Racy headlines aside, I really enjoyed Mitt’s session at Silicon Slopes Tech Summit 2018. He spins a pretty good yarn. We’re covering: inspiration, motivation, focus, brand and product/market. Mitt was in a talkative mood, so buckle in, this ain’t a short one.
Mitt “I know what Moore’s law is” Romney is an American politician and Co-Founder of Bain Capital.Before we get to Mitt, I have to say my favorite quote of the session was one Mitt shared from John McCain.
“Russia is a gas station parading as a country.”
The night before Mitt’s talk, I was telling a friend how I was going to see Mitt talk the next morning. He painted Mitt as a chameleon that just plays to his crowd making it hard to know what he really believes in. I know, hard to believe a politician would behave in this manner.Let me just say this, Mitt is tanner than any chameleon I’ve ever seen. He also charmed the Allbirds off of thousands of people the next morning, your dear author included.Mitt came across as an intelligent, humble and humorous man with a wealth of experiences and no shortage of ability to compellingly share them with an audience.I’d also say that, while he is clearly a calculating and savvy politician, I did feel that he shared some of his beliefs with us, which is probably a bit easier when there’s a friendly crowd engaging in some hero worship.The crowd bellowed,
“Mitt for President”
To which Mitt responded,
“I tried that once, thank you.”
Fun Facts About Mitt:
He’s Been Successful.
He and his Co-Founder raised Bain Capital Fund I in 1984. They spent 12 months fundraising resulting in $37M in committed capital.Today, Bain Capital manages $85BN in assets (2,297x the original capital allocation). I think we can say “Job well done, Mitt!”.
He Can Admit When He’s Wrong.
Mitt mentioned how he thought the LBO business had peaked in 1984, when he raised his first fund. Why one would raise a fund to execute a strategy one feels has peaked is beyond the point (remember Mitt has been very successful).In 1984, 75 LBOs totaling $11.8BN in deal value were completed. 2016 clocked in with 3,871 LBOs totaling $648BN in deal value.To Mitt’s credit, he does not pretend he is able to read the future, noting that he was “totally wrong” The LBO market’s only grown like 50x anyways, so he was almost kinda right. Right?
Mitt’s Keys to Success:
- Hiring Smart. Mitt and his Co-Founder knew they weren’t the smartest guys out there, so they decided early on that they needed to hire people smarter than them. I call this being the worst player in the band, and it’s something I definitely believe in. There are just some people out there who are able to pull this off, and they’re generally highly successful as a result.
- To Err is Human. Almost titled this one sum > parts but I’m doing my darndest to avoid death by a thousand cliches. Mitt had a good way of putting this, saying “Don’t focus on people’s flat spots.” We all have flat spots. We’re good possibly even great at a handful of things and bad possibly even terrible at many others. Mitt’s point is to recognize that this is a human condition, so you better build a team that complements each other.
- Captain Obvious. It’s probably telling that Mitt’s keys to success are people and team-centric.
How Mitt Selects Investments:
- Follow This Leader. Mitt’s most important element when evaluating an new investment opportunity is the quality of character of the person leading the enterprise. Do their peers and colleagues respect them? Do they like them? Do/will they follow them?
- Model of Change. Mitt needs to see a business plan conveying vision. He’s not looking for me too or also ran solutions. Show the man that you carry a large vision for changing the way things are currently being done.
How Mitt Turned around Bain Consulting:
Mitt was appointed CEO of Bain Consulting when it was on its last leg. Mitt had been an employee there prior to leaving to form Bain Capital. When he was brought back in to right the ship, the company has about two weeks of cash left.So, how did he go about saving a sinking ship? Well, turns out he focuses on three things when working to turnaround a business.
- Audit. First things first, Mitt conducts a strategic audit to completely dissect the enterprise with brutal honesty, golden geese be danged. All top employees, customers and partners are talked to, the financials are scoured and scrutinized as are all policies and procedures.
The purpose of the audit is to unearth head in the sand thinking and acting, malfeasance and misalignment to discover where the train has gotten off the tracks and chart a corrective course back to success.2. People. Although the company did not have enough cash in the bank to satisfy its current liabilities, Mitt was heck-bent (his words, not mine) on retaining the top brass of the company. In fact, Mitt told his landlord they would no doubt fulfill their lease obligations in due time, but they would not be able to pay their $1M in monthly rent this month. Turns out, they did not pay for 24 months.Not paying their landlord enabled Mitt to pay (and retain) his top execs. Bain Consulting had 50 partners at the time. Mitt was able to get every since one of them to commit to staying on for one year, even though they could have easily jumped ship to more lucrative offers from competitors.He did this by getting them to buy into something bigger than themselves. It wasn’t about the money, it was about fighting through the shared struggle to come out the other end together.3. Focus. Simply put. Have a vision for where you’re going and focus, focus, focus.
On Overcoming Fearing Failure:
When asked how he got past the fear of failing, Mitt deadpanned,
“You may not know this, but I actually ran for President and lost.”
He then quoted Walter Mondale, a fellow presidential candidate, who said,
“All my life, I wanted to run for President in the worst way and that’s just what I did.”
Mondale, the Democratic candidate, carried exactly one state (Minnesota) in the ’84 election.Obviously Mitt faces failure with levity. He also feels that if one goes into an enterprise and is not afraid, then he/she is not being bold enough.Recognize that failure is not the end. It’s part of life. You learn from it and you move on.
“Everyone comes with a bag of rocks.”
Mitt talked about how scared he was of failing out of Harvard Law School. He had come from BYU and felt like if he was not studying he would fall behind, never be able to catch up and fail out.He was carrying a dark cloud around with him, a load that was really weighing him down. Mitt made a decision: he would take Sunday off and spend it with his family.A seemingly small decision akin to the modern day digital Sabbath. Lo and behold, this sacrifice in studying time did not lead to his failing out, rather I think it chilled him out a bit.More importantly, what his struggle did was give him a sense of empathy. Mitt realized that “everyone comes with a bag of rocks” meaning we all have our personal burdens that we bear that others don’t usually know about. Given that, we should lay off each other and be more understanding and supportive.
On Lessons Learned From His Dad:
Muddling is For Cocktails, Not Life.
You must have a vision for where you want to go. Don’t just muddle along.
The AMC Rambler aka the “grocery getter” | Image credit:
Mitt told a story about his dad taking over American Motors Company, having risen up the ranks. AMC was competing against Ford, GM and a ton of other companies vying for market share in the hyper-competitive auto industry. Good luck with thatMitt’s dad made a bold business decision out of the gates. AMC was going to go all-in on providing the 2nd car of choice for America. He called it the “grocery getter”. It was the reliable, 2nd car a family would have to run errands for the family.And guess what…it paid off, big time.See, Mitt’s dad had also been bold and taken the liberty of selling his family’s house and his childrens’ savings bonds to buy AMC stock. He was betting on himself. Good thing, because under his direction, AMC’s stock went from $7 to $90.The Takeaway: Believe in yourself and give it all of your energy and passion.
China is going Ape.
While US lawmakers are chatting about a $1 trillion domestic infrastructure program, China’s coolly spending $1 trillion on infrastructure outside of China, playing the long-term game as Mitt likes to say.
Mitt, a skilled politician who knows to know his audience, namedropped Moore’s law and how its impacting everything and changing the way our entire economy works. He then gleefully noted that robots will replace 50% of American jobs. “How exciting is that?” Quite the ending point to make.
That’s a wrap on Mitt’s session. Thanks for reading.Digest1:
[Couldn’t resist. Image credit: knowyourmeme.com]