All Segments
George Roberts: Don't Miss Opportunities
26 segments available
When he first got started, Roberts took the chance on forming KKR because if he didn't he would always look back and say he missed an opportunity. Recorded: March 11, 2008
Segments Timeline
The Birth of KKR
George Roberts reflects on the decision he and his cousin Henry Kravis made in the 1970s to leave their stable banking jobs and start KKR. He discusses the historical context of leveraged buyouts and how their approach was innovative in making management partners in the process, setting the stage for a new industry.
"So, welcome George to the GSB and thanks for coming. We're happy to have you. Um I'm gonna start by taking us back to the 70s. It's a little bit of a theme around here today. Um, looks like a good the..."
Overcoming Initial Challenges
Roberts shares the challenges faced while establishing KKR, including the difficulty of securing funding and the skepticism from traditional financial institutions. He emphasizes the importance of their prior experience and credibility, which ultimately led to their first significant acquisition of nine businesses from Rockwell.
"value, which was quite frank, it was 7% of the total US G&P at the time. Uh, and it was financed with some gold back bonds, some convertible securities. Uh, JP Morgan and his buddies all bought uh, so..."
Calculating Risks and Opportunities
In this segment, Roberts discusses the fears and considerations he had before taking the leap into entrepreneurship. He highlights the importance of education, integrity, and the willingness to take calculated risks, noting that the fear of missing out on opportunities was a driving factor in his decision to start KKR.
"we didn't just wake up one day and say hey this is a good idea let's go do it. Uh we had the training and experience we had some experience of some deals not working out. Quite frankly you learn more ..."
The Value of Partnership
Roberts talks about his partnership with Henry Kravis, emphasizing the unique bond they share as cousins and business partners. He offers insights on the importance of trust and shared values in a partnership, which have been crucial to their success at KKR.
"And you'll find as you go out in the world, and many of you already know this that the system we have in this country does not penalize failures as long as you fail honorably. The system will give you..."
Management Pitfalls
Roberts identifies common mistakes made by managers in larger companies, stressing the need for effective communication and focus on objectives rather than bureaucracy. He shares a personal anecdote about a budgeting issue that illustrates the importance of thinking like an owner to drive better business outcomes.
"to to be able to do that. That sounds like good advice. Um so, let's talk a little bit about management. You've had the unique opportunity to see how lots of different businesses are managed and I kno..."
Thinking Like Owners
George Roberts shares a pivotal experience from the early 80s when KKR acquired Union Texas Petroleum. He emphasizes the importance of management thinking like owners rather than renters, illustrating this with a budget discussion that led to significant cost savings. This segment highlights how ownership mentality can drive better decision-making in corporate environments.
"best you can out of the organization. Uh many times people don't think um like owners. I'll give you one quick example. Uh back in the early 80s, we bought up a company called Union Texas Petroleum, w..."
Learning from Mistakes
In this segment, Roberts reflects on the common mistakes made in business judgment, particularly the tendency to give management multiple chances despite gut feelings suggesting otherwise. He stresses the importance of making swift changes when necessary, drawing from his experiences to underline the value of decisive leadership in business.
"human nature. I mean, to get people to think like owners of something as opposed to renters, you know, if you own a house, you take better care of it than when you rent it. Uh, it's not real complicat..."
The RJR Experience
Roberts discusses the acquisition of RJR Nabisco and the challenges it brought to KKR. He reflects on the scrutiny faced from Congress and the distractions it caused for the firm. This segment provides insight into the complexities of high-stakes acquisitions and the long-term implications they can have on a company's focus and reputation.
"uh organizations when there's a change of control expect excuse me expect change um you know you should go do that and do it uh do it very very quickly so from a business standpoint I think that's you..."
Inspiring Leadership
Roberts shares his admiration for Ray O'Keefe, the CEO of AJ Industries, who transformed the company during tough economic times. He highlights O'Keefe's work ethic and leadership style, emphasizing the importance of leading by example and being actively involved in the business. This segment illustrates the impact of effective leadership on organizational success.
"and you've probably hired and fired a lot of CEOs and managers throughout your career. Are there any particular CEOs or leaders that you found especially inspiring or effective? And what was it about ..."
Work-Life Balance in Private Equity
In this segment, Roberts discusses his perspective on work-life balance, particularly in the demanding field of private equity. He reflects on his passion for work and the importance of finding fulfillment in both professional and personal life. This segment offers valuable insights into maintaining balance while pursuing a successful career.
"probably a good example. Well, you mentioned it, so let's talk about balance. Um, I worked a lot of hours when I was at KKR having these memories of sleeping in the office on more than one occasion. G..."
Career Advice for New Graduates
Roberts provides practical career advice for recent graduates, emphasizing the value of confidence and the importance of education. He encourages exploring various job opportunities without the pressure of making a lifelong commitment. This segment serves as a motivational guide for those starting their careers, highlighting the significance of adaptability and continuous learning.
"the balance. So, I think this is going to be our last question. Um, and it's about some career advice for all of us. Um, you know, I'm trying to find a job right now, and I know that I would benefit a..."
Investing in a Volatile Market
Roberts discusses investment strategies in the context of a volatile market, suggesting that opportunities exist in the debt markets and distressed assets. He emphasizes the importance of focusing on improving investments and maintaining operational excellence, which is essential for long-term success in private equity.
"turn it over to questions from the audience, but thanks again for your cander and for your time and being here. Sure. [Applause] All right. It'll work. Okay. So, Mr. Roberts, uh it's a privilege to se..."
Navigating Economic Cycles
In this segment, Roberts reflects on the cyclical nature of the economy and the challenges faced by financial institutions. He shares insights on how KKR plans to weather economic downturns by focusing on operational improvements and maintaining a strong investment strategy. This perspective is vital for understanding resilience in private equity.
"Um, in terms of the environment today, um people lose sight of what's really our business. Our business is really making investments in companies and making them better. So that's what our job has to ..."
Emerging Markets and Investment Opportunities
Roberts discusses the potential of emerging markets and the balance between seeking high returns and prioritizing safety in investments. He shares KKR's strategy of being liquid and ready to capitalize on opportunities as they arise, emphasizing the importance of adaptability in investment approaches during uncertain times.
"grow grow your business. But um you know the um this form of investment, whether you call it private equity or buyouts or whatever it is, is not going away. every every 10 or 15 years, and the dean kn..."
Navigating Emerging Markets
George Roberts discusses the current state of emerging market fundraising amidst financial turmoil. He emphasizes the importance of being liquid and having capital ready to seize opportunities, even in uncertain times. Roberts reflects on the cyclical nature of markets and the potential for profitable investments if approached wisely.
"you have to follow up. You have to hold your people accountable for for doing what they say and you have to be all over. There has been a lot of uh emerging market fundraising activity recently. Uh gi..."
Opportunities in Turmoil
In this segment, Roberts shares insights on how to identify investment opportunities during market downturns. He highlights the importance of flexibility in investment strategies, such as taking minority stakes or investing in debt, rather than solely pursuing full business acquisitions. He encourages viewers to recognize the potential for profit in challenging times.
"between uh chasing the returns versus flight to safety? What was the last part again? Uh where do you see the balance between uh chasing the returns in emerging markets versus flight to safety? Okay. ..."
The Black Swan Phenomenon
Roberts reflects on the unpredictability of market events, likening them to 'black swan' occurrences that can disrupt expectations. He shares his experience of witnessing multiple market cycles and stresses the need for resilience and adaptability in investment strategies to capitalize on unforeseen opportunities.
"capital. Uh and in terms of in times of turmoil u that we're in, it's great to be liquid. It's great to have capital uh in this period of time. I have no doubt that we'll be able to find some producti..."
The Press and Private Equity
In this segment, Roberts addresses the media's portrayal of private equity, discussing the challenges of public perception and the scrutiny faced by the industry. He contrasts the criticism of private equity figures with the more favorable treatment of other investors, emphasizing the need for transparency and accountability in the sector.
"Um these are periods of time where there'll be different kinds of opportunities than going out and buying 100% of a business. It could be taking a minority stake, which we did in Lake Mason in the bus..."
Leadership Lessons from Attila the Hun
Roberts shares intriguing leadership insights inspired by Attila the Hun. He discusses the qualities necessary for effective leadership, including resilience, hard work, and the ability to inspire others. This segment highlights the timeless nature of leadership principles and their relevance in today's business environment.
"bet. Go ahead. Uh you you know you spoke briefly about the RJR deal and how maybe that had brought a little more attention to the industry than you would have liked. Uh I mean again you're still seein..."
Succession Planning at KKR
Roberts discusses the importance of succession planning within KKR, emphasizing the need for strong leadership to ensure the firm's future success. He expresses his hope that the next generation of leaders will surpass their predecessors and highlights the unique ownership structure at KKR that fosters a collaborative environment.
"of uh liquidators essentially? Okay. Well, all you got to do is to see what our records are is to look at them. They're there. Um ours have been audited. um the information's there. So, you know, the ..."
Sharing Economics and Firm Culture
In this segment, Roberts explains KKR's approach to sharing economics among employees, ensuring that everyone has a stake in the firm's success. He discusses how this ownership model promotes communication and reduces internal politics, contributing to a positive workplace culture that encourages long-term commitment.
"pick Warren apart I mean believe me they could find a lot of warts but you don't see that uh you know so when you can when the press can individualize this they do it I mean it happened with Mike Mili..."
Empowering Through Ownership
George Roberts discusses the unique ownership structure at KKR, where every full-time employee has a stake in the firm's success. This approach fosters a collaborative environment, reduces internal politics, and enhances communication, ultimately leading to better performance and retention of talent.
"uh, if you're going to be a leader in an organization is is to make sure that you have a good succession plan. And my hopes are that the people that take over after Henry and I aren't there do a bette..."
Creating a Supportive Workplace
Roberts emphasizes the importance of treating employees fairly and maintaining open communication to foster a productive workplace. He shares insights on how KKR has managed to retain talent and create a culture where employees feel valued and motivated to contribute.
"So when you when you take that out of the organization and without people having to fight every year over what uh they think they should be reasonably paid uh you create an environment that uh where p..."
Balancing Work and Life
In this segment, Roberts reflects on his personal life outside of work, including his fitness routine, family time, and hobbies like golf. He highlights the importance of maintaining a balanced life to enhance overall well-being and productivity.
"get the best out of everyone. So you've obviously uh created this entity which has been hugely successful. You've been very good at doing that. Just wondering how do you how do you think about spendin..."
Venture Philanthropy Vision
Roberts shares his journey into venture philanthropy, detailing the motivation behind starting Redf. He discusses the challenges faced in creating jobs for homeless women and the pivot towards supporting organizations that help the underserved population find employment.
"industry. Okay. Well, we uh my wife and I started when we were were fortunate enough to have uh the wherewithal to give back. Uh one of the things we wanted to do was to do something if we didn't do i..."
Measuring Impact in Philanthropy
In this concluding segment, Roberts explains the importance of developing metrics to assess the effectiveness of philanthropic efforts. He discusses the ongoing goal of creating jobs for underserved communities and the collaborative efforts with other organizations to achieve meaningful impact.
"come out of all this. Um so today we Jed's moved on. Uh we have a lady named Carla Javitz who runs that. Uh we also said well you know we can't just keep supporting the same organizations over and ove..."