(the middle)

I recently sat with my father in his cigar room in our office building and asked him to tell me his story of becoming an auctioneer and how the Kruse Family got their start in the collector car industry. The following is a written narrative of that conversation.

Tiffany: Bob Jensen? Is he the guy from ITT?

Daniel: Yes. He was with ITT International and approached Dean about buying Kruse Auctions. He was the president of their auction services division if I remember correctly.

Tiffany: How many auctions was Kruse holding at this point?

Daniel: 20 or so annual auctions a year plus collections.

Tiffany: Do you remember how much ITT paid for Kruse?

Daniel: I am not sure. I know they covered the debt and I believe Dean got paid a yearly override, a percentage of the profits for 5 years, I believe. They stopped the rapid expansion and started making a profit.

Tiffany: Our family moves to Las Cruces, and you take on the associate pastor role. I assume being a pastor does provide much of an income.

Daniel: No. It was great for my spiritual development but not so great for our finances. There was not much of a marketplace in Las Cruces for auctions; not like in the Midwest where auctions are almost a way of life. Before I left Kruse, I had received a phone call from a Canadian company, Canam. They wanted me to work as a fee auctioneer at their equipment auctions. I told Dean I didn’t want to work for Canam for $500 a day. Instead of just saying no, he advised me to ask for what I wanted. I asked for $1,500 a day plus first-class travel and all expenses paid. To my amazement, they said yes. I worked for them during our short time in New Mexico as well as continuing to fee auctioneer for ITT Kruse.

Tiffany: We only lived there like what…9 months.

Daniel: Yes, it was around 9 months. During my time at Canam, I was approached by Nelson International in Tyler, Texas about coming on board as a full-time auctioneer and salesman. I spoke with Candy (his wife, my mother) and we decided moving Tyler was right for the family.

Tiffany: Nelson International was how you began your career in the oilfield auction business.

Daniel: Yes. I arrived at the office for my first day and I remember a person greeting me with car keys, a gas card, and a company credit card. I asked what the keys were for and was told my new company car. My first year with Nelson, I made well over $100,000. The industry was lacking good auctioneers.

Tiffany: Did Nelson allow you to continue working for Kruse?

Daniel: Yes, but I could no longer work for Canam as they were viewed as a competitor.

Tiffany: Selling oilfield equipment is very different from selling cars.

Daniel: It is. It is a much faster pace. The customer is more knowledgeable about the auction process and the products being purchased. Having the experience of selling heavy equipment had been a good proving ground.

Tiffany: I loved living in Tyler. How long were we there?

Daniel: From around 1980 to 1984. It was a significant time for me. I met both Gary Bergman and Craig Cannon, both of whom would become partners in Superior Auctioneers & Marketing. I also met and began mentoring (as an auctioneer) Jim Richie, currently my partner in Superior Energy and now my lifelong best friend. Jack and Linda (Jines, aunt and uncle) moved to Tyler, and it was so much fun to be surrounded by family again. I refined my skills as an auctioneer and began to make a name for myself outside of the collector car industry.

Tiffany: But we left there. Why?

Daniel: One of the partners at Nelson International was not on the up and up. Gary, Craig, and I decided it was best to leave and form Superior Auctioneers & Marketing. We all had reputations of our own to protect in the oilfield industry. Gary and Craig both wanted to own small ranches, so they went looking around in South Texas near both Austin and San Antonio. Both found properties in Boerne, Texas which made San Antonio the best choice for our office headquarters.

Tiffany: ITT owned Kruse during this entire period, correct?

Daniel: They did. It wasn’t until 1986 that Kruse was bought back, and Mitchell (Kruse, Dean’s eldest son) was brought in to form Kruse International.

Tiffany: How did Dean end up buying Kruse back from ITT?

Daniel: ITT wanted to sell Kruse to another, larger auction company. Dean offered to buy it back, but they refused. Dean threatened to quit auctioneering and they threatened to sue. You know your Uncle Dean; he told them to sue. Someone within the ITT organization leaked to Dean that the bookkeeping was being mishandled and he used that information to countersue which resulted in ITT agreeing to sell the company back to Dean for a dollar…or at least that is how I remembered it. He had to agree to not to sell the company again for 3 years too, I think. Anyway, Dean got Kruse back and brought Mitchell in as president and they formed Kruse International.

Tiffany: Was there a big shift at Kruse when Mitchell came on board?

Daniel: Nothing tangible for me. I was just a fee auctioneer. He was great for Dean though! Mitchell was fantastic at running the company for a profit. A great businessman! The company started making $4-5 million a year during Mitchell’s tenure. I suppose the biggest change with Kruse being family run again, was the family was more involved. We started in earnest training the next generation. All three of you, girls (Tedra Kruse and Tara Puckett, my sisters), Matthew and John (Kruse, Dennis’ two eldest boys) and of course, Stuart (Kruse, Dean’s youngest son).

Tiffany: As your daughter, I remember this being a very busy time for you. Oilfield auctions every week and collector car auctions every weekend.

Daniel: It was very busy, yes but Dean and I were at the very top of our game as auctioneers. I think KI (Kruse International) was holding 30-40 auctions a year at this point. Sometimes, two in one weekend.

Tiffany: I remember one year, you and I being at Laguna Seca during the vintage races basically holding a KI auction on our own because Dean and Mitch were on the east coast somewhere with most of the staff and all the computers. I was in the office with one other person, doing it all by hand and you were the sole auctioneer with a solitary ringman. Personally, I never understood being your own competition.

How and when did you end up with that little collector in New Braunfels that eventually became Kruse Classics Car Productions?

Daniel: “ALL roads lead to Auburn”, Tiffany. Dean loved being the BIGGEST. He did not look at it like he was competing against himself but rather by holding both auctions, he was keeping someone else OUT of the market.

Tiffany: Okay, Dad.

Daniel: I started working for Ron Brooks in New Braunfels upon moving to San Antonio. He held two auctions a year annually, spring and fall. Ron rang me up when he heard I moved to the area and asked if I’d help. I obliged. When he was ready to retire, he asked if I had any interest in owning it. I could not pass up the opportunity, so I agreed. While in Auburn on a visit, I met Bruce Knox who was at that time working for Kruse. I hired him and he relocated down here to San Antonio. Together, we built Kruse Classic Car Productions. We held anywhere from 4-6 auctions a year.

Tiffany: Around what year is this, Dad?

Daniel: Early 1990’s.

Tiffany: Before eBay?

Daniel: Yes, before eBay.

Tiffany: So…eBay. How did that all come about?

Daniel: Before eBay, Dean and Mitchell had received a written offer from Christie’s (the world famous, British auction house) for $44 million.

Tiffany: Wait. WHAT? Why have I never heard this before?

Daniel: It was not widely broadcast because while Mitchell liked the offer and the idea, Dean did not. Although, he was not entirely opposed to the idea of selling. I saw an article in the Wall Street Journal quoting eBay. They were actively looking for companies to acquire. I sent that article to Dean.

Tiffany: This is what you miss, I guess when you are younger and clearly not paying attention!

Daniel: Once the word was out that Kruse International might be for sale, other offers started coming. Most notably from a man from Atlanta, Georgia. For the life of me, I cannot remember his name, right now. Anyway, at this point, Dean had met with eBay but wasn’t happy with their initial offers. I think everyone was having a hard time determining the value of KI, but Dean worked his magic and eBay agreed to doubling his highest written offer.

Dean set up a meeting in Auburn at the Kruse Park office building. eBay and the man from Georgia are both in attendance. Dean starts the meeting by looking over at the Atlantan and says, make me your best offer because eBay is here and interested. The Georgian takes out a piece of paper and writes down a number then slides it over to Dean as he gets up from his seat. He tells Dean this is his final offer. Take it or leave it. You have 48 hours. He walks out of the meeting.

eBay looks over at Dean and says, “what’s that number”? Dean flipped over the paper, and it read $75 million. eBay said, “okay, we will give you a $150 million”.

TO BE CONTINUED….