, and if so, for how long?
A Historically, the marine industry in general has seen 5- to 7-year cycles. It’s been about nine years since the last downturn, so perhaps history would say we are due. However, the recovery has been different this time — basically slow and steady. I anticipate this will continue for a while. Also, our segment does not necessarily react the same as other segments in a general downturn. Regardless of the market, we intend to grow. There is still plenty of share to take by leveraging innovation and a strong brand.