Forbes - USA (October 2019)

47























































T H E S E N I O R R E D S T O N E W A S S O P L E A S E D , H E R E P O R T E D LY S A I D ,
“ YO U R L I F E I S N OT C O M P L E T E U N T I L YO U H AV E M E T S H A R I .”






In contrast to their complicated adult years, “When I got divorced and I . . . needed to get
her early memories include him taking her a job, [my father’s] the one who pushed me into
to school in the morning, having breakfast to- National,” Redstone says. “He wanted me to go
gether and doing college tours. She recalls one on the boards when I just got divorced, and I said
rainy morning while slogging it out through law no, because I was trying to take care of my kids
school, as her dad did, when he ran out at 3 a.m. and balance working. . . . This was all my dad’s
in search of a copy shop for one of her school
pushing.”
MARK SULLIVAN/GETTY IMAGES sharp intellect. After the birth of her third child, president of corporate strategy in 1994, she ex-
papers.
After she joined National Amusements as vice
She inherited her father’s auburn hair and
panded the company globally, opening theaters
she stopped practicing law full-time. While
in Russia and Latin America. She pioneered a
studying to be a social worker, she found her life
concept still in vogue today—introducing gour-
met food, lounges and valet parking at the-
changing course as her 13-year marriage to Ira
Korff ended in 1993.


O C T O B E R 3 1 , 2 0 1 9 aters in Los Angeles and elsewhere. The senior
F O R B E S . C O M

K I M A R I E YO W E L L


VP, Talent Development, Quicken Loans

“ MICHIGAN IS A





PLACE WHERE





YOU CAN GROW,





BE CREATIVE AND





LIVE YOUR BEST





LIFE.”















In Michigan, you don’t have to choose between working and

having a life. High-paying specialized jobs and a low cost of

living are huge draws for our talented workforce. And our

business-friendly environment and global relationships make
Michigan just as attractive to businesses. Whether you’re a job

seeker or job maker, come to Michigan or get left behind.




Visit michiganbusiness.org/pure-opportunity
















MICHIGAN.
PURE OPPORTUNITY.

Redstone was so ing she and her brother, Brent, had made
pleased, he report- “little or no contribution” to building the
edly said, “Your life media empire. “While my daughter talks
is not complete until of good governance, she apparently ig-
you have met Shari.” nores the cardinal rule of good gover-
The sunshine of nance that the boards of two public com-
his approval did not panies, Viacom and CBS, should select
last long. The patri- my successor,” he wrote.
50 arch, who frequent- Brent had sued his father in 2006 for
ly boasted of his im- shutting him out of big deals—includ-
mortality—he fa- ing the decision to split Viacom into two
E
N mously clung to a companies—and for self-dealing. Shari
O third-story window took Sumner’s side, and the company
T
S ledge during a dead- issued a statement accusing her broth-
D
E ly blaze at the Co- er of “abusing the court system in an at-
R
pley Plaza hotel in tempt to extract a financial settlement in
I
R Boston, which left a family dispute.” Brent sued for access
A
H burns over almost to his one-sixth interest in the company
S
half of his body— and walked away with $240 million. (At-

E
L was also famous tempts to reach him at his home in Colo-
I
F for refusing to sur- rado were unsuccessful.)
O
R render power, dis- That left Shari Redstone with a 20%
P
pensing with a long stake in National Amusements, which had
string of well-re- morphed into a holding company for Vi-
garded executives, acom and CBS. It was complex. She had
from Frank Biondi defended her father and publicly rebuked
Philippe Dauman
to Mel Karmazin to her brother when he sued for his rightful
He was like another son to
Tom Freston. Sumner Redstone—and was stake in the holding company. She forgave
pushed out as CEO in 2016.
Sumner and Shari and protected Sumner even after he den-
began to clash over igrated her to Viacom executives. But the
succession, corporate governance and the fu- elder Redstone had taken a shine to two other
ture of the theater business. A major point of executives, Philippe Dauman and Les Moonves.
contention was her father’s investment in Mid- The battle to succeed Redstone was about to get
way Games, a company that later filed for bank- even trickier.
ruptcy. The tension erupted publicly in 2007, af-
ter Shari voted to block a $105 million charita- o Sumner, Dauman was like an-
ble gift that her father wanted to make to hospi- T other son. The Columbia-educat-
tal systems in Massachusetts and California. In a ed lawyer earned Sumner’s con-
letter to the trustees of the National Amusements fidence while hunkered down in
a one-bedroom room at the Car-
lyle Hotel in New York plotting his hostile bid-
DAU M A N WAS N A M E D C H I E F E X E C U T I V E
ding war for Viacom. National Amusements out-
W H E N C A B L E WA S AT I T S P E A K , B U T H E maneuvered a management-led buyout team in

LO S T H I S TO U C H I N 2 0 1 4 , W H E N V I AC O M ’ S 1987, acquiring the company’s assets, including
S TO C K S TA RT E D TO D E C L I N E A N D MTV Networks, Showtime, The Movie Channel
and Nickelodeon.
T E L E V I S I O N R AT I N G S D E T E R I O R AT E D.
Dauman was named chief executive of Viacom
at a time when cable television was at its peak.
Viacom’s MTV was arguably the most influential
cultural force of that generation, Nickelodeon
Trust, Sumner wrote that his daughter “does not became the dominant channel for kids with fare
have the requisite business judgment and abili- like SpongeBob SquarePants, and Comedy Cen-
ties to serve as chairman of the three companies,” tral became iconic for offerings like South Park
according to a lawsuit later filed by one of Sum- and The Daily Show. SYLVAIN GABOURY/PMC/NEWSCOM
ner’s former companions. But Dauman lost his touch in 2014, when Vi-
In a letter sent to Forbes five months later, acom’s stock started to decline, in lockstep with
he publicly blasted her for making an effort to television ratings and Paramount Filmed Enter-
succeed him as chair of Viacom and CBS, say- tainment revenue fell by $557 million—a trend


O C T O B E R 3 1 , 2 0 1 9
F O R B E S . C O M

IT’S ALL









SCIENCE








FICTION








UNTIL IT’S









NOT.





























Explore a range of ETFs based on today’s biggest
trends and back the forces shaping our future.



Invest in something bigger.








Visit www.iShares.com to view a prospectus, which includes investment objectives,
risks, fees, expenses and other information that you should read and consider careful-
ly before investing. Risks include principal loss. BlackRock Investments, LLC, distribu-
tor. ©2019 BlackRock, Inc. All rights reserved. iSHARES and BLACKROCK are registered
ı
İı İ
ƀƈƁƉ ŠƉƂƃƆƈƃ

that would accelerate the following year. Red- She took a more active role in her father’s life
stone, who pulled away from National Amuse- after he went through a series of hospitalizations
ments, and in 2011 started a venture firm with her in the summer of 2014, claiming in a court fil-
son-in-law, was growing increasingly concerned. ing that a nurse confided he had witnessed emo-
Executives past and present were lamenting the tional and financial abuse of the frail billionaire.
slow erosion of a culture built around her father’s While the two women denied the allegations,
oft-stated mantra, “Content is king.” they were removed from the home in 2015, and
“The culture and the values that represented after a legal battle that revealed embarrassing
52 everything that Viacom was disappeared under details of Sumner’s sexual and other appetites,
Philippe,” she says. “The belief in content, that it Shari took charge of his care and once again be-
matters, disappeared under Philippe.” gan visiting her father.
E
N Dauman declined comment. “Sadly, people came into his life who had a dif-
O Viacom spent $15 billion on buybacks in an at- ferent agenda, and their agenda was to separate
T
S tempt to prop up the stock, while rivals were ac- us. And in some ways they did a good job,” Red-
D
E quiring properties that added immense long-term stone says. “It never meant we stopped loving
R
value to their libraries, such as Disney’s purchas- each other or caring about each other, but it be-
I
R es of Marvel Entertainment and came really hard.”
A
H Lucas film. Redstone, who sat on Once they were reconciled, she
S
the board, was constrained with- shared her concerns about Via-

E
L out her father’s support. com with her father. She talked
I
F “Basically, it was really a lot about his lost legacy, the flight of
O
R about financial engineering and talent, including marquee stars
P
stock buybacks and not believing Stephen Colbert and Jon Stewart,
in the people who created con- and the loss of viewers to digital
tent, not supporting the people platforms. She lamented the dam-
creating content, not creating a aged culture.
culture of creating content,” Red- “He asked me a question, and
stone says. “So, I was up against the question caused me to say,
that, and I tried to fight that bat- ‘Look, Dad, let me tell you what
tle for years to no avail.” happened at Viacom.’ And I went
She watched helplessly as the through all of the businesses of
legacy Sumner built faded away. Viacom, the positions I had taken
MTV and Nickelodeon were los- on the board, which had not nec-
ing relevance as young audienc- essarily been well received. So he
es turned their gaze online. Para- was only hearing Philippe’s view
mount Pictures, the studio of the of what was going on at the com-
Godfather movies was releasing pany, what was going on at the
duds like Hot Tub Time Machine board and what my views were,”
2 and a remake of Ben-Hur. Redstone says. “So I kind of came
“We have the best opportuni- in, and I gave my dad that whole
ty of any media company in the sense. And even at the end of that,
world to be number one going I think when he understood what
forward,” she recalls saying to the was going on in the company, he
board at the time. “We own these wasn’t ready to let Philippe go.”
people. Shame on us if we lose Then one day in February 2016
them.” Dauman drove past the met-
But while she found the board indifferent to Les Moonves al gates of Sumner’s home in the exclusive Bev-
her concerns, she says much of the company was The CBS chief erly Park neighborhood to propose selling an eq-
invigorated a
rallying behind her. “People were rooting for network and was uity stake in Paramount, in a meeting vividly de-
me—not for me, but because they wanted Via- brought down by scribed in Keach Hagey’s biography of Sumner,
#MeToo allegations.
com back,” she says. The King of Content. Sumner’s 1994 triumph over
Ailing and struggling with physical mobility QVC Chairman Barry Diller in the pursuit of Para-
but still in control, her father proved to be her mount, the oldest surviving film studio in the U.S.,
biggest challenge. For a time, Shari and her fam- was the career victory he would savor most. Sell- DAVID PAUL MORRIS/BLOOMBERG
ily wouldn’t visit the Beverly Hills mansion that ing it was tantamount to treason.
Sumner shared with two women, then-girlfriend Sumner instructed his lawyers not to sell, but
Sydney Holland and a former companion, Manu- it was his daughter he turned to to ensure that it
ela Herzer, and communication was limited. didn’t happen.


O C T O B E R 3 1 , 2 0 1 9
F O R B E S . C O M

Your privacy






and security







Ā½ŞÑçÉĀ






made easy.














































'ííÉá½ ³³íČçć ùüíėѹ½Ā ½¥ĀĞ̀ćí̀ČĀ½ Ā½ŞÑçÉĀ ¥ç¹
tools to help you control how Google works for you.
Another way we keep your data private, safe, and secure.


g.co/privacy

“I said to him, ‘I will do this, but this Minutes executive producer Jeff
is your battle,’” she recalls. “It wasn’t my Fager for “violating company poli-
battle for me. It was my battle for him.” cy”—specifically, threatening a CBS
reporter who was following up on
S hari Redstone says reports of sexual misconduct at the
company. Rose apologized for his
she had no master
blueprint for the fight
all of the allegations were accurate.
ahead. “It wasn’t a inappropriate behavior but said not
54 long-range plan be- But the most powerful executive
cause I kept having short-range chal- at risk was Moonves, who in July
lenges,” she says. 2018 found himself the focus of a
E
N By March 2016, Dauman and Via- story published in the New York-
O com board member George Abrams er reporting allegations of sexual
T
S had both been removed from the sev- misconduct and threats of retri-
D
E en-person family trust. That pair sued, bution. Moonves resigned in Sep-
R
challenging Sumner’s mental com- tember 2018, and six new mem-
I
R petency and accusing Shari of ma- bers joined the CBS board. With
A
H nipulating her father. Then Dauman interim CEO Joseph Ianniello in
S
was removed from the Viacom board place, the company moved swift-

E
L along with four other pliant directors. ly to repair a culture described as
I
F A new legal challenge was mount- toxic and misogynistic—donating
O
R ed, but before the courtroom dramas $20 million to organizations com-
P
could play out, Dauman agreed to a lu- mitted to eliminating workplace
Bob Bakish
crative exit, which included $58 million in sever- ViacomCBS’s harassment, installing a new chief people officer
ance pay. new CEO won and naming a woman, Susan Zirinsky, president
confidence with a
Shari was faced with one more significant op- digital strategy he of CBS News.
ponent, an executive she’d considered a trusted perfected overseas. “I was speaking before a women’s group . . .
friend, who stood in the way of the merger she felt and they said to me, ‘After everything you’ve been
would be in the best interest of the company and through, why shouldn’t every woman in this room
its shareholders: CBS chief executive Les Moonves. be pessimistic?’” Redstone recalls. “ ‘Because I’m
Moonves was hired by Sumner in July 1995, here, because we can do this.’ But this is a moment
taking over as president of CBS Entertainment in time where, I think, we can’t drop the ball. We
when the Tiffany Network was the laughing stock have an opportunity and a responsibility to do
of the television industry. The savvy program- what we can to have an impact.”
ming executive, who had green-lighted Friends
and ER, set out making hits like CSI, NCIS and er two chief rivals having been
Cold Case, transforming CBS into the nation’s H dispatched and imploding, re-
most-watched broadcast network, winning him- spectively, Redstone’s ascension
self the CEO title and titan status in the process. went from a long shot to almost
Moonves had little interest in taking on the woes a fait accompli. While it wasn’t
of the network’s struggling corporate sibling, Vi- made official until this past August, when CBS
acom, and even went to court to block the merg- and Viacom announced their $12 billion merg-
er with Viacom. er deal, Shari Redstone began looking to the fu-
Then came the #MeToo movement, which quick- ture last year.
ly ensnared CBS. The company first fired CBS This To get there she will need to keep the family on
Morning host Charlie Rose, citing reports of “dis- her side. Sumner’s 80% stake will be divided in
turbing and intolerable behavior,” and then 60 two on his passing, half for the benefit of his de-
scendants, whose trustees will include Shari and
her son as well as others with long ties to mem-
T H E Y A S K E D , “A F T E R E V E RY T H I N G YO U ’ V E
bers of the family, including divorce lawyers for
B E E N T H R O U G H , W H Y S H O U L D N ’ T E V E RY Sumner and his former wife, Phyllis, and a Na-

W O M A N I N T H I S R O O M B E P E S S I M I S T I C ? ” tional Amusements executive. The other trust
will be for the benefit of Phyllis. In other words,
S H A R I A N S W E R E D , “ B E C A U S E I ’ M H E R E ,
more drama could be on the horizon. CHRISTOPHER GOODNEY/BLOOMBERG
B E C A U S E W E C A N D O T H I S .” Shari Redstone will have a critical ally in Bob

Bakish, who had been running Viacom Internation-
al Media Networks. Initially designated as interim
CEO, he was viewed as keeping the seat warm un-


O C T O B E R 3 1 , 2 0 1 9
F O R B E S . C O M

We’ll walk






you through






your privacy







Ā½ŞÑçÉĀˏ






step by step.





































Privacy Checkup helps you manage your most


ÑæùíŜ¥çć Ā½ŞÑçÉĀ Ñç æÑçČć½Ā˙ çíćνü Ę¥Ğ
Ę½ Þ½½ù ĞíČü ¹¥ć¥ ùüÑė¥ć½ˏ Ā¥È½ˏ ¥ç¹ Ā½³Čü½˙

g.co/privacy

til Moonves would lead the combined companies. SEEKING VALUE
Bakish didn’t wait for that to happen. He shook up
THE MERGER OF VIACOM AND CBS WILL GIVE THE MEDIA COMPANY
the executive ranks, recruited high-profile industry
MORE HEFT AND GREATER SPENDING POWER, BUT IT HAS A LONG
executives to lead the Paramount and Nickelodeon
WAY TO GO TO CATCH UP TO ITS BULKED UP COMPETITORS.
units, invested in developing content for social me-
dia and, most critically, acquired the free, ad-sup- $50 Bil 100 150 200 250
ported video service Pluto TV to give Viacom a foot- AT&T $276 Bil
(TIME WARNER) $171 Bil
hold in the streaming world. Pluto TV now boasts
56 18 million regular users. WALT DISNEY $238 Bil
“Where have you been?” Redstone recalls ask- $59 Bil
ing Bakish after he presented his plans for the
E COMCAST $210 Bil
N business unit to the board. She was particular- $95 Bil
O ly struck by his digital strategy, which was more
T
S evolved than in the U.S. business. NETFLIX $115 Bil
D $16 Bil MARKET CAP
E “I specifically decided that the board is impor-
R $26 Bil REVENUE
tant, has valuable perspective, and therefore I VIACOM
I
R want to engage with them,” Bakish says, adding & CBS $27 Bil
A
H that Redstone “was a clear person that I thought
S
it was important to build a relationship with

E DUELING MOGULS
L based on transparency, trust and more.” Bakish’s
I
F management style and the gains at Viacom were A DECADE AGO, SUMNER REDSTONE USED CNBC TO WARN
O
R rewarded: He will lead ViacomCBS as president RUPERT MURDOCH THAT HIS MEDIA EMPIRE WAS “BURIED IN
P INK.” LAST YEAR, MURDOCH’S FORTUNE SOARED WHEN NEWS
and CEO once the merger is completed.
CORP. ANNOUNCED THAT IT WAS SELLING THE BULK OF HIS
Bakish and Redstone are bullish on the fu-
ENTERTAINMENT ASSETS TO WALT DISNEY FOR $71 BILLION.
ture. They argue that the combined companies’
global reach and production capacity, massive $20 Bil
film and TV library (140,000 television episodes, 19.1
18
3,600 film titles) and $13 billion in spending on NET WORTH
content (750 series on order) put it on a more 10 RUPERT MURDOCH
equal footing with rivals. That’s on par with the SUMNER REDSTONE 14.2
spending binge Netflix has used to seize the nar- 13.4
rative of the once insular and impenetrable in- 11.6 11.1 12
10
dustry, and eclipses reported figures for Amazon
9.4
or Apple. But even together, ViacomCBS will be
dwarfed in market value by traditional media ri- 7.4
vals like Disney or Warner Media parent AT&T or 5 6 6.2 5.8 6.5
5 4.7 5.1 4.8
Comcast, the cable giant whose holdings include 4.1 4.1 4.1
NBC and Universal Pictures. 2.8
2
Redstone’s emerging media venture invest-
ments, from YouTube creator network Maker- 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Studios to podcast platform Wondery, inform
how she thinks of the family’s traditional media
business. She’s now looking to digital-savvy ex-
ecutives like Viacom’s digital studios chief Kel-
ly Day, who’s been developing original program- The question led her to fund ventures like
ming for YouTube, Facebook and Snapchat and, Niche, a startup that connected social media
before that, shows for Netflix, as a contemporary stars with advertisers and subsequently was ac-
role model for reaching audiences fragmented quired by Twitter, and Religion of Sports Me-
among multiple screens. “It’s the same vision my dia, a startup whose cofounders include Patri-
dad had in ’99, but it’s more true now than ever ots quarterback Tom Brady.
before,” she says. “When you take a look at these “My dad had a line, ‘Little failure, little success;
assets, they’re complementary.” big failure, big success.’ You have to take risks,”
She obsesses about ways to reach audienc- Shari Redstone says. “That’s what a venture fund
es beyond a linear broadcast. Her interest in is all about. How much risk do you take? So I say,
emerging media began with a question she we take risks, but we take it conservatively. But
posed at a Viacom board meeting to which she you have to take risks. You have to be willing to
never received a satisfactory answer: Who’s fail in order to succeed. And we’ve all failed. So,
watching the MTV reality show Jersey Shore? thank God there’s a value to it.” F


O C T O B E R 3 1 , 2 0 1 9
F O R B E S . C O M

Turn it on.







cČüç Ñć íŌ˙





You control







what data






gets saved.





































Activity Controls let you decide what data is used
to personalize your experience on Google services.
Another way we keep your data private, safe, and secure.


g.co/privacy

58





















O


























WALL STREET’S









BEST DEALMAKER













Orlando Bravo peaked as a competitive tennis player as a junior in the 1980s, but he
is the undisputed world champion in a far more lucrative game: private equity.




BY ANTOINE GARA










F O R B E S . C O M
PHOTOGRAPH BY JAMEL TOPPIN FOR FORBES

59






























































































O C T O B E R 3 1 , 2 0 1 9

60



O
A V
R
B

O
D
N
A →
L Orlando Bravo
R
O

E
L
I
F
O
R discovered his edge early.
P


In 1985, at age 15, he traveled from his home in Mayagüez, Puerto
Rico, a small town on the island’s western coast, to Bradenton, Flor-
ida, to enroll in the legendary tennis guru Nick Bollettieri’s grueling
academy.
Bravo would wake at dawn, head to class at St. Stephen’s Episco-
pal School, then return to Bollettieri’s tennis courts at noon. He spent
hours warring against peers like Andre Agassi and Jim Courier un-
der the broiling sun. At sundown, after an hour to shower and eat,
he would study, then retire to a sweaty, two-bedroom condominium
in which players bunked four to a room like army barracks. Then he
would do it all over again, six days a week, for a full year. “It was the
tennis version of Lord of the Flies,” says his former roommate Courier.
The brutally competitive environment helped Bravo climb to a top-
40 ranking in the U.S. as a junior. Then he peaked. “It was quite hum-
bling,” recalls Bravo, who’s still fit from his weekly tennis games. “It
was a different level of hard work altogether. It became clear I could
operate at these super-high levels of pain.”
That grit and perseverance eventually propelled him to the top ech-
elons of the private equity world. Few outside of finance have heard of
the 49-year-old Bravo, but he is the driving force behind Wall Street’s
hottest firm, the $39 billion (assets) Thoma Bravo.
In February, the French business school HEC Paris, in conjunction
with Dow Jones, named Thoma Bravo the best-performing buyout
investor in the world after studying 898 funds raised between 2005
and 2014. According to public data analyzed by Forbes, its funds re-
turned 30% net annually, far better than famous buyout firms like
KKR, Blackstone and Apollo Global Management. That’s even better
than the returns from the software buyout firm Vista Equity Partners,
its closest rival, run by Robert F. Smith, the African American billion-
aire who recently made headlines by paying off the college debt of
Morehouse College’s entire graduating class. Since the beginning of
2015, Bravo has sold or listed 25 investments worth a total of $20 bil-
lion, four times their cost. His secret? He invests only in well-estab-




O C T O B E R 3 1 , 2 0 1 9
F O R B E S . C O M

“First Republic understands private clubs like WS New York,


and our commitment to extraordinary experiences.”



WS NEW YORK

Stephen M. Ross, Founder (left); Marvin R. Shanken, Founder (center); Kenneth A. Himmel, Founder (right)
WS New York, Hudson Yards’ only Private Club, opens Fall 2019






















(855) 886-4824 | Ŕrstrepublic.com | New York Stock Exchange symbol: FRC

MEMBER FDIC AND EQUAL HOUSING LENDER

lished software companies, especially those with firm’s funds, and lenders have checkbooks ready
clearly discernible moats. to finance his next big deal. “The opportuni-
“The economics of software were just so pow- ties today are the biggest I’ve ever seen,” Bravo
erful. It was like no other industry I had ever re- says. “Right now we are in a huge, exploding and
searched,” says Bravo, seated in his office in San changing industry.”
Francisco’s Transamerica Pyramid. He wears a
tailored purple dress shirt and enunciates his rlando Bravo’s isn’t a rags-to-
words with a slight Puerto Rican accent. “It was O riches story. He was born into a
62 just very obvious.” privileged life in Puerto Rico in
Bravo’s firm has done 230 software deals worth the Spanish colonial city of May-
over $68 billion since 2003 and presently over- agüez, which for decades was the
O sees a portfolio of 38 software companies that port for tuna fishing vessels supplying the local
A V
R generate some $12 billion in annual revenue and Starkist, Neptune and Bumble Bee canneries.
B employ 40,000 people. Forbes estimates the val- Starting in 1945, his grandfather Orlando Bra-

O ue of the firm, which is owned entirely by Bravo vo, and later his father, Orlando Bravo Sr., ran
D
N and a handful of his partners, at $7 billion. Based Bravo Shipping, which acted as an agent for the
A on his stake in the firm and his cash in its funds, massive tuna-fishing factory ships entering the
L
R Bravo has a $3 billion fortune. Not only does that port in Mayagüez. It was a lucrative business. His
O
make him the first Puerto Rican-born billion- parents moved him and his younger brother Ale-
E
L aire, it’s enough for Bravo to debut at 287th place jandro to what’s now a gated community in the
I
F on this year’s Forbes 400 ranking of the richest hills of Mayagüez, where the brothers attended
O
R Americans. private schools and tooled about on the family’s
P
Like a good tennis player who’s worked relent- 16-foot motorboat.
lessly on his ground strokes, Bravo has made pri- After taking up tennis at age 8, practicing on
vate equity investing look simple. There are no the courts of a local university and a Hilton hotel,


I learned I didn’t want to invest in risky



things ever again. It was too painful.








complicated tricks. He figured out nearly two de- Bravo and his family began making the two-and-
cades ago that software and private equity were a-half-hour drive from their home to San Juan
an incredible combination. Since then, Bravo on weekends to allow him to train against bet-
has never invested elsewhere, instead honing his ter competition. “What I loved about tennis was
strategy and technique deal after deal. He hunts the opportunity,” he recalls. “I’m from Mayagüez,
for companies with novel software products, like and I’m going to come to the big city and I’m go-
Veracode, a Burlington, Massachusetts-based ing to make it,” he says. “Let’s go! The underdog!”
maker of security features for coders, or Pleasan- He quickly became one of Puerto Rico’s top
ton, California-based Ellie Mae, the default sys- players, which landed him at Bollettieri’s acade-
tem among online mortgage lenders, which the my and then on Brown University’s tennis team.
firm picked up for $3.7 billion in April. His in- “I was so scared I wouldn’t make it through,” Bra-
vestments typically have at least $150 million in vo says of the Ivy League, so he took most class-
sales from repeat customers and are in markets es pass/fail as a college freshman. But he quick-
that are too specialized to draw the interest of ly found his footing and graduated Phi Beta Kap-
giants like Microsoft and Google. Bravo looks to pa in 1992 with degrees in economics and politi-
triple their size with better operations, and by cal science. That helped him get a prestigious job
the time he strikes, he’s already mapped out an as an analyst in Morgan Stanley’s mergers and
acquisition or turnaround strategy. acquisitions department. There he paid his dues,
The pool of potential deals is growing. On pub- clocking 100-hour weeks under the renowned
lic markets, there are now more than 75 subscrip- dealmaker Joseph Perella.
tion software companies, worth nearly $1 tril- Bravo’s Spanish fluency put him in front of cli-
lion, that Bravo can target, versus fewer than 20, ents as other analysts slaved away in data rooms.
worth less than $100 billion, a decade ago. In- Working on Venezuelan billionaire Gustavo Cis-
vestors around the world clamor to get into his neros’ 1993 acquisition of Puerto Rican super-


O C T O B E R 3 1 , 2 0 1 9
F O R B E S . C O M

LLS:








LEADING
LEADING






THE WAY IN The Leukemia & Lymphoma Society is leading the charge



against one of the most daunting challenges in blood cancer:
acute myeloid leukemia (AML), which claims the lives of nearly
PRECISION 11,000 patients in the U.S. each year. Our groundbreaking

Beat AML® Master Clinical Trial brings together the brightest
minds across the cancer landscape. Using a precision medicine

approach to treatment, patients are assigned a targeted therapy
MEDICINE. based on their genetic profi le.



To bring new and better treatments to cancer patients in
urgent need, we need to think and act boldly.



Please help us by

donating today at


www.LLS.org/Donate.

Golder and Bruce Rauner, who later
went on to become governor of Illi-
nois, creating Thoma Cressey. Thoma
sent Bravo to San Francisco to hunt
for investments and eventually ex-
pand the firm’s Bay Area presence.
Bravo’s first few deals, struck be-
fore he turned 30, were disasters. He
64 backed two website design startups,
NerveWire and Eclipse Networks, just
as the dot-com bubble popped. The
O two lost most of the $100 million Bravo
A V
R invested. “I learned I didn’t want to
B invest in risky things ever again,” Bra-

O vo says. “It was too painful to live
D
N through.” Thoma Cressey was also
A struggling elsewhere, with under-
L
R performing investments in oil and
O
gas and telecommunications. It was
E
L among the worst performers in the
I
F private equity industry at the time.
O
R But the failure led to an epiphany
P
that soon made Bravo and his part-
market chain Pueblo Xtra International opened Mission Driven ners billions. He realized his mistake was in
his eyes to the world of buyouts. But mostly he Days after Hurricane backing startup entrepreneurs, an inherently
Maria hit his
says he learned he didn’t want to be a banker. native Puerto Rico, risky move, when for the same money he could
Orlando Bravo
Bravo eventually headed west to Stanford Uni- buy established companies selling niche software
loads up a plane in
versity. He’d already been accepted into its law Ft. Lauderdale with to loyal customers. With Thoma’s blessing, Bra-
hundreds of pounds
school, but he also wanted to attend the busi- of supplies, including vo pivoted and became an expert on these arcane
ness school. He called insistently and eventually hydration pills, IV firms. Coming out of the dot-com bust, the mar-
tubes and diapers.
got accepted to pursue both. He worked during a ket was littered with foundering companies that
summer at Seaver Kent, a Menlo Park, California- had gone public during the bubble and had few
based joint venture with David Bonderman’s Tex- interested buyers. Bravo got to work. His first big
as Pacific Group that specialized in middle mar- move, in 2002, was to buy Prophet 21, a Yardley,
ket deals. Upon graduation in 1998,
Bravo wasn’t offered a position there
or at TPG, and he spent months cold- Every time we picked up our
calling for a job. After about a hun-
eye of Carl Thoma, a founding partner heads to peek at a deal that
dred calls, Bravo’s résumé caught the


of the Chicago-based private equity
firm Golder, Thoma, Cressey, Rauner wasn’t software, the software
(now known as GTCR), and they hit it
off. “The biggest mistake Texas Pacif- deal looked a lot better to us.
ic made was Orlando worked there for
the summer between business school
years and they didn’t make him a job offer,” says Pennsylvania-based software provider to distrib-
Thoma, 71, who Forbes estimates is also a billion- utors in the healthcare and manufacturing sec-
aire based on an analysis of public filings. tors that was trading at a mere one times sales.
One of the pioneers of the private equity in- Rather than clean house, Bravo kept the com-
dustry in the 1970s, Thoma is a tall and mild- pany’s CEO, Chuck Boyle, and worked beside
mannered Oklahoman whose parents were him to boost profits, mainly by rolling up com-
ranchers. Thoma and his partners practiced a petitors. When Boyle wanted to buy a company
friendlier version of the buyouts popularized by called Faspac, Bravo flew to San Diego to work
Michael Milken, preferring to buy small busi- out of the Faspac owner’s garage for five days,
nesses and expand them using acquisitions. analyzing reams of contracts to see if the deal
When Bravo came aboard in 1998, Thoma and would work. “Orlando would help not only at the
partner Bryan Cressey had just split from Stanley highest level with strategy but also when we got


O C T O B E R 3 1 , 2 0 1 9
F O R B E S . C O M

You promised







your customers.







We’ll help deliver.
























































As a leading national LTL carrier, Old Dominion works to make your job easier. We take your
success seriously and it shows in our #1 rankings for value, satisfaction, responsiveness and overall
performance.* With over 23,000 employees working in more than 235 service centers, we take pride
in helping you ship confi dently from coast to coast and everywhere in between.



For more information, visit odfl.com or call 1-800-235-5569.



*Source: 2018 Mastio & Co. National LTL Carrier Report
Old Dominion Freight Line, the Old Dominion logo, OD Household Services and Helping The World Keep Promises
are registered service marks of Old Dominion Freight Line, Inc. ©2019 Old Dominion Freight Line, Inc.

grunt work done,” Boyle recalls. After seven ac- camps for new acquisitions, grueling daylong
quisitions, Bravo sold the business for $215 mil- sessions that are critical to its success. Partners
lion, making five times his money. regularly buzz into Bravo’s spartan glass-walled
Software quickly became Bravo’s sole focus, offices, while in the background the drilling and
and Thoma Cressey began to thrive. By 2005, hammering of construction workers making
Bravo and Thoma had recruited three employ- room for 13 new associates disturbs the peace.
ees, Scott Crabill, Holden Spaht and Seth Boro, After two decades studying software, Bravo
to focus on software applications, cybersecurity recognizes clear patterns. For instance, when a
66 and Web infrastructure. All remain with the firm company pioneers a product, its sales explode
today as managing partners. and then inevitably slow as competitors emerge.
Bravo’s big opportunity came during the finan- Often a CEO will use this cue to stray into new
O cial crisis when Thoma put Bravo’s name on the markets or overspend to gin up sales. Bravo calls
A V
R door and split with his partner Bryan Cressey, a this “chasing too many rabbits.” To fix it, he and
B healthcare investor, creating Thoma Bravo. From his ten partners work alongside 22 current and

O that moment on, the firm invested only in soft- former software executives who serve as con-
D
N ware, with Bravo leading the way. sultants. They begin tracking the profit-and-loss
A A string of billion-dollar buyouts followed— statements for each product line and pore over
L
R Sunnyvale, California-based network security contracts in search of bad deals or underpriced
O

E
L
I
F With a fresh $12.6 billion war chest, Bravo
O
R
P
is now eyeing $10 billion-plus deals and expects

to begin buying entire divisions of tech giants.





firm Blue Coat, financial software outfit Digital products. Critically, by the time a Thoma Bravo
Insight of Westlake Village, California, and Hern- acquisition check clears, existing management
don, Virginia’s Deltek, which sells project man- has agreed that this rigorous approach will help.
agement software—all of which more than dou- Bravo calls it “making peace with the past.”
bled in value under Bravo’s watch. The firm’s in- There are also layoffs. Those can total as much
augural 2009 software-only fund posted a 44% as 10% of the workforce, for which Bravo doesn’t
net annualized return by the time its invest- apologize. “In order to realign the business and
ments were sold, making investors four times set it up for big-time growth, you first need to
their money and proving the wisdom of disci- take a step back before you take a step forward.
pline and specialization. “Every time we picked It’s like boxing,” he says. “These are unbelievable
up our heads to peek at a deal that wasn’t soft- assets with great innovators, and they are usual-
ware, the software deal looked a lot better to us,” ly undermanaged.”
he brags. Mark Bishof, the former CEO of Flexera Soft-
ware, an application management company out-
I t’s late May, and Orlando Bra- side of Chicago that Bravo bought in 2008 for
$200 million and sold for a nearly $1 billion prof-
vo’s 20th-floor offices overlook-
ing the San Francisco Bay are
it three years later, has a succinct description for
filled with dozens of tech exec- this wild success. “He just kind of cuts all of the
utives from its portfolio compa- bullsh*t,” Bishof says. “It’s refreshing.” Flexera’s
nies. Folks from Houston’s Quorum Software, profits rose 70% during Bravo’s ownership, large-
which makes technology systems for oil and ly thanks to four major acquisitions. “Orlando’s
gas companies, mingle with cybersecurity ex- like the general in the foxhole with his sergeant.
perts from Redwood Shores, California’s Imper- You know he’s knee-deep in there with you,” Bish-
va. They juggle their rollerboard suitcases and of gushes.
thick financial books as Thoma Bravo partners Under Thoma Bravo’s watch, companies on av-
map out corporate strategies on dry-erase white- erage saw cash flow surge as margins hit 35%, as
boards. Those on break hammer away at key- of 2018, nearly triple those of the average pub-
boards in small workrooms or demolish chicken lic software company at that time. “It’s like train-
sandwiches in a no-frills kitchenette. ing for the Olympics. . . . You have a finite goal to
This is one of Thoma Bravo’s monthly boot make it [in year four], and you make it very, very


O C T O B E R 3 1 , 2 0 1 9
F O R B E S . C O M

SMALL BUSINESS







ISN’T SMALL







TO US











As Dell Small Business Technology

Advisors, we are committed to helping
you navigate your tech needs with the


right solutions, advice and dedicated
one-on-one partnership.







TECH. ADVICE. PARTNERSHIP.




CLICK CALL CHAT

































®
Latitude 3500 with an 8th Gen Intel Get in touch today
™
Core i5 processor starting at $749
877-BUY-DELL
Dell.com/SmallBusinessPartner






*Offers subject to change, not combinable with all other offers. Taxes, shipping, and other fees apply. Free shipping offer valid only in Continental (except Alaska) U.S. Offer not valid for Resellers. Dell reserves the right to cancel orders
arising from pricing or other errors. Intel and the Intel logo are trademarks of Intel Corporation in the U.S. and/or other countries. Copyright © 2019 Dell Inc. or its subsidiaries. All Rights Reserved. Dell Technologies, Dell, EMC, Dell EMC
and other trademarks are trademarks of Dell Inc. or its subsidiaries. 310656

clear,” Bravo says. Today’s roaring market adds 1,000 pounds of supplies—water, granola bars,
potency to the playbook. Lenders are now gorg- meal kits, satellite telephones, diapers, intrave-
ing on software debt, and stock market multiples nous tubes and hydration pills—to Aguadilla,
for these businesses are surging. near Mayagüez. When an airport worker opened
A recent example is Detroit’s Compuware, a the door of his plane, Bravo says, the look of fear
decades-old pioneer of software applications to on his face was unforgettable. “All you could say
manage mainframe computer systems. In 2013, was ‘I’m sorry for what happened to you.’ ”
this Nasdaq-listed giant was all but left for dead He returned two weeks later in a larger plane
68 and up for sale. There was minimal interest, oth- with 7,000 pounds of supplies. Then he came in
er than from Bravo and partner Seth Boro, who a massive DC-10 cargo plane before ultimately
were keen on Dynatrace, software that helped chartering two container ships carrying 600,000
O companies move databases to the cloud, which pounds. “It was just like cold-calling for deals,”
A V
R Compuware had acquired in 2011. Thoma Bravo Bravo says of rounding up all the donations. He
B used $675 million in cash and raised $1.8 billion personally put in $3

O in debt to buy Compuware and then split off Dy- million in just the first
D
N natrace as a separate company. The pair began I learned more 30 days, and commit-
A to move Dynatrace from selling database licens- ted $10 million alto-
L
R es, once the bulk of its business, to cloud sub- gether.
O scription services, now 70% of sales. This past about building
When the Federal
E
L August, Dynatrace went public, and Thoma Bra- Emergency Manage-
I
F vo’s 70% stake is now worth over $4 billion, with an efficient ment Agency became
O
R the remainder of Compuware worth nearly a bil- fully operative there,
P
lion more. “I learned more about building an ef- software the island’s richest na-
ficient software company over the last four and a tive turned his atten-
half years than in the first 30 years of my career,” tion to Puerto Rico’s
says Dynatrace CEO John Van Siclen. company over future. Though 44% of
With a fresh $12.6 billion war chest for its Puerto Ricans live be-
13th fund raised in 2018, Bravo is eyeing $10 bil- the last four low the poverty line,
lion-plus deals and expects to begin buying en- Bravo believes in the
thanks in part to the success of his firm, he now and a half years potential to foster en-
tire divisions from today’s technology giants. But
cit-
trepreneurship,
faces more competition. Heavyweights like Black- ing that a tenth of the
stone and KKR are increasingly sussing out soft- than in the first population has tried to
ware deals, not to mention his longtime rival Vis- build a business.
vo’s $3.6 billion 2015 acquisition of San Francis- 30 years of money, his founda-
his
ta Equity. And he’s not immune to mistakes. Bra-
with
Armed
co-based digital network tracker Riverbed Tech- tion is looking to back
nology is currently struggling because of slowing my career. Puerto Rican technol-
sales and too much debt. He isn’t worried. “There ogy entrepreneurs,
are bigger and better companies to fix than there even ferrying them to
were ten years ago,” Bravo says. Thoma Bravo’s offic-
es for training. Bravo
is biggest challenge these days
admits to being tired
H is likely back home in Puerto of the debate over Puerto Rico’s statehood and
Rico where it all began. Bravo an-
holds his tongue when asked about President
nounced in May that he is con- Trump’s performance during Maria. “My pas-
tributing $100 million to his Bra- sion, which is the same as with companies, is
vo Family Foundation that will be to move beyond the strategic, long-term pon-
used to promote entrepreneurship and economic tification, and into the operational and tactical
development on the island. moves that make you move forward today,” he
This new foundation was birthed by Hurri- says. “Economies go down, companies miss their
cane Maria, which devastated the island two numbers, trade stops, product issues happen
years ago. Bravo was in Japan raising cash for and people quit. [The question is] do you have
yet another massive fund and frantically calling a creative approach to problem solving?” Bravo
San Juan trying to locate his parents, who were says. “Some people are stuck . . . and some peo-
living in the capital. They were fine, but the is- ple love putting the pieces together. I just feel
land wasn’t. like every operational problem can be solved.
Five days later, he flew his Gulfstream jet with There’s always a solution.” F


O C T O B E R 3 1 , 2 0 1 9
F O R B E S . C O M

Numbers tell



only half the



story.







Your investments


deserve the full story.





















































1
Strategic investing takes us beyond the numbers. That’s why over 400 of our experts go out in the fi eld
to examine opportunities fi rsthand—like how e-commerce growth is spurring demand for more innovative
packaging solutions. Our rigorous approach helps us select and manage investments for our funds.


Put our strategic investing approach to work for you today.
troweprice.com/fullstory | 1-877-872-5475


Consider the investment objectives, risks, and charges and expenses carefully before investing. For a prospectus
or, if available, a summary prospectus containing this and other information, call 1-877-804-2315. Read it carefully.

1
Investment professionals as of 12/31/18.
All funds are subject to market risk, including possible loss of principal.
T. Rowe Price Investment Services, Inc., Distributor.

PROMOTION









































Back To The







SKIES By K.H. Queen














Post-Hip Surgery, Former Pararescueman


Makes Record-Setting Return To Skydiving





Doctors told Ray Medley he’d never run again. Skydiving? won his age group in a major competition. I have had a yoga
Don’t even ask. But a year after his hip replacement with Dr. instructor back doing full splits and backbends six weeks after
Richard A. Berger, the former special operations parares- a hip replacement. Yes, I have even had patients participate in
cueman returned to skydiving after a decades-long hiatus. extreme sports like skydiving—though I wouldn’t recommend
Five years later, he was part of a team that broke a world that for everyone!”
skydiving record. For Medley, skydiving is fun—hard landings and all. Pre-
“Dr. Berger told me, ‘I’m giving you this new hip to be active— viously, skydiving was also his career. As a U.S. Air Force
not to sit in front of the TV,’” Medley recalls. “He told me, ‘You pararescueman, Medley rescued downed pilots around the
want to run, run. If you come into surgery an athlete, you’ll go world for four years.
out an athlete.’” In 2014, one year after surgery, he resumed skydiving and
In March 2013, Medley returned to work just 10 days after his has completed about 800 skydives since, including landings
surgery with Dr. Berger at Midwest Orthopaedics at Rush Univer- that sent him to urgent care.
sity Medical Center in Chicago. He resumed running two months He earned his instructor’s license in 2015 and in 2018 was
later. Five months after his surgery, Medley hiked Longs Peak in invited to be part of a World Record Formation for Skydivers
Rocky Mountain National Park. Over Sixty (SOS). According to the United States Parachute
Association, the team first set a record in April 2018 with a
PATIENTS RETURN TO SPORTS THAT BRING JOY formation of 66 SOS skydivers. That August, they set a record
“I have had patients return to every activity you can imagine, with a formation of 75 people, according to the Parachutists
and quickly,” Dr. Berger says. “I had a patient run the Chicago Over Phorty Society.
Marathon six weeks after her hip replacement, finishing in “I have put this hip through the test, and it comes out great,”
under four hours. I have had a man return to triathlons, who Medley says.


HEALTHCARE

PROMOTION



086&/(Ž63$5,1* 685*(5< can call these numbers. I think this makes everyone feel more
comfortable with the procedure and with leaving the hospital
MAKES THE DIFFERENCE
Dr. Berger’s innovative surgical technique made the difference, a few hours after surgery.”

Medley says. $IWHU KLV VXUJHU\ 0HGOH\ XVHG D FDQH RQO\ EULHż\ $FFRUG
During traditional hip and knee replacements, the surgeon ing to Medley, the bone-on-bone acute pain in his hip was
cuts muscles, ligaments and tendons, Dr. Berger explains. The gone. “The pain I was feeling was from the surgical incision
scar tissue that forms during healing doesn’t function like the and minor swelling—the actual pain from the arthritic hip has
patient’s original tissue. been alleviated,” he says. His next order of business was unas-
Dr. Berger reports that with his anterior, muscle-preserving, sisted walking, then physical therapy.
minimally invasive approach, patients experience less pain, “Dr. Berger did not give me a handicapped parking [plac-
faster recovery and a better long-term prognosis without the ard],” Medley says. “He told me, ‘You need to walk.’”
additional worry of hip dislocation. Medley considers himself a model
Dr. Berger reports performing patient: “I did exactly what Dr. Berger
more than 20,000 muscle-sparing told me to do.”
hip and knee replacements since
2001 and estimates that about AGE NOT A DECIDING FACTOR
half of his patients leave the hos- Medley was more than 10 years
pital the same day, with the rest younger than the average hip replace-
leaving the following day. At the ment patient. According to research
end of 2018, Dr. Berger performed published by the Association of Bone
his 10,000th muscle-sparing joint and Joint Surgeons, the average age
replacement. He is now well on for a hip replacement is 68.
his way to almost 12,000 just a Age is not the deciding factor for a
year later. hip or knee replacement, however. Dr.
Medley, now 63 and living just Berger has replaced hips and knees
outside Milwaukee, began expe- on a range of people: from teenagers
ULHQFLQJ KLS SDLQ LQ 7KH ŻUVW to those over 100.

doctor Medley consulted assured “The oldest hip replacement I have
him his hip was fine and that he done was on a man who was 101
just needed heel lifts in his running years old,” Dr. Berger says. “He walked
shoes to compensate for training a mile back and forth to his 82-year-
on convex roads. While running old girlfriend’s house. His hip hurt
the Bataan Memorial Death March him too much to walk, so I replaced
marathon, Medley’s pain became it. He lived to 106. The youngest hip
excruciating. He gutted it out, but replacement was 17 years old; I have
knew heel lifts weren’t the solution. done a few at this age.”
Medley consulted a second doctor, After being told by other surgeons
Photos courtesy of Terry Weatherford and Kelly O’Keefe; (right page) Dr. Richard A. Berger
who ordered an MRI. “I was shown My patients are surprised that their activities will be limited fol-
to have no cartilage left in my left when I tell them, ‘Do lowing surgery, Dr. Berger’s patients
hip,” he says. “The head of the femur are thrilled to hear they can resume
looked like the surface of the moon.” everything and anything you their active lives.
That doctor and a third doctor told want as soon as you want “My patients are surprised when
Medley he needed a hip replace- I tell them, ‘Do everything and any-
ment and that he’d never run again. to.’… Arthritis takes away your thing you want as soon as you want
“They put limitations on everything I life and your joy; I return it.” to,’” Berger says. “Mostly, they are
wanted to do,” Medley said. “I had to delighted and overwhelmed when
ŻQG VRPHRQH WR PDNH PH ZKROH ř they actually do the things they loved

DR. RICHARD A. BERGER
A friend of Medley’s, who contin- but had to stop previously with the
ued to run and wear high heels after arthritis. They uniformly come back
her hip replacement surgery, recom- saying, ‘Why did I wait so long?’ and
mended Dr. Berger. “That was the guy I wanted,” Medley says. ‘Thank you for my life back.’ Arthritis takes away your life and
Medley was impressed by the professionalism, care and your joy; I return it.”
attention to detail throughout the process with Dr. Berger’s Medley is happy to be running again—and to be back in the sky.
team. “They educate you on what your surgery is going to be,” “Dr. Berger makes you feel like you can conquer the world,”
he says. “They show you the device that’s going in.” Medley says.
Dr. Berger ensures patients can reach him and his team. And set world records.
“Every patient gets my home telephone number,” he says. “If
they have a question, I want them to be able to talk to me For a consultation or to learn more, please visit
immediately. My seven nurses have cellphones, and patients outpatienthipandknee.com or call 312-432-2557.



HEALTHCARE

F O R B E S . C O M

73




































B A R R Y









B E G I N S








A G A I N









M O S T T E C H B I L L I O N A I R E S A R E P R E C O C I O U S R E V O L U T I O N A R I E S .
T H E N T H E R E ’ S B A R R Y D I L L E R . T H E F O R M E R H O L LY W O O D M O G U L H A S
G R O U N D H I S W AY T O A $ 4 . 2 B I L L I O N T E C H N O L O G Y F O R T U N E , O N E
U N S E X Y S P I N O F F AT A T I M E —— A N D AT 7 7 H E I S A B O U T T O S TA R T A F R E S H .





BY ANTOINE GARA












O C T O B E R 3 1 , 2 0 1 9
PHOTOGRAPHS BY JAMEL TOPPIN FOR FORBES

bronzed from his floating adventures, which took
him from Stockholm to Scotland, then to France,
and on to Italy, the Greek islands and Croatia.
He wears a black blazer and brown leather shoes
without socks, as if he’s just stepped off his be-
loved boat. The paparazzi picked up Diller’s trail
on the island of Panarea in Italy and again in
74 Venice, where Bezos cuddled with Sanchez. “It’s
embarrassing to me,” says Diller of the publici-
ty, so he changes the subject as raindrops pelt
the patio of his corporate abode, designed by
Frank Gehry in waves of shimmering white glass
to resemble the sails of a Spanish galleon taking
wind. “My wife says if I have an engine under-
neath me, I am happy,” Diller notes. “I just need
“Oh, no!” to be on the water. . . . It’s such a great luxury to

have a house that travels.”
Over the past 55 years, as Diller’s magnificent,
swashbuckling career has taken him from deck-
hand to mutineer to admiral, he’s navigated up-
heavals in media and technology while at the
Barry Diller’s same time making big bets ahead of (and some-
times counter to) almost every major trend. In
leathery voice a former life, he was one of the most powerful
hired hands in Hollywood, heading Gulf & West-
R E ern’s movie studio, Paramount Pictures, from
D booms when talk 1974 to 1984 before leaving to build Rupert Mur-
L
L
doch’s Fox Broadcasting into the fourth national
I
A turns to paparazzi network. His string of blockbusters include Sat-

Y
urday Night Fever, Grease and Raiders of the Lost
R
R
Ark at Paramount and The Simpsons at Fox. But
L photos from a in the 1990s Diller pivoted hard after a sojourn
B


E
selling zirconium baubles on QVC convinced him
I that the future lay in the convergence of enter-
F
O recent vacation on tainment, commerce and the internet. Act Two
R
P (or Three or Four—who’s counting?) for Diller
his $40 million has been IAC/InterActiveCorp, an online con-
glomerate that has grown to a value of $20 bil-
superyacht. lion after a tenfold surge in its stock over the
past decade, yielding Diller a $4.2 billion fortune,
good for No. 168 on The Forbes 400 list of rich-
Resting on a curvy, arched sofa in his expansive est Americans.
office, the 77-year-old Diller has pleasantly mean- “Barry’s had one of the most unusual careers of
dered from chatting about the champagne-flute- anybody in America,” says David Geffen (No. 60),
shaped floating island he’s building in the Hud- a close friend and former colleague, now worth
son River to throwing barbs at Donald Trump to $7.9 billion himself. “When he decided he was go-
digressing into the French Revolution to describ- ing to take over QVC I was shocked. I didn’t think
ing IAC/InterActiveCorp, his evolving $20 bil- that was good enough, or big enough, or impor-
lion internet assemblage. The pics in question tant enough, or classy enough for Barry.”
documented a six-week summer yachting holi- In a 1993 New Yorker profile, Diller laid out
day in Europe on which Diller was accompanied a prescient vision of nonlinear TV viewing hab-
by his fashion designer wife, Diane von Fursten- its, essentially describing Netflix. Yet when the
berg, and a carousel of celebrity pals, from singer time came to build his own streaming business,
Katy Perry and actors Orlando Bloom and Brad- Diller admits, “the ideas we had were bad.” De-
ley Cooper to Oprah and Jeff Bezos and his girl- spite owning Ask Jeeves and Vimeo, he was beat-
friend, Lauren Sanchez. en by Google in search and YouTube in video. He
It’s the Friday after Labor Day, and Diller is still passed on the chance to invest in Chinese inter-


O C T O B E R 3 1 , 2 0 1 9
F O R B E S . C O M

L E T T H E R E V O L U T I O N B E G I N .






























































U.S. +1.844.44.TXTAV | INTERNATIONAL +1.316.517.8270 | CESSNA.COM/LONGITUDE

© 2019 Textron Aviation Inc. All rights reserved. CESSNA & DESIGN and CITATION LONGITUDE are trademarks or service marks
of Textron Aviation or an affiliate and may be registered in the United States or other jurisdictions.

THE DILLER DOZEN

STARTING IN THE 1960S BARRY DILLER BECAME A FORCE IN TELEVISION, THEN MOVIES
AND NOW THE INTERNET. HIS TRAIL OF PROTÉGÉS AND ASSOCIATES IS EQUALLY IMPRESSIVE.








76


Michael Eisner David Geffen Jeffrey Katzenberg Mindy Grossman Dara Khosrowshahi John Foley
R
E ex-CEO, Disney Founder, Geffen Cofounder, DreamWorks CEO, WW CEO, Uber Technologies Cofounder/CEO, Peloton
L Records, Cofounder (Weight Watchers)
L Worked with Diller at Hired as assistant to Former banker to IAC Spent 13 years at
I ABC in the 1960s, then Dreamworks Diller at Paramount and Ran Home at Allen & Co. Hired IAC, running brands
D
Diller hired him at Worked with Diller at eventually tasked with Shopping Network by Diller in 1998. Ran like Evite, Citysearch
Y Paramount. William Morris. reviving Star Trek. for Diller. Expedia. and Pronto.
R
R
A
B


E
L
I
F
O
R
P
Sean Rad Scott Sanborn Julius Genachowski Ricky Van Veen Shana Fisher Sam Yagan
Cofounder, Tinder CEO, Former Chairman, FCC, Head of Global Cofounder, Third CEO,
LendingClub now at Carlyle Group Strategy, Facebook Kind VC ShopRunner
Hired by IAC-funded
incubator Hatch Marketing Hired by Diller in 1997 Cofounded Hired by Diller from Sold OKCupid to
Labs in 2012, where executive at Home and spent 8 years CollegeHumor at Allen & Co and led Match in 2013. Was
he co-created Shopping Network building up IAC and Wake Forest; sold his strategic planning CEO when it went
Tinder. for five years. predecessors. operation to IAC in 2006. and M&A for IAC. public in 2015.








net giants like Baidu at their dawn and Amazon always has a plan,” Geffen adds. “I’ve never seen
after the dot-com bust. When Priceline was of- him be anything but successful. To bet against CLOCKWISE FROM TOP LEFT:EVAN AGOSTINI-INVISION-AP; NICHOLAS HUNT-GETTY IMAGES; RICHARD SHOTWELL-INVISION-AP; JIM SPELLMAN-GETTY IMAGES; DAVID PAUL MORRIS-BLOOMBERG; ALLI HARVEY-GETTY IMAGES;
fered to him, he was stretched thin because of him would be a fool’s errand.”
trouble at Expedia and was unable to pounce. Now Diller is again challenging convention.
But Diller’s hits have more than made up for He is preparing to spin off the remainder of
his misses. At IAC he has built and spun off ten Match Group, IAC’s crown jewel, and the handy-
publicly traded companies including Ticketmas- man marketplace ANGI HomeServices, worth
ter, travel giant Expedia and Match Group, Tin- a combined $20 billion. Then Diller will start EVAN AGOSTINI-INVISION-AP; HEIDI GUTMAN-CNBC-GETTY IMAGES; FREDERICK M. BROWN-GETTY IMAGES; DANIEL ACKER-BLOOMBERG; DAVID PAUL MORRIS-BLOOMBERG
der’s parent company, worth a combined $70 bil- again with a hodgepodge of internet unknowns
lion (at an estimated cost of $12 billion). and has-beens. “All of our transmutations have
“Seventy billion dollars from nothing is a lot, been about renewal,” he philosophizes. “Spinning
but it isn’t $700 billion,” Diller concedes. “It off Match is a process of renewal in that IAC the
would be so absurd and almost revolting for me company gets to start inventing again. We are
to feel bad about that disparity. I wasn’t a found- … shrinking in order to grow again … shrinking
er of a single company. We were opportunists and with $5 billion or so of cash.”
I think pretty good managers. I wish I had in- Former Diller lieutenant Dara Khosrowshahi,
vented a single company, but I also wish I could now the CEO of Uber Technologies, says, “Barry’s
dance like Fred Astaire and sing like Adele.” like a shark. If he stops swimming, he dies. So he
Since he took control of IAC’s predecessor in just keeps going.”
1995, he’s produced 14% compound annual re- o understand Diller, it’s impor-
lywood giants like Disney, CBS and Viacom. “He T tant to realize that he relishes be-
turns for shareholders, outperforming Berkshire
Hathaway and trouncing both the S&P and Hol-
ing an underdog. When it comes
understood the dynamics of the digital world to acquisitions, he tends to buy
early among the media moguls, and he captured misfits that others dismiss. That,
it,” says billionaire Mario Gabelli, an IAC inves- in fact, is the plot of one of Diller’s earliest suc-
tor who has followed Diller for decades. “Barry cesses, the 1976 comedy The Bad News Bears,


O C T O B E R 3 1 , 2 0 1 9
F O R B E S . C O M

FIFTH THIRD

CORPORATE BANK







WHERE



EXPERIENCE




AND



INNOVATION



INTERSECT.












Kevin P. Lavender
EVP, Head of Corporate Banking






At Fifth Third Corporate Bank, Kevin and his
team of industry experts do more than offer
competitive capital solutions. They build
personal relationships with clients and
provide meaningful guidance through all

economic cycles—resulting in a partnership
that’s truly strategic, flexible and efficient.


Fifth Third Means Business


53.com/CorporateBank

























Member FDIC

America with a Macintosh PowerBook, searching
for his future.
Serendipity arrived when his friend and now
wife of nearly two decades, designer Diane von
Furstenberg, began selling scarves on QVC. They
sold like hotcakes and she tipped him to the op-
portunity. “I had only known screens for narra-
78 tive storytelling purposes,” Diller says. “Here I
saw a screen being used at this primitive conver-
gence of telephones, televisions and computers.”
R
E He was hooked, thanks to Von Furstenberg, who
L
L herself has an estimated net worth of $200 mil-
I
D lion. “I will say an idea, or she’ll say something,

Y and it bounces, and the ball goes in the air and
R
R it drops where it drops,” Diller says of their rela-
A
B tionship. “We are stimulants in each other’s lives.”

In 1992, QVC was put up for sale, and Diller says
E
L that with the backing of Comcast’s Roberts fami-
I
F
O ly he invested $25 million and took control of the
R company. He promptly tried to buy Paramount,
P
but got in a bidding war with Viacom’s Sumner
which Diller produced after taking over Para- Understudy Redstone and lost the $9.6 billion prize. Then, in
mount. In it, Walter Matthau plays a flamed-out Unlike his college 1994, on the eve of a planned merger with CBS,
dropout boss, IAC
ballplayer who transforms a talentless team of CEO Jerry Levin the Roberts bought QVC out, earning Diller a $130
California Little Leaguers into contenders for the has two Ivy League million windfall. But he was jobless once again.
degrees, a bachelor’s
championship. It’s a perfect summary of Diller’s in economics Help came in the form of Liberty Media’s John
career. and a master’s in Malone (ranked No. 75, with $7.3 billion), who,
engineering.
“Everybody thought this television kid knew Diller says, helped finance his acquisition of Sil-
nothing about movies,” he says, noting that the ver King Broadcasting in 1995. At the time, Sil-
$9 million film grossed $32 million. “I had this ver King was little more than a collection of UHF
little movie, and I was able to mother it to com- stations that controlled a stake in QVC’s compet-
pletion. This little jewel wasn’t the biggest movie itor, the Home Shopping Network. But it was the
ever made, but it was a joy,” Diller says, beaming. beginning of IAC.
“Everybody was betting against it.” With Malone’s backing, Diller
Born in San Francisco in 1942 and raised in started making deals—and lots of
D I L L E R
Beverly Hills, where his father ran a success- money. In 1997 he cut a deal to buy
ful real estate business, Diller attended UCLA R E L I S H E S 55% of cable-TV network USA from
but dropped out eventually finding a job in the B E I N G A N Edgar Bronfman Jr. for $4.1 billion.
mail room of the William Morris talent agency. Less than four years later he flipped
U N D E R D O G .
There he worked alongside future industry icon it to Vivendi for $11 billion. In 1997
W H E N I T
David Geffen. He moved to ABC in 1964 and hit he also bought half of Ticketmas-
pay dirt a few years later, at the age of 25, birth- C O M E S T O ter for $210 million, snapping up
ing the network’s Movie of the Week concept, the A C Q U I S I T I O N S , the rest in 2003. He spun off Tick-
start of a decades-long rise. At 30, he was named etmaster in 2008 and merged it
H E T E N D S T O
vice president of prime time; a year later, in 1974, with Live Nation two years later.
he decamped to the silver screen at Paramount, B U Y M I S F I T S The business, a near monopoly in
where he worked for almost a decade, producing T H AT O T H E R S concert and sports ticketing, is now
a stream of hits like Raiders. worth $15 billion.
D I S M I S S .
In 1984, Diller left that cushy job to build a In the late 1990s, Alexander von
fourth national network for Rupert Murdoch. Furstenberg, Diane’s son, recom-
Onlookers predicted disaster. With little budget, mended that Diller look into an early online dat-
he built Fox Broadcasting into a powerhouse by ing site. Both believed dating would move on-
making contrarian bets on shows like Married . . . line. They soon discovered Dallas-based Match.
with Children and The Simpsons. Having con- com and began investing in the company in 1999.
quered Hollywood, Diller decided to start over. Eventually it would merge with hipper platforms
“I was getting less and less curious, which, for like Tinder and Hinge. With a total investment
me, is fatal.” He quit Fox in 1992 and wandered of $1.6 billion, he’s seen the value of IAC’s stake


O C T O B E R 3 1 , 2 0 1 9
F O R B E S . C O M



grow to $17 billion. Travel, Diller also predicted, acquisition of Bluecrew in March 2018. Bluecrew
would move from agencies to the Web. In 1999 he connects construction and logistics workers with
purchased Hotels.com for $245 million and then, jobs and fits in with IAC’s vision for the future of
in 2001, struck a deal with Microsoft to take con- ANGI HomeServices. In a similar vein, last Oc-
trol of Expedia for $1.5 billion, agreeing to com- tober ANGI paid an estimated $150 million for
plete the purchase just after the September 11 at- Handy, an on-demand cleaning service, and a few
tacks. “If there is life, there’s travel,” Diller decid- months later Levin spent $250 mil-
ed, persuading himself to complete the deal. Ex- lion on Turo, an app that lets motor-
D I L L E R ’ S
80 pedia is now worth $20 billion. ists share their idle cars like home-
Not every deal has panned out. In 1999, Diller D E A L S owners rent out Airbnb rooms.
tried and failed to buy Lycos, an early search en- A R E P U N Y Diller’s deals are puny compared
R
E gine. That’s probably a good thing given that a with the ones cut in Silicon Val-
L C O M P A R E D T O
L small company named Google had been found- ley, but they are much more like-
I T H E O N E S C U T
D ed a year earlier. But he still managed to waste ly to make money. The rival inter-

Y nearly $2 billion in search, buying the also-ran I N S I L I C O N net conglomerate Softbank is sweat-
R
R Ask Jeeves in 2005. VA L L E Y, B U T ing to salvage its massive invest-
A
B Jeffrey Katzenberg, who worked under Diller ments in Uber ($7.4 billion) and We-
T H E Y A R E
at Paramount, believes Diller’s instincts and dog- Work ($10.6 billion). IAC is more
E
L gedness, learned over two decades in Hollywood, M U C H M O R E old-school. Diller would rather in-
I
F
O have transferred perfectly to the Web and IAC. A L I K E LY T O vest years—and millions—growing
R movie like The Bad News Bears, he points out, is a property like ANGI into a multi-
P M A K E M O N E Y.
willed into existence by a producer with convic- billion-dollar business than try to
tion, the same way Diller has impelled some of jump-start the process with a bazil-
his disparate Web properties to success. “Barry lion-dollar investment.
would always say there’s no natural momentum Even the duds are put to work. IAC continues
to a movie,” Katzenberg says. “It must be driven to own Ask Jeeves. Now rebranded as just Ask, it
by somebody’s belief and passion.” is split into a media company and Web browser
app. It still draws 120 million monthly users, and
D iller’s current hand looks chal- IAC milks it for cash. Diller’s eight-figure acqui-
sition of Connected Ventures, owner of College-
lenging. He’s slimming IAC down
at a time when the behemoths of
Silicon Valley look every bit as Humor, drew hackles in 2006. But Diller might
have the last laugh. Tucked inside was a media
powerful as John D. Rockefell- player called Vimeo.
er’s Standard Oil. As Diller entertained hours In 2015, a 32-year-old Harvard M.B.A. named
of questioning from Forbes in early September, Anjali Sud pitched Levin and Diller on abandon-
Match shares were falling after Facebook said it ing Vimeo’s money-losing original content in fa-
would redouble its online dating efforts. Mean- vor of doubling down on it as a publishing tool
while, ANGI HomeServices, which grew out of for filmakers. Much the way WordPress is the soft-
Angie’s List, a decades-old directory of reliable ware behind hundreds of millions of blogs, Vimeo
local businesses, plunged 45% in August when is now the publishing platform of choice for more
its profits fell short. than a million paying subscribers who generate
There are also lawsuits. The cofounders of Tin- more than $200 million in annual revenues. It’s
der, Sean Rad and Justin Mateen, claim they were gone from bad-news bear to IAC gem, growing at
deprived of billions when the app was consoli- a 26% clip to an estimated $2 billion valuation.
dated by Match. Diller responds sharply: “Sean In 2019, Diller’s IAC will generate $5 billion in
Rad is a blowhard and a bad actor.” revenues, up about 12% over last year. Its $20 bil-
Facebook, Diller adds, has yet to register as lion market capitalization, however, seems to re-
a threat to Match. “I’m not overly worried,” he flect investments in only two operations, 81% of
quips, then brings up the possibility of regula- Match Group and 84% of ANGI HomeServices,
tion. “I think that there are real issues,” he says, both of which Diller is considering jettisoning.
turning his attention to Google. “It’s okay to take But if you think for a second that you’ve heard
our money as advertisers. It’s not fine, in my the last from Barry Diller and his band of under-
opinion, to then try and get our customers.” dogs—from Investopedia and Ask to Bluecrew,
Diller has delegated much of IAC’s day-to- Brides and Turo—you’re mistaken.
day to a new line of deal-hungry executives, led “My heart has been in this little tiny compa-
by Joey Levin, a 40-year-old former M&A bank- ny that has grown up,” says Diller, wistfully. “At
er with a thick Chicago accent who took over as some point, I said, If they don’t laugh at me,
CEO in 2015. Levin spearheaded the $10 million something’s wrong.” F


O C T O B E R 3 1 , 2 0 1 9
F O R B E S . C O M



82































































































F O R B E S . C O M

A








83 83

























































F O R C E O F N A T U R E







BILLIONAIRE OILMAN PHIL ANSCHUTZ IS GEARING UP FOR ONE

LAST ACT, MOVING FROM FOSSIL FUELS TO—GASP!—RENEWABLE

ENERGY. BUT HE’S IN IT FOR A DIFFERENT SHADE OF GREEN. WILL
ANSCHUTZ’S $8 BILLION WIND FARM BE HIS ULTIMATE WINDFALL?




BY CHRISTOPHER HELMAN












PHOTOGRAPH BY JAMEL TOPPIN FOR FORBES O C T O B E R 3 1 , 2 0 1 9

→ Over his 60-year career Phil Anschutz



has owned oilfields, railroads, fiber-optic

84
networks, tungsten mines,


Z Anschutz slogged through a decade of permitting,
T construction is under way. Workers have built 95
U
H movie theaters and even miles of work roads and prepped 115 pad sites for
C the first phase of turbine installation, which could
S
N a pancake manufacturer. begin in 2020 and finish in 2025. Anschutz has
A
bankrolled the first $400 million out of his own
L
I pocket and is looking for equity partners or to raise
H
P He owns the L.A. Kings NHL team, nearly a debt to finance the rest. Just don’t expect him to


E third of the NBA’s Lakers, and the Staples Cen- give up control. “I want to see it built,” he says.
L
I ter, where they both play. He runs the Coachel- Is he doing this to greenwash his reputation?
F
O la music festival, The O2 arena in London and “No. We’re doing it to make money.” Though he
R
P The Broadmoor, the historic 784-room hotel in believes excess carbon dioxide in the atmosphere
Colorado Springs. He bankrolled the Chronicles “is a problem,” it’s “not as extreme as some would
of Narnia movies and was backing Michael Jack- think.” What’s extreme is California’s new law
son’s comeback tour when the pop star died. An- mandating the transition to 100% renewable en-
schutz doesn’t just love unique businesses—he’s ergy by 2045. He intends to profit from it.
obsessed. “My wife calls it a psychosis,” he says Anschutz says the hardest work is already over.
with a laugh. The permitting process culled a quarter of the
Anschutz has a soft spot for oil, as that’s where planned turbines—in the windiest area, there will
he got his start, and fossil fuels form the basis be 157 instead of 325. The only time he thought
of his estimated $11.5 billion fortune, placing about selling the land and walking away was when
him at No. 41 on The Forbes 400. Unwrapping the pro-coal factions of the Wyoming legislature
a fresh box of Swisher Sweets cigarillos, he ex- succeeded in pushing through a new wind-gener-
plains the favored attributes of the 500,000 acres ation tax of 0.1 cent per kilowatt hour—the first in
his oil company has been exploring in Wyoming’s the nation. Even little numbers add up when you
Powder River Basin, where his team has drilled plan on putting out 12 billion kWh per year.
and fracked enough wells to be convinced they In some ways, the permitting slog was a bless-
are sitting on more than a billion barrels. This ing in disguise. Over the last decade, turbines
could yield a bigger payday than the $2.5 billion have improved in size, power and efficiency. Ac-
he made in 2010 selling other oilfields. The best cording to Lazard, the all-in cost of generating
part, he says, is the way that his acreage “interfin- a kilowatt-hour of wind power, without subsi-
gers” with the holdings of bigger oil companies, dies, has fallen from 13.5 cents a decade ago to
which might like to buy it. He links his fingers to- 4.3 cents. Factor in federal renewable-energy-in-
gether, half-chewed cigar in hand, to illustrate. vestment tax credits (a $2.8 billion value over the
Anschutz, 79, has never been a roughneck. first ten years) and Anschutz’s costs should drop
He’s 5 feet 9, slim, well coiffed and sounds like to 2 to 3 cents per kWh. California gets about
the actor Lorne Greene (more Battlestar Galacti- a third of its energy from renewables and 40%
ca than Bonanza) as he explains that his next— from fossil fuels. For wind, which makes up 11%
and perhaps last—big investment will not be in of supply, it’s been paying 3 cents per kWh, ac-
oil at all. Instead, fossil-fuel king Phil Anschutz is cording to the Department of Energy. Anschutz’s
building America’s biggest wind farm. long-term bet is that as tax credits expire and
It will cost $5 billion to erect 1,000 turbines at California’s 2045 target date approaches, wind
the Chokecherry and Sierra Madre Wind Ener- power pricing will go up.
gy Project on Anschutz’s 320,000-acre Overland Anschutz has long been familiar with the fe-
Trail Ranch near Rawlins, Wyoming. Plus anoth- rocity of Wyoming winds. Fresh out of college
er $3 billion to construct a 730-mile direct-current in the early 1960s, he started working at his fa-
transmission line to deliver that power (enough ther’s Circle A drilling company, which owned a
for 1.8 million homes) to the California grid. After handful of rigs in the vast, wind-scrubbed lands


O C T O B E R 3 1 , 2 0 1 9
F O R B E S . C O M

Hazel doesn’t know what she wants
to be when she grows up, and that’s

just fine. At age 11, her job is to play,
grow and learn. But for kids like
her in the world’s poorest places,
poverty gets in the way.

ChildFund works in 24 countries
to make sure children grow up
healthy, educated, self-sufficient

and safe, wherever they were born.

Thanks to generous supporters, our
programs help children fulfill their
potential. That’s been our promise
to them for 80-plus years.





CHILDFUND.ORG

BIG WIND which turned out to be in Wyoming in the vicin-
ity of the Overland Trail Ranch. Here, through
ON A WYOMING RANCH BIGGER THAN SAN FRANCISCO, ANSCHUTZ’S the mountain gap that pioneers on the Overland
WIND COMPANY IS BUILDING 1,000 TURBINES THAT WILL BE ALMOST
Trail took on their way west, came big, steady
500 FEET HIGH AND POWER 1.8 MILLION HOMES.
winds, averaging around 20 mph.
Anschutz and Miller sketched plans for a wind

farm with at least 1,400 turbines, figuring per-
mitting would take about four years and they’d
86 Berkeley have it built by 2015.
Sausalito
Not so fast. The Bureau of Land Management
required a voluminous Environmental Impact
Z
T Oakland Study. There were negotiations with the Audubon
U
H Alameda Society and the Wyoming Game & Fish Depart-
C ment over how much land to set aside for sage
S
N grouse. The Oregon-California Trails Association
A
wanted access to the wagon tracks still etched into
L Daly City
I the landscape. And the U.S. Fish & Wildlife Service
H
P OVERLAND TRAIL RANCH was worried about how many endangered golden

500 SQUARE MILES
E eagles the turbines were likely to kill.
L
I Anschutz paid for vegetation surveys, employed
F
O ornithologists, deployed avian radar, mapped ea-
R

P San Mateo gle flights. He agreed to set aside the skies above
105,000 eagle-favored acres as off-limits to tur-

bines. Adjustments were made so that the “view-
Redwood City shed” from the Teton Reservoir would not be

marred by the flickering of turbine blades in the
distance. “We’d never seen a project of that scale
before,” says Brian Lovett, administrator of Wyo-
ming’s industrial siting division. “They were made
to jump through a lot of hoops.” Some sour grapes
of northern Wyoming. It wasn’t long before An- remain—historic preservationists hope that An-
schutz bought his father out. In 1967, a crew did schutz will someday allow tourists to walk on the
hit oil but lost control of the well, which ignited wagon ruts that cross his land.

into a raging inferno. Famous oil well firefighter It’s fun to do things other people think can’t

Red Adair requested $100,000 to battle the blaze, be done, Miller says, recalling the oil pipeline
and quick-thinking Anschutz saved his company that he and Anschutz built in the 1970s from Ba-

by getting Universal Pictures to pay that sum for kersfield, California, through Los Angeles to the
the filming rights. (The footage was used in the port of Long Beach. “People thought we were ab-

John Wayne flick Hellfighters.) solutely stupid, but we did it,” Miller says with


Anschutz made his first mega-fortune in 1982, a laugh. They got the same thrill risking $1 bil-

selling half of an oilfield on the Wyoming-Utah lion to lay thousands of miles of fiber optics with


border to Mobil Oil for $500 million ($1.4 bil- Qwest Communications in the 1990s. “You know
lion in today’s money). He reinvested in mining how many customers I had signed up? Zero,” An-
and railroads and built the Southern Pacific line, schutz says, holding up his fingers in an “o” sign.


which in 1996 he sold to Union Pacific for $5.4 “But I knew the world was moving from voice-by-

billion, valuing his shares in the new company at the-minute to data-by-the-megabyte.” He sees the
more than $900 million. same kind of bet in the transmission line that will
But wind was already on his mind. Anschutz carry wind power across four states, 16 BLM dis-
loved riding his railroad around California, and he tricts and the properties of 378 landowners.
marveled at the wind farms built in the Sierra Ne- America’s wind capacity will grow 60% in five

vada passes. “I started out just curious,” he says. “I years from a current 100,000 MW, according to
had come out of the traditional energy business and consultancy Wood Mackenzie. Those turbines
thought, what’s all this?” Wind turbines looked to have to go somewhere. If America is dedicated to
Anschutz like any other natural resource business— decarbonizing its energy sources, it makes sense
kind of like an upside-down oil well, sucking ener- to utilize the windiest places with the fewest peo- PATRICK WELSH FOR FORBES
gy out of the air. And one that would never run dry. ple. “The wind regime extends beyond our ranch
He asked Bill Miller, then president of his oil to the whole gathering basin,” Anschutz says. “If
company, to find the windiest land in the nation, we can’t build it here, we can’t build anywhere.” F


O C T O B E R 3 1 , 2 0 1 9
F O R B E S . C O M

PROMOTION


D I V E R S I T Y AT T H E T O P



Leading With






Purpose








W R I T T E N B Y J U D I T H L . T U R N O C K

PROMOTION











he ELC’s North Star—more black
board directors and CEOs—is the
bold but attainable goal for ELC
T members, described by CEO Skip
Spriggs without exaggeration as “850 of the
most powerful black corporate executives in
the world.” ELC members are all either CEOs
or within one or two reports of their CEOs, so
they are within reach of these CEO and direc-
tor roles. The ELC put its reputation on the line
several years ago when it added numbers to
the general statement: increasing blacks in
the C-suites of major corporations by 500
and black directors by 200.
This overarching goal at the same time
illuminates a broader purpose for The ELC,
turning its powerful collective voice beyond
what it does to demonstrate why it does it.
“The ELC is guided by a newly formed
purpose statement: to open channels of
opportunity for the development of black
executives to positively impact business and
our communities,” says Libi Rice, ELC vice
SUHVLGHQW DQG FKLHI FRPPXQLFDWLRQV RIŻFHU
“We will continue to advance the professional
needs of our members so they in turn will be
in the best position to help build the next gen-
eration of black corporate leaders—but also
The ELC’s goal—its North Star— the increasing number of future black entre-
preneurs and our communities overall.”
is to increase the number of blacks “Business is evolving, corporate America is
evolving,” says Tonie Leatherberry, The ELC
on the top 500 corporate boards and Board’s chair, a principal at Deloitte & Touche
LLP and president of the Deloitte Foundation.
LQ WKHLU &(2 RIŻFHV DQG WR NHHS WKH “We’re evolving too, focusing more on our
mission,” adds Spriggs. “It’s the right time for
pipeline behind them full of the next The ELC to focus on addressing the longer-

term challenges of our community.”
generation of leaders. That North Star “Pivoting to the new” is how Chloe Barzey,
a member of The ELC Board’s Member-
also speaks to a deeper purpose, ship Committee and a managing director at

Accenture North America, labels this orga-
FDOOLQJ PHPEHUV WR żH[ RXU SRZHUIXO nizational evolution, introduced publicly last

week at The ELC’s Annual Recognition Gala
collective voice for our black community in Washington, D.C., to a sold-out audience of

2,300 members, business and policy leaders
DV D ZKROH WR PDNH VXUH ZH DV D SHRSOH DQG HOHFWHG RIŻFLDOV

DUH UHSUHVHQWHG LQ WKH ULJKW ZD\ ř CEO GAMECHANGER CONFERENCE

Signaling The ELC’s already powerful and
SKIP SPRIGGS, CEO, influential draw, more than 40 CEOs gath-
ered immediately before the Gala for The
THE EXECUTIVE LEADERSHIP COUNCIL
ELC’s inaugural CEO GameChanger Confer-
ence. Behind closed doors, CEOs and their
(/& PHPEHUV EHJDQ KDPPHULQJ RXW VSHFLŻF



2 | DIVERSITY

ELC 2019 Board, front, l to r: Greg Deavens, treasurer; Tonie Leatherberry, chair; Leilani Brown, secretary; Crystal Ashby, vice chair;
Skip Spriggs, CEO; top row far right; Orlando Ashford, immediate past ELC Bord chair and president, Holland America Line



action steps to move corporations along peers,” says Satonya Fair, The ELC’s new /HDGHUVKLS (GXFDWLRQ IRU $VLDQ 3DFLŻFV
with The ELC on its North Star journey. vice president and chief philanthropy /($3 'LYHUVLŻHG 6HDUFK LV DOVR D VWUD-
Robert F. Smith, recipient of The ELC’s 2019 RIŻFHU Ř([SDQG \RXU WKLQNLQJ ř )DLU VXJ- tegic ABD partner.
Achievement Award and founder, chair gests, or “you are leaving both money Percentages, however, can gloss over
and CEO of Vista Equity Partners, gave and talent on the table.” a more complicated reality. The ABD
the keynote address. The discussion that “All these CEOs, with their awesome Census demonstrates in numerous
followed was based on what CEO Spriggs responsibilities, spending significant charts, figures and the appendix that
calls “groundbreaking research from Korn time with us to come up with game plans the increase is heavily skewed toward
Ferry, identifying the skills and competen- is really a testament to what they think one category: white women. “The total
cies of black leaders and the value they of The ELC,” says Leatherberry. “This number of minority board members is
bring to corporations.” event was quite literally a game changer, moving,” says Spriggs, “and I applaud
Michael Hyter, a former ELC Board going deep on actionable items, not just the progress of women. But when you
member and Korn Ferry managing another discussion.” disaggregate the data, there’s one
partner, walked participants through the underrepresented group that’s barely
data. “We were able to quantify the driv- THE ELC’S NORTH STAR: moving at all, and that’s blacks—men
ers and traits of a sizable pool of current BLACKS AT THE TOP and women.”
black P&L executives at major corpora- “Since 2012, the number of [leading 500 With regard to CEOs, no detailed
tions, each of them already responsible companies] with greater than 40% diver- FHQVXVŔQR FKDUWV QR ŻJXUHV QR DSSHQ-
for budgets of tens of billions of dollars,” sity [on their boards] has doubled…. At the dix—is needed to demonstrate the reality.
VD\V +\WHU Ř,WŖV QRW DERXW ŻQGLQJ D XQL- current rate of progress, we predict that “We’ve got only four black CEOs in the
corn. This level of talent already exists.” we would see the number of women and top 500 companies—less than 1%—and
7KH UHVHDUFK VD\V +\WHU LGHQWLŻHV WKH minorities increase to 40% [across all the there is no guarantee there will be black
behaviors that powered their success: leading 500 companies] by 2024.” This successors,” says Spriggs. “There were
“willingness to go all in, not easily shaken, is the promising declaration of Missing more just a couple of years ago. Unless
need to overperform and outperform, Pieces: The 2018 Board Diversity Cen- we are really proactive, we may find
beating the odds and—always crucial— sus of Women and Minorities on Fortune more backsliding. That’s unacceptable.”
leading others. Why wouldn’t you want 500 Boards (January 2019), prepared
more of those star players on your team?” by Deloitte and the Alliance for Board CORPORATE BOARD INITIATIVE
asks Hyter. Diversity (ABD), a collaboration between It is not a lack of candidates that keeps the
These candidates don’t need or want The ELC and three other organizations: needle from moving. For almost a decade
special treatment. “They stack up very Catalyst, the Hispanic Association on The ELC has heavily invested in filling
well against their best-in-class white Corporate Responsibility (HACR) and the supply side of the equation. “We’ve



DIVERSITY | 3

PROMOTION





created an amazing pipeline of potential
black board talent, and we are approach-
ing 300 members with nonprofit and
IRU SURŻW GLUHFWRUVKLSV ř VD\V %LOO\ 'H[WHU
an ELC member, principal at the execu-
WLYH VHDUFK ŻUP +HLGULFN 6WUXJJOHV DQG “The total number of minority board
the co-chair and inspirational leader of
the Corporate Board Initiative (CBI). “The PHPEHUV LV PRYLQJ %XW ZKHQ
availability of black board talent is stron-
ger than it has ever been.” you disaggregate the data, there’s one
CBI, sponsored by EY and Heidrick
& Struggles, readies select ELC mem- underrepresented group that’s barely
bers for service on corporate boards. PRYLQJ DW DOO DQG WKDWŖV EODFNV ř
In spring 2019, the fourth CBI cohort, 27
carefully chosen ELC members, began
a restructured and refocused readiness
experience. First, they completed the cer-
WLŻFDWLRQ SURFHVV RIIHUHG E\ WKH 1DWLRQDO
Association of Corporate Directors. programmatic emphasis on the demand Fast-forward to November, when
They continued with assigned individual side. “We want to be the go-to source for The ELC will partner with the African
mentors and coaching sessions with a black board talent,” says Dexter, “so we’re American Directors Forum (AADF) to
member of Heidrick & Struggles’ CEO going directly to chairs of board nomi- bring highly qualified, board-proven
and Board Practice. nating committees and CEOs. Our CEO and board-ready African-American
With the supply side of the equation GameChanger Conference, for example, executives together with the CEOs,
expanding, CBI now places an equal is an important forum.” board chairs and nominating and







Our Commitment


To Diversity





Morgan Stanley’s ability to build value for clients rests on the
talent of our employees, who bring the benefits of their diverse
experiences and perspectives to their work. We firmly believe
JAMES P. GORMAN,
that our business thrives by promoting a culture of inclusion and
Chairman and CEO,
belonging where dedicated professionals can collaborate to Morgan Stanley
produce breakthrough thinking.
We leverage targeted recruitment and development programs
to hire, retain and promote top diverse talent. Programs designed to
help employees develop skills and build networks include the Leader
Engagement and Development Program for Black and Hispanic Vice
Presidents and Executive Directors, the Multicultural Professional “At Morgan Stanley, diversity is an opportunity—
Development Program for Ethnically Diverse Analysts and Associates IRU FOLHQWV HPSOR\HHV DQG WKH ŻUP %\ YDOXLQJ
and the Women’s Development Program for Vice Presidents and GLYHUVH SHUVSHFWLYHV ZH FDQ EHWWHU VHUYH RXU
Executive Directors.
FOLHQWV ZKLOH ZH KHOS HPSOR\HHV DFKLHYH WKHLU
In 2019, our inaugural Wealth Management Black Leaders Forum
professional objectives. A corporate culture
brought colleagues together for a multiday experience that provided
exposure to senior leaders and created a sense of community LQ ZKLFK HYHU\RQH IHHOV WKH\ EHORQJ LV IXQGD-
designed to build career momentum. Other strategic programs, like mental to our role as a global leader constantly
the Multicultural Leadership Summit, underscore our commitment VWULYLQJ IRU H[FHOOHQFH LQ DOO WKDW ZH GR ř
to inclusion as a strategic business imperative and convene our
multicultural employees in a business development forum focused
on deepening client relationships.


© 2019 Morgan Stanley & Co. LLC and Morgan Stanley Smith Barney LLC. Members SIPC. CRC 2727141 10/2019

4 | DIVERSITY

HOW WILL THE NEXT GENERATION





CHANGE THE FACE OF PHILANTHROPY?











I AM MANDELL CRAWLEY




Head of Private Wealth Management






The future poses many questions


as millennials stand to inherit a

whopping $30 trillion* over the

next 30 years—the largest wealth

transfer we’ve ever seen. Most

notable is how this entrepreneurial


generation is choosing to invest

both their created and inherited

wealth as forces for good.

By aligning with like-minded


organizations that are sustainable

and philanthropic, and demanding

improved transparency around

impact, millennials are paving a


worthier way for future investors.




















¹ Á«¾­² «¸®¯¶¶ʤ½ ¹¼±«¸ ¾«¸¶¯Ã ³¸¿¾¯ ¹¸
“Managing Wealth With Purpose,” go to morganstanley.com/wealth-purpose.





ʷ ¹¿¼­¯ʨ ¹¼¬¯½ʨ ²¯ ³¶¶¯¸¸³«¶ ¯«¶¾² ¼«¸½°¯¼ʦʣ ¿±¿½¾ ʦ
ʽ ¹¼±«¸ ¾«¸¶¯Ã ·³¾² «¼¸¯Ã ʧ ¯·¬¯¼ ʧ ʵ ʵ

PROMOTION





governance chairs of corporations grow in numbers. The ELC’s programs, talent pool is many layers deep, reten-
in Atlanta for the express objective created by The ELC’s Institute for Lead- tion rates improve.
of increasing the representation of ership Development and Research, In collaboration with McKinsey
African Americans on the boards of institutionalize that vigilance. & Company, the Institute holds an
publicly traded companies. The ELC/ “Our pipeline development programs annual C-Suite Academy, gathering
AADF-Atlanta aims to replicate the prepare younger leaders for more senior black senior executives who aspire to
success of the inaugural AADF held roles and even greater opportunities to C-suite roles, reporting directly to the
in 2017 in Pittsburgh, which directly contribute to our broader community,” CEO, or who simply want to improve

influenced an impressive eight board VD\V 6SULJJV 7KH EHQHŻWV WKDW DFFUXH their influence and effectiveness in
appointments. to those who attend accrue equally to their interactions with C-suite execu-
The next step, Dexter says, will be their corporations; when a company’s tives. The most recent Academy was
The ELC’s “inside game” strategy: “We
are purposefully connecting our mem-
bers already on boards with our board
cohort member talent, so they feel com-
fortable referring them when openings
occur.” This pool is ready for any slate
of candidates. Our pipeline development programs


1(;7Ž*(1(5$7,21 3,3(/,1( prepare younger leaders for more senior
The ELC knows that achieving those few
top positions is not reaching the North roles and even greater opportunities to
Star. It merely signals the vigilance nec-
essary for black corporate leaders not FRQWULEXWH WR RXU EURDGHU FRPPXQLW\ ř
only to continue developing but also to









AT&T: We’re Pushing Our



Bar Even Higher


We champion diversity and inclusion in all we do, from “ We p r o v i d e
bringing in the best talent, to providing innovative devel- a culture in which
opment opportunities, to giving our employees a voice a l l e m p l o y e e s
—all to support them and our business each day. can realize their
Recognizing our efforts, DiversityInc this year honored highest potential,”
us with No. 1 rankings on its overall Top 50 Companies for says Kirk McDonald,
Diversity list and on three of its supporting specialty lists— chief marketing officer
COREY ANTHONY,
talent acquisition, mentoring and sponsorships. of Xandr and newest
Senior Vice President, HR, and
“Our diverse and inclusive culture grows stronger AT&T ELC m e m b e r. &KLHI 'LYHUVLW\ 2IŻFHU $7 7

each year because we embrace new ideas, encourage “We know that diverse
innovation, challenge assumptions and disrupt the status perspectives and experiences at all levels spark keener
quo,” says Corey Anthony, senior vice president of HR and insight, broader ideas, stronger teamwork and a better
FKLHI GLYHUVLW\ RIŻFHU understanding of others’ needs.”

This spring, we launched a new, six-month development In becoming a modern telecommunications media
program exclusively for our high-performing African and technology company, our diversity and inclusion
American leaders—the Executive Black Leadership efforts are now more multidimensional in depth and reach.
Experience (EBLE). It features strategic workshops and Through the 250,000 unique individuals that comprise our
matches participants with advocates and sponsors to workforce, we work cohesively as a company to inspire
deepen their exposure and engagement with leaders human progress.
companywide. EBLE reflects our commitment to push
our bar even higher as a corporate pacesetter in pipeline To learn about a career at
diversity and talent development. AT&T, go to https://att.jobs/
careers.



6 | DIVERSITY

TO BE THE BEST,



WE SEEK OUT THE

















At AT&T, we know how to identify great talent and
understand that our diverse workforce is a key to our
innovation and success. But we’re also committed
to strengthening the diverse communities we serve.
Whether by doing business in the preferred language of
our customers, seeking out diverse suppliers, or being
the largest full-time union employer in the U.S., we’re
always looking for new ways to lead by example. And we
proudly support the Executive Leadership Council.


att.com/diversity



©2019 AT&T Intellectual Property. All rights reserved. All marks used herein are the property of their respective owners.

PROMOTION





held in Philadelphia in June. Partici-
pants learn from the best coaches,
leadership facilitators and current
and former ELC C-suite executives
the strategic and tactical challenges
of the C-suite and receive deeper pro-
fessional and personal guidance and
insights through individual feedback,
assignments and coaching.
More than 300 executive and high-
potential women gathered at the 16th
Women’s Leadership Forum (WLF)
in Atlanta in July to hear ELC, politi-
cal and media luminaries encourage
them to be “Bold Yet Balanced.” In
addition to strategies for corporate
advancement—especially leveraging
the “power of being the only one” in
the room—speakers discussed trail-
blazing as directors and in the C-Suite,
embracing the promise and challenge
of technology now and in the future,
negotiating compensation packages
Billy Dexter, The ELC’s Corporate Board Initiative (CBI) co-chair (second from left), with, l to r,
and winning support from male col-
Dmitri Stockton, former CEO of GE Asset Management and director of multiple corporate boards;
leagues. Inspiration from the explosion Gena Ashe, board director of XPO Logistics; Ken Bouyer, EY, director, Americas Inclusiveness; and
Daniel Clifford, EY, associate director, Board and Executive Referral




Otsuka in the U.S.: Reaching Patients



Through Inclusion And Creativity



At Otsuka America Pharmaceutical, Inc. “Our goal is to find more and more
(OAPI), delivering products to serve unmet innovative ways to help patients,” reports
medical needs in the areas of neuroscience Sanket Shah, senior director, OAPI channel
and nephrology is an endeavor that requires strategy and patient support. “Empowering
creativity on the part of each employee. As our people to push boundaries and be as
such, employees at all levels of the organi- creative and innovative as they can be
zation are encouraged to solve problems makes us a magnet for talent. We all listen

DQG WR SHUVHYHUH XQWLO WKH\ ŻQG DQVZHUV to each other.”
“No one is pigeonholed here. If you Shah, a 10-year veteran, has been a
have an idea, you are welcome to share it, part of this inclusiveness as the company SANKET SHAH
even if it is not within your functional area has grown: “I’ve been able to help design Senior Director, OAPI Channel
Strategy and Patient Support
of expertise,” reports April Mitchell, vice some of our support programs to really
president, U.S. and global CNS marketing. help patients appropriately access our
“Otsuka embraces diversity in the largest products. We’ve always had people of
sense of the word. Each of us has much different backgrounds, but there’s more. The
more than a seat at the table, and I felt it even company’s culture is to make sure everyone
before I started at the organization. We all is included.”
have a voice, so we have robust discussions Embracing a culture of inclusion and
that yield informed decisions to ultimately creativity from its vast tapestry of different
EHQHŻW WKH SDWLHQWV ZH VHHN WR KHOS ř cultures, professions and backgrounds,

The idea that everyone has something Otsuka has seen employees deepen their
to contribute is informed by Otsuka’s value engagement and its bottom line grow
of humility, which involves putting individual while, most importantly, addressing unmet
needs, and pride, aside to serve the greater patient needs. APRIL MITCHELL
good. Together, more is possible. Vice President, U.S. and
Global CNS Marketing
8 | DIVERSITY

By focusing on diversity of ideas,


the organization becomes more diverse by


design. This helps us meet patients where


they are and deliver meaningful outcomes.






- William H. Carson, M.D.

President & CEO Otsuka Pharmaceutical
Development & Commercialization




















































Otsuka America Pharmaceutical, Inc.
Otsuka Pharmaceutical Development & Commercialization, Inc. September 2019 01US19EUC0242

PROMOTION





of black women millennial leaders and
the sage advice of seasoned leaders
was a powerful backdrop.
Money raised was donated—to
enthusiastic audience cheers and
applause—to Morehouse School of
Medicine, Spelman College and The
ELC’s Ann Fudge Scholarship.
Two separate Leadership Develop-
ment Weeks (LDW) of sold-out courses
meet annually to build the black execu-
tive pipeline, one on the East Coast and
one on the West Coast. They took place
this year in Miami and Las Vegas. The
corporate sponsors are Bristol-Myers
Squibb, Bank of America, Citi (East) and
Prudential (West). Each course focuses
on different levels of experience and dif-
ferent aspects of leadership.
A five-day course for black vice
presidents, directors, senior manag-
ers and entrepreneurs, Strengthening
the Pipeline: Critical Factors for Suc-
cessful Leaders, covers advanced
concepts in leadership such as
Participants in the 2019 ELC C-Suite Academy enhancing self-awareness, navigating




Carnival: Promoting Diversity,



At Sea And Onshore





At Carnival Corporation we are committed to diversity A diverse group
in our employees and our leadership, and we are dedi- of people, if prop-
cated to creating a safe and inclusive workspace, both erly aligned with
onboard and shoreside. w o r k p r o c e s s e s
Our employees are from more than 140 countries, that foster true inclu-
and our guests come from virtually every country in the sion (equal voice and
world. We bring them together to create unique and equal recognition), will
ARNOLD W. DONALD,
diverse communities onboard each of our 100-plus outperform a homoge-
President and CEO,
ships sailing to all seven continents and visiting more neous group of people Carnival Corporation
than 700 ports around the globe. nearly every time.
Our diverse global workforce reflects the world we At Carnival Corporation we aren’t just committed to
sail. It is the source of our innovation and the key to diversity; we live it. I’m proud of the positive influence the
our success. We work together to create an environ- cruise experience has in the world and for the role we
ment where no one is judged for their appearance or are playing in bringing our world closer together today
harassed because of their position but celebrated for and in the future.
their character and for results achieved—and encour-
aged for their effort. For more
Purposefully engineering diversity is also good information, please
business strategy. Business thrives over time through visit the World’s
innovation, and innovation, by definition, is diversity of Leading Cruise
thinking—thinking outside the box. You’re far more likely Lines at wlcl.com.
to achieve sustained diversity of thinking—true innova-
tion—with a truly diverse group of people.



10 | DIVERSITY