Back in 2003, Vancouver-based Nautilus seemed to be on a steady path.
Brian Cook, had founded Bowflex in 1986 and grown it to into Nautilus, a publicly traded business that at the time employed more than 1,200 people. Now Cook was ready to retire. But Gregg Hammann, Cook’s hand-picked successor, brought big ambitions that never seemed to align with economic reality.
Manufacturing problems began to plague the company, with production glitches keeping products from consumers during critical sales periods. Profits fell, and despite some concerns about Nautilus’ cash levels, the company decided to buy a Chinese manufacturer so it could have more control over production.
Before Hammann could complete that transaction, a group of outsiders swooped in. Sherborne Investors bought a quarter of Nautilus’ shares and gained enough seats on the company’s board to force Hammann out. In 2007, Nautilus appointed Robert Falcone as interim CEO. In 2008, Sherborne’s founder, Edward Bramson, stepped in as the new executive.
Under Bramson’s watch, Nautilus slashed and sold in an attempt to turn the business around. He cut staffing from more than 1,200 to the roughly 340 employees at the business today. The company also sold off several product lines, including Pearl Izumi, and cancelled its purchase of the Chinese manufacturer. Nautilus remained publicly traded, but its stock value plummeted. Shares that had sold for more than $18 in early 2007 traded for less than $4 a year later.
