by Wallace Ford
But they were all very smart. I knew that. Indeed, I was counting on that. They had not gotten to where they were in life and business by dismissing good ideas simply because they were not their own.
And so, not even Gordon Perkins—loud, always first with the smart remark—had anything to say at first. I had achieved my initial desired result. I had shocked them into deep thought and serious and immediate consideration of my proposal.
They simply had to consider my idea. It was that outrageous and it had the tantalizing potential of fabulous success. I didn’t expect Ray Beard to have anything to say.
This discussion was heading into the deep water and he was still on the shore. That much I knew. I figured that Jerome would be contemplative, and the question was, would Gordon or Diedre speak first.
CHAPTER 30
Paul
Stepping up to the plate
“Paul, let’s cut to the chase. There is no way any of us would say yes sitting here at this table. You couldn’t possibly expect that. So what is it that you want us to do with your bright idea?”
It was Diedre breaking this whole situation down to its basics, as I hoped that she would. I correctly figured that the group dynamic would be critical during the next few minutes.
However, we all have our strengths and we all have our weaknesses. The key factor affecting relative personal success is the number of times that we can use our strengths and how often we can control and divert attention from our weaknesses. I have a tendency to make the “smart” remark and to be sarcastic. I have to call it a weakness as it usually serves no good reason, and even my closest friends have to choose to ignore those comments, as they are rarely enjoyable.
For some inexplicable Tourette-related reason, the smart aleck imp in me decided to make a guest appearance . In retrospect I have no idea how that happened. I am just glad that I was able to leash the little beast down before irreparable harm was done.
“As a matter of fact, Diedre, I don’t have any documents in my briefcase, although I could whip some up by the close of business—if that’s all you need to get moving on this.”
The quiet table got quieter than a confessional in a whorehouse. I immediately realized that the imp that had hopped out of my subconscious had almost immediately returned to his dark cave, hidden deep in my psyche. Of course I was left facing the absolute collapse of everything that I had planned. I had to think and move fast. I smiled and tried to make it clear that there was no animus behind the stupid, snide comment that I had made. Of course, at that point all I could do was press on.
“Seriously, I think that your idea makes sense. You are absolutely right, Diedre, in saying that the most that you can do is think about it. But I think that the next step is for all of you to decide to think about this and we can get together in a few days to talk about a specific game plan, if you decide that you want to play this game.”
“Okay, Paul,” said Gordon. Finally. “Let’s just say that before we go along with your really bright idea, we might have a few questions. Like why do you think this idea is such a bulletproof, gold-plated winner?”
Gordon had a smile on his face. But this time he was not trying to be funny. And there was no laughter forthcoming. He was taking this very seriously. And that was a good sign. But I had to be very careful. Gordon, despite his crude ways, had a great mind and he would be the first to spot any weakness in my proposal.
“Let’s just think about it for a moment, Gordon. You are doing just about as much public finance business as the major white firms. You are in just about every major city in the country. There isn’t a major agency finance director, state comptroller or city treasurer who doesn’t know you and your firm.
“Even with the tax changes of the past few years and the shrinking margins, you are at the top of the heap. But let’s think about this a little bit more.
“Diedre, you have been making huge strides in the asset management field. More than most folks on the street know right now. At some point soon your firm will be a brand name on the street, and then most of the major companies, unions, and states will be banging at your door. You know it, and the rest of us at this table know it too.
“Jerome, your firm is getting corporate finance deals going in industries that are only going to get bigger—high tech, internet firms, biotechnology, international structured finance. Your best days are definitely ahead of you. Again, we all know it. After all, we have agreed to be frank and honest this afternoon, haven’t we?”
I was on a roll. Gordon, Diedre, and Jerome were fully involved in what I was saying. Ray Beard was along for the ride. It was a critical moment. I could see each of them computing, figuring, speculating, extrapolating—trying to figure out their next move in this floating, shifting, three-dimensional chess game, when I had just changed the rules.
They now knew where all of this was leading. The question was, could they, or rather would they, buy into this idea, right here, right now. If we walked out of the Water Club without some kind of threshold agreement I didn’t think that anything I suggested would ever happen.
It was clear that Ray Beard was the fifth wheel and from the look on his face, he really didn’t like it. He was used to being in or near the center of attention. He was seething—almost visibly. But he simply was not a player in this game. He was just a part of someone else’s team. And frankly, I could not worry about that. I had to move on.
“These are all the good points. But, like most things in life, there is another side to the coin.
“The other side of the coin goes like this—Gordon, the profit margins in municipal finance will never be any better than they are right now. You and I both know that there will be a steady decline in the profitability of this part of your business. What is your solution? Get more business and diversify simultaneously. If you join in this merger, you get to do both.”
Gordon did not say a word. You could see his brain weighing all the possible aspects of what I was saying.
“Jerome, if you get these new hot deals going, you are going to be a real star on Wall Street … for about half a minute. Because that’s how long it will take for the bigger firms to ramp up their own units to do the same deals … only bigger. Or, they will just buy you out. And we all know that can happen.
“If you do this merger, however, you will be part of such a highly visible operation that you will get more business than you can ever hope for on your own, and even the big boys will have to think twice about just taking you down. Basically, this merger offers you protective cover as you move forward with your existing strategy.
“And then, Diedre, there is you and your firm.”
Diedre shifted almost imperceptibly in her chair. Probably no one noticed but me. My comments were hitting home. As I looked at the faces of Gordon and Jerome, it was clear that I had spoken the truth. It was also clear that Diedre did not welcome an analysis of her business in front of others. But there was no stopping now.
“By any possible standard, you are doing real well. Your asset management business is moving forward. But think about it. If you had Gordon’s municipal contacts and Jerome’s corporate contacts, there would really be no stopping you.
“If you don’t merge, it’s only a matter of time before all of you will be fighting tooth and nail to keep the business that you have as other small firms come after you.
“So you see, if you merge, you create history with the chemical reaction of your combined presence. If you don’t, you will miss an opportunity to move into the truly big time. And, you may even find your existing businesses in jeopardy and at risk over time.
“Either you adapt, or people will be talking about who you used to be. You won’t wind up in the Wax Museum, but you will most certainly be referred to in the past tense as the coming charge of the light brigade of Harvard/Yale/Chicago/NYU Business School graduates goes right after your franchise in the business. The choice is yours. Gordon, Jerome, and Diedre—the opportunity is right in front o
f you.”
When I stopped and sipped some wine, it was eerily quiet at the table. No one spoke. It felt as if my words were like the assault of a demented and possessed archer savant—shooting arrow after arrow, hitting the bull’s-eye every single time. Everyone at the table was used to plain talk. But this was something different.
By now the Water Club had started to clear out. As the waiters cleared the luncheon plates, everyone considered what I had said while they ordered some refreshments to end the meal. As I recall, Gordon and I ordered Delamaine, Diedre order Sambucca, Jerome had Amaretto di Saronno, and Ray Beard had some Sandeman’s port wine, a pretty decent vintage as I recall.
The winter sun had given all of the heat and light that it was going to give for the day. At this point, the light had begun to fade almost perceptibly. The only question I had at this point was who was going to speak first. The three of them simply had to see that this idea would work. My task was to help them make it happen. That is, if we ever got that far.
CHAPTER 31
Paul
Oh happy day
“Paul, I really have to hand it to you this time. If anyone but you had suggested something like this I would have told them to go fuck themselves … excuse the language, Ms. Diedre,” said Gordon. “But, of course, if we are going to be business partners as Brother Paul suggests, we are all going to have to … adjust.”
Diedre acknowledged Gordon’s comment with a grim, tight smile. But I knew that her mind was clearly beyond Gordon’s eternal mind games.
As I looked at it, in this very special chemical reaction, all three of the components were critically important. Gordon was important because of his nationwide network of contacts. Also, even though profit margins in the municipal finance business were shrinking, the name of Gordon’s firm would give the new enterprise instant credibility and a pipeline of deals that would almost guarantee that the new firm would be listed on the financial pages of newspapers around the country every week.
It seemed to me that Gordon had bought into my idea. But with Gordon, one never really knew what he might be thinking or what his real plan might be. Clearly, if this new partnership was going to work it was going to be tricky … to say the least.
We all waited as he sat back in his chair and cradled a balloon of brandy in his very large hand. He savored the aroma and he also seemed to be savoring the attention from everyone around the table. This was clearly his moment. He took another sip, considered its flavor and then continued to speak.
“Paul, as I have said before, when you are right, you are right. Your analysis of my business hit the nail right on the head. My educated guess is that you hit pretty close to home with Diedre and Jerome as well.”
The absence of comment was all the confirmation that I needed. Gordon continued to carry the ball on this play. I silently cheered him on.
“Everything you say makes sense. If I had Jerome’s corporate contacts and Diedre’s asset management operation I would be kicking even more ass up and down Wall Street.
“And I have to believe that if Diedre had complete and unlimited access to the state and city finance officers that I know, and the municipal union leaders that they know, her business would grow exponentially.
“As far as you are concerned, Jerome, we all realize that with my deal flow, and cash flow, you could go after even bigger and better corporate deals, and have the financial wherewithal to buy your way into new deals. But, there is no way that I am going along with this one.”
I felt myself deflate. I felt that everyone could hear the whooshing sound of air leaving my body. I could not believe that this was happening. A moment ago, it was too good to be true. Now, it was too bad to be real. What the hell was wrong with Gordon?
“At least, not right now.” Gordon was really enjoying himself. His melodramatic pause had everyone very focused.
“If this thing is going to work, a big if, then we are going to have to find out if we can work together. After all, it doesn’t make sense to go through all the bullshit that a merger entails and then find out that we can’t work together. I think that we should date a little before we start heading toward the honeymoon suite.”
“Well, Gordon, what would you suggest? After all, if you think that this idea has any merit, then we all need to start somewhere, right?”
I was doing all that I could do to maintain momentum. Now I knew that I had to be quiet and hope that there was some momentum in all of this. I did, of course, have some ideas on how this undertaking could get off the ground. But it was really important that Gordon, Jerome, and Diedre came to some of those same conclusions.
If everything went in the direction that I hoped, we would leave the Water Club agreeing to some trial cooperative projects while I drafted a preliminary Letter of Intent as a prelude to an actual merger. I noticed that Jerome was about to speak and it was clear that the best thing that I could do was to keep quiet.
“Paul, I have to agree with Gordon this time. You have come up with an idea that is wild and great at the same time. And you know something? It just might work. It is so outrageous and logical in its concept … it just might work. But you are right. We have to start somewhere.” At this point, Jerome looked at Ray Beard, seeming to realize for the first time that Ray was very much out of place. He seemed to start to ask Ray for his opinion, just so that Ray would have something to say. But at precisely that moment, Diedre had something to say and Ray had to stay bolted to his second tier role.
I watched Diedre take a deep breath and then exhale—very slowly. Clearly, her mind had been going a million miles an hour ever since I had hatched my grand scheme. I knew that she liked and respected Jerome and I also knew that she absolutely could not stand Gordon. And as for my involvement—I hoped that we had been ex-spouses for too long to let anything personal get in the way of business. And this was certainly business of the highest order.
I also knew that ever since she had left Citibank, building her own firm into a success had been the prime motivating factor in her life. Whatever was second place wasn’t even close. I also knew that she was on the verge of making that firm into something that was not only going to be successful for the long term, but that it was on its way to becoming an institution—in other words, it was going to last. Knowing Diedre, she already had a plan—and now this. She thought long and hard. And then she spoke. Another pivotal point in this most interesting of afternoons.
“I really don’t know where to begin with you guys, but I guess I am going to have to try. Paul, you are the last person in the world from whom I should take advice, but what you are saying makes a hell of a lot of sense, in a very bizarre, but very real way.
“Gordon, let’s be frank. The truth is the truth. We have simply never gotten along. Not even a little bit. But business is business. Enough said.
“Jerome, with you it’s something else again. You are truly one of the very special people that I know—you are a gentleman and you are a man of your word. But Jerome, I have never seen you be anyone but the man in charge. I am not about to be in second place at this point in my life either. And Gordon, we all know about you.
“So, gentlemen. The question is, given the facts of life as we know them, where are we going to go with Paul’s oh-so-brilliant bright idea?”
“Goddamn good question, Diedre.” It was Gordon again. But he was being surprisingly human and practical. This was one time he was not trying to get under Diedre’s skin.
“We can chew on this thing until it is mush, or we can try and make it work. I don’t have time to waste, and my guess is that neither do any of you. So, if we are going to do something, let’s try and figure it out right now.”
And with that, I was amazed that the group just got down to business. Plain and simple. Gordon was, and would always be, a lout, an idiot, and an asshole, but no one would ever, ever say that he was stupid. Certainly no one sitting at the table that day. He quickly and concisely outlined a plan of action that could have been
downloaded from my brain.
He correctly pointed out that if the three principals had any hope of working together, two things had to take place. First, they would need a basic outline of the principles of a merger which, logic dictated, should be contained in a Memorandum of Understanding or Letter of Intent that I would draft within thirty days for the group’s consideration. Gordon also suggested that each of them commit $10,000 to fund the legal fees that were inherent in such a task.
The whole afternoon had taken a turn which amazed and exhilarated me. I could only observe as they took their first collective acts based on this proposed joint venture. It was not the commitment of the money that was meaningful. After all, it was not a lot for them. It was their commitment to work together that marked this day as being very, very different. And we would all remember this day and this moment for the rest of our lives.
Gordon then went on to make another suggestion. He pointed out, again with compelling logic, that the only way to truly find out if the threesome could work together would be for them to select some cooperative projects that would determine empirically the extent to which their combined efforts could be successful in the long run.
Gordon went on to suggest that each of them select a project that was currently of personal interest, and present it to the group to see if it could be the basis for a cooperative effort. The true proof of all of this synergy would be the success of their collective efforts.
This would of course require that each of them reveal confidential and private information about their firms and their strategies. A leap of faith to say the least. “You show me yours and I will show you mine” at a big league level. Gordon, Jerome, and Diedre all realized it.
Ray continued to sit, stewing in the juices of his extremely obvious irrelevance. For a moment no one said anything. This adventure had more than one Rubicon. That’s for sure.
