Craig Bouchard, ’81

Chicago Booth Magazine (U of C)

Originally published October, 2015

The entrepreneur reflects on tossing out an entire board of directors, the joy of making hard-working employees into millionaires, and the importance of bedtime stories for kids.

Craig Bouchard, U of C, Chicago Booth Magazine

“I’m legacy University of Chicago. There wasn’t a course that wasn’t valuable to my progression.”

Serial entrepreneur Craig Bouchard, ’81, heads Real Industry Inc., a publicly traded buyer of companies, whose control he won after a 2013 proxy battle. The largest investor was Chicago billionaire Sam Zell, who became a partner and mentor. A similar proxy contest eight years earlier put Bouchard at the helm of a steel business that he grew from $4 million to $4 billion in sales. He’s the author of two business books—one a New York Times best seller—and recently released a children’s adventure novel and video game. Bouchard lives half the year in Naples, Florida, and the other half in Hinsdale, Illinois.

I spent nearly 20 years in banking. I was lucky having been chosen for the First Scholar Program at First Chicago. Every six months I chose a rotation and a new boss. I was a sponge. Landing in television, newspapers, and movie fi nance, they gave me a very high lending limit. We did a lot of deals. I was 23 at the time. Young bankers don’t have enough responsibility today. I learned the importance of making zero mistakes.

Set the leadership bar really high and jump over it. They will follow you.

I never had a sales job. Instead, I’ve been a risk manager much of my career. I think about business like this: How do you reduce the risk? Eliminate all the risk and you reach nirvana.

A business is fascinating in its first few years. Knowing most start-ups don’t survive, you live on the edge. You find out how good you really are.

My handshake is my contract. Old fashioned, you might be thinking. Wrong. If people trust you, it’s powerful. Trust and ethics create an oasis of opportunity. When I submitted our $525 million bid to purchase Real Alloy in March, the company’s CEO trusted me to get to the finish line. Closing is about killer instinct, one of the most important skills in business.

Very few CEOs are good capital allocators. Lots of them are talented in sales and operations. Many big companies have simply gone away because they didn’t allocate capital properly.

Running a public company requires that shareholders are always number-one. I’m not sure why, but people don’t always like to hear this. It’s about creating value for the investors who bought our shares—we owe everything to them. They trusted us.

It’s fun making midlevel managers into millionaires. It’s the American Dream. At Real Industry, everyone rows in the same boat. If we perform, we all do well. It’s never about one person. It’s
about the team.

I read all my emails daily, and normally respond. I get hundreds a day. If I let them wait until tomorrow, I’d be under water.

The free marketplace: I’m legacy University of Chicago. I remember two classes I took with Merton Miller, one of the school’s greatest minds. He taught efficient markets and understanding the true cost of capital. It changed me. There wasn’t a course that wasn’t valuable to my progression.

Working with my brother was interesting: We’d slug and maybe hug. He’s a little brother. We acquired nine steel companies—one in a hostile takeover—to create Esmark. Our team of 10 threw out an entire pubic company board and executive management team on a single day. In four years, we grew revenues from $4 million to nearly $4 billion. My brother and I had different skills, and views, but we were a powerful combination.

The steel industry is in my blood. When I was at First Chicago I’d ride downtown with my dad, who was one of the three people at Inland Steel to rise from the mail room to senior management. My mom worked there, too, as an admin. My dad was very well respected in the industry. At the dinner table I’d engage him in hilarious debates about steel tariffs.

Sam Zell’s number is on my speed dial. He was the largest investor in Real Industry when I got involved. We had lunch and he liked my plan for the company. We shook hands, and since that day he calls me once a month for lunch. I don’t walk, I sprint there.

I wrote three books between 3 and 4 a.m. over the past seven years. I don’t worry much about my fiduciary duties at that hour. I write and then go back to sleep.

So far, I’ve made six beautiful kids. In the early days I read them bedtime stories. My daughters were a tough audience. I started making up stories. One of these became The Adventures of Ai, about an independent 11-year-old-girl in the mountains of Japan in 1514. It took four years and 200 versions to get right. In writing, patience and attention to detail is important.

I unwind by playing tennis. My wife and I are ranked nationally in mixed doubles.

This year, I hired a personal assistant. That’s a first. It’s not easy to to train someone to think like me. In the past, it slowed me down. I like to do things my way and now. This time around it worked. My assistant, Julie, is a pro. She opened the floodgates of what I can efficiently accomplish.