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Not
Your Father’s Old Home Town
The
Richmond
region has seen a sweeping turnover in
its business and civic leadership. Far
from being a haven of bluebloods, the city is wide open
to newcomers.
Eugene
Trani heard the stereotypes of Richmond
15 years ago when he was working for the University
of Wisconsin
and pondering an offer to take over the presidency of Virginia
Commonwealth
University. As the son of an Italian immigrant father and an
Irish-American mother – and as a northerner to boot --
there wasn’t much chance that he’d be numbered among
the First Families of Virginia. Despite concerns about
how he would be accepted, he decided to make the move.
It
turned out to be the best decision he ever made, Trani
says. “Lois and I were warmly welcomed.” Since then,
both of his children, including a daughter who relocated
from London, and his five grandchildren have joined him in Richmond. “People from all over the world are heading here.
… Richmond has its own melting pot taking place.”
Like
Trani, we’ve all heard the rap against Richmond. It’s an old, Southern city dominated by
genealogy-obsessed blue bloods: bankers, industrialists
and investors whose great grandfathers all fought for
Robert E. Lee. By reputation, this “aristocracy” is
paternalistic, resistant to change and closed to
newcomers; the movers and shakers drink three-martini
lunches at the exclusive, men’s-only Commonwealth
Club, while their wives organize debutante balls and
join the Junior League.
Here’s
the reality: The people who run the Richmond
region today can hardly be called “blue bloods”. The
corporate base of the Richmond regional economy has undergone incredible churn over the
past 10 to 15 years, causing massive turnover in the
business and civic leadership. Most of the old faces are
gone, and it’s far from settled where the new
generation of leaders will come from -- although it’s
a good bet that nearly all of them will have made their
money, not inherited it, that only a few will be
native-born Richmonders, and that a good number will be
women and minorities.
Far
from being a hard town to break into, Richmond has dozens of business and civic organizations where
newcomers can plug in right away. Some are large and
well established like the regional Chamber of Commerce
and Greater Richmond Technology Council. Others are
small and run by volunteers. But they’re all looking
for warm bodies to help out. As newcomers quickly learn,
one of the most admired virtues among Richmonders is a
willingness to contribute to the community. If you
don’t have money, donating your time and energy is
perfectly acceptable.
The
fact is, nobody cares anymore whether you can trace your
genealogy back to Pocahontas and John Rolfe. The
metropolitan area is so mobile, so blessed by
in-migration from around the country, that it can be
hard to find native-born Richmonders even when you’re
looking for them. According to recent research, of the
140,000 residents in the 25- to 34-year-old age group, 68 percent came from somewhere else!
Even
a cursory look at Richmond ’s leadership shows the blue-blood stereotype to be
ludicrously out of date. Any list of the richest, best
connected and most powerful individuals in Richmond would include men like Eugene Trani, Bill Goodwin, Doug
Wilder, Ivor Massey and the Ukrop brothers. Let’s take
a look at who these people are.
Eugene
Trani came to Richmond 15 years ago, by way of the University
of Wisconsin, to run VCU. He hardly fits the mold of
conservative, Southern gentry. An academic by training
and demeanor, he recently published a revisionist
history tracing the origins of the Cold War not to
Soviet aggression after World War II but to United
States intervention in the Bolshevik revolution in 1918.
In his main job, as president of the region’s largest
university, he has transformed VCU into the
fastest-growing university in Virginia, recruiting students from an ever-expanding market,
building strong life science programs, launching Virginia’s newest engineering school, and investing more than
$1.1 billion in new facilities in the past 10 years.
Trani doesn’t see VCU as an elite school like the
University of Virginia or William & Mary but as an
inclusive institution appealing to the working
class and minorities, to students who are the first
in their families to earn a college degree.
Bill
Goodwin is a Horatio Alger story: He grew up in a
small Southside town, studied engineering at Virginia
Tech and business at the Darden
School, and accumulated a portfolio of manufacturing and
resort properties. Selling AMF Bowling for more than $1
billion, he gave away multi-millions to the AMF
employees who’d helped make the company successful.
Since then, he has lavished tens of millions of dollars
and considerable time on two institutions crucial to Richmond’s emerging knowledge economy: the Massey Cancer, a
leading center of cancer treatment and R&D, and the
VCU School of Engineering. Goodwin doesn’t waste much
time on “how’s your daddy?” small talk: He demands
results. Setting high goals -- he wants VCU Engineering
to become a “Top 25” engineering school in 25 years
– he drives people hard to meet them.
Doug
Wilder launched his political career by becoming the
first African-American ever elected to the Virginia
state senate, then went on to break the 300-year-old
color line in American politics, winning statewide
elections as Lieutenant Governor and then Governor of
Virginia – the first African-American ever elected
governor of any U.S. state. He made his mark as a fiscal
conservative, cutting spending without raising taxes
during the recession of the early 1990s. Since leaving
government, he founded the National
Slavery
Museum, chaired government study commissions and invested in a
number of business concerns, including one that
developed an electronic voting machine. Currently,
Wilder is running for mayor of Richmond
as a reform candidate, largely on the basis of his
reputation as an independent thinker beholden to no
special interest or constituency.
Ivor
Massey Jr. does come from one of Richmond’s wealthiest and most respected families – not that
you’d ever guess it from meeting him while he’s
driving to work on his Harley-Davidson with his Z-Z-Top
beard protruding from under his motorcycle helmet. A
risk taker, he backed Monument Capital, a late-90s
venture capital fund that bankrolled a slew of start-up
technology companies. Crippled by the dot.com bust,
Monument has since folded. But Massey has funded a
number of other start-ups that have proven successful,
and he’s pioneered the revitalization of buildings
along the historic Canal Walk. Impatient with red tape
and bureaucracy, he can usually be counted on for a
contrarian view of the current conventional wisdom
regarding downtown development.
The
Ukrop Brothers, Jimmy and Bobby, own Ukrop’s
Supermarkets, one of the most successful regional
grocery chains in the country, which they built from a
mom-and-pop store they took over from their parents. The
brothers do contribute to the region’s reputation for
cultural conservatism: closing their stores on Sunday,
refusing to sell alcohol, and leading the charge several
years back to chase Howard Stern off the Richmond
airwaves. But they’re anything but conservative in
business, where they pioneered many of the grocery
industry’s best practices and launched one of the
region’s most successful community banks, or in the
civic realm, where they’ve worked tirelessly to bring
new voices into the process and new perspectives to
community and economic development.
So,
there’s your “Southern aristocracy”…. a
scholarly, Catholic-ethnic university president…. a
self-made millionaire from a small town….
The grandson of a slave and political
maverick…. A bearded, Harley-riding angel
investor/venture capitalist…. and two brothers,
descended from Czech immigrants, who made it big in the
grocery store business.
The
old-Richmond stereotype is just “crazy,” says Bobby
Ukrop, whose grandparents emigrated from Czechoslavakia
to the United States
in 1900. “They were poor farmers who didn’t speak
any English.” His father quit school at 14 and went to
work as a meat cutter. It wasn’t until the 1980s that
the family grocery business became big enough to garner
any visibility for his brother and him in the community.
As a sports enthusiast, he got involved with the
Diamond, home of the Richmond Braves, and the Richmond
Sports Backers, an organization that promotes amateur
sports. Needless to say, he wasn’t driven by power or
prestige. “It was fun. I was just trying to serve, to
be helpful.”
Ivor
Massey, who describes his family origins as “a bunch
of West Virginia
rednecks,” sums up the reality this way: “Who are
the blue bloods? I guess you could name a few of the old
names, and some are still influential. But it’s not
like they run things. …
Richmond
is wide open for anyone who wants to come here and wants
to work and do something constructive.”
Once
upon a time, Richmond
did have a stable, identifiable power structure
dominated by bankers and industrialists. Home to the
Federal Reserve Bank of
Richmond, the city was headquarters to most of the leading banks
in the state. Boasting one of the major concentrations
of corporate headquarters in the
Southeastern U.S.
, the region also had its fair share of industrial
corporations whose CEOs were extremely active in the
community: Ethyl Corporation (gasoline additives), A.H.
Robins (pharmaceuticals),
James River
(paper products), R.J. Reynolds (aluminum), CSX
(railroads); Dominion (electric power) and Universal
Leaf (tobacco).
But
a wave of corporate restructurings and interstate bank
consolidations gutted the old guard. The bank
headquarters moved to North Carolina
and Atlanta, while several Fortune 500 companies either relocated
or got acquired. New leaders from emerging giants like
consumer electronics retailer Circuit
City
and credit-card marketer Capital One filled the vacuum,
but they hardly fit the mold of Southern gentility.
Richard Sharpe, former CEO of Circuit City, came to Richmond
by way of Northern Virginia, as did Richard Fairbank and British-born Nigel Morris,
the co-founders of Capital One. Since then, Sharpe has
retired, while Fairbank and Morris moved with their
corporate H.Q. to Tysons Corner.
Even
Media General, whose Bryan
family has published the Richmond Times-Dispatch for ages and built a regional media
powerhouse, soon will see a changing of the watch. CEO
J. Stewart Bryan, a pillar of Richmond
old guard, is nearing retirement age. With no family
members involved in management, he has elevated Reid
Ashe, former publisher of the Tampa
Tribune, as COO and heir apparent.
The
corporate leadership of Richmond
is, arguably, in greater flux than at any time in the
past century. New players are continually arriving on
the scene. The past year has seen an influx of New
Yorkers as Philip Morris USA relocated its headquarters
to the city and Wachovia Securities absorbed the
brokerage operations of Prudential Securities.
Meanwhile, the CEOs of up-and-coming, home-grown
companies -- John Petze at Tridium, John Vivadelli at
AgilQuest, Jim Brady at PayerPath, Brad Evans at
Cavalier Telephone -- are all run by CEOs who moved to
Richmond
from somewhere else.
The
changing foundation of Richmond’s economic base means that power and influence are
distributed widely. The Richmond Ballpark Initiative is
a case in point. RBI, which proposes building a downtown
baseball stadium in Shockoe Bottom, came out of nowhere.
The backers are mostly 30- and 40-something
professionals who fell in love with the idea of a
downtown ballpark. One need not agree with their vision,
which is highly controversial, to appreciate the fact
that 26 individuals, none of whom would be considered
part of any aristocratic elite, have banded together and
raised $500,000 in cash and in-kind contributions to
move their idea to the forefront of the public agenda.
Susan
Hardwicke has seen the change that overtook
Richmond
in a single generation. The daughter of a prominent
architect, she grew up here in the 1960s and found it
stifling. It was like the old joke that Richmonders tell
about themselves, she says: “How many Richmonders does
it take to change a light bulb? Seven. One to change the
bulb and six to stand around and say how great the old
one was.” As a teenager, she could hardly wait to
leave. Blazing through the
University
of
Virginia
in three years, she moved to
Northern Virginia
and then to San Diego, where she pursued a career in human relations
consulting.
Twelve
years ago, after having children of her own, Hardwicke
moved back to Richmond
in search of a more family-friendly environment. She was
astounded at the changes that had taken place. Race
relations were much more cordial, and there were so many
newcomers, she recalls. The new Richmond
seemed full of possibilities. Starting a business in
business-process consulting, she found, ironically, that
it was advantageous to represent herself as an outsider.
Outsiders had more
credibility, she explains. Out of her first business
grew another – a successful online testing service.
More recently, she has launched a business around
cognitive development in early childhood.
Meanwhile,
Hardwicke has gotten involved in the community through
work at the Virginia Museum of Arts, a community bank
board and other organizations. How did she get so
plugged in? It wasn’t her old-Richmond social
connections, she says, but friendships she has made
professionally. It was a lot easier breaking into the
Richmond
business scene than San Diego, she adds. “If you weren’t connected to one of the
big-name companies there, you couldn’t get anyone to
pay attention.”
Hardwicke
is typical of the rising generation of civic and
business leaders: She springs from the ranks of what
economic development theorist Richard Florida calls the
“creative class” – those artistically,
scientifically and entrepreneurially gifted people who
create new ideas, technologies and business models.
Typically well educated, they are engaged in occupations
where they either master highly specialized bodies of
knowledge or solve complex problems. In a time of
technological and social ferment, they drive innovation
and change.
With
the Richmond
regional economy in flux and the old order passing away,
members of the creative class are bringing a new
generation of leadership to the fore. Many new leaders
are idealistic and want to change the world -- Hardwicke,
for instance, wants to help parents emancipate their
children from the negative cognitive consequences of too
much television and video games – but they aren’t
what you’d call “social activists” of the same
stripe you’d find in Boston
or San Francisco. The up-and-comers would rather work within the system
than expend energy trying to transform it. In turn, they
insist, “the system” should be open to anyone
demonstrating competence and a willingness to contribute
to the common good.
To
grasp the nature of the emerging leadership, it is
crucial to understand how Richmond
is being transfigured by the knowledge economy.
The
regional economy can be divided into three parts:
-
The
professional economy: law, investment banking,
accounting, advertising/marketing,
architecture/engineering.
The
story of modern Richmond
begins in the late 19th century with the rise
of the tobacco and cigarette industry. Although the
tobacco sector has shrunk under withering market
pressures, Richmond
remains home to Philip Morris USA, the world’s largest
cigarette manufacturer; Universal Leaf, the world’s
largest tobacco trading company; several independent
manufacturers of cigarettes and smokeless products; and
a slew of equipment suppliers and packaging companies
that support the industry.
Although
Virginia
history is steeped in tobacco, industry executives have
assumed a low profile in the community. Their
involvement has been limited mainly to workforce
development, supporting the arts and fending off
anti-tobacco initiatives in the legislature.
Another
world-class industry cluster in the region consists of
specialty chemicals and high-performance fibers.
Heavyweights DuPont and Honeywell manufacture super
fibers-strong like Kevlar and Spectra used in everything
from body armor to industrial safety apparel. As
multinational corporations, the chemical giants rotate
executives through the Richmond
region; although some stay because they like it here,
few linger long enough to develop leadership roles in
the community. Most of the chemical plants are owned by
German or Japanese firms, and their executives tend to
transfer home after a few years.
It’s
safe to say that old-line industrialists, drawn from the
ranks of manufacturing companies, have all but
disappeared from Richmond’s leadership, though that may change if senior Philip
Morris executives choose to get more engaged. As it
stands now, the region’s leadership is drawn
disproportionately from the service professions.
Tom
Bowden, who heads the strategic transactions practice
for the McCandlish Holton law firm, maintains a client
base that does business across four continents. He talks
to one client in South Africa
on a daily basis and he’s building connections in Israel. The law firm runs an office in China, and business ties to
Europe
are ubiquitous. “My practice and career have been
centered around capital transactions and technology,”
he says. “In this day and age, with telecommunications
the way they are, there’s no need to be in an
expensive city to do international business.”
With
a law degree from the
University
of
Pennsylvania
and a business degree from Wharton, he could practice
anywhere he wants. He chose Richmond. Bowden’s wife, a native Richmonder, had something to
do with that decision. But he wouldn’t have moved
here, he insists, if the city hadn’t made a good
impression. Richmond
has a fantastic legal profession for a city its size.
Scores of attorneys, like him, run national and
international practices from downtown offices. And, in
his experience, the city is wide open to newcomers.
Says
Bowden: “I heard all the negative things people said
about Richmond
but I was convinced by the people I talked to that they
weren’t true.” It turns out that his sources were
right. “There are a lot more come-heres than from-heres
– not that there’s anything wrong with being a
from-here!”
With
a number of top-flight law schools in the state to draw
from, law firms have no difficulty recruiting top
talent. It’s little surprise, then, that the legal
profession is one of Richmond’s growth industries. The city can boast of far more
than its share of major law firms, and senior partners
of Hunton & Williams, McGuire Woods and the midsized
law firms cut a high profile in community organizations.
The
pre-eminence of the professions in
Richmond
is all about talent – the talent generated through Virginia’s system of higher education. The city draws also
upon some of the top business schools in the country –
three of the top 100 in the world are located in
Virginia, according to a Financial
Times ranking – and a lot of those MBAs wind up in
the investment banking sector. Wachovia Securities, one
of the leading brokerages and investment banking houses
outside of New York, recruits top talent from Virginia
and around the country and, in turn, has seeded dozens
of smaller firms with its alumni. The Richmond
region is notable for the large number of boutique and
mid-tier investment banking firms that close deals
flying under the radar screens of the New York
giants.
The
situation is much the same with the advertising
industry. Fed by highly rated programs in advertising
and the arts at Virginia
Commonwealth
University, the advertising/marketing profession enjoys a
cornucopia of talented young employees. The Martin
Agency, the largest ad agency in the Southeast, plays the same
role as Wachovia Securities: It has the clout to recruit
top national talent to the region and it fertilizes the
local economy with entrepreneurial break-aways.
While
there is a strong corporate base to support a local
advertising industry, the plethora of ad agencies,
marketing shops, P.R. firms and esoteric boutiques
couldn’t possibly survive on local business alone.
Many firms, from boutiques to the larger, full-service
agencies, work with clients outside the region and even
outside the state.
Much
the same can be said of the multiplicity of architecture
and engineering firms. Richmond
has proven to be a congenial setting for smaller firms
serving niche markets like clean room construction,
environmental remediation or the design of hospitals,
schools and other public buildings. Most firms could not
survive without a larger, regional or national
clientele.
Although
no one would characterize Richmond
as a major info-tech center, the region does support a
healthy base of IT firms that serve the local corporate
market and, increasingly, businesses in neighboring
cities. The Richmond IT community has prospered despite
living in the shadow of a world-class IT community only
two hours away in
Northern Virginia. While
Northern Virginia
firms play in national and global markets, Richmond
companies have staked out strong positions serving
regional markets.
Increasingly,
political and civic leaders are being drawn from the
ranks of the professions. Paula Gulak, a partner in
SyCom Technologies, is a case study. She moved to Richmond
30 years ago but never thought of herself as an
"outsider." She simply found out what was
going on and threw herself in.
“I
was so naïve when I came into town,” Gulak remembers.
“I just looked to get involved in areas, like the arts
and community areas, that I had a passion for.” She
soon developed many close friendships, both personally
and professionally. Then, about eight years ago, after
15 years in the technology sector, she and four partners
joined to form SyCom, a company that has since become
one of the fastest-growing IT vendors in the region. As
the gregarious one in the group, she took on the
marketing responsibilities and the informal job of
schmoozer in chief.
Among her
many contributions to the community was a four-year
stint, first as president and then chairman, of the
Greater Richmond Technology Council, a high-visibility
position in one of the region’s most high-visibility
organizations. Even two years after stepping
down, if there were a list of “The Most Plugged In
Women in Richmond,” Gulak would be on it. Her advice to newcomers: "There
are so many great organizations in Richmond, and they’re all looking for people to get
involved. Just follow your passion whatever it is, but
when you step in do something – don’t just have your
name on a list. Richmond
is wide open. You’ll end up meeting all sorts of
people.”
-- November 1, 2004
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