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Last Update: Monday June 21, 2021

Key Idea: Give Strong Leaders Room to Breath

Michael Kowalsky is President of Medallion Funding. He takes care of customers like Guy Roberts who owns taxis and manages them for other owners.

Key Question:


Let good people with great ideas act on them.  Andy has bought 15 companies and has operations now in Minneapolis, Hartford, New Orleans, and, of course, New York City, where it all began.

This is an example of how Andy's dad has given Andy room to breathe.  Going public and using the money to buy similar companies was Andy's idea.  In turn, other leaders at Medallion are given plenty of support to try new ideas.

Q: How does a company successfully fold a new acquisition into the corporate whole?

Acquisitions are an outstanding way to accelerate a company's growth and have certainly worked well for Medallion. Medallion buys successful companies with at least a five year track record in a complementing business. They insist on long term employment contracts and permit some duplication in administrative effort rather than disrupting the business of the acquisition target.

This approach has worked well for them as it creates a "business as usual" environment for "new" Medallion employees and customers. In other instances, it may be necessary to implement more standardized policies and procedures, particularly in the area of financial and management reporting, in order to facilitate the consolidation of reporting necessary for executive oversight and to meet the stakeholder reporting responsibilities of the consolidated entity. If change is necessary, it should be kept to an absolute minimum, be communicated clearly, and implemented slowly.

If you are implementing an acquisition strategy, remember that the acquisition target's most valuable assets are its customer relationships and its employees. Disturbing either will have an immediate negative impact on the valuation of the target. As you evaluate potential acquisitions, be mindful of what will occur after the acquisition, and how this will affect the target's performance.

Think about it

What person on your payroll should you promote?  What company should you buy? 

Clip from: Medallion Financial

New York City:  Meet Andy Murstein.   He is the grandson of the founder of a taxi business.   Andy has transformed that business to be a bank for immigrants, minorities, and women.

Andy's grandfather began as an immigrant taxi driver.  By the time Andy's dad joined the firm, they had a fleet.  They then began financing the acquisition of taxi medallions for new immigrants.  They became a Small Business Investment Company (SBIC) and now, after an IPO and subsequent rounds, Andy is buying up finance companies.  Within just three generations, this family business will have become a billion dollar business!

Medallion Financial has become a large SBIC quickly because they were already  making loans to immigrants and minorities to buy their taxi's medallion.  Andy is doing exactly what his grandfather suggested: "Stick to your niche and you'll get rich."

National Association

You can find an SBIC near you.   Listings are within the website of the Small Business Investor Alliance.

Medallion Financial Corp.

Andy Murstein, CEO

437 Madison Avenue
New York, NY 10022

Visit our web site:

Office: 212-328-2100

Business Classification:
Financial Services

Year Founded: 1937

Give Strong Leaders Room to Breath

HATTIE: Okay. When you do a merger, I think it takes a lot of forethought and strategy. How did you merge all these 15 companies?

ANDY: That's a good point. We're not naive enough to think that we could do other people's jobs and businesses better than they can. When we bought this group out of Minneapolis, Medallion Capital, they'd been doing mezzanine lending for 30 years. Yes there was some duplication of services, but that's meaningless in the long run. You really want people that know what they're doing. Again, they've had a great track record. Not only do you want them and you make them sign long-term employment contracts, you want to know that they're just not taking the money and running but they want to be part of your future also.

HATTIE: Okay. When I come to you as a taxi driver and explain to you my vision, do you make me produce any numbers or do you just -- one of your loan officers follows me around for a few days?

ANDY: That's a good point. Banks for example have a very rigid standards. They're going to want to look at the three-year financials, they're going to want to look at projections. We'll ask for that, but if you don't have it we'll help you do it.


ANDY: We go to small businesses throughout the country that don't have access to banks, whether it's they've only been around for a couple of years, they don't have a long track record. But we believe that looking into a person's eyes you can't judge the character and their hard work and ethics. And for example in the taxi industry, we lent over $1 billion and have zero losses. We've never lost a dime in any loan we've made in the history of the company.

GUY ROBERTS: I've got the return that you asked me for.

MICHAEL KOWALSKY: Very good, so we'll be able to work on the deal.

HATTIE: (Voiceover) Michael Kowalsky is President of Medallion Funding. He takes care of customers like Guy Roberts who owns or manages nearly 100 Medallions. The two have worked together since 1983. GUY: Let's go in the office. I was driving a taxi to get by. I started in 1979, I probably stopped driving about 1986. You know, by the time I built up a substantial fleet. I mean all the cars belong to me, but not all the licenses. The licenses are from Medallion's.

HATTIE: What's the challenge of working with all these wonderful internationals?

GUY: Well for one thing, I deal with a lot of French-speaking West Africans, and I was born in France. So it's kind of good to practice my French, and I get to speak French every day. My manager, Sonny, he's from Pakistan, so he can speak in their own language to the drivers from that part of the world. My dispatcher's from Bangladesh. A lot of my crew here is African or from the Caribbean. My secretary speaks Spanish. So we cover a lot of languages. It's kind of interesting because it's kind of an international community, and it's amazing that on the other side of the world all these people, are you know, going after each other and here everybody gets along just fine.

HATTIE: (Voiceover) Marie took us across the street from Medallion Financial to have lunch at Deli On Madison -- which is owed by Joe Cho, one of her customers. We learned that Korean-Americans in New City invented this type of eating establishment. It is a hybrid with deli items, hot foods, yogurt, salad bar, whole fruit, and juices. Financing this type of business has become a new niche for Medallion.

MARIE: Building a rapport with our people is so important. Becoming their friend. We don't treat our borrowers like, 'So what.' And I always tell my borrower, you're not a number. Your account number is not important to me. I want to know that you're Mr. Jones or Mr. Smith. And when you call here, I don't care about your account number. I just want your name, I look it up on the system and I know how you're performing and we go from there. We want everyone to be happy, Hattie.

MARIE: Good morning, how are you? Good to see you.

HATTIE: (Voiceover) Marie is always delighted to see her customers.

MARIE: Can I help you?

Jean Claude Millien: Yes, I just came today to bring a payment.

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