Steve Schwarzman, Blackstone Group Founder
Net worth: $10 Billion
Very intelligent, but clearly not the technical type, he is a creator/visionary, not detail oriented.
He is the salesman type, not technical.
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How did he do it?
He studied at Harvard, and had a lot of trouble focusing on details. See his interview with the English Literature class, regarding the problems he had.
He went to work for Lehman, and eventually got to a high position.
He wasn’t the technical person, clearly. See his story from his first M&A.
After Lehman, he went on to create a company with a partner.
They started with $400k each, with no investment experience and got together for breakfast every day to answer these questions:
Why will we create a company, what will be the name of the company, what will we do we different from the others.
They worked on a business plan for some time(it would be interesting for us entrepreneurs to know how long. How long do you sustain yourself without a source of income) and when they finished they sent it to the list of prospects they knew.
They wanted to raise 1 billion and sent almost 500 letters. That means an average of $2M per prospect.
The first round didn’t go well, so they sent the letters again.
Eventually they got $850M. Here we don’t know if they started the company earlier or waited until they got the sum to get started.
Steve hates losing money(me too), and talks about an episode where they didn’t have a system in place to test the variables of the investments to do. They lost $30M of a clients money and, being an intelligent person like he is, they created a system in order for that to never happen again.
Blackstone has a main brain(Steve and his team) and several lieutenants in charge of each fund type.
They have Julian Robertson in front of the Hedge Funds, another person in front of real estate and so on.
Steve got what he wanted: to be a telephone switchboard. Translated to today that means analyzing deals everyday with a team of smarter people(he acknowledged he wouldn’t be hired to his own firm today) and making decisions so that they continue to produce sound results for their clients.
To sum up:
Steve is a creative brain, visionary, salesman type, not the technical type at all.
He is a fund raiser. As a great entrepreneur he created opportunities for people to take care of the money they raised and developed a system so that the society can benefit.
Remember, great entrepreneurs are not technical people. Since they are creators, they lack the planning side.
They are promoters. They come up with an idea, go out to the marketplace and test it out, selling, selling, selling, networking, networking, networking until something happens.
In the end he gave opportunities to a lot of people because he understood that he couldn’t do it alone.
It would be great to have Mr. Schwarzman’s input so that we could complete some details and help entrepreneurs find their way and avoid years of pitfalls.
You can find several of his interviews online. I have seem them all. Repeatedly.
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