Venture Voice – interviews with entrepreneurs

Entertaining Entrepreneurship

VV Show #52 – Sam Wyly of Maverick Capital, Green Mountain Energy, Michaels Stores and Sterling Software

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Not to be called a one trick pony, Sam Wyly’s turned himself into a billionaire by starting and growing companies in technology, oil, retail and even in the restaurant industry. Coming from a modest upbringing, Sam worked in sales at IBM and Honeywell before founding University Computing in 1963 at age 29 with just “$1,000 and an idea” as he puts it in his book of that title. The company IPOed and grew to over 5,000 people. Sam hired CEOs and stayed an entrepreneur. He’s founded and acquired numerous companies including Bonanza Steakhouse (grew to 600 restaurants), Earth Resources Company, Sterling Software (sold for $3.3 billion), Sterling Commerce (sold for $4 billion), arts-and-crafts chain Michaels (sold for $6 billion), Maverick Capital (a hedge fund with over $10 billion under management) and clean-energy producer Green Mountain Energy. Despite being soft-spoken, Sam’s fought and won several high profile proxy fights. Sam’s been undeterred as several of his ventures have had visible failures over the years and he’s lost audacious bids to take over Western Union and Computer Associates. On the whole, Sam’s created a huge amount of value that’s put him on the Forbes list of the 400 richest people. Hear how he does it.

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3:00 – A modest family background

7:00 – The early years: high school football, Louisiana State Legislature, Louisiana Tech, Ross School of Business at the University of Michigan

14:45 – Computing infancy at IBM: selling “computing as a service”

15:45 – The sales side of IBM

18:15 – Recruited by Honeywell: “I didn’t care about the money. I cared about being a manager.”

20:15 – University Computing begins: “I wanted to start my own company… I looked around for who could be my customers.”

25:00 – Leveraging $1,000 and a 5 year guaranteed contract into a $600,000 used computer

28:20 – University Computing goes public: “The original public investors in four years made one hundred times their money. That was a real fun time.”

29:55 – A growing empire: using University Computing interest to buy Bonanza Steakhouse and start Earth Resources, an oil refinery and mining company

31:45 – The steakhouse business

32:40 – Earth Resources: big bet on unleaded gasoline and the battle to sell

37:25 – A rough economy: shutdown of University Computing in 1976

44:40 – Current company: Green Mountain Energy, “It’s in the monopoly busting business… It’s kind of my third time around in monopoly busting.”

46:25 – “Texas was the only state that wrote a really free market electricity deregulation law and we’ve done real, real well here. It’s probably the most successful green company in America.”

46:55 – On CleanTech: “It’s going to be a great industry.”

47:10 – Small company acquires a large one: Sterling Software buys Informatics with the help of Michael Milken and the junk bond market

54:15 – Business partner and brother Charles Wyly: “Mostly we’ve done everything together.”

56:00 – Differences in style: “I’ve always been the more conceptual type.”

58:25 – Business vs. politics as a career

59:15 – Political affiliations and thoughts on Barack Obama

1:02:00 – The modest life of a billionaire

1:03:45 – Advice for entrepreneurs: “Most people have to figure things out for themselves.”

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