To celebrate a magazine that has always championed the power of the individual, we have amassed what we believe to be the greatest ever collection of business essayists—100 entrepreneurs, visionaries and prophets of capitalism who have shaped the past century. And we’ve complemented this A-to-Z encyclopedia of ideas with the greatest ever portrait portfolio in business history, all taken by the amazing Martin Schoeller, who literally traveled around the world for it. The result is a visual time capsule and master class in entrepreneurial thinking conveyed in 100 anecdotes, lessons and ideas.
While Forbes prides itself on quantifiable lists – the richest, the biggest, the highest – assembling a list of the 100 greatest business living minds is inherently subjective. More than a dozen editors met dozens of times over two years, winnowing an initial roster more than three times as large. In the end, we opted for doers over theoreticians, disruptive entrepreneurs over those that inherit or CEOs that maintain. We sought people who had either created something with a lasting impact on the world or innovated in a way that transcends their given field. We also required that the honorees actively participate in the project – all these essays are original, wisdom from the sages themselves.
While the advice is tailored to the future, this list reflects, to a large degree, the achievements of the past, for both Forbes and the greater business world. It was the American century, and our roots and readership lean that way. It was also a period that skewed older and whiter and male.
That said, change is coming: Twenty three people on the list are nonwhite. Twenty five are not American, including 11 from Asia, the world’s most dynamic business region. Ten are women, and 11 are under 50. When someone reads the 200th anniversary issue of Forbes, I expect all these numbers will increase substantially.
Such dynamism is the magazine’s lifeblood – it’s what makes Forbes as relevant now as it was in 1917.
- Randall Lane, Editor, Forbes Magazine
IMMIGRANT, RURAL JOBS CREATOR, BILLIONAIRE: FOUNDER, CHOBANI YOGURT
The poet Rumi wrote, “As you start to walk on the way, the way appears.” When I started Chobani, I’d never run a company before and there was no plan. But one thing I saw that could be fixed easily was the factory’s old walls: They badly needed a paint job. So I bought some paint, and our first five employees and I all got to work. It was the first and best decision I ever made. There’s something magical in the movement, in the action – it allows you to think, to discover new ideas and to feel like you’re making progress. So don’t sit around waiting – act.
You cannot do everything alone – especially when you get to a certain level. It is impossible. I had to rely on myself and trust my decisions when it came to building Chobani – and today I still do. But we’re a team made up of a lot of people who I’d trust with my life.
PURPOSE-DRIVEN ROCK STAR: LEAD SINGER, U2; CO-FOUNDER, ONE, (RED), ELEVATION PARTNERS, RISE FUND
Capitalism is not immoral, but it is amoral. And it requires our instruction. It’s a wild beast that needs to be tamed, a better servant than master. That’s my philosophy with (RED), which partners with corporations to direct profits to fighting HIV/AIDS. The idea really came about after meeting with former Treasury secretary Bob Rubin, where he said, “You have to tell Americans the scale of the problem and what they can do about it. And you have to go about that like Nike does: They spend $50 million on ad campaigns.” And I said, “Well, where are we going to get that kind of money?” And he said, “You’re clever. You’ll figure it out.”
And we did. I realized that going to big companies and trying to break into their more modest philanthropy funds was a huge missed opportunity. It was their robust marketing and publicity budgets that we needed. Think of the creative minds in those departments – the messaging is the most important thing in keeping an issue “hot”, making it relevant. Fighting HIV is very difficult. Activists often demonize the corporate world. It’s easy to do, but I think it’s just foolishness to not recognize the creativity that you can unlock in the corporate world, together with the entertainment world. (RED) has so far generated nearly $500 million for the fight against AIDS, but the heat (RED) companies have created has also helped pressure governments to do their part – and that’s where the big money is, with donor governments spending $87.5 billion on HIV/AIDS since 2002. That’s the reason we all do this!
Some of the most selfish people I’ve met are artists – I’m one of them – and some of the most selfless people I’ve ever met are in business, people like Warren Buffett. So, I’ve never had that clichéd view of commerce and culture being different. I always remember Björk saying to me that her songs, she feels, are like carpentry. Like her friends in Iceland, one of them designs a chair. Is that more beautiful or useful than a song? Well, it depends on the chair. Or the song. I’ve always seen what I do as an activist, as an artist, as an investor, as coming from the same place.
Great melodies have a lot in common with great ideas. They’re instantly memorable. There’s a certain inevitability. There’s a sort of beautiful arc. Whether it’s a song or business or a solution to a problem facing the world’s poor, I see what I do as the same thing. I look for the topline melody, a clear thought. Now, my friends – and sometimes my bandmates and sometimes my family – would see this as multiple personality disorder. But for me, it’s all the same thing.
Artificial intelligence by…
DORM-ROOM LEGEND: FOUNDER, DELL TECHNOLOGIES
The Computer Age is just beginning. Most companies today have about a thousand times more data than they actually use to make better decisions. When you overlay the latest in computer science – AI, machine learning, deep learning, unsupervised learning – you will create an explosion of opportunity and also a real emergency. Over the next few years, as the cost of making something intelligent approaches zero, companies will succeed and fail based on their ability to translate data, including historical data, into insights and actions and products and services in real time. We like to think of ourselves as a company with big ears: We listen, we learn, we understand – and we create things.
MASTER DEALMAKER: FOUNDER, SOFTBANK
When I was 19 years old, I saw a photo of a microprocessor in a science magazine for the first time. It was just a tiny chip that could fit on a fingertip but represented an entire computer. “Oh my God,” I said to myself, “this is going to change mankind’s life. This is the biggest invention that mankind ever created.” And I start crying on the street. Those microprocessors were compacted into PCs, then linked together to create the internet and later smartphones. Now they are extending our knowledge and intelligence via artificial intelligence.
The industrial revolution transformed people’s lives from the roots. But the information revolution is not just an extension of human capabilities but an extension of our brain cells. In a sense, our brains are more important than our arms and legs. This superintelligence will bring about developments we’ve never seen before and contribute to humanity.
Every morning I wake up and ask, Where am I? I don’t know where I am because I am jumping around the world, but I don’t want to go to sleep. It’s thrilling.
ORACLE ESCAPEE: FOUNDER, SALESFORCE
We are living in the fourth industrial revolution, with advancements in robotics, genetics, stem cells, autonomous vehicles and especially artificial intelligence. All will dramatically change life itself. We need to have a beginner’s mind to think about what is happening. That idea of the beginner’s mind is the core to innovation. When you ask, What do you want and what do you dream, you’re able to ask yourself, What am I beginning? People who lose their relevance get stuck in the past because they’re no longer in the present moment.
AMERICAN TASTEMAKER, EPONYMOUS SEAL OF APPROVAL
There’s no room for sloppiness, inaccuracy or omission when you’re trying to build a relationship with a customer base. I’m very clear that everything I do is authentic, practiced and viable – and the end result is generally beautiful. I’m sure that’s the same way Steve Jobs created his products.
ASIAN CONGLOMERATOR: FOUNDER, THAI BEVERAGE
As a child, I saw my parents making preparations for their hoi tod (crispy pan-fried mussels in egg batter) store from before dawn until midnight every day, yet still made time to teach their 11 children to be diligent, responsible and grateful to those who had helped and cared for us. If I could turn back time, I would like to create a right balance in life. I think I have done better than in the past by dedicating some time to looking after my health and my quality of life. My wife always reminds me of the following truths in life: Health is your own; money belongs to others; power is temporary; and reputation is eternal. That is why I teach my children to find the right balance between working to build up business and maintaining good health.
COFFEE CZAR: EXECUTIVE CHAIRMAN, FORMER CEO, STARBUCKS
In 1987, we had 11 stores and 100 employees and were already speaking about the need for a business to balance profitability and benevolence. Starbucks was one of the first American companies to give part-time workers comprehensive health insurance and equity in the form of stock options.
Back then our shareholders were very angry and concerned about dilution. I convinced them that we would be more profitable, more productive, by creating these benefits. When we made college tuition free a few years ago, I explained it wasn’t charity because investing in people is how we grow. I’m still trying to build the kind of company that my father never had a chance to work for; he held lots of blue-collar jobs, and I saw firsthand what being disrespected and devalued did to him. He had no loyalty to any employer because they showed no loyalty to him.
T. Boone Pickens
RISK-TAKER: OIL WILDCATTER, HEDGE FUND MANAGER
Over the Christmas holiday, I had several strokes, and in June, I suffered a Texas-size fall that required hospitalization. I am still mentally strong, and I comprehend and process information like I did before the incident, but sometimes find myself literally at a loss for words. That’s been tough for a loudmouth like me, as I’ve always believed you can trace every problem to a lack of communication or lack of clarity in communication. Many of those who face adversity like this at 89 choose to hide it. My life has always been an open book. Some chapters of my life have been great. Others not so much. I clearly am in the fourth quarter, and the clock is ticking, and my health is in decline. Now, don’t for a minute think I’m being morbid. When you’re in the oil business like I’ve been all my life, you drill your fair share of dry holes, but you never lose your optimism. There’s a story I tell about the geologist who fell off a 10-storey building. When he blew past the fifth floor he thought to himself, “So far, so good.” That’s the way to approach life. Be the eternal optimist who is excited to see what the next decade will bring. I thrive on that, and I’m going to stick to it until the game is over.
RUSSIA’S TECH SUCCESS STORY: BILLIONAIRE FOUNDER, DST GLOBAL; INVESTED IN FACEBOOK, AIRBNB, TWITTER, ETC.
On November 21, 1783, Benjamin Franklin watched as the first manned hot-air balloon rose from the ground. A skeptic in the crowd called out, “What is the use of it?” And Franklin is said to have replied, “What is the use of a newborn child?” He had a vision of humanity not as it was but as it could be. And he understood that from each new height a new horizon comes into view. That’s what matters most. When I was growing up in the Soviet Union, my father told me if I wanted to learn about business, I had to start looking beyond my horizon, at least as far as America. Most of the better decisions I’ve made in my career came from trying to look beyond the horizon. The first was in the 90s, betting everything on the internet. I believed it would be one of the most profound advances for civilization since electricity. I built one of the biggest internet startups in Europe, then founded DST Global, an investment firm targeting internet companies worldwide. The key to our investment philosophy is to support founders, enabling progress through technology.
Four years ago, I joined with Mark Zuckerberg and Priscilla Chan, Sergey Brin and Anne Wojcicki to found the Breakthrough Prize, the world’s biggest award for fundamental science and mathematics. We believe these are the best tools we have for understanding the universe and advancing our civilization. Then, last year, Mark joined with me and Stephen Hawking to launch Breakthrough Starshot, the first practical attempt to reach another star. As Franklin understood, the higher we go, the wider our horizons become – and the bigger the challenge of looking beyond them. Breakthrough Starshot, if it succeeds, could set our horizon at the interstellar scale.
FINANCIAL ALCHEMIST, JUNK-BOND PRODIGY (DREXEL BURNHAM LAMBERT), WALL STREET POSTER CHILD, PHILANTHROPIST
I came of age and went into business right in the middle of these past 100 years. Two issues of Forbes had a particularly significant influence on me: the 50th anniversary issue, in 1967, and the 60th anniversary issue 10 years later. I carried the latter in a briefcase for years and reread it often.
Both issues really made me think about how financial structures changed over time and how leading companies changed. I often point out that automobiles changed the world, but in 1917, when the majority of a car’s cost was based on raw materials, the country’s largest company by far was U.S. Steel. Other top companies included International Harvester, U.S. Rubber, Anaconda Copper and Phelps Dodge – so you can see how natural resources dominated society. A century later, these resources make up only a tiny fraction of the cost of the dominant product, the microchip, whose primary economic input is the brainpower of engineers.
A century ago, the automobile was radically changing transportation and mobility. Ford Motor was the 21st largest company. By the time it went public in 1956 with what was then the largest stock sale in history, it was one of the most valuable companies in the U.S. Today its total market value is less than the annual price variation of Amazon, Facebook, Apple or Google.
Understanding how change occurs is key. By the 1970s, Singer, the sewing machine maker, was known for an unbroken record of paying dividends going back more than 100 years. But that wasn’t as relevant as the emancipation of women, which had been upending its business for years. The company didn’t understand that women were less interested in sewing than in careers.
I was in elementary school in the 1950s when Sputnik went up. That made me think about science, and I later went to Berkeley because it had so many scientific Nobel laureates. Before the 1965 Watts Riot, I thought the American Dream was achievable without regard to race. When I found that it wasn’t, I switched my major from science to business. Twenty two years later, I helped finance Reginald Lewis, the Jackie Robinson of the business world, when he bought Beatrice International Foods from Beatrice Cos. for $985 million. Finance can change the world and create millions of jobs by empowering people with ability.
Today’s growing challenge: create meaningful lives for the world’s population. We’ve accomplished the greatest achievement of mankind, the extension of life. Over 4 million years of evolution, life expectancy of early hominids and then Homo sapiens had only increased from about 20 to 31. But just since 1900, average human life expectancy worldwide has grown from 31 to over 70. Economists estimate that about half of economic growth is tied to the public health and medical research advances that underlie increased longevity.
How do you create meaningful lives for all these people, and the 1 to 2 billion more who will soon be living? What are the jobs of the future in an age of robotics, driverless trucks and other new technologies? At one point, 90% of Americans worked in agriculture, then 40% and now less than 2%. U.S. Steel was the number one company a century ago, but today the American steel industry directly employs fewer than 140,000 workers. It’s a great challenge.
Most people who build businesses are passionate about it. They stand for something. The people who worked with me believed, as I do, in the democratization of capital – an opportunity to empower talent and help job creation in America. My legacy isn’t any one asset class like junk bonds. It’s the understanding of capital structure and how best to finance companies that create jobs and drive change.
INTERNET ENABLER: COFOUNDER, AOL; VENTURE CAPITAL DISPERSER: COFOUNDER, REVOLUTION
The story of American business over the last 100 years is a story about different sectors rising and falling (and often rising again, in unanticipated ways) in different regions of the country. When Detroit was an automobile powerhouse and Pittsburgh was the steel city, Silicon Valley was just fruit orchards. As the industrial revolution peaked and the technology revolution accelerated, the role of those places changed. Today 75% of venture capital still goes to three states (California, New York and Massachusetts); half goes to California alone. As we enter the internet’s third wave, where entrepreneurs will leverage technology to disrupt major real-world sectors – like healthcare, education, financial services – start-ups will increasingly move to cities where industry expertise exists. The opportunity to grow companies that spur job creation and economic growth holds great promise for what I call these “Rise of the Rest” cities. This will lead to a more dispersed innovating economy, where jobs and wealth are created all across the country, not just on the coasts. We need to level the playing field so that everyone, everywhere, has a shot at the American dream.
BUILDER: FOUNDER, QUICKEN LOANS; OWNER, CLEVELAND CAVALIERS; DETROIT’S REVITALIZER
I have never seen anybody create a whole lot of wealth by chasing money. Ironically, those who seem to be motivated by taking a great idea and turning it into reality are the ones who end up acquiring significant wealth.
In the last few years, we have taken this philosophy a step further. We have moved the headquarters and a substantial amount of the other pieces of our flagship business, as well as other businesses we are involved with, to downtown Detroit. An all-in commitment that our mission would not only be to continue to grow our business but also to help lead the transformation and rebuilding of one of America’s most devastated urban centers.
And here is the secret sauce: We are absolutely a more profitable (and better) business because we have a mission beyond the sole pursuit of profits. The investment we make in the community with both our dollars and our team members’ time has created a culture and environment that has motivated our people to be better at their day jobs. The yin feeds the yang, and the yang feeds the yin. You will attract the best and brightest who are motivated by more than a paycheck.
The more you invest in your mission, the more profits your business will produce. We are living proof of this. Not such a bad formula, huh?
Leonardo Del Vecchio
VISION VISIONARY: FOUNDER, LUXOTTICA
One thing that hasn’t changed in my years of doing business – I’m always doing and saying what I really think, acting with clarity and transparency. I prefer to match words with deeds or let the facts speak for me. I try to be what I really am and not what people would like me to be. There is a certain peace that comes with that. My reputation is truly my own.
THE ADULT IN THE ROOM: FORMER CEO, CHAIRMAN, NOVELL; FORMER CEO, GOOGLE
In 2001, my friend and colleague John Doerr called to suggest that I get some coaching. What? I was far along in my career; I didn’t need a coach. I could be a coach. Of course, I was wrong about that. I actually needed the coach.
We all called the late Bill Campbell “Coach,” and it wasn’t because of the 12-41-1 record he compiled as the head coach of the Columbia football team in the late 70s. He knew what was needed to succeed – to win – in Silicon Valley.
Bill wasn’t some far-off guru who didn’t get his hands dirty, but a coach who got on the playing field with me. He participated in board and executive meetings, developing credibility with my management team and helping us make crucial decisions. He would give advice and then make sure I lived by it. I would spend hours in his small office – whiteboards, markers, etc. – going over the “plays.” Without fail, he knew what I needed to do, and he knew how I should do it.
Bill had many tenets of leadership, but one that sticks with me, especially at this moment, is to “maintain a culture of respect.” This was essential for him – and he knew it came from the top of any organization. I worked hard to make sure that the prevailing culture at Google was one of respect above all else, as Larry and Sergey always have, and as Sundar does today. Like much of Coach’s advice, this one continues to resonate. I miss my coach.
KING OF THE HEDGE FUND MANAGERS: FOUNDER, BRIDGEWATER ASSOCIATES (WORLD’S LARGEST HEDGE FUND)
I think that the most important issue that will reshape our lives in the years ahead will be how man-made and artificial intelligence compete and work together.
My views have been colored by experiences with algorithmic decision-making over the last 30 years, which have been fabulous. But it’s a two-edged sword. I have learned that by thinking through my criteria for making decisions, writing them down as principles and then expressing them as algorithms so that the computer thinks in parallel with me, I can make much better decisions than I could make alone. It has also helped us to have an idea meritocracy that produces collective decision-making that’s much better than individual decision-making. But our path to doing this was to work with the computer to gain deep understanding.
PERPETUAL REINVENTOR: FOUNDER, SIRIUS, UNITED THERAPEUTICS; CREATOR OF PANAMSAT
Anything worthwhile in life requires teamwork, and you cannot manage what you don’t understand. My favorite thing to do at work is to walk around and talk to people. Each person is like a library of information. The more I know about a person, the better able I am to connect them to other people with synergistic interests – a leader works for those they lead. Lawrence Bell, the founder of Bell Aircraft, said that anyone unwilling to do small things should not be trusted to do big things. Running a business is a very big thing, because you are having an outsize effect on countless people’s lives. Hence, when I started creating organ-manufacturing technology, I practiced suturing arteries.
I find it awe-inspiring that there are an infinite number of ways to improve the world through business. Providing better products and services, or less expensive ones, or more accessible ones, all makes people happier. That’s what it’s all about.
CORPORATE RAIDER/ACTIVIST INVESTOR: FOUNDER, ICAHN ENTERPRISES
Sometimes the best way to make money is when most people say you are wrong and nuts. It’s not easy to do, but it’s like in the Rudyard Kipling poem: “If you can keep your head when all about you are losing theirs.” If you have the emotional makeup (you can develop it), you don’t care what the experts are saying.
You need to do a lot of work to be contrarian and you need to have the strength – you can’t just be a contrarian to be contrarian. For example, when we had the junk bond crash of 1989, for a few days I was literally almost the only one buying – even though it took a few years, we made a fortune on them. I believed the risk-reward ratio was greatly in my favor because I felt I was buying companies, not bonds.
You are not always right, and it sometimes takes a long time to prove it out. A lot of the time you are early. (I really believe today, for example, that this market is going to have a crisis, some major corrections, so I have been hedged.) People thought I was crazy when I bought the Stratosphere Hotel in Las Vegas out of bankruptcy. It was in the north end of the Strip – at the time, a part of town as bad as a Third World country. Then I bought all the homes around the Stratosphere. Even the people in Las Vegas and at the hotel told me I was crazy. But it was the fact that I bought the shacks and the 24 acres next to the Stratosphere that made the hotel very attractive. Goldman Sachs ended up buying the Stratosphere from me, and we made about $1 billion.
It’s not easy, but something inside you goes click. That’s what I enjoy.
MALL STORE JUGGERNAUT: VISIONARY FOR THE LIMITED (VICTORIA’S SECRET, PINK, BATH & BODY WORKS, ETC.)
Back when I had just a few stores, I made a cold call to the office of John Galbreath, who was probably the most successful guy in Ohio at the time. He was a big international real estate developer, but he also owned the Pittsburgh Pirates and had a private airport outside of Columbus, where the queen of England once flew in to talk to him about Thoroughbred horse breeding.
I introduced myself over the phone, and he invited me to his office. We talked for about an hour. What I really wanted to know was how he had gone from being a kid on a farm to a friend of the queen of England. He told me that the key was just to be curious and pursue various interests. Riding down the elevator, I remember sort of shaking my head and thinking to myself, what a load of crap. Here I had come for wisdom, and he just tells me to be curious.
And yet, I have continued to reflect on that conversation in the 40 years since then. Curiosity led me to see if I could replicate building one successful retail brand into creating several. I ended up building Victoria’s Secret, Express, Abercrombie & Fitch and Bath & Body Works. Curiosity made me wonder if I could have success in picking the right garments for stores. Would I have an eye for picking out artwork? I eventually selected a collection centered on Pablo Picasso. If I was a leader in my business and industry, could I become a leader in my community, too? I now devote 10% to 20% of my time to improving my hometown of Columbus, Ohio. Curiosity has kept me young as I have gotten older. Now, nearly a half century after I walked into Galbreath’s office, I’m still curious to see what’s next.
Customer service by…
Sean “Diddy” Combs
HIP-HOP MOGUL (BAD BOY); FASHION MOGUL (SEAN JOHN); LIQUOR MOGUL (CIROC)
I started my business career at age 12, delivering newspapers. I had a lot of elderly customers, so I would always put the newspaper in between the screen door and the door – that caring made me different, made me better than the last paperboy. Since then, I’ve always understood that if I give the customers my best and service them differently, whether music, clothing or vodka, I’ll get a return on my hard work.
THE MONEYBALL MAN: OAKLAND A’S EXECUTIVE VICE PRESIDENT
In sports, you’re not allowed to just survive. People cheer for teams that win. And it’s a zero-sum game. You don’t get partial credit for losing. I never doubted the Moneyball approach. We had two choices – intuition or data. Before, it seemed like we were making decisions on a roulette wheel, and when we were correct we celebrated the good guesses and applied some sort of clairvoyance to it, as opposed to just pure luck and random outcome.
So instead, we were very rational, logical and fact-based. What was interesting was the resistance. When we applied data to decision making and relied on objective reasoning, it was held to a perfect standard. If it was not correct 100% of the time, the response was “I told you that number s–t doesn’t work.” But it did work. And then we had to evolve again. As soon as you think you’ve completely figured it out, you’re probably in trouble. Every business is a living document, an algorithm that needs to be improved.
In my fourth year at the University of Southern California, the teacher from my professional practice class came up to me in the courtyard one day and said, “Frank, I’ve been watching you, and I think you’re a talented guy who’s going to go somewhere. I just want to give you one word of advice: No matter how small a project you work on, and no matter what it is, put your heart and soul and sense of responsibility into it, and don’t dismiss anything.” He said it very clearly and lovingly, and I never forgot it and I’ve lived by it.
Due diligence by…
RAGS TO (BILLION-DOLLAR) RICHES: FOUNDER, CEO, SPANX
In the early days of Spanx, I didn’t vet the manufacturer helping me make our first product, footless pantyhose. They went out of business and gave me one week’s notice. It almost put Spanx under. Had I done any kind of financial due diligence on them, I would have been able to prevent that. Early-stage entrepreneurs shouldn’t forget about that layer. It almost stopped everything for me.
TECH TRAILBLAZER: WOMEN’S LEADERSHIP CHAMPION; COO, FACEBOOK
Driving to work on my first day back after maternity leave, I cried the entire way there. I wanted to work, but leaving my son at home was hard. To be able to see him, I started finding ways to come in later and leave earlier.
Years later I mentioned in an interview that I left work at 5:30. The response was overwhelmingly positive. That’s when I realized that we are better employees when we stop trying to be two people and bring our whole selves to work. That doesn’t mean working around the clock. It means sharing what you are going through so that other people can empathize and help you.
When I lost my husband Dave two years ago, I learned this lesson even more deeply. Dave was a true partner at home and at work and taught me the value of peer mentorship. When I was talking to Mark about joining Facebook, Dave told me not to work out the substance in advance but rather to agree on the process. His point was that the substance would change but our working relationship was the single most important thing to get right. We agreed to sit together, giving each other feedback every week one-on-one. Nine years later, I often smile when I remember how Dave’s advice set us up for success.
So bringing my full self to work meant being openly sad. The way colleagues supported me drove home the need for better policies for bereavement and sick leave. Taking care of people when they need it most is not just the right thing to do, it is the smart thing to do.
THE DECODER: FOUNDER, CELERA GENOMICS; HUMAN GENOME SEQUENCER; CHAIRMAN, HUMAN LONGEVITY INC. AND SYNTHETIC GENOMICS INC.
Timing is everything in science, like it is in most things in life. In 1944 Oswald Avery did the experiment proving DNA was how traits are inherited. But he didn’t get the Nobel Prize because everybody wanted to believe proteins were the genetic material. I’ve been lucky. I nearly flunked out of high school, and I decided not to go to college even though I had a swimming scholarship. I ended up in Vietnam. After, I had to start my education over from scratch. I had this English teacher, Bruce Cameron. We became lifelong friends. If it weren’t for him, I would not have survived the first semester of community college. He taught me to ignore the assignment and write what I wanted. I ended up getting my Ph.D. in just three years. I learned that most people fail in science because they talk themselves out of doing the experiment. Ideas are a dime a dozen. What makes the difference is the execution of the idea. That taught me to recognize when it was time to adopt new technologies to understand genetics and then even to sequence the human genome. Once, I was too early: I started trying to create synthetic life a decade before the world was ready for it. But it’s ready now.
ULTIMATE TASTEMAKER: FOUNDER, LUXURY-GOODS CONGLOMERATE LVMH
The success of LVMH is built on creativity, quality, entrepreneurship and, most importantly, long-term vision. For instance, I remember the first time I visited China, in 1991. I arrived in Beijing – I saw no cars, only bicycles, no tall buildings. The GDP was 4% of what it is today. Nonetheless, we decided to open our first Louis Vuitton store in China. Today Louis Vuitton is the number one luxury brand in the country and across the world. We have been seeing for the past 25 years a growing desire for high-quality products and an acceleration of buying power. Nowadays, the internet makes the planet much smaller. Product launches now need to be global in order to be successful. When you start something today, you usually have to start it all over the world at the same time to be successful, and you can see what’s going on anywhere, instantly. That requires higher investment – which gives us an advantage. Creating increasingly desirable new products and selling them worldwide is what LVMH does best.
HEDGE FUND GODFATHER: FOUNDER, TIGER MANAGEMENT
Do you know what the most desirable job was at the beginning of my career, in the 1950s? Advertising. All the hotshots went into advertising. Investment banks? They were begging for people. I was interested in stocks from an early age, so I really wanted to go into investment banking. The fancy way in was to go to business school and then get into the investment banking department of one of the firms, but I started as a stockbroker. Today, people wonder why hedge funds aren’t doing better – I think it is from increasing competition from other hedge funds. If I were starting out now, I would look at what the competition is like in various fields – and then consider some that aren’t so popular.
WORLD BUILDER: CHAIRMAN, CEO, ARCELORMITTAL, THE LARGEST STEELMAKER ON EARTH
Steel is one of the most used materials in the world today, but that doesn’t mean in the future there won’t be a different way of making steel or that other, new materials won’t be developed that challenge steel’s position. The pace of technological change is significantly faster than historically – every industry today has to fight complacency, prepare to see the disruption coming and then be flexible enough to adapt swiftly.
IRON MAN: ALPHA ENTREPRENEUR; COFOUNDER, PAYPAL, TESLA, SPACEX
Artificial intelligence will provide many societal benefits, including self-driving cars and improved medical diagnostics. However, with AI we may be summoning the demon and could create an existential risk to humanity. If a digital superintelligence were inadvertently optimized to do something detrimental to humanity, this could have catastrophic consequences. It could be something like directing the AI to get rid of spam, and it concludes the best way to get rid of spam is to get rid of humans. Or a financial program decides the best way to make money is to increase the value of defense stocks by starting a war. We’re the first species capable of self-annihilation, and it’s extremely likely, given enough time. The question: Can we get ahead of it? We need to learn as much as possible and should create a government agency to regulate AI. Ultimately the private sector will have to take the lead in building safe and useful technology that benefits humanity.
THE WORLD OVERNIGHT: FOUNDER, FEDEX
Everything was going as planned in the early days of FedEx, until the Arab oil embargo hit in 1973. Suddenly our costs spiked and our cash evaporated. Right around then I went out to Vegas with this high roller I knew. We went to the casino and he got me a line of credit.
I knew how to play blackjack from my days in Vietnam. It was a horrible war with a bad strategy and terrible consequences, but I met some great people and played a lot of cards. The odds in blackjack actually aren’t that bad if you know how to bet. The problem is most people get chicken and pull their money off the table exactly when they ought to be doubling down. I didn’t have that problem. I won $27,000 and wired it back to the company.
The myth says that money alone saved FedEx. The truth is that we owed so much damn money, $27,000 didn’t make much of a difference on the balance sheet. But it lifted our confidence at a time that we needed it. No business school graduate would recommend gambling as a financial strategy, but sometimes it pays to be a little crazy early in your career.
Golden rule by…
John Paul DeJoria
SELF-MADE BILLIONAIRE—TWICE: CO-FOUNDER, JOHN PAUL MITCHELL SYSTEMS; COFOUNDER, PATRÓN TEQUILA
There’s turnover of staff and then there’s efficiency of staff. Companies sometimes hire 10 people to do the job of three. What’s the answer to it all? It’s a basic thing that goes back to the law to do unto others as you would have others do unto you. Treat and pay your staff exactly the way you’d want to be treated if you were in their place.
Now, how does this work? John Paul Mitchell Systems is in almost 100 countries. We’ve been around for 37 years. My turnover is less than 100 people. Only two people have even retired from our company. They don’t want to. They’re having such a good time.
Someone once asked Francisco Alcaraz, the genius distiller creating all of our formulas for Patrón, “What is the secret? Why is Patrón so good? Why do people keep coming back?” He says, “The secret’s very easy. It’s called love. We are all treated so well, we love what we’re doing. We never want to leave. We want every bottle to be reflective of us.”
With Patrón, 53 people touch every single bottle; that’s a lot of hands-on work, and they’re all loved. If you work for me during the day shift, you get a free lunch by chefs. If you work for me at night during the night shift, you get a free lunch and dinner by chefs. You want to pray during the day? We built a chapel right in the middle of the 17th-century Spanish-French hacienda.
In all the businesses we’re involved in it’s the exact same way. If you love your people and let them know you’re giving back, not just hoarding all the money for yourself, they want to join in.
David M. Rubenstein
WASHINGTON’S FINANCIER: COFOUNDER, CO-CEO, THE CARLYLE GROUP
Thomas Jefferson famously said that the country is, to some extent, about the pursuit of happiness. Unfortunately, over the next 50 years of his life he never defined what happiness was. Personal happiness might be the most elusive thing in life. In my own case, personal happiness came about much more from giving away my money than from earning it. I use what I call the “mother test.” If your mother calls you and tells you that she is proud of what you are doing, that’s probably a good indication that you are on the road to happiness. My mother used to call much more when I was giving away my money than when I was making it.
SURVIVOR: COFOUNDER, MICROSOFT; INVESTOR AND PHILANTHROPIST (VULCAN); SPORTS TEAM OWNER; BRAIN SCIENCE BENEFACTOR
We are about to enter the era of deep medicine, where we understand cell pathways and how to change them. I’m a two-time cancer survivor. First I had Hodgkin’s, a young person’s cancer. And then non-Hodgkin’s lymphoma. Right now they just hit you with everything they’ve got, like carpet bombing. And then my mother passed away of Alzheimer’s. Those things are motivating experiences that make you want to understand things better and then make a difference. In maybe 20 or 30 years, we will use things like stem cells to change disease outcomes – your own immune system, designed by evolution, to attack sick cells and things like that. It seems inconceivable now – we have thousands of types of cells, so there are trillions of combinations – but healthcare would be much more personal. And the costs will potentially decline.
COMPUTER INSIDER: FOUNDER, TAIWAN SEMICONDUCTOR
My values are: integrity, commitment, innovation and trust from customers. Integrity means honesty and willingness to fulfill a promise, even at high cost. Commitment means dedication and loyalty to a task or an organization. Innovation means change. Trust from customers of course has to be earned, and I try to earn it by integrity and commitment.
J.W. “Bill” Marriott Jr.
AMERICA’S HOTELIER: CHAIRMAN, MARRIOTT INTERNATIONAL
I learned what may be the single biggest factor in our success the hard way, when I was in the Navy. I was assigned to be the wardroom officer on an aircraft carrier, and I had a bunch of stewards doing the food preparation. They were enlisted men who were World War II veterans because this was back in the early 1950s. I had new recipe cards that I thought would improve the quality of the food. I gave them an order to follow the cards. And they just gave me this glassy stare and said, “We ain’t following them,” and I didn’t know what to do, so I let them do their own thing. I realized that I didn’t get their buy-in. I didn’t sit down with them and say, I think we can improve the quality of the food if you follow these recipes.
The four most important words in business are “What do you think?” And that’s why I would visit over 200 hotels a year to meet with our associates. You can talk about all the technology, distribution and other things that are taking place. If you take good care of your associates, they’ll take good care of the customers and the customers will come back. We’re in the people business. We don’t manufacture anything. We just take care of our guests.
BUILDER: COFOUNDER, HOME DEPOT; OWNER, ATLANTA FALCONS
When I was running Home Depot, I’d always stop the customers who walked out of our stores with nothing. They were the ones who taught us the most. Odds were, they didn’t come to Home Depot just to walk around. They came because they wanted to buy something. And somehow, we had let them down. Wrong stuff, wrong price, bad service – something. They would tell us what the issue was, and then we would just go in and fix the problem.
I took the same approach after buying the Atlanta Falcons. At the time, 40% of our stadium was empty. Our players needed a full house of our fans, but half of the people who came to games were rooting for the other team. So I went around the city asking people why they weren’t buying tickets. I didn’t ask Falcons employees – they had been trying to get people into the stadium since 1966, and they hadn’t figured it out yet. I asked everyone else I met. Why don’t you come to the Georgia Dome? They always had some explanation. We made a list of the problems and then fixed them. This is my 15th year as an owner, and we’ve sold out every game except for two.
Business isn’t all that complicated. If someone is out in the desert walking around, they’re going to be thirsty. You just have to ask them what they want to drink. If you have the humility to listen to other people rather than just hawking stuff, you’re going to have a lot of customers. Too many businesspeople have big egos and aren’t willing to ask.
VISIONARY: FOUNDER, ARMANI
I always try to maintain a sense of reality and ensure that I surround myself with the right people, who understand the times in which we live. In this line of work, my team is crucial. I’m the one who decides, but I like having lots of other people with whom I can discuss ideas, as this helps with the creative process. In the world of fashion, five years is already a hundred, so going forward, the challenge will be to capture the attention of a public that is increasingly stimulated by countless offers and new forms of communication.
Industry shifts by…
CONNECTOR: RAILROADS, QWEST, ENTERTAINMENT
I’ve always been intellectually curious. I like to research how and why things are, and imagine how they might change. Specifically, I look for industries in transition and try to anticipate opportunities that could arise from changes in underlying fundamentals. So far I’ve had decent timing when it comes to certain businesses, such as energy, railroads and telecom. Deregulation changed the railroad and telephone industries. When I was running Southern Pacific, we realized that railroad rights-of-way were perfect paths to lay fiber-optic cables. So we started Qwest to lay important portions of the early backbone of the internet. I got a little nervous when Qwest had over $1 billion of fiber in the ground and no customers, but it wasn’t long before we went from selling voice by the minute to selling data by the gigabyte. With the rise of the digital world, I believed demand would grow for live analog entertainment like sports and music, so we started building and acquiring more than 100 unique venues, like the L.A. Staples Center and the O2 London, along with music, entertainment and teams to play in them like the Kings, Lakers and Galaxy. While the underlying concept was developing well-located real estate, the critical strategy was content.
A sector about to undergo transformational change is the power industry, driven in part by the rise of renewable clean energy, which has the potential to drive change, much like the advent of fiber optics drove change within the telephone business. I’m currently building what could be America’s biggest wind farm.
Not everything of course always works as anticipated, but it helps to get into the habit of being curious and developing a willingness to accept the concept of risk.
AGENT OF DISRUPTION: NAPSTER COFOUNDER, FACEBOOK’S FIRST PRESIDENT, SPOTIFY EVANGELIST
I’ve been involved in the start of many innovative ideas and companies, not because they were fashionable at the time but because they appealed to my sense of intellectual curiosity. Just as experts in the record industry couldn’t accept that music on the internet would ever go mainstream, or that social media would ever be used by adults rather than college kids, I have always chosen to ignore the conventional wisdom in favor of the ideas that interested me. Inventing the future starts with intellectual curiosity – along with a healthy dose of skepticism. You need enough curiosity to “deep dive” into the ideas that interest you. And enough skepticism to second-guess everything you think you know and everything the so-called experts want you to believe.
We’re living at a unique moment in history, where everyone on the internet who has a knack for Googling can access more information than any university could ever teach. About a decade ago I became interested in the emerging field of cancer immunotherapy. The data was compelling, even though the field had been written off by famous oncologists. But with little more than the internet at my disposal, I was able to learn enough about the field to be dangerous. I got involved in funding clinical trials for drugs that would ultimately treat blood cancers and melanoma. In a few short years the field of immunotherapy had produced several billion-dollar companies, FDA approved drugs and breakthroughs that helped patients where conventional treatments had failed. I launched a non-profit institute dedicated to the field, assembling a dream team of scientists around a $250 million bet that the next generation of immunotherapy treatments would treat an even larger number of patients. While engineering T cells to fight cancer may seem very different from writing software to give away free music, the instincts that led me to each of these projects haven’t changed a bit.
SHOWMAN: BILLIONAIRE COFOUNDER, CIRQUE DU SOLEIL
I came up in Montreal as a street performer – a fire-breather, literally. I lived in the streets for almost 10 years, by choice. And the streets have their own rules. Sometimes, you have a fraction of a second to evaluate, when you first meet somebody, whether they might stab you or become your friend. The things I learned in the street about reading and feeling people and believing my intuition proved very important in my business life. If I was entering a meeting, I was able to stand and scan people and feel them immediately as what they were, instead of discovering weeks later, when it was too late.
AMERICA’S MONEY MANAGER: FORMER PORTFOLIO MANAGER, MAGELLAN FUND
My biggest mistake was that I always sold stocks way too early. In fact, I got a call from Warren Buffett in 1989. My daughter picks up the phone and says, “It’s Mr. Buffett on the line.” And I thought some of my buddies are kidding me because she was only six. And I pick up the phone, and I hear, “This is Warren Buffett from Omaha, Nebraska.” You know, he talks so fast. “And I love your book, One Up on Wall Street, and I want to use a line from it in my year-end report. I have to have it. Can I please use it?” I said, “Sure. What’s the line?” He says, “Selling your winners and holding your losers is like cutting the flowers and watering the weeds.”
That one line that he picked in my whole book has been my greatest mistake. I visited the first four Home Depots ever built. I sold that stock after it tripled, and then it went up another fiftyfold. If you’re great in this business you’re right six times out of ten. But the times you’re right, if you make a triple or ten-bagger, it overcomes your mistakes. So you have to find the big winners. I sold way too early on Home Depot. I sold too early on Dunkin’ Donuts. Why did I do that? I was dumb. With great companies the passage of time is a major positive.
THE ORACLE: CEO, BERKSHIRE HATHAWAY; ARGUABLY THE GREATEST INVESTOR AND BIGGEST PHILANTHROPIST OF ALL TIME
When I was 7 or 8 years old, I was lucky in that I found a subject that really interested me – investing. I read every book on that topic in the Omaha Public Library by the time I was 11. Some of them more than once. My dad happened to be in the investment business, so when I would go down to have lunch with him on Saturdays, or whenever it might be, I would pick up the books around his office and start reading. (If he’d been a shoe salesman, I might be a shoe salesman now.)
I bought the book that became the largest influence on my investing life by accident, while I was at the University of Nebraska. I read and reread The Intelligent Investor, by Benjamin Graham, about half a dozen times – it’s incredibly sound philosophically, very well written and easy to understand. And it gave me an investment philosophy that I’m still using today.
That strategy is to find a good business – and one that I can understand why it’s good – with a durable, competitive advantage, run by able and honest people, and available at a price that makes sense. Because we’re not going to sell the business, we don’t need something with earnings that go up the next month or the next quarter; we need something that will earn more money 10 and 20 and 30 years from now. And then we want a management team we admire and trust.
My favorite investment, one that embodies this philosophy, is Geico, which I learned about when I was 20 years old, because I got on a train and went down to Washington and banged on the door on a Saturday until Lorimer Davidson, who would later become CEO, responded. He answered my questions, taught me the insurance business and explained to me the competitive advantage that Geico had. That afternoon changed my life.
Here’s a product that now costs, on average, about $1,800 a year. People don’t want to buy it – but they do want to drive. And they hope they never use it, because they don’t want to have an accident. And Geico was a way to deliver that product for less money than people had been paying. When Berkshire bought control of it in 1995, it had about a 2% market share; now it has a 12% market share, and we are saving the American public perhaps $4 billion a year against what they would be paying if they had bought insurance the way they had before. A simple idea when Leo Goodwin founded the company in 1936. The same simple idea now.
Ben Franklin said it a long time ago: “Keep thy shop and thy shop will keep thee.” The quaint language aside, it means don’t just satisfy your customers – delight them. They’re gonna talk to other people. They’re going to come back. Anybody who has happy customers is likely to have a pretty good future.
But ultimately, there’s one investment that supersedes all others: Invest in yourself. Address whatever you feel your weaknesses are, and do it now. I was terrified of public speaking when I was young. I couldn’t do it. It cost me $100 to take a Dale Carnegie course, and it changed my life. I got so confident about my new ability, I proposed to my wife during the middle of the course. It also helped me sell stocks in Omaha, despite being 21 and looking even younger. Nobody can take away what you’ve got in yourself – and everybody has potential they haven’t used yet. If you can increase your potential 10%, 20% or 30% by enhancing your talents, they can’t tax it away. Inflation can’t take it from you. You have it the rest of your life.
DATA PIONEER (EDS, PEROT SYSTEMS); ORIGINAL POPULIST-BUSINESSMAN PRESIDENTIAL CANDIDATE
Believe in big ideas. In 1962 I was IBM’s biggest salesman for those giant mainframe computers. I tried to convince IBM we were missing an opportunity, that in addition to selling the computers, we ought to sell services, too – as in help our customers learn how to use their new machines. But IBM wasn’t interested, and my big idea nearly died right there. That week I went to get my hair cut, and while flipping through a Reader’s Digest I came across a quote from Henry David Thoreau: “The mass of men lead lives of quiet desperation.” That wasn’t for me. It was at that moment that I decided to go it alone, to start my own company, Electronic Data Systems. After 70 sales calls I finally landed my first customer. Two decades later, after I had sold EDS to General Motors, I got into the business of backing the next generation of entrepreneurs. I recognized a little bit of myself in 1986 when I put up $20 million to seed Steve Jobs at NeXT Computer, which he eventually sold to Apple Computer. He believed in big ideas, too.
Keep ‘em honest by…
THE PICASSO OF ART DEALERS
There was a painting that Si Newhouse wanted to buy in the early 1980s – “Aloha” by Roy Lichtenstein. I had sold several paintings from that collection to him, and this Lichtenstein was $1 million. Only a handful of paintings had sold for $1 million at that time. So I said, “Let’s write them a check.” And Si, who is a billionaire, said, “No, I’m not going to write a check for $1 million. Let’s pay them $100,000 a month.” And when I asked him why, he said, “I don’t want them to think that money comes that easily.” If he were willing to write a check right away, he explained, it would influence the negotiation. It was a shrewd lesson, especially since “Aloha” would later become worth well over $100 million.
CHINA’S PREEMINENT VENTURE CAPITALIST
Our business changes so quickly that one must continuously go through learning curves to stay relevant. A part of learning is done through reading, and the other part, which is likely more important, is talking with bright minds from different fields – scientists, writers, policymakers, philosophers, etc. Such engagement helps you get many new perspectives on life and the world.
We are in the business of helping entrepreneurs build the very best companies in the world, mostly in the technology space. I do not think we will be replaced by AI. This business oftentimes is more like art than science.
We might have to live with an easy monetary policy environment on a global basis for a very long period of time to come. How to consistently create value and generate alpha, with this backdrop, is the real challenge.
TALK SHOW MASTER; SYNDICATION SUPERSTAR; BRANDING JUGGERNAUT; FOUNDER, OPRAH WINFREY NETWORK
I was invited by Nelson Mandela to stay at his home for 10 days. At first, I was very intimidated. I’d said to my partner Stedman, “What am I going to talk about for 10 days and 10 nights at Nelson Mandela’s house?” And Stedman said, “Why don’t you try listening?” So when I was there, halfway through my visit with him, I got comfortable sitting and being with him. First of all, when you go to Nelson Mandela’s house, what do you take? You can’t bring a candle. What I wanted to do really was leave something that would be of value. When we were talking one day, we started a conversation about what was in the newspaper: poverty and how to change it. And I said, “The only way to change poverty is through education, and one day I would like to build a school in South Africa.” And he said, “You want to build a school?” He got up and called the minister of education. By that afternoon I was in a meeting, talking about building a school.
Lee Shau Kee
HONG KONG’S LANDLORD; STOCK-PICKING SAVANT
There’s a Chinese saying: “Explore what’s best in the others and follow.” Among my friends, I always learn the best from them.
HIP-HOP PIONEER; SERIAL ENTREPRENEUR; YOGA GURU
The self is the greatest teacher: The more you dig, the more you learn. So the self-discovery is your journey. Yogis refer to the state of yoga, which is the same as heaven on Earth. If you’re present and awake, you become this great thinker, this great worker. You become a fine-tuned machine.
Diane von Furstenberg
FASHION ICON, ENTREPRENEUR, TASTEMAKER; INVENTOR OF THE WRAP DRESS
My mother, a Holocaust survivor, taught me that fear is not an option and that has been my guideline. I came to America in 1970 as a young European bride, with a dream and a suitcase full of Italian printed jersey dresses that I had designed. They were simple, easy, sexy little dresses that could be worn anywhere and did not wrinkle. My guardian angel mentor was Angelo Ferretti, the Italian man who owned the factory those dresses were made in. He believed in me, and I believed in his printed jersey fabric.
In New York I met my second mentor, the editor-in-chief of American Vogue, Diana Vreeland. Although I had shown my dresses to other editors, she saw something special in them, something modern and fresh. She helped me with exposure and introducing me to stores. With the help of a salesman, I took a showroom. Soon after, I designed the first wrap dress. Overnight that dress became a huge commercial success and a symbol of women’s liberation. Soon we were making 25,000 dresses a week. I was living the American Dream and established my brand.
After that I had many ups and downs, but what allowed me to survive is that I was always honest and I truly believed in what I did. With my dress, I was selling confidence and, with its success, I was getting more and more confident. Confidence in what you do is crucial, but that does not mean being delusional. You must always face the truth and the combat the obstacles as they appear.
SALESMAN AND RINGMASTER EXTRAORDINAIRE: OWNER, TRUMP ORGANIZATION; 45TH PRESIDENT OF THE UNITED STATES
The greatest business lesson I’ve learned in life is the same message I have for young people across America: Never give up. Even in the most difficult circumstances, have faith in yourself, confidence in your abilities and the conviction that you will be able to win for your family, for your business and for your country. But you have to relish the fight – you have to enjoy coming in to work each day and going to battle for what you believe in, and for the people who you believe in. And if you do that, if you keep moving forward, then each victory along the way will feed into another victory, and another opportunity, and another chance for a breakthrough. By building this momentum, by pushing, by never backing down and by refusing to allow other people to define your limits, you will bring your goals into closer range, and you will accomplish them. America is a land of dreams, and if we chase those dreams with all of our hearts, then our country will be greater than ever before.
THE CEO OF CEOS: FORMER CEO, GE
My biggest mistake was explosive – literally. In 1963, three years into my GE career, I was a chemical engineer, eager and ambitious and trying like hell to build a plastics business in an electrical company. In the process, my pilot plant blew up. Yes, blew up – roof collapsed, windows shattered, clouds of smoke, the works. I thank God no one was hurt, to this day. But I was certain my career was over, especially when my boss in Pittsfield suddenly didn’t know me, and I got a call to go see the big boss in New York. His name was Charlie Reed, and I didn’t know him at all. What I did know was that I was terrified – I was sure I was going to be yelled at, humiliated and then unceremoniously fired. After all, it was my plant and my fault.
But Charlie Reed taught me a huge lesson about leadership and life that day. He was calm. He was kind. He was thoughtful. He spent several hours with me, employing the Socratic method of questioning, to help me understand why the explosion occurred and what I could have – and should have – done differently. And then, after it was all over, he gave me a second chance.
I learned to never kick someone when they’re down. Everyone makes mistakes, and some are real whoppers. But that makes them whopping opportunities, too – for growth. In the years after my encounter with Charlie, I followed his example with my own employees, and saw it help more people for the better. I also learned that the time to “kick” people – and by kick I mean “challenge” – is when they’re on the way up, to remind them that when you’re growing, make sure your head isn’t swelling, too!
THE MOUSE THAT MIKE BUILT: FORMER CEO, DISNEY
In 1998, Disney bought Infoseek, then one of the largest search engines, behind Yahoo. Shortly thereafter, I was convinced in the men’s room by a consultant at McKinsey that Infoseek shouldn’t do advertised search because it wasn’t the Disney way. I wasn’t in my office, I wasn’t thinking, and I said, “Oh, yeah. My job is to protect the Disney brand. We won’t have advertised search, that’s not clean.” Google came around and did AdWords, and Infoseek didn’t. It was probably a $200 billion mistake. After that, we made a rule: No more meetings in the bathroom.
MULTITASKING CEO: TWITTER, SQUARE
My biggest mistake was thinking I shouldn’t show my mistakes – I learned I should.
GLOBAL CONNECTOR: COFOUNDER, FACEBOOK
My hope was never to build a company. I was driven by a sense of purpose to connect people and bring us closer together.
A couple years after starting Facebook, some big companies wanted to buy us. Nearly everyone else wanted to sell, but I didn’t. I wanted to see if we could connect more people. It tore our company apart, fraying relationships until, within a year or so, every single person on the management team was gone.
That was my hardest time leading Facebook. I believed in what we were doing, but I felt alone. And worse, it was my fault. It taught me that it’s not enough to have purpose yourself. You have to create a sense of purpose for others. And I hadn’t explained what I hoped to build.
That sense of purpose creates motivation and meaning for people beyond just surviving or making money. It attracts other people who are interested in the right things. People here build products because they want to do something meaningful and play an important part in how people use Facebook. The company has to be successful for us to keep going, but the real motivation is creating positive social change in the world.
I think that’s true for most good businesses. Building something like Facebook and running a community like ours requires some inspiration. A lot of our leadership team is wired that way. Our compass as a company is all about making our services available to the most people possible so we can give everyone around the world a voice.
People often ask me for advice about starting a company, and I always tell them your goal should never be starting a company. Focus on the change you want to make, find people who share your same purpose, and eventually you may have an opportunity to build something that helps create purpose for others and has a positive impact on the world.
ENTREPRENEURIAL ICON: AFRICA’S FIRST BLACK BILLIONAIRE
After I completed my first significant transaction, buying mines that were closed or about to close, with a demotivated workforce of 8,000, who for years had been told, “Guys, you’re not cutting it,” people asked if I was mad. But we ran our business differently and it worked – we paid our workers based on profitability, with bonuses based on aspirational targets that, if achieved, created money for the mineworkers, the company and its shareholders alike.
CEILING BREAKER, COMPANY BUILDER: FORMER CEO, EBAY; CEO, HEWLETT PACKARD ENTERPRISE
There is a myth (at least I believe it’s a myth) that being successful demands that we give up on decent, commonsense values: honesty, family, community, integrity, generosity, courage, empathy, etc. As we advance in our careers, there is this belief that winning at all costs is winning nonetheless. I never bought into that myth. I respect ambition, but not ruthless ambition.
We have the opportunity today to use our values to help us reinvent our future during a time of great stress and economic anxiety. There are those who see a focus on values as a luxury for prosperous times, when we can “afford” to think about making the world a kinder or nobler place. I want to make a different argument: It is precisely during difficult times that we need to align our priorities and actions with the fundamental principles that ultimately create stability, efficiency, energy and even prosperity. Navigating by essential values can have a force-multiplying effect.
VISIONARY: INVENTOR, WORLD WIDE WEB
I published my proposal for the World Wide Web in 1989. From the outset, I imagined it as an open, universal space, where anyone, anywhere could take their ideas and bring them to life without having to ask for permission or pay royalties. I hardwired these factors into the Web’s design and made a conscious decision not to try to copyright or patent it. In 1993, CERN, my employers at the time, agreed to make the code available to anyone, royalty-free, forever.
This openness is at the core of what makes the Web powerful. It has underpinned the decades of creativity and innovation, opening up access to information, letting us communicate and collaborate across borders, and creating new industries. But now, as the Web matures, this openness is under threat.
Some governments have stepped up censorship of information they feel threatened by, using Web-based technologies to monitor citizens or even shutting down the internet in their jurisdiction. And some companies are also trying to limit openness for financial gain by challenging the principle that all internet traffic is treated equally – net neutrality. The internet is both a market for bandwidth and a market enabler (content, social networks, etc.). Strong net neutrality rules separating these markets are key. Otherwise, one set of interests can control the other – a disaster for innovation.
The open Web has been fertile ground for entrepreneurs to build successful companies –without having to ask permission from internet providers to allow their idea to take off. You break that “permissionless” space, and you establish substantial barriers for the Web’s next big thing.
The open Web, like all open markets, demands rules to ensure it stays fair and competitive. For the economic, social and political benefit of all, the Web must be recognized as a public good and locked open through appropriate corporate and government action – including the preservation of net neutrality. No single individual can control the future of the Web, but together we can keep it open and build the Web we want.
Operating lean by…
SCRAMBLER: OIL WILDCATTER, FOOTBALL REVOLUTIONARY; OWNER, DALLAS COWBOYS
In my mid-30s, I would have annual visits with Sam Walton. At that time I was primarily in the oil and gas business and some real estate. I asked him very early in our acquaintance if he had one rule that he practiced, what would it be, and I have applied it ever since. “If you are not undermanned, you’re overstaffed, and you’ll never see your heroes.” What he meant: Keep your labor or your expense down and maximize the responsibility you extend to fewer people. When you do that you will see the people who have the ability and motivation to do the work.
When I bought the Cowboys in 1989, Tex Schramm had done a marvelous job creating visibility. What was lacking was the ability to monetize the visibility – to bring back home juice. When we first met, he said that football would be a hell of business if you didn’t have to play those games. With Sam Walton in mind, I set out to have a franchise that could have financial viability, win or lose. I call it bringing the ten-pound bass in on the one-pound test line.
The ineffective people take care of themselves. Someone has to produce or it becomes apparent where they are. We need people with across-the-board knowledge in terms of what we are trying to do. One of the real plusses of oil and gas exploration is you can do it with a relatively small staff. We probably have only a dozen involved in running the Cowboys and related businesses. I am my own president and GM; if you eliminate my family you probably have only two or three people involved. You can do a lot of things with fewer people if you are willing to take a lot of risk. There is definitely a correlation.
FACE OF THE AMERICAN DREAM: OWNER, FLEX-N-GATE; OWNER, JACKSONVILLE JAGUARS
When I showed up in America at 16, I wasn’t trying to make billions – I was just trying to survive. I had come from Pakistan with 500 bucks in my pocket and not much else. The bus dropped me off at a place that cost $8 a night. I asked if there was anything cheaper, and they told me to go to the YMCA. So I trudged down the street in the middle of one of the worst snowstorms in Illinois history. I had never seen snow before, and my shoes were falling apart. The YMCA cost $2 a night, and after a meal, I was already down $3 or $4. That was big money back in Pakistan.
But the next morning, I found an opportunity to make even bigger money. All I had to do was wash dishes and I could earn $1.20 an hour. That was more than 99% of the people back home in Pakistan. I realized right then that this was the land of opportunity and I could control my own fate. Less than 24 hours after arriving, I had already discovered the American Dream.
VOICE OF A GENERATION: BEATLE, ARTIST, SONGWRITER, COPYRIGHT OWNER
In the mid-1980s, Michael Jackson and I were hanging out, and he asked me for career advice. I said, “Okay, three things: First of all, get yourself a really good manager. You’re really hot now, there’s going to be a lot of money coming in, and you really need someone to help you manage it. Second, think about getting into videos.” (Shortly after that, he did “Thriller,” so I thought that was cool, he took my advice.) Then I said, “And finally, be careful about your songs – own your work – and get into song publishing.” And he said, “Oh, I’m going to get yours!” I kind of laughed; I didn’t think he was serious. But he was.
It all goes back to the very beginning of the Beatles, when we signed the music publishing contract. We didn’t care what it was: We were just like any other writers; we wanted to get published. It turned out to be basically a slave contract; no matter how successful we made the company, we didn’t get a raise. After John died, I talked to Sir Lew Grade, who owned Northern Songs, the company that held our publishing rights. I said, “Lew, if you’re ever going to sell Northern Songs, you’ve got to come to me first.” He said, “I’m never going to sell.” And I said, “Fair enough. But if you do, come to me first.” He later came to me and said, “Yeah, I am selling it – for $20 million.” I said, “Okay, I think that’s a fair valuation.”
But I didn’t want to be the guy who bought John out. So I went to John’s people, and I said, “We’ve got this opportunity to buy Northern Songs, finally. It’s $20 million. And so that’s $10 million from me, $10 million from you. And we should do this, what do you think?” The response: “Oh, no, we can get it for $4 million.” I said, “I’m not sure about that.” It ended up falling through, and Michael later ended up buying it off this Australian guy Robert Holmes à Court for $47.5 million. I wasn’t willing to pay that much for my own songs. It’s difficult, when you’ve written them for nothing, to pay $50 million to get them back.
It’s so important to have good people around you. That’s why I’m anywhere near this list. My lawyers, John and Lee Eastman, are really smart, both great guys, and I listen to them. In recent years, they’ve helped me recover my copyrights. (There’s a U.S. law that allows me to get them back.) If I’m wheeling and dealing, life becomes very difficult for me. I’ve got to reserve a portion of my brain for writing songs.
ORIGINAL BARBARIAN: PRIVATE EQUITY PIONEER, COFOUNDER, KOHLBERG KRAVIS ROBERTS (KKR)
George Roberts and I are first cousins; we met at age 2 and we grew up together. We both went to Claremont McKenna College, and we roomed together in New York during summers, while I was working at Goldman Sachs and he at Bear Stearns. On our road trips from California to New York, we would quiz each other in the car: “What is yield? What’s P/E?” We didn’t know anything.
People often ask, “You must fight a lot?” The last fight we had was when we were 7 years old. He wanted to ride my new bike and I didn’t want him to. He chased me in the house in Tulsa, and I ran into the corner of a wall, cracked my head open. I had 23 stitches and thought, “Well, there has to be a better way than this.” So we don’t fight. We’ve never fought. We talk about things. He doesn’t agree with everything I think, and I don’t agree with everything he thinks, nor should we. It’s healthy. But we know each other so well I can finish his sentences, he can finish mine. Next to my wife, he is my best friend and confidant, and I trust him with my life, my family.
If you have the same values and are focused on the same goals, which is to build a firm that will be here long after we have retired, you can go a long way.
IMPACT MAN: EBAY BILLIONAIRE; SOCIAL ENTREPRENEURSHIP KINGPIN
We are on the cusp of a clean-energy economy, where energy is essentially costless, abundant and safe, with no externalities, no health costs, no Deepwater Horizons. Around the world, solar has done what looks like Moore’s Law. Wind has done somewhat the same, coming down to a competitive place. And to finish the trifecta, there’s a step change in batteries about to hit the world next year. I would liken the clean-energy revolution to the industrial revolution, just happening faster. The numbers are staggering.
Having clean, inexpensive, sufficient energy that’s not controlled in some government’s hands or some big business’ hands helps solve a couple of the giant threats coming down the pike. Climate change, obviously, is a biggie – this stuff doesn’t solve it, but it mitigates it. In terms of water issues, if you have enough clean energy and you have access to an ocean, you can desalinate and then pipe that desalinated water where you need it, and grow food in deserts that previously couldn’t sustain agriculture. In the Middle East, there’s a lot of conflict over water as well as refugees and displacement. Clean tech may also cover some of the issues with nuclear proliferation. There’s no need to build new nuclear plants, so why would anyone build one except for weapons? On the pandemics side, people living in better living conditions with more plentiful health and food options are less likely to be struck with diseases that become epidemics that become pandemics.
The clean-energy economy can happen in the next 10 years. So when I think out 100 years, we’re either going to be in a world of extreme abundance and peace and prosperity where people live these glorious lives, or we’re going to be toast. It’s one or the other.
LITERATURE AT SCALE: RECORD-SETTING AUTHOR (87 NO. 1 BESTSELLERS); FORMER CEO, J. WALTER THOMPSON
Don’t take “no” when your gut tells you “yes.” Just before Little, Brown published Along Came a Spider, the first of my Alex Cross books, I said I wanted to do a TV commercial. They said, “We don’t do TV commercials.” So I just went and did one for nothing – $1,500. And then I brought it to them, and they went, “Ooh, we like this.” I said, “Let’s run it.” That started things going. The book and me went on the bestsellers list.
Once I got out of the advertising business, I had a lot more time. I remember going to my publisher, saying, “I want to do more than one book a year.” I told them one was at a beach house, and it was a mystery. And the other one was Suzanne’s Diary for Nicholas. The fellow who ran Time Warner said, “We want to do The Beach House, but we don’t want to do Suzanne’s Diary because it’s not your brand.” And I went, “I don’t think of myself as a brand. But if I did, I think the brand is when you pick up a James Patterson book, the pages are really going to fly for you.” It was a big moment in my career because it was the point at which I went from publishing one book a year, to ultimately 20. And in multiple genres.
I faced the same resistance when I started writing children’s books. People have a tendency to stay within their comfort zone, and many thought I could only do adult thrillers. I knew I could write great kids’ books, though, and launched my own children’s imprint, JIMMY Patterson. Now I publish nearly as many kids’ bestsellers as I do adult titles.
ASIA’S SUPERMAN: CHAIRMAN, CK HUTCHISON AND CHEUNG KONG PROPERTY; RESPECTED PHILANTHROPIST
My experience in manufacturing taught me cash flow is the lifeblood of a company and one of the best safeguards for a company’s future. Between 1999 and 2000, when everyone saw the 3G development in Europe as a gold mine, it was overhyped. All through the spectrum auction, I directed our team to adhere to our cash flow projection and only advance with cautious deliberation. I knew everyone thought I was too conservative and challenged this mandate. But in retrospect our telecom businesses remain competitive while several of those companies that won the bid were stuck. Writing a check to invest $100 is easy; returning the same to shareholders is harder. That’s why I am a strong believer in advancing with cautious deliberation. Prudence and agility, creativity and innovation will give you the edge to thrive in uncertain times.
PRIVATE EQUITY BILLIONAIRE: FOUNDER, VISTA EQUITY PARTNERS
My training as a chemical engineer sharpened my passion for complex systems – for understanding them, deconstructing them and finding their equilibrium. But while I found beauty in the absolute truth of machines in the classroom, I found purpose in the messiness of human interactions in the real world. Whatever drives us, we all derive happiness from finding purpose. We find joy in thinking, doing and discovering – in improving people’s lives and catalyzing positive change in the world. And in this age of intellectual capital, where brainpower is the world’s most valued currency, the opportunity to find purpose – and create value that aligns with our values – has never been greater.
TURNAROUND SPECIALIST: FORMER CHAIRMAN AND CEO, IBM
When I arrived at IBM in 1993, I discovered that I had a number of businesses that were losing massive amounts of money, including one software product losing as much as $1 billion a year. I asked the question: What is the market share of this product? What are the customers saying? The answer: Our main competitor had 96% of the market; we had only 2%. But my technical people came back to me and said we had a better product, and my salespeople came back to me and said we had important customers that rely on this product. I was early in my tenure, so I waited. But the fact was that the product was not being accepted by enough customers to be viable, and we eventually killed it. There are always reasons to go slow, many of them good ones. Yet, when the decision is finally made, I’ve found my reaction is always the same: I should have done this a long time ago!
UPWARD MOBILITY: FROM TRADE SHOWS (COMDEX) TO CASINOS (SANDS: LAS VEGAS, MACAU, SINGAPORE) TO POLITICAL POWER (GOP)
You don’t always have to be the guy that comes up with a new idea from scratch. If you can take an old concept, like vending or gambling, and just put a new spin on it, e.g open new online casino success will follow you like a shadow.
When I was 16, I bought a bunch of vending machines. At the time, they were set up inside factories, which meant people only bought snacks during the 40-hour workweek. So I moved the machines into gas stations, where cab drivers were lining up 24 hours a day, seven days a week. Money came rolling in.
Years later I did a similar thing with casinos. Las Vegas had been successful in the United States, but China had a billion more people in it. Why not rebuild the Las Vegas Strip there? Everyone else in the gambling industry thought it was the dumbest idea ever. I charged ahead in Macau anyways. Now all the naysayers would cut off their right arm to get a piece of land there. I’ve got a warehouse full of right arms, and a couple of left ones, too.
INDEX FUND POPULARIZER: FOUNDER, VANGUARD, WORLD’S LARGEST MUTUAL FUND COMPANY
In 1965, my mentor, Walter L. Morgan, the founder of Wellington Management Co., called me into his office. It was the go-go era, and we only had a conventional, balanced mutual fund. “I want you to do whatever it takes to fix the company. You’re in charge now.” I was 35. So I merged with a very aggressive equity fund out of Boston with managers younger than I was. It seemed like an act of genius, until it wasn’t. The go-go era fell apart, and they turned out to be terrible money managers. In January 1974, the board of Wellington Management, controlled by that Boston group, fired me.
Except that the mutual funds themselves had a separate board controlled by independent directors, and I persuaded that board not to fire me. So there was a big fight, and it was resolved with a terrible deal: I would continue as chairman and CEO of the funds, which would be responsible for their own legal, compliance, administration and record keeping. (And I had to come up with a new name – that was the start of Vanguard Group.) My rivals, the people who fired me, would continue to oversee distribution, marketing and investment management. The scheme was totally irrational.
I had to find a way for Vanguard to take on the investment management and distribution of our funds. I had done some work on index funds in my senior thesis at Princeton in 1951. I had experienced the failure of active management firsthand. And I had just read an article by Nobel Laureate Paul Samuelson, saying, in essence, “Somebody, somewhere, please start an index fund.” I took the idea to the board and they said “You can’t get into investment management,” and I said, “This fund has no investment management.” They bought it, and there’s where the index revolution began. Then I decided we couldn’t allow Wellington and its sales force to continue to distribute the funds – so we eliminated all sales commissions and went no-load overnight. The directors said “You’re not allowed to take over distribution,” and I said “We’re not taking it over; we’re eliminating it.” They bought it, again.
When a door closes, if you look long enough and hard enough, if you’re strong enough, you’ll find a window that opens.
People assume they are most creative at a certain age. But if you look at truly great artists, they always get better. Matisse got better. Picasso got better. Da Vinci got better. I think it’s the same in all areas of creativity.
INDIA’S INDUSTRIALIST: FORMER CHAIRMAN, TATA MOTORS, TATA STEEL, TATA CONSULTING SERVICES, ETC.
Be passionate in areas relevant to you, and be a voice that is respected and abreast of developments. I have also tried not to express a view on matters which I am not fully involved with or qualified to comment upon.
VENTURE CAPITAL MIDAS
Here’s how I stay relevant: I read. I listen. I try to surround myself with smart people of all ages and backgrounds. Most Wednesday nights, my wife, Ann, and I host a group of college students for dinner to share their worldviews and the work they are doing. They inspire me with their potential and passion to change the world.
BUILDER: COFOUNDER, HOME DEPOT
Age is just a number for me – I haven’t thought about it in years. I go by the motto that I learn something new every single day. From reading and asking questions, you broaden your knowledge, your thinking, every aspect of your life. By the end of the day, I’ve learned something that shows how dumb I was yesterday.
COFOUNDER, FORMER CEO, SUN MICROSYSTEMS; VENTURE CAPITALIST (KLEINER PERKINS, KHOSLA VENTURES)
I explicitly don’t build or guard my reputation. I believe in telling it like it is and not worrying about it.
INFLUENTIAL DESIGNER: CO-CEO, PRADA
I’m not really interested in building a reputation for myself. But I do care for what the company stands for. I believe in work and being connected to the world we live in. You need to be curious and never stop studying. You have to challenge yourself to think every day to understand and react to what is happening.
Carlos Slim Helú
MEXICO’S ONE-MAN ECONOMY; ONETIME RICHEST MAN IN THE WORLD
At the end we leave with nothing. Entrepreneurs are only temporary managers of wealth. So do right by your customers, your employees, your backers.
SOCIAL CAPITALIST: FOUNDER, ACUMEN FUND
In our connected era, word spreads. People know when you are being true to your values. Don’t worry about reputation but about character. You build character by practicing empathy, practicing moral courage, practicing determination. Those traits are like muscles. When you are known for that, you don’t have to worry about guarding your reputation – others will do it for you.
ENTERTAINMENT ENTREPRENEUR: FOUNDER, ASYLUM RECORDS, GEFFEN RECORDS; COFOUNDER, DREAMWORKS
Being in business by yourself, you’re responsible, one way or the other, and I had a lot of success that way. In 1994, Jeffrey Katzenberg, Steven Spielberg and I started DreamWorks. We had to borrow a billion dollars, and raise a billion dollars in equity, which created a huge responsibility for me. I never had any debt before that. I did it because I wanted to help Jeffrey, who had been fired at the Walt Disney Company. But it wasn’t something I was passionate about. Partners have shared goals but also divergent ones. It was a commitment over 15 years, because I wanted to stay until the investors got their money back. That was very important to me. Starting a new studio was a thrilling challenge, but it was more stressful than fun. I never took a salary, a bonus or expenses. I learned never to do anything you’re not passionate about. I gave all the money I earned from the $3.8 billion sale of the company to charity.
Retire smart by…
WALL STREET CONGLOMERATOR: SHEARSON, TRAVELERS, CITIGROUP
I retired as CEO of Citigroup in 2003 and retired as chairman in 2006 because I was afraid of making an abrupt change in my life. That turned out to be a mistake, as I should have retired from both positions at the same time. When you’ve been the CEO of something for a long time and you retire, you should really retire. As chairman I spoke to directors about various issues and things that I thought were wrong, and I felt I was sometimes getting a response that they thought I wanted my old job as CEO back. I stress the importance of having another life outside of business so that when it does come time to retire, the transition is easier. For me that other life has been in philanthropy for the last four decades.
TECH TITAN (COFOUNDER, MICROSOFT); GLOBAL PHILANTHROPIST (BILL & MELINDA GATES FOUNDATION); RICHEST PERSON IN THE WORLD (FOR NOW)
In early 1975, when I was in college, my friend Paul Allen showed me an issue of Popular Electronics featuring the Altair 8800 computer, the first commercially successful personal computer. We both had the same thought: “The revolution is going to happen without us!” We were sure that software was going to change the world, and we worried that if we didn’t join the digital revolution soon, it would pass us by. That conversation marked the end of my college career and the beginning of Microsoft.
The next 100 years will create even more opportunities like that. Because it’s so easy for someone with a great idea to share it with the world in an instant, the pace of innovation is accelerating – and that opens up more areas than ever for exploration. We’ve just begun to tap artificial intelligence’s ability to help people be more productive and creative. The biosciences are filled with prospects for helping people live longer, healthier lives. Big advances in clean energy will make it more affordable and available, which will fight poverty and help us avoid the worst effects of climate change.
The potential for these advances is thrilling – they could save and improve the lives of millions – but they’re not inevitable. They will happen only if people are willing to bet on a lot of crazy notions, knowing that while some won’t work out, one breakthrough can change the world. Over the next 100 years, we need people to keep believing in the power of innovation and to take a risk on a few revolutionary ideas.
THRILLIONAIRE: CONSUMMATE ENTREPRENEUR; FOUNDER, VIRGIN GROUP
I suppose that out of all the businesspeople in this issue, I’ve done a few more mad, zany things to get my companies on the map. Sometimes these stunts work, sometimes they don’t. When Virgin America launched its Las Vegas route, my staff took me to the top of the Palms Hotel there and told me that I had to jump off the top floor into the party on the bottom floor on a bungee. I was very sceptical – the wind was blowing 50 miles an hour. But I jumped and hit the side of the building on the way down, completely ripping my trousers off. Blood poured down my legs as I arrived to the party. The Virgin brand is quite intricately linked with me personally, so I have to be careful not to go and damage the brand myself.
But that doesn’t mean not taking risks. As the Virgin Group has gotten much bigger and much stronger, we can afford to take bigger, bolder risks in lots and lots of different sectors. One of our biggest investments has been the space companies, which we have already invested $1 billion to set up. We take tons of risks in life, whether personal risks or business risks. We sometimes fall flat on our face. But people don’t mind people who try things and fail.
Risk management by…
PRIVATE EQUITY KINGPIN: COFOUNDER, BLACKSTONE
When Pete Peterson and I launched Blackstone in 1985, we wanted to create a place where people would enjoy coming to work and be rewarded for internal collaboration. The firm we came from was known for its internal rivalries, with partners often at odds, plotting against and one-upping each other.
Creating this environment became important early in Blackstone’s history, as we moved from M&A into private equity. We had no organization then. People would just come into my office and ask me to make decisions. One deal, a steel distribution company in Philadelphia called Edgcomb Steel, didn’t turn out the way we hoped because we failed to solicit multiple points of view from all of our partners. I had a special tombstone made for that deal, which was black and in the shape of an actual tombstone to remind myself every day of what I learned. I realized that we needed to set up rigorous processes to review deals together and help avoid risks, even if that meant challenging an idea I was putting forward. Nobody’s job was to say, “I think it’s wonderful.” Instead, I insisted on everyone coming together to analyze potential problems that could lose investor money.
Today we’ve institutionalized this approach across the firm and have our deal teams meet every Monday to review each potential transaction. We’ve replicated this process across each of our business groups. Without this process, I’m not sure we would have evolved into a successful business.
DOER: FINTECH AND MEDIA PIONEER; SOLUTIONS-ORIENTED MAYOR; PHILANTHROPIST
I was fired from Salomon Brothers in 1981 in part because no one at the firm thought much of my idea for computerizing financial data and analysis and presenting it in real time. Back then, most financial professionals didn’t know how to use a computer, much less have one on their desk.
Organizations resist innovation – and those that do inevitably fail – because people are more comfortable with what they know than with what they don’t. Looking beyond the horizon and taking risks have always been a core part of our company’s culture, which we brought to New York’s city hall and worked hard to spread throughout city government.
In both the public and private sectors, innovation requires hiring smart, creative and driven people, empowering them to take risks and standing behind them – in a public way – when things don’t go as hoped. The biggest management failures in both business and government are not missed targets but missed opportunities.
MEDIA MOGUL: BOSS AT ABC, PARAMOUNT, 20TH CENTURY FOX; FOUNDER, IAC
Don’t think of a specific job, so to speak, or a specific career, like “I’d like to be this” or “I’d like to be that.” You should find an area that interests you and just get on the highway, and it will lead you wherever you lead it. For me, I’ve only really worked for three companies: ABC was eight years, Paramount was 10 years, and Fox was eight years. That’s my entire working-in-a-company life, so to speak. I got to a point where I wanted to work for myself. If you can, do it – which is more than just the word “can”; there’s a lot cooked up in there – you should. You can control your own destiny, whatever that is, good or bad.
KING OF THE STRIP: SAVIOR, GOLDEN NUGGET; FOUNDER, MIRAGE RESORTS, WYNN RESORTS, ETC.
I’m in the service business, where 10% of the franchise is the stuff and 90% is the guest experience. So the big question for me: How do you motivate employees? With 13,000 of them at the Wynn and Encore, you can’t have 6,500 supervisors watching 6,500 people. You need to have a culture instead of a payroll, so that people watch themselves. What does this? Not money, but enhanced self-esteem.
Spotlight programs, such as Employee of the Month, are great, but there’s honest prejudice built into them, as well as luck. So we retrained 1,300 supervisors to become something of a psychologist and learn how to evoke a story. Every day they hold 15-minute preshift meetings that start out like this: Who can tell us about something that happened yesterday with a guest? Then when staffers tell the story, we reinforce it. We thank them. The supervisor calls a storytelling hotline. We then put the story on the in-house internet and plaster it on the walls. We make the storyteller a hero and do this hundreds of times a week. Now I have 13,000 people looking for a story – it’s the thing that brings them all together. Since the employees get to nominate themselves, they control their own enhanced self-esteem. That’s the key to paradise.
FATHER OF MICROLENDING: FOUNDER, GRAMEEN BANK; WINNER, NOBEL PEACE PRIZE
Capitalism has been interpreted to be based on greed. But while human beings are selfish, they’re also selfless. Why is the latter part discarded from the interpretation? We’re increasingly seeing social businesses, or nondividend businesses, whose entire objective is to solve problems rather than make money, being born in many parts of the world. In social businesses, profits are recycled inside the company itself to continue work on a problem. Investors get to recoup their money but nothing more, other than the enjoyment of what they’ve done. Making money is a happiness; making other people happy is a super-happiness.
An example: We’ve started Grameen Shakti, or “Grameen Energy,” to bring electricity to rural Bangladesh. We tell people, “Whatever money you spend on kerosene every month, give that money to us, and we’ll give you electricity.” And we use their money to finance their solar home system – and after three years, they get to keep it without any other payments. We’ve created 2 million solar-powered rural homes, the world’s largest off-grid system, and customers can’t believe it – they can now have television and charge mobile phones. It’s so successful, many competitors have sprung up – which we welcome, because we are a social business, and those competitors help solve the problem.
In Bangladesh, for the last three years, we have been asking unemployed young people to come up with their own moneymaking business ideas, and we invest in them. We become the social business venture capital fund for them. We assure them that none of them will be rejected, only the implementation-ready ones will get funded. Now we fund 1,500 new entrepreneurs each month. This number keeps growing every month. Nineteen thousand businesses have already been funded. Success rate is 99.5%. We believe all human beings are born as entrepreneurs. They are not born to work for somebody else. Their early history is about being hunters, gatherers and problem-solvers. It remained as an essential part of our DNA; we are not job-seekers, we are job creators. Jobseeking is a wrong turn in our history.
REVLON RON; BUYOUT SPECIALIST
The world is changing so fast that you cannot bask in any sort of passivity, because it doesn’t exist anymore. You have to be on top of your game at all times. Two kids can develop Google in their garage, and 15 years later, it’s the most powerful company in the world. It’s like the Henry Ford days on steroids. Everything today is speed, and there is always somebody else working on something better. One of our companies, Deluxe, was the largest supplier of prints to the film industry. We knew that prints was declining but didn’t know it was about to go off a cliff.
Luckily, we were already supplying a digital solution for the same service, but a transition that we thought would take years only took a matter of weeks.
THE WORLD’S ELECTRONICS MAKER: FOUNDER, FOXCONN
In the first 20 years of my career, I worked hard to make money. It was necessary, because without it, accomplishing my ideals would not be possible.
In the second 20 years of my career, I worked for my ideals. Guided by those ideals and a purposeful life, I developed a good working spirit and self-confidence to withstand any challenge.
In the next 20 years, I will work for issues that are my passion. My interests and my priorities are using my life experience and what I have been able to achieve to nurture the next generation so they can make their own contributions to building a better world.
I believe that the most fortunate professionals in the world are those who can successfully carry out those three phases throughout their working life.
TELEVISIONARY: HOLLYWOOD’S TOP SHOWRUNNER
Storytelling has become ubiquitous, across so many mediums, creating an audience that’s ever more sophisticated. But it doesn’t matter how many people tell stories or how many platforms they go on. Storytelling remains basic: It’s a just a campfire, the human connection that says you’re not alone. New mediums like VR will go so far as to put you inside, but there’s going to be a lot of dissatisfaction there. If you decide the ending, there’s no adventure. In a world of unlimited voices and choices, those who can bring people together and tell a good story have power.
THE SAM WALTON OF THE 21ST CENTURY: FOUNDER, AMAZON
We’re in the midst of a gigantic transition, where customers have incredible power as a result of transparency and word of mouth. It used to be that if you made a customer happy, they would tell five friends. Now with the megaphone of the internet, whether online customer reviews or social media, they can tell 5,000 friends. In the old days, an inferior product could prevail in the marketplace with superior marketing. Today customers can tell whether product and service is good because there’s so much transparency. They can compare it to others very easily, and then they can tell all their friends – the customers will do part of the heavy lifting, marketing-wise. Rather than inferior products shouting louder, we have sort of a product meritocracy. It’s very good for customers, it’s very good for the companies that embrace it – and it’s very good for society.
GENRE CREATOR: FOUNDER, MOTOWN RECORDS
Dr. Martin Luther King Jr. came to see me in Detroit at the peak of the civil rights era. And I was, of course, honored. He said, “What I’m trying to do politically and intellectually, you’re doing with your music. I love the feeling people get when they hear your music. And so maybe we can make a deal.” That was the biggest compliment that I could think of. And we put out three albums covering his greatest speeches. It just goes to show that if you do the right thing, the right thing will come to you.
SERIAL ENTREPRENEUR (KB HOME, SUNAMERICA); MAJOR PHILANTHROPIST
If you look at all the companies in the new economy, whether it’s Amazon, Uber, Facebook or Google, reasonable people wouldn’t have done that. George Bernard Shaw said the reasonable man adapts himself to the world, the unreasonable person doesn’t; therefore all progress comes from unreasonable people. I think my wife gave me a plaque that said that shortly after we were married. Being unreasonable allowed me to do things: Leaving the profession of accounting to start a homebuilding company; to take a traditional life insurance company and change it into a retirement-savings company, which we then sold to AIG for $18 billion, which then allowed me to become a fulltime philanthropist.
I think the best thing to do is follow the advice that reasonable people maintain the status quo – those who are unreasonable make changes. I have yet to meet a scientist who wants to maintain the status quo. I hope philanthropists will do things that government can’t or won’t do. If you’re a government bureaucrat, if you make a mistake, you’re going to be out. A lot of things that have started with philanthropy then became of interest to government. In philanthropy we don’t worry about getting fired. There’s a lot of work to be done.
LAST OF THE NEWSPAPER MOGULS, SHREWDEST OF THE POWER BROKERS: EXECUTIVE CHAIRMAN, NEWS CORP., 21ST CENTURY FOX
As a relatively shy and inexperienced young newspaper owner at the Adelaide News in Australia, I was lucky enough to work alongside top-notch reporters, editors, compositors who put together the paper in metal form ahead of its printing. Hardy souls who had no time for elitism or airs and graces, and even less time for incompetence.
My outlook, energy, self-assurance and sense of social purpose were fashioned in the slightly mad meritocracy that is the newsroom, where you start each day with a blank canvas and relentlessly strive to capture as much original news as possible and present it in a manner that is coherent, compelling and valuable. The urgency, daily drive, that constant self-questioning integral in editing a paper, the ceaseless curiosity, are what I have stood upon every day of my career, taking me and our businesses further than my young self ever imagined. Those experiences, those principles, helped me build a business in television and films and digital media, where drive and creativity are essential and working as part of a team, regardless of your title, is imperative.
To those early colleagues, who tolerated my inexperience and guided me with their earthy wisdom, I am and will always be grateful.
CONSULTANT, AUTHOR: GOOD TO GREAT AND BUILT TO LAST
Peter Drucker made the biggest impact upon me in a personal moment when he hit me with a challenge, like a Zen master thwacking the table with a bamboo stick to get the attention of a wayward student. “It seems to me you spend a lot of time worrying about how you will survive,” he said in his resonant Austrian accent, referring to my anxiety in leaving my comfortable faculty teaching post at Stanford to carve a self-directed intellectual path at age 36. “And you seem to spend a lot of energy on the question on how to be successful. But that is the wrong question!” Then, pausing for effect, “The question is, how to be useful.”
THE POWER BROKER: INDUSTRIAL AND POLITICAL KINGPIN; CEO, KOCH INDUSTRIES
I expect all our employees to live up to the set of values that we started codifying for Koch Industries decades ago. Among our 10 guiding principles: having integrity and humility, treating others with respect, proactively sharing knowledge and focusing on creating the greatest long-term value. The biggest mistake I’ve made in business is hiring and promoting executives who only paid lip service to them. That got us into several bad deals – and drove out people who shared our values. (It took several years to restructure our management teams and divest those deals.) When hiring, if forced to choose between virtue and talent, choose virtue. Talented people with bad values will do far more damage than virtuous people with lesser talents.
FOUNDER, FAST RETAILING (UNIQLO)
I come from a small mining town in Yamaguchi Prefecture. My lifestyle is based on doing the right thing and on being correct in my actions. In my daily life I try my best to practice what is known as Shin Zen Bi, which translates to Truth, Goodness, Beauty. By continuing with these values, I believe I can live my life in a reputable way.
BROKERAGE DEMOCRATIZER: FOUNDER, CHARLES SCHWAB
In the late 1990s and early 2000s, we were growing by leaps and bounds. Everybody wanted to trade stocks. Then came the dot-com bust, and all of a sudden, business collapsed. I came back as CEO in 2004. We realized success had covered over mistakes, and we had begun to lose our compass. The only path forward was to go back to our core values – helping individual investors with lower costs, less complexity and great service. We cut expenses, we trimmed back staff, we sold off businesses, and ultimately we turned things around.
MAVERICK: CABLE TELEVISION PIONEER; FOUNDER, CNN; HOLLYWOOD STUDIO DABBLER; U.N. SAVIOR
Growing up, my father hired a man named Jimmy Brown to work for our family, and he became one of my dearest friends. Jimmy taught me things my own father couldn’t teach me, like how to sail. We were living in Savannah during segregation and Jimmy and I couldn’t have been a more unlikely pair – a privileged white kid and a grown black man. But Jimmy provided more wisdom and understanding than anyone else ever did. I don’t think I would be the person I am today if it weren’t for him.
AMALGAMATOR: SENIOR CHAIRMAN, CP GROUP
Each industrial age is different. We are now in an era when the younger generation is redefining the market with startups, technology and innovation. In this new world, everything happens and changes very quickly. Successful people today are both innovators and disruptors – they create something that was not there before. Most importantly, we need to appreciate that the success we have today can be taken away tomorrow and that there are more capable people with better technology that we need to keep up with. If we are complacent and not open to change, we will soon lose our place. The best way to stay ahead is to learn from the younger generation. The knowledge and thought processes among people who grew up in Industry 3.0, when computers were new concepts, compared to Industry 4.0, when robots and AI are revolutionizing production processes, are very different. The new generation will always lead us to new innovations and ways of doing things we could never have imagined before.
THE GRAVE DANCER: VULTURE LEGEND, REIT COLLECTOR
There were many times in my life when I would have liked to follow the herd. Instead, I have always followed my gut – and sometimes it’s been really lonely. In 1991, I was standing in the lobby of a bank, and they had agreed to sell me an office building at 50 cents on the dollar. I kept looking over my shoulder and wondering why there were not all sorts of people waiting in line behind me. After all, this was an incredible opportunity. Maybe I was wrong? But I thought it through again and decided that I knew what I was doing, so I kept going. By 1994 all those people were there in line, but the bulk of the opportunity had passed. When you look at The Forbes 400 list and take off everybody who inherited money, what’s left are people who went right when everyone else went left. Conventional wisdom leads to mediocrity.
HOTEL DISRUPTOR, SHARING-ECONOMY POINT PERSON: COFOUNDER AIRBNB
Pablo Picasso once said, “It took me four years to paint like Raphael, but a lifetime to paint like a child.” I think you must always live and think like a child. Or have that childlike curiosity and wonder. That’s probably the most important trait you can have, especially as an entrepreneur. And even though I’m still young, I try to always look at what people significantly younger than me are doing. What’s the next thing? I like to imagine the world five years from now. Or imagine what I want the world to look like five years from now. And when I think back to when we started Airbnb, we were trying to challenge the status quo. Now we’re trying to challenge ourselves.
Contributors: Susan Adams, Dan Alexander, George Anders, Madeline Berg, Steven Bertoni, Abram Brown, Kathleen Chaykowski, Kerry A. Dolan, Matt Drange, Antoine Gara, Zack O’Malley Greenburg, Miguel Helft, Chris Helman, Matthew Herper, Alex Konrad, Luisa Kroll, Michael Noer, Janet Novack, Randall Lane, Clare O’Connor, Michael Ozanian, Natalie Robehmed, Matt Schifrin, Michael Solomon, Halah Touryalai, Nathan Vardi, Alexandra Wilson.
How mogul Abdulsamad Rabiu has become a billionaire again
Nigeria’s business mogul and third richest man, who cemented his return to Forbes’ African Billionaires List this year since dropping off it in 2015, says he owes his $1.6 billion net worth to being a disruptor – and to being stubborn.
The inside of Abdulsamad Rabiu’s office, on the corner of Churchgate Street, in Victoria Island’s commercial district in the heart of Lagos that is notorious for chaotic, rambunctious traffic, is marked by a serious lack of clutter.
The expansive room is tastefully decorated in cream and black hues. Rabiu’s desk is organized in a manner that seems as though everything is exactly where it should be; completely spotless and devoid of any distractions that will hinder the 58-year-old founder of BUA Group from managing his vast empire, a conglomerate spread across southern and northern Nigeria.
A firm believer in strategy, the cement and sugar tycoon boosted his fortunes by a whopping $650 million this year when he merged Kalambaina Cement, a subsidiary company of his BUA Cement, with the publicly traded Cement Company of Northern Nigeria (CCNN), where he was a controlling shareholder.
That calculated move has made him the third richest man in Africa’s largest economy, with a staggering net worth of $1.6 billion, according to the latest Forbes African Billionaires List, which he dropped out of.
“Nigerian cement mogul Abdulsamad Rabiu, who runs and owns the BUA Group, returns to the list for the first time since 2015. He merged his Kalambaina Cement firm into publicly-traded Cement Company of Northern Nigeria, which he controlled, in late 2018. Rabiu now owns 97% of the list entity,” Forbes reported.
He says his fall from the coveted list was due to the devaluation of the Naira, which meant that the exchange rate went from N190 against the dollar, to N300.
“That was the main reason I dropped off the rich list. Also, most of our other assets were not being considered because once you are not listed, it becomes more challenging to get an accurate valuation.
“Our assets, in the cement industry alone, are worth more than $2 billion, but that is because Obu Cement [Plant], which is our biggest cement plant, is not listed,” Rabiu says.
His return to the billionaire boys’ club is due to five years of strategic expansion and a much more stable Nigerian economy. However, it is about more than just numbers for Rabiu.
“It is a good feeling to be on the rich list, the most important thing is not about how much money you make, but the impact you make. Touching people’s lives is more important because money is a number. What you need in terms of your day-to-day is not that much.”
One of the secret ingredients to his tremendous success is that Rabiu is a firm believer in delegation.
His phone purrs only occasionally, but this is also because his plants run with clockwork precision in an environment that is chaotic at the best of times.
He has a calm and soft-spoken demeanour, a trait which is, quite frankly, unconventional for someone who has fought his way through hell and high water in business.
“I am quiet but I am very stubborn. If I want something I go for it and if I don’t want it, no matter how much I’m pushed, I don’t do it. If somebody is stubborn, sometimes it’s seen as arrogant but I don’t think I am an arrogant person,” Rabiu says.
It is also immediately clear that he is not a man who rushes into things. He would rather move methodically, with clarity and precision, a skill he picked up in the early days learning the ropes from his industrialist father. Case in point is how he built his empire brick-by-brick from the early days as an importer.
“In 1988, I started my own business and founded BUA International Ltd. At the time, the in-thing was importation of rice, sugar, fertilizer, agriculture etc. So the challenge was that, if there was scarcity of any product, everybody would now go and import the same thing. This pushes the price up and everybody will say the price of fertilizer has doubled, so everyone would now go and import fertilizer and within a short time, the product would now come down to half price and everyone would lose money,” Rabiu says.
He decided to break the mould and instead adopted a value-added approach. He focused on bringing in raw materials to process it locally.
“We started with oil in Kano. We were processing crude palm oil to refine it. We were also getting peanuts from Kano and then crushing and processing, and that was a good business at the time because it was adding value and people were not used to adding value to anything at all. They were importing everything.”
In 2000, BUA acquired Nigeria Oil Mills, which was a peanut processing company in Kano. In 2005, he set up the BUA Flour Mills factory in Lagos. Rabiu saw very early on that he had to be distinctive in a sea of importers who simply followed the trend.
It is this measured philosophy of value that has allowed BUA Group to innovate and expand capacity to about 2 million tons of cement per annum with its new merger. Rabiu says with the consolidation, BUA Group has a market valuation of about $800 million. A far cry from the company’s humble beginnings.
Returning to Kano as a newly-minted graduate with a degree in economics from Capital University in Columbus, Ohio, in the United States, a lot had changed while Rabiu was away.
The country was being run by a military leader and there were severe shortages in foreign exchange which made the business of importation extremely difficult. Following his new ethos of adding value to the production line, Rabiu set his eyes on the sugar business by establishing the 2,000 metric ton (MT) per day capacity plant in Lagos which is the second largest refinery in West Africa, after the Dangote Sugar Refinery.
But the BUA story isn’t without its share of trials and tribulations. The fight began in the early years of business, when the Nigerian government introduced the backward integration policy in the sugar business.
“This is where you were allowed to import raw sugar and process into refined sugar and you must have a sugar refinery facility. So, if you have the facility for a sugar refinery, you were able to import sugar and pay a duty of 5% to 10%, while everybody else was importing refined sugar and paying 50% duty,” Rabiu says.
At the time, it was only the Dangote Group that had the refinery facility, so Rabiu decided the lack of saturation made sugar a viable business to go into.
The government’s backward integration policy is a well-known competitive strategy which allows an organization to control more of its supply chain in order to bring down the costs.
It means that a company is allowed to purchase or internally produce segments of its supply chain. This is done to ensure the supply, along with securing bargaining, leverage on vendors.
To take advantage of backward integration, a company needed to have its sugar refinery at the ports in order to import raw materials in bulk, which made having a terminal at the port a prerequisite.
“At that time, everything was owned by [the] Nigerian Ports Authority (NPA), so you had to go and lease land from them, together with the storage. This was a huge capital investment, and to make matters worse, there was no land at the time because everything was taken.”
Luckily, Rabiu was able to find a company that had a facility that was not being utilized.
“We paid a lot of money to that company, got all the designs, bought all the equipment, we were about to start the company, then the lease was revoked and we could not go there. This was during the [Olusegun] Obasanjo regime. Most of our money had been spent on getting the land and equipment and they revoked the lease and gave it to somebody else. It took us a year and almost $50 million in cost before we were able to start all over again,” he says.
Incidentally, that site was given to Rabiu by his father. Once they took off, the business worked out so well that they were able to recoup their money within a very short period of time. The sugar venture was a cash cow.
The company was able to reap huge margins due to the difference in duties for imports of raw sugar, and, yet again, Rabiu found validation in his strategic approach to business.
Even in those early days, his penchant for success was apparent. The sugar refinery is still operating at capacity and Rabiu is in the process of commissioning another refinery at Port Harcourt in Nigeria. They say the apple does not fall far from the tree, and this is true for Rabiu.
His father, Isyaku Rabiu, was a renowned businessman, who also made his fortune in trade decades after Nigeria’s independence.
His wealth grew significantly until the 1983 coup which toppled the government and led to the arrests of President Shehu Shagari and his close allies, including Isyaku, leaving his business empire in a precarious state.
But where his father lost his footing in trade, Rabiu was destined to find his in cement. Opportunity came knocking in 2007 when the price of cement was so high that the Nigerian government decided to introduce yet another backward integration in the cement industry.
The idea was simple. You could only import cement into Nigeria, if you had a cement factory. At the time, there were only two multinational organizations in the country with the capacity to build their own cement plant.
Local companies like the Dangote Group and Flour Mills of Nigeria were the only two other companies that had signed contracts to build cement factories in Nigeria.
“Nobody else was allowed. So President [Umaru Musa] Yar’Adua was alarmed that the prices of cement was going up every day and he called for a meeting when the price was $300 per ton. He said it was too much, so what do we do? He was briefed on the reason nobody else could bring cement into Nigeria and told that there was a policy in place that only those building factories could import cement into Nigeria, and we did not have enough capacity in terms of manufacturing to meet Nigerian demand.”
There were only three or four cement plants in Nigeria at the time producing about 4 million MT per annum against what the country needed – almost 10 million MT.
The president ruled that the existing backward integration policy could not be continued and established a committee who came up with the idea that the policy should allow companies outside manufacturers who were building plants, in order to bring prices down.
“So they selected six companies to be able to import cement and we were chosen as one of the six companies,” Rabiu says.
But there was a big challenge.
“How do you import a million tons in a year or even 100,000 tons a month in bags? That will be like five or six cargos a month, to be able to take the bags out and transport them all over the country, so nobody could actually do it.
“The other guys had terminals, which means they were discharging the cement in bulk and taking it to their warehouses and bagging them in the warehouses and they had been in the business for a long time,” Rabiu says.
In order to reap the rewards in the lucrative cement industry, all the new six companies who had been granted licenses needed to secure terminals at the port. But the barriers to entry were significantly high.
Rabiu decided on a disruptive approach. “So I now came up with the idea of the floating terminal. It is like a factory on a vessel, so it moves. It is a big ship with a terminal in the ship. It was an idea I read about a long time ago and I decided to be innovative.”
He approached the only terminal at the time that was free in Greece and agreed on a price.
Fearing the size of the competition, Rabiu knew he needed to get protection for his business, if he stood a chance of competing favorably in the new venture.
“I knew that we had tough competition from the people who had factories and they were not happy with the government giving us the license because they were making so much money they did not want anyone to come into the business.
“So they were doing everything to frustrate it [the process]. I knew that there would be a problem. So before I bought my vessel, I came to Nigeria and sought an appointment to meet the president who granted me an audience and I explained everything to him.”
Rabiu made an impassioned plea to President Yar’Adua — he knew he could drive down the price of cement from $300 per bag to $150 if he had his own terminal.
However, building the terminal would take more than a year to complete, during which time cement prices would continue to rise, which would be detrimental to the Nigerian economy.
A floating terminal meant that the timeline of going to market was significantly reduced but more importantly, without the blessing from the president, the other giants in the industry would muscle him out of the game.
Once approval from the president was secured, Rabiu purchased his floating terminal and was ready to reap in the millions of dollars awaiting him in bags of cement.
It was logistically impossible for Rabiu to set up shop in Lagos. These circumstances pushed him to explore other means through which he could realize his goal. He approached Port Harcourt and this move proved to be fortuitous for him because all the eastern markets were coming to the port as there was nothing in the east.
However, not everything was ideal as he was allowed only one week in a month after which point he had to leave the port, making it difficult to offload his cement.
Rabiu was faced with more hurdles but eventually, was forced to consult the highest authority in the country to explain the barriers he encountered.
It was only after an order from the president that the impediments to Rabiu’s business stopped and, with that, came the growth of the BUA Group, to become one of the leading conglomerates in West Africa. As the monopolists gradually loosened their grips on the cement industry, Rabiu used the opportunity to build capacity. The company has five plants now.
“That experience strengthened my resolve because it was not easy. I never thought I was going to quit. If you don’t fight back or if you are weak, you will never survive. You have to understand that this is not personal but business and you have to keep fighting. When they see that you are fighting and not giving up then they let go because most of these things are illegal anyway,” says Rabiu.
BUA Group steadily expanded to cover new ground. With the new merger, Rabiu has seen an opportunity outside Nigeria’s borders. The demand between Sokoto and Niger through to Burkina Faso is estimated to be about 4 million MT of cement per annum.
Coupled with the fact that these countries are landlocked, there is a need to import all their clinker, the raw material needed for making cement.
His new merger with CCNN will create the second largest cement company on the Nigerian bourse after African mammoth, Dangote Cement.
Rabiu believes in Nigeria’s ability to produce its own products without relying on imports from other countries and in so doing, create tens of thousands of jobs for the Nigerian economy.
As the avenues to expand in Nigeria get limited, BUA Group has consistently sought to broaden its reach to new territories.
The fighting days are long gone and BUA under the aegis of its bold leader is ready to conquer new turf in Africa.
The Madhvanis: The Industrialists Who Have Tasted Sucrose And Success
The Madhvanis started with sugar and now lead diversified global businesses. In a rare interview from their home base of Kakira in Uganda, Mayur and Kamlesh Madhvani, the Joint Managing Directors of the Madhvani Group, share a century-old tale of extraordinary family enterprise and how they are continuing the legacy of their forefathers.
It’s a bumpy 100km drive from the Ugandan capital of Kampala to the town of Kakira in the east. Past the swaying sugarcane plantations and green hillocks and roundabouts intermittently featuring the words ‘Madhvani’ and ‘Sugar’ that announce you have arrived, a tranquil avenue, immaculately lined by pine trees and acacia, leads to Kakira.
From this little town, an international empire was built, with a reach in far and distant lands. To this little town, have many a cavalcade, bearing presidents and global business tycoons, made its way.
At the sugar factory that is the pulsating heart of Kakira, the quiet of the verdant landscape rapidly gives way to the deafening sound of production.
The sound of enterprise, the sound of African industry.
Close to the equator and Jinja, the source of the Nile, I am in the ‘cane yard’ of Kakira Sugar Limited, watching giant machines noisily swallow up truckloads of sugarcane and crush them into pulp.
READ MORE | Uganda Sees 11% Growth In Sugar Output This Year
Under the sweltering African sun, these monsters, also known as feeder tables, are four in number around me, relentlessly chopping tons of sugarcane fed by a long line of at least 400 trucks piled high with unruly cane stalks gathered from the fields in this eastern corner of Uganda.
This is the back-end and the beginning of a well-oiled factory process that will eventually turn sugarcane into foamy rivers of juice and finally sugar.
The entire process, from feeder table to sugar crystal, is completed in eight hours, resulting in bags of refined sugar at the other end.
Inside the factory, even the air is calorific, with the saccharine-sweet smell of sugar – and success. The factory is the soul of the 14,000-hectare Kakira Sugar Estate, which provides a livelihood to some 9,300 direct employees, and sugar to the rest of Uganda and East Africa.
It is the core business of The Madhvani Group, Uganda’s biggest sugar producer. And everything within a 10km radius from here, belongs to the group.
Generations of the Madhvani family have been based in Kakira, and much has happened here over the last century: success, strife, destruction and resurrection.
It all started in 1908, when at the age of 14, the family’s venerable patriarch, Mujlibhai Madhvani undertook the long and arduous journey from India to Uganda, to join his uncles Vithaldas and Kalidas Haridas in their shop in Iganga. By the time he was 20, Mujlibhai was tasked with opening and managing a shop in Jinja, a town at the source of the Nile River.
The waters ran deep in his veins as he was determined to make a success of his enterprise. He was appointed the Managing Director of Vithaldas Haridas & Company, which in 1918, bought around 800 acres of land in Kakira. The sugar factory subsequently started operating here in 1930, with a cane crushing capacity of 150 tons per day.
Mujlibhai built his empire on sugarcane, and laid the foundation for Kakira’s development, also empowering the communities within. Kakira grew around the factory and family home.
Soon, Mujlibhai Madhvani & Co. was also manufacturing sweets, soap, cooking oil, ghee, tea, margarine and pastry shortening. It also made cotton and became the agents for imported goods such as Goodyear tyres.
The late Manubhai, Mujlibhai’s second son, writes in his book, Tide of Fortune, an account of the family’s tale, with British author Giles Foden: “My father was the first person in Jinja to own a radio, which he bought in 1938. He purchased a record player in 1940 and soon afterwards, he became the proud owner of a 9.5mm film projector. His love of cars led him to purchase an extremely expensive powder-blue Buick, as well as an Oldsmobile.”
After Mujlibhai’s death in 1958, his eldest son, Jayantbhai, took over the business. Manubhai worked closely with him. By 1970, the Madhvani Group, according to Tide of Fortune, was at its peak with rapid annual growth of at least one new manufacturing unit a year. Manubhai says of his brother Jayantbhai: “I admired his humility and his commitment not only to serve the family, but also the community at large.”
And he further pens: “How did we select the industries we were expanding into? It was a combination of two or three policies, really. The first was to seek vertical integration. If you make beer, you will need bottles, so why not manufacture them and some plastic crates as well?”
Unfortunately, for the Madhvani family, tragedy struck when Jayantbhai died of a massive heart attack in 1971.
Politically too, Uganda’s destiny was changing.
When Idi Amin came to power in 1971, Manubhai was thrown into the Makindye military prison, an infamous hell hole, by the ruler for 21 days. The Madhvanis, along with the rest of the Asians living in Uganda, were notoriously expelled by Amin in 1972. The family relocated to London and then Kenya.
The sugar mill operation, which was producing 83,000 tons of sugar and contributing to 10% of the country’s Gross Domestic Product (GDP), was destroyed, looted and run down.
“Production had been at a standstill since the end of 1983 and the great hangar where sugar had once been produced was now a home to birds and animals,” says a line in Manubhai’s book.
When Amin was toppled, the Madhvanis returned, to the vestiges of their farm and factory, and a family squabble, with a segment of the family taking over the business in 1980.
The property was returned and the process of recovery started in 1985, with Manubhai and Mayur, Mujlibhai’s youngest son.
“When you repossess assets that are completely destroyed and run down, there is obviously a great emotional side to this,” says Mayur, the Madhvani Group’s Joint Managing Director, when we meet him in his offices at the Kakira sugar factory on a sun-filled afternoon in March.
The offices he shares with his nephew and Joint Managing Director, Kamlesh, Manubhai’s elder son, are adorned with tasteful MF Husain paintings, family memorabilia and redolent with the smell of incense. The British-educated Mayur, wearing a crisp white linen shirt, warmly invites us to his office space.
“For us, it was not so much a business decision, I think it was more of an emotional decision but it ran into the business arena because we knew that once the industry would come up, there would be growth,” continues Mayur about the challenging 1980s.
Kamlesh, 64, who joined the business a few years later, and is the younger of the two, chips in: “Kakira is where the roots of the family are. What we learned very quickly was that it is far easier to build something new than to rehabilitate something that is in total disrepair. It is not only the physical assets but also the mentality of the people.”
They had to work hard to return it to the glory days of the past.
“When we were here before 1972, we had connections with a lot of leaders. Mrs Indira Gandhi visited us, and also the Kennedys; they all used to visit Kakira. Martin Luther King was here, to meet my brother. My father of course is the pioneer. I mean if you look at the way the estate is laid out, it was this man in the early 1950s that laid it out,” recalls Mayur.
Today, the Madhvani Group is one of the biggest diversified private-sector businesses in Uganda, with assets of $750 million for the Kakira sugar business, producing 180,000 tons of sugar, 74,000 tons of molasses and 22 million liters of ethanol.
The sugar factory also makes green electricity. Very little of the sugarcane is wasted. The fiber from the process, or the bagasse residue, is burned in large boilers to generate steam that drives the turbines.
The facility also generates 51MW of electricity daily and of that, sells 32MW to the national grid, “enough to light up Kampala”, says Mayur. This is one of the biggest bagasse co-generation power plants in Africa.
A tour of the sprawling factory is rounded off with a visit to a storage warehouse with mountains of 50kg sugar bags, stacked from floor to ceiling at any given time, ready to be hauled onto waiting trucks.
At an altitude of about 4,000ft, Kakira is lush, fertile territory offering year-round harvest. The sugar factory stops only for a month every year for maintenance. It processes its own cane but also buys from the farmers, or the out-growers, living outside the nucleus of the estate. This is an association built from Mujlibhai’s time.
“There was a genuine affection when we came back [in 1985]. But it was very nice to say the Madhvanis are back but the Madhvanis are not magicians,” recounts Mayur. “It takes a lot of hard work and strategizing, and with government support (President Yoweri Museveni was newly elected at the time), we managed, through our small efforts, to instil in him, the aspect of business not necessarily being a bad thing. He was the one that allowed us to move forward and put this company right and pay taxes.” Fast forward to now, and the group’s focus continues to be to build its core businesses.
It is commencing a new $150 million sugar project in the northern district of Uganda named Amuru, working closely with the government. It has a sugar project in Rwanda, and projects in South Sudan and Tanzania are also on the cards.
“If you are manufacturing food commodities, it’s going to grow and this is the bread basket of the world. The Ugandans went through hell with Idi Amin but you never heard about famine because we can put anything in the ground here. We are so blessed,” says Mayur.
Cashing in on the salubrious climate and natural resources, another focus area for the group is tourism. There are nine lodges that it currently operates in Africa including in Rwanda, Uganda and Kenya.
One of the ways in which it opts to stay relevant is with partnerships.
“In the past, we used to think we can run [the business] ourselves and have those old-fashioned conglomerates. Those days are gone. You need to tap into the international market and get good world-class partners to work with and work with the right value for the African context,” offers Kamlesh.
And this applies to management as well, to further professionalize what is a family-run business.
“Most businesses that have started have been family businesses, if you look at Walmart, Ford, etc. But what you have to do is move away from the family business and let it become a little bit more professionalized,” adds Mayur.
“You want to avoid falling into the trap where the first generation creates, the second generation enjoys and the third generation destroys. We are the second generation moving to the third. The Madhvanis have broken the mould, but now [it’s not] for us to think we are infallible. We need to set up something that other family businesses can emulate, and follow other families that have succeeded in this. For that, you need to have a business that is professionally-run, yet have the family involved to give direction and not lose total touch or control.”
For this reason, the group mandatorily organizes three meetings a year in Bermuda, attended by family members and stakeholders.
But why this location in the Atlantic Ocean, far from Kakira? “We set up our companies in Bermuda in 1958, so we have been there some serious years now,” says Mayur. “In those days, perhaps it’s correct to say Bermuda was a tax haven, but now, the corporate tax structures have changed. Bermuda becomes a good venue because it is one of those tax havens that is also respected by various jurisdictions and for us, it is a historical fact that we were based in Bermuda. Our boards are all there.”
In Bermuda, the family also meets with members not actively involved in the business. Even the youngsters who are a part of the business have to report on their activities.
“We present our reports to the family and I think the secret that myself and Kamlesh are looking at is that the business has to be such that it survives this turmoil of create, enjoy and destroy and there is transparency. The secret is transparency. The more transparency you have in a business, the more likely it is going to survive the long-term because then individuals are not allowed to mess up the day-to-day control systems,” says Mayur.
“Leadership is something that you grow into by an accident of life. I am not the oldest of this family. I have two brothers but they are much older. Kamlesh’s dad, and my elder brother Jayant, sort of had the experience of my father. So did Pratap and Sur, my elder brothers and then things changed. We came back here and I worked closely with Kamlesh’s father and he had a lot of knowledge and I had the advantage I had. We got on as a team wonderfully, and in any business, you always need the ying and the yang. Kamlesh and I work very closely but you will find that each one of us is very good in certain aspects of the business. That is so important.”
As Joint Managing Directors, their offices are adjacent to each other.
“We have this little window and we shout at each other or talk to each other whenever we want,” laughs Mayur.
“We are more like brothers, but he is still my nephew. As children, when we were at boarding school in the United Kingdom, his mother was always worried and I had to look out for him.”
Looking ahead, the Madhvani Group plans to produce rum, vodka and gin, predominantly for the export market. All of these are by-products of the same crop – sugarcane. The distillery at the estate produces 22 million liters of Extra Neutral Alcohol or ethanol a year.
“Sugar is the main product, [but] it’s quite possible in the time to come that some of these other activities from the by-products will become the main product. Such as electricity and alcohol… We are even putting up a plant for carbonated waters coming up next year,” says Mayur.
But Uganda, a part of the East African Community (EAC), has a population of about 45 million and a poor rating score in the EAC when it comes to corruption. Surely, that’s discouraging for investors?
“The biggest problem we have in Africa is nearly 58% of the population is below the age of 30 and these individuals really do not want to hear about the wars because it is history. They are looking to see Africa catapult itself to another level. What the businessman needs is political stability and structured legal systems so that you feel comfortable doing your activity and I think [that is the only way] you will see Africa grow,” says Mayur.
“And yes, we do have corruption; it is endemic, you have corruption in every country. You have got to stop it. You have to have the right systems in place and you have to have total transparency on how businesses are conducted. Countries have gone through these stages and I think you have got to make an effort to try and eliminate corruption actively, without lip service. Now, action needs to be taken. If you look at Rwanda, it has progressed amazingly. As a businessman, what I have seen is the efficiency in which the government works, and the government takes decisions very pragmatically. That is the kind of model one needs to follow.”
At this point, Kamlesh interjects to say decisions taken must be implemented too.
“It leads to frustration. In Uganda, you have the President who has tremendous vision, and his vision towards the private sector driving the economy becoming the engine of the economy is absolutely spot-on, but there is no follow up,” agrees Mayur.
As in other countries of the EAC, in Uganda too, private-public partnerships may be the way forward and it takes effort from the private sector to lead that charge.
“The politics of Africa is very similar. Leadership is important but then [you have to] have growth cycles driven by the private sector. I remember there was a time when in Uganda, prior to the expulsion of the Asians in 1972, to do business was criminal. If you were a businessman, you were regarded as a crook. Today, it is instilled that everyone should do business; business is a good thing. There are positive changes.”
The Madhvani Group’s sugar project in Amuru, in northern Uganda, for example, will be owned 51% by the government and 49% by the group and it will be managing it.
“Eventually, the government will offload the shares to the general public, but I think it is important for all private sector businesses to try to involve the community, the population around you,” says Mayur.
“Kenya’s President Jomo Kenyatta gave a good analogy when we left Uganda. He said ‘in the case of you Madhvani, you are the tree and the tree has fruit and if you share the fruit with the local community, the tree will get water’… For instance, we make the products, but we don’t do the distribution, we allow the others, we have our out-growers.”
“The farmers benefit more, we have a very successful joint venture NGO with them,” adds Kamlesh. “Essentially, we convinced the farmers to contribute a certain amount of money which we will also contribute and this money goes to finance roads, clinics, health facilities and orphanages. This is one quite unique experiment. The farmers have voluntarily sort of parted with money.”
For farmers like 48-year-old Naitema Godfrey, who owns 48 acres of land and has been an out-grower for the Madhvani Group for the last 15 years, sugarcane is everything. Calling himself a “sugarcane millionaire”, he says: “The food crop has given us money, power, sugar and electricity.”
Another out-grower, Robert Waako, who has been supplying sugarcane to the Madhvanis for the last 26 years, says he has been able to put his six children through school and college; four of them are software engineers today.
On the cards for the Madhvani Group is a possible listing in the future. The group also operates properties in India, and is big on religious tourism with hotels in famous pilgrimage sites.
“Indians are very religious, they go to these sites, but don’t have a good place to stay. We built a beautiful four-star hotel in Tirupati. We are now opening one in Bodh Gaya, and we have in Rajkot. At Rishikesh, we have the land, and we are looking at Shirdi and Benares. They are all in the pipeline.”
Back home in Uganda, the group are also big in packaging and steel.
The discovery of oil in the country has made investors and the private sector sit up to the opportunities to fund development.
The Madhvanis are also keen to hop on to the bandwagon.
“We are looking for good partners to work with. We have our infrastructure companies, also working on the logistics side,” offers Mayur, but says Africa’s real strength is the green economy.
“I think oil is overplayed, and is not going to solve our problems. I think oil brings problems in itself, from an environmental point of view and the point of view of not becoming too reliant on this one product. Look at Nigeria and Saudi Arabia; they are all looking at alternatives now. The one thing you have got to remember in Africa is we have the weather, and we have vast tracks of land that are fertile. I think Africa can be a great grain basket for the world.”
The next generation of the Madhvanis are in line to take the company to the future. Mayur’s 34-year-old daughter Tanya, who is based in Rome, is responsible for managing the hotel business.
His nephew Ronnie was tasked with reviving the packaging business and he has built it into “a multi-million enterprise through his creativity and marketing efforts”.
The caveat is that family members who are involved in the business must contribute to its growth. Kamlesh and Mayur too came up learning the ropes the hard way.
“We have enough youngsters in business. But just employing family members for the sake of employing them and giving them a posh office is totally wrong and it hasn’t worked. What you have to do is contribute, and when you do, you also get a share of the success as an individual,” says Mayur.
“Basically, we are all fortunate we had good role models to follow. If you read my father’s book, you will know we had our own turmoil in the family. Kakira did not come to us and say ‘here is the key’; we had to fight for it. We had to fight for it from other family members as well. We are not the perfect family; we had to prove ourselves [in addition to] the passion we had [for the business]. That is the type of determination that made it work,” says Kamlesh.
“We started at zero…” adds Mayur.
Today, the family members all have their own businesses too, and in different countries. “I have my own companies. Kamlesh has his. I have vast real estate in Orlando, we all have assets in Europe, North America and India. But we have been taught to be low-profile,” says Mayur.
The family live in bungalows near the factory in Kakira, minutes from each other. There is nowhere else they would rather be. They have their own airstrip and private planes.
“This is utopia for us,” says Kamlesh.
Succession planning is key in ensuring the Madhvani legacy lives on. Mayur is cognizant of this truism.
“We have reached an age where we know the inevitable is coming. We have to witness the change so we can actually guide that change to some extent, rather than create a vacuum and arrive at a situation where there is no smooth handover,” he says.
“We will have to leave that to the next generation. The important thing is to make sure that whatever business that we have, we maintain a world-class lead in them. Today, our sugar factory is the most modern in the world, and more and more we are moving towards automation, and everybody is going to still need sugar,” says Kamlesh.
“In the end, you don’t work for the money, you work for the passion of it all.” The bags and packets of sugar that go out of this little town of Kakira are testament to the fertile bounties of the land, and the story of a family from India that, through enterprise, resilience and industry, found its fortune in the fields in a beautiful corner of Africa.
Businesses Of The Future: 20 New Wealth Creators On The African Continent
The New Wealth Creators is the first of its kind list by FORBES WOMAN AFRICA. Herein is a collection of female entrepreneurs on the African continent running businesses and social enterprises that are new, offbeat and radical.
These 20 women have been selected because they have created significant impact in their respective sectors by transforming a market or company, or innovating a product or service, and are pioneering their organization(s) in generating new untapped streams of income.
These women come from across the continent, from the villages and the suburbs, and are in their 20s, 30s, 40s and 50s. They have all adopted sustainable development initiatives in one way or another to help solve Africa’s problems.
They may be wealth creators but their businesses, ironically, did not stem from a need to make money, but rather from the need to solve Africa’s persisting socio-economic challenges.
Economically empowering women has shown to boost productivity. It increases economic diversification and income equality, in addition to other positive developmental outcomes.
Simply put, when more women work, economies are likely to grow.
FORBES WOMAN AFRICA put in months of rigorous research, searching near and far for these inspirational entrepreneurs.
We took into account their business model, new ideas, potential, struggles, social impact, growth, influence, resilience and most importantly, their innovation.
Speaking to FORBES WOMAN AFRICA last year at the BRICS summit in Johannesburg, South Africa’s Minister of Science and Technology, Mmamoloko Kubayi-Ngubane, said: “Innovation [is] becoming the cornerstone for our economy going forward.”
As Africa’s population is reported to increase by 53% by 2100, according to the United Nations, new solutions must be created in order for us to keep up.
One question remains: can Africa translate its significant population growth into economic development, and invest this wealth to improve the quality of life?
Entrepreneurship could very well be the answer, or at least, one of the answers.
Last year, the Founder and Chair of the Alibaba Group Jack Ma paid Africa a visit to discuss tangible investment and technology development.
He encouraged African entrepreneurs to take giant leaps in solving the challenges facing the continent and to take advantage of the digital economy.
He said that opportunities lie where people complain.
And these women, through their businesses, have identified just that.
Vijay Tirathrai, director of the Techstars Dubai Accelerator, shared the same sentiments with FORBES WOMAN AFRICA.
“The new wealth creators, for me, are entrepreneurs who are very conscious about finding solutions in the market place, but from a lens of having social impact or having impacted the environment,” he says.
Tirathrai believes that while servicing consumers, new wealth creators are also “making a safer and a greener planet in the process, eliminating diseases, improving health conditions and advocating for equality for women”.
Women on the African continent have been making headway as drivers of change, and in many ways, they embody new wealth.
They are the true wealth.
As FORBES WOMAN AFRICA, we seek to celebrate such women.
Through this list, money is no longer the central indicator of new wealth creation.
It is about job creation, contributing to healthy societies, recycling waste, giving agency to those who are financially excluded and developing solutions for some of the socio-economic problems we grapple with.
These women may all come from different places but they are bound together by one common thread, and that is the thread of new wealth creation.
This compilation is innovative, exciting, inspiring and shows what businesses of the future may look like.
Meet the FORBES WOMAN AFRICA New Wealth Creators of 2019.
The list on the pages that follow is in no particular order.
-Curated by: Unathi Shologu
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