In October 2015, a large company bought Jostens Inc., one of the most venerable names in Minnesota business. Two months later, an even larger company bought that company.
And Jostens — a maker of class rings, yearbooks, apparel and sports mementos, including the Heisman Trophy — was suddenly inside a portfolio of more than 30 brands, all aimed at the aisles of a big-box store rather than the halls of a high school.
“It was not the healthiest umbrella to be under,” said Chuck Mooty, who became Jostens’ chief executive in 2013.
Last year, Mooty engineered yet another sale, to a Los Angeles investment firm that has pumped millions into Jostens. And this month, he turned the day-to-day leadership over to a new chief executive, Michael Burgess, a veteran marketer at several consumer companies, most recently Life Time Inc. Mooty remains chairman.
It’s a turning point that executives and employees hope marks the end of two decades of turbulence after Bloomington-based Jostens was taken private by an investment firm in 1999. Starting around 2003, revenue and profits began shrinking.
The contraction continued for a time after the arrival of Mooty, who previously turned around some other well-known Minnesota-based companies: International Dairy Queen, Faribault Woolen Mill and Fairview Health Services.
Yet Jostens experienced revenue and profit growth in each of the last four years, Mooty said. The company doesn’t routinely disclose figures, though it said last year that 2017 revenue was $768 million.
“With Chuck and the team, the business truly stabilized and key product areas are growing,” Burgess said. “That provides a great platform for the next chapter of growth at Jostens.”
The company is one of Minnesota’s oldest, with a history that reaches back to an Owatonna jewelry and watch repair shop in 1897. Founder Otto Josten in 1900 started making emblems and awards for schools and began making rings in 1906. The company still has a sizable presence in Owatonna, with a production facility and offices just blocks from downtown.
A young high school football coach, Daniel Gainey, who joined the company as a ring salesman in 1922, built Jostens into a presence in the life of American teenagers. In the 1940s, Jostens started making diplomas for high schools and, in 1950, it launched a yearbook-production business. By the time Gainey retired in the late 1960s, Jostens was the nation’s leading maker of both keepsakes. The firm had $100 million in annual sales, about $700 million in today’s dollars.
The company’s next leader, William Lurton, presided for 20 years and drove the company into the greeting card, sportswear and travel businesses. To counter the decline in the school-memento business as baby boomers moved into adulthood in the late 1970s and 1980s, Lurton bought and operated more than 30 private schools across the country. Jostens exited that business, profitably, in 1987.
Around that same time, Jostens bought an educational technology firm and created a subsidiary, Jostens Learning, that provided teaching materials to schools. In the early 1990s, it even worked with Dell Computer to market Jostens-branded PCs for schools. But demographic and competitive challenges mounted, and executives in the years before taking Jostens private exited many of the business categories Lurton had entered.
For about a decade, Jostens was owned by a unit of Kohlberg Kravis Roberts & Co., the well-known New York investment firm. That firm hired Mooty in 2013, telling him to polish it up for an eventual sale. When Jarden Corp., the owner of a number of historic manufacturers including Coleman Co. and Rawlings, emerged to buy Jostens in 2015, Mooty thought the company would finally have backing to carve a path for the next decade or so.
But just weeks later, Jarden itself was purchased by Newell Rubbermaid, now Newell Brands. The firm owns office-supply brands like Sharpie and Elmer’s, outdoor-product brands like Marmot and cookware brands like Calphalon.
“It was a very different management team and approach to the business, a much bigger organization,” Mooty said. “When they started to have challenges within their businesses, they made the decision that they needed to divest some of their noncore entities.”
Last year, Mooty went hunting for another buyer and talked with Platinum Equity, one of the firms that he approached before Jarden bought Jostens. With more years of improving performance, Jostens had a stronger pitch for the Los Angeles-based investment firm. And with Newell eager to move on, a lower price was on the table. Platinum paid $1.3 billion for Jostens, about $200 million less than Jarden did.
“We at least had the track record on growth, which was obviously important in building credibility. But beyond that was the opportunity,” Mooty said, describing his pitch to potential buyers last year.
“The thing I would always note was this was a business that nobody had really invested in. We had tired owners or strained owners,” he said. “Our progress had been done by a team with a limited amount of additional capital to find new ways to grow.”
Platinum has since invested heavily in some of Jostens’ digital initiatives and in the development of a new line of class rings that are formed with 3-D printing technology. To be formally unveiled this week, the Class Band and Affinity Band lines have a sleeker profile and, created from molds formed by 3-D printing, are more customizable than traditional class rings.
The new design opens the door for Jostens to enter other segments of the jewelry market.
“The fact that we don’t have to rely on a room full of dies and tools gives us so much flexibility,” said Jeff Peterson, the company’s vice president of marketing. “We’ve had people who have wanted to design that ring for their weddings or as an anniversary ring.”
Burgess said the company also plans to expand its sports-uniform business and make a return to school photography, a business it exited years ago. He said he will assess other growth ideas from employees over the next few months.
One challenge the company faces is that schools, colleges and their students today are under considerably more strain than in previous generations. Schools face funding, testing and safety issues, while students face more pressure in and out of the classroom. As a result, some students don’t form the bonds with schools that their parents and grandparents did.
“The problem for our business is, if you don’t feel good about school, then why buy a yearbook or why buy a class ring that associates you with your school,” Mooty said.
He oversaw the expansion of the Jostens Renaissance service, which helps schoolteachers and principals build a sense of community. The company now produces free videos and curriculum for teachers and students to discuss societal issues and personal development.
“We focus on how do you get consumers inspired about their community and excited about celebrating their accomplishments,” Burgess said. “As long as we stay focused on that idea, and innovate around that, that’s how Jostens will keep being the market leader.”