Thank you Dean Gilligan.
Distinguished faculty, proud parents and especially you graduates: it is my great honor to be here today. I want to CONGRATULATE you on earning your BBA degree from the McCombs School of Business at The University of Texas. Welcome to the Burnt Orange Nation. You’re now forever branded a “Longhorn,” pretty cool. I’m confident in 34 years (when you’re about my age) you’ll be even prouder of that distinction.
I love UT and bleed Burnt Orange. My parents both graduated from The University, after meeting here 60 years ago (introduce them), and brainwashed me from birth. I never had a chance. They pretty much had me at “Hook ‘em.” My father and brother were outstanding Longhorn football players and my sister and eldest son are also graduates. Texas is our family school. The loss to Baylor yesterday really stings, but I still have a bounce in my step from sending 85,000 Aggies home miserable on Thanksgiving night.
As the father of 5, I can relate to the pride your parents are feeling today. They know how hard it is to get accepted into Texas and especially this world class undergraduate Business School. They’re proud of your talent, hard work and, above all, perseverance. I know you’ll thank them, not just for their financial support, but for the love and guidance that made this day possible.
You are distinguished students who deserve to celebrate your accomplishment. However, I thought I could best contribute today by offering a little career advice. Your BBA has catapulted you into a position of unlimited possibility and opportunity. Note: POSSIBILITY and OPPORTUNITY, not CERTAINTY or GUARANTEE. I’ll begin with some blunt advice. If your degree has triggered any sense of ENTITLEMENT or EXPECTATION, do yourself a favor and hit the delete button now, even if you’re summa cum laude with an offer from Goldman Sachs. Now, I’m not recommending you lower your ambition. No way. But take it from the legendary Mark Twain, “Don’t go around saying the world owes you a living. The world owes you nothing. After all, it was here first.”
Your BBA from UT reveals you have the intellectual capacity to grasp complex subjects like Economics, Accounting, Finance, Statistics, etc. But what immediate demand for your services will that bring you in today’s cold, cruel marketplace? Lo siento mi amigos. Solamente un poquito (only a little). OK, you accounting grads are lucky exceptions. For the rest of you, it may be cliché, but your business degree is merely a strong passport into the business world.
Take it again from Mark Twain who said, “I have never let schooling interfere with my education.” Many employers share Twain’s view. You may have had great “schooling,” but will hiring you be accretive to their EPS? Businesses that risk expense hiring in this weak economy crave experience more than ever. Heard anything about 9% unemployment and 18% under-employment? I thought so. Many older, experienced executives are now willing to accept entry level pay in order to get a job. LIFE AIN’T FAIR, I know. If you can accept that, you’re way ahead.
I empathize when it comes to graduating into a tough economy. When I graduated back in ’76, hiring was slow, with the economy just emerging from the ’73-‘75 recession. This was the post-Vietnam/Watergate era, inflation was rampant, the prime rate was 12%, unemployment was high and the Soviet Union was a global menace to freedom and free markets. Times were dreary (so dreary that disco music became popular). They got even drearier for me when I whiffed on my first several interviews with financial institutions. Then I caught a lucky break with a fine gentleman in Houston who ran the investment department of a life insurance company. He knew I wasn’t qualified, even with my UT BBA in Finance. But he liked my attitude and we negotiated a 90 day trial run. He was crystal clear. If you can’t handle the job, you’re out, no hard feelings. I took the lowest paying job of any of my classmates, a survival wage. But I was in the building! I now had a chance to learn Institutional Finance and Income Property Lending and grab that 1st rung on the ladder of Success. As a result of my lucky break, I always advise young grads, “First, you’ve got to find a way to get in the building,” the right building. I have a friend from Southern California who deployed a more extreme version of this strategy. He landed a job in real estate investment banking in SF by offering to work for free for 6 months. It was a long 6 months, but 32 years later he’s CEO of the same company and one wealthy dude. First, he got in the building. Then he hunkered down and learned.
Speaking of learning, Will Rogers said it best, “A man only learns in 2 ways, one, by reading and two, by association with smarter people.” So when you land a job, find a mentor. You learn business best by doing and ideally doing it with a MENTOR you can observe in action. Also, become a sponge. When soaking up knowledge, don’t just look to superiors, look to co-workers too. In my first job I spent many long days interrogating the veteran secretaries who would stay late to document financing transactions. Though they lacked college degrees, they were smart and excellent teachers. While initially skeptical of this 22 year old, I eventually earned their respect. The word spread, the kid can do the job.
Over the years I’ve hired several executives “below market” that lacked experience yet were long in attitude, who later evolved into superstars. The old Horatio Alger success story in America is still alive and well. Humility combined with a fierce determination to succeed is one heck of a potent combination. Plato said it perfectly 2,400 years ago, “Necessity is the mother of invention.”
Some folks may cringe a bit with my next tip, some sage old advice that worked well for me. While you’re in OJT, there will be times when you’re in over your head. First, “never let them see you sweat” and, sometimes, “you gotta fake it ‘til you make it.” Now don’t take that literally, integrity is paramount. If your confused, ask questions and seek help. But, if you stay cool and act like you know what you’re doing, funny…YOU SOON WILL! It’s called LEARNING BY DOING. Deliver results. Then watch your paycheck zoom.
It’s time to dispel a myth. You know the old cliche, “you’ll never use much of what you learn in college.” FALSE! For example, you know those tedious calculations of NPVs, IRRs and WACCs, as well as all the Financial Statements you dissected? You’ll use it all. In fact, you’ll advantage from most everything you learned at McCombs. This will dawn on you one day and you’ll smile and be even more grateful for your time here.
Many of you will prefer the challenge of big business or the corporate world (like I did initially). Some of you will gravitate towards young companies. More young Americans than ever are choosing to work for start-up firms. Dean Gilligan and the leadership team at McCombs really get this. They’ve done a superb job encouraging entrepreneurial thinking with their Herb Kelleher Center, Venture Labs and the Austin Incubator, among other endeavors. I find this incredibly exciting because it bodes well for America’ future prosperity and job creation. I realize Bill Gates, Steve Jobs, Michael Dell and Mark Zuckerberg started up their companies without prior business experience, or even completing college. I think you know, they’re the hyper-rare exception, not the rule. The vast majority of successful entrepreneurs are well-educated, often MBAs (sometimes PHDs) and have amassed impressive experience in the workplace prior to plunging into entrepreneurial waters. So exercise patience. Take the time to learn some core business skills first. You’ll know when and if it’s time to take the plunge. When I started my first company (one month shy of age 28) I had no idea my career was forking off into that of a serial entrepreneur, with 3 consecutive startups to unfold over the next 25 years. I’m incredibly proud all 3 companies succeeded, despite many down days and a couple of near-death experiences. The truth is you’re going to experience difficult times in your career, whether you go the entrepreneurial route or not. When bad times hit, remember the brilliant words of the theologian Robert Schuller, “tough times never last, tough people do.” I also relish the genius and humor of Winston Churchill, “If you’re going through Hell, keep going.”
Becoming an entrepreneur can be lucrative. I personally made more $ than I ever planned on or dreamed of. Cool. But to be frank, personal wealth wasn’t my primary motivation. Serving customers and generating strong returns for investors was paramount. You know what I loved about starting up companies? Thomas Edison, the ultimate startup dude, said it best: “Hell, there are no rules here, we’re trying to accomplish something.” I loved the challenge, creativity and collaboration. I thrived on how fast we could make decisions. No politics or bureaucracy. At my 3rd startup, Rent.com, it was so much fun building a radical new business model from scratch! I used to joke with my young associates, “Working for a successful startup is the most fun you can have with your clothes on.” They would laugh and enthusiastically agree. The truth is they couldn’t wait to get to work each morning because they owned equity and were emotionally vested in the business model. My long-time CA-based business partner (of 27 years) and I encouraged our associates to be daring and innovative, yet smart and practical. Our mantra was, “if we make a mistake, let’s make it being aggressive serving customers.” We had a value system at all 3 of our companies: Customers 1st, Shareholders 2nd and Employees 3rd. By subordinating ourselves to customers and shareholders, we employees would prosper too. And we did, big time. It was one of the great thrills of my life to see my co-workers cash-in big when we sold Rent.com to eBay in 2005.
Many of you are apprehensive about leaving college and going to work. I certainly was 34 years ago. I wasn’t even sure what I wanted to do, other than having a general interest in Finance. You can’t possibly visualize or plan your entire career today, so don’t even try. Instead, follow the advice of the great financier J.P. Morgan who said 100 years ago, “Go as far as you can see. When you get there, you will see even farther.”
I want to close by welcoming you once again to the one of the greatest clubs on earth, the TexasExes. Congratulations on earning your degree from the legendary University of Texas and its prestigious McCombs School of Business. Having lived and worked in California for 19 years and done business on Wall Street running a public company, I can assure you, your diploma will travel extremely well. UT and McCombs are highly, highly respected across this great nation.
So remember, first, GET IN THE BUILDING. LEARN. Then make the Longhorn Nation proud. You can be sure we’ll be watching. THE EYES OF TEXAS ARE UPON YOU!
Hook ‘em!