Robert F Smith 2nd Richest Black SM Billionaire 4thIndustrialRevolut

Welcome to Episode 235, Robert F. Smith, Second Richest Afro-American Self-Made Billionaire, 1962 to 2018. This is an outline of Episode 235. There are five reasons why we study Robert F. Smith. First, he's the second richest black self-made billionaire in the United States. Second, he's a chemical engineer with four patents. Third, he co-founded one of the best performing private equity firm in the U.S., Mr. Equity Partner. Fourth, he did all this in just 18 years. Fifth, my friend Shiji recommended him. Robert F. Smith was born in Denver, Colorado in 1962. Both his parents have PhDs and were principals of high school. I grew up in Colorado, fourth generation from there, my father's side. And I grew up in a neighborhood that was a wonderful neighborhood in many respects. It was very community oriented. My dad was the principal of the school down the street. My neighbor was a guy by the name of George Brown, was one of the first African-American lieutenant governors. And across the street, I had an African-American congressman who sat state congress. We had a very diverse community economically as well. But the thing that was most important was education, educational pursuits. Bell Labs interned in high school. Robert F. Smith would not take no for an answer. And I took a computer class. And from that computer class, I said, wow, this is really interesting. In my teacher, because they weren't professors in high school. It was a junior. I was a junior in high school. And he started telling me about the basic components of a computer. He started talking about transistors. And well, what is this transistor? He told me a little bit about it. It was invented at this place called Bell Labs. I said, well, they must have some pretty smart people. Let me go check that out. So I go to the guidance counselor and say, what's this place called? Bell Labs. And they've got great stuff. Yeah. And so I called them. And I say, hey, you know, I hear you guys have summer internships. She said, yes, we do. And she said, if you're between your junior and senior year in college, you know, we have internships. I said, that's fantastic. I'm a junior in high school. I'm taking all AP classes. I'm getting all A's in my AP classes. It's the exact same thing. And she said, no, it isn't. But that didn't stop you. Of course not. So I literally called her every day for two weeks. And then I called her every Monday, because after two weeks, I figured Monday after that for five months. And I get a call back in June. And they said, listen, you know, a student from MIT didn't show up from time to time. And I got a job at Bell Labs. And that just opened the world for me. Because I saw things. I saw the first cell phones way back when. That took 15 years before they were commercialized. And I saw communication systems. And I saw the applications of science that I would have never known about growing up in my neighborhood. That changed my life. And from that, I told people, I discovered the joy of figuring things out. So in 1985, he graduated BS in chemical engineering from Cornell University. Then he worked four years at Kraft Food, where he earned two US patents and two European patents. Against his parents' wishes, he quit chemical engineering, enrolled at Columbia Business School, and graduated MBA in 1994. We're pretty well together today. One is technology, and the other is finance. And when I ultimately made a transition, went off to business school, and I'll tell you about that in a second. Where I learned how much these people made in investment banking was obscene. You know, I'm a hardworking engineer. I was making $42,000 a year. I didn't think you made any more money than that in the world. And then some of my friends were telling me about what these investment bankers made. They're making hundreds of thousands. I was like, you've got to be kidding me. I know these people. Between 1994 and 2000, he worked six years at Goldman Sachs. He became a millionaire in 1999 at the age of 35. And then at Goldman, there he played a key role. He's how and why he started his company, Mr. Equity Partner, in 2000. Enterprise Software. And then I run into this little software company based in Houston, Texas. I take them on as a sell-side project. And through that, I learn how they're running this business. And I say, oh, my God. If you actually took what they use as their best practices and laid them across these enterprise software companies, you could make a fortune. I said, what do you guys do with all this money? And they're buying CDs, certificates of deposit. You know, this is 97, 98, 99. What was going on in your head? Because if you think about it, that was 1999, right? Or 2000? Yeah, 99. So here's where that starts. So remember, I was an engineer for six years. Think about that. So I got a chance in my early part of my engineering career to work on some of the early implementations of software into process industries. Think about it. Software, technology. Probably the most productive tool introduced in our business economy in the last 50 years. I said, what else? I said, if I were you, I would take that money and I'd drive it into these enterprise software businesses. I'd take these best practices that you all have, and I'd apply them across these companies, and you'll probably do okay. And they said, that's the best idea we've ever heard. Would you be interested in being a general partner if we were the limited partners? I said, well, I'm not too sure about that. And so that's what led to the formation of Vista. The fourth industrial revolution. So here's the thing. We are truly in the early stages of the fourth industrial revolution. There is a digitization of every single industry on the planet, and ultimately that will lead to the digitization of every single company in one way, shape, form, or another. You read about it all the time, but you really have to, depending upon what group you're in, you got to get into the bowels of it. What do I mean by that? You have to now start to evaluate what is creating productivity in all its measures at the company level, and what technology, and then to what extent it's going to impact jobs and opportunity, and what impact is going to, to some degree, disintermediate entire industries. You've seen it. We have these talks about, oh, everybody wants to be a king, right? No, you actually want to be an emperor. Okay? And that's what Bezos has done, if you think about it, because now you can actually, you know, disintermediate entire industries if you have the right platform. Intellectual property is the new currency, as the pace of change has accelerated. Dynamic that they have to embrace is the pace of change has accelerated. Truly intellectual property, intellectual capital is now the currency of business, and it is a currency of engagement. The ideas, the thoughts, how free-flowing and how quickly they flow, and the impact that they have in the communities and businesses in which they operate. They're going to have to make sure they have, you know, the facility of their minds have to be, you know, frankly, a lot more accelerated. In 2015, he appeared on the Forbes list of billionaire for the first time. The same year, he married Hope Borasik, who was the Playboy Playmate of the Year 2010. He was 52. She was 30. Together, they have two children. In 2016, he donated $50 million to Cornell University to create the Robert Frederick Smith School of Chemical and Biomolecular Engineering. Music has always been his passion. He became the first Black American to be a chairman of Carnegie Hall. He also donated $20 million to the National Museum of African American History and Culture, second only to the $21 million donated by Oprah Winfrey. Brian Schiff, co-founder of Vista Equity Partners in 2000, also became a billionaire in 2017. In a real dollar term, every billion dollars that we invest in environmental preservation has about 110x return. Clean water, clean air, and clean food, which are all pretty important, but actually direct benefits to folks in terms of arable farmland, soil preservation, things like that. What have I learned today? First, now in his 50s, Robert F. Smith is a very busy man with marriage, foundation, charity, and community work. Second, we all can learn and benefit from his idea on the 4th Industrial Revolution. Thank you for watching. Please subscribe and leave your questions and comments below. My next video will be Robert F. Smith 12 Lessons. Wishing everyone peace and prosperity.