01 Mar 2003

A Casual Approach to Success

Warren Hellman
by Susan Young


One of the advantages of getting up before 4 a.m., F. Warren Hellman (MBA ’59) says with a smile, is that you aren’t expected to go to cocktail parties. Every day at that hour, Hellman can be found running six miles through his San Francisco neighborhood. He reads the Torah before heading downtown to Hellman & Friedman, LLC, the well-respected private equity investment firm he cofounded (with Tully Friedman) in 1984. Hellman is one of the Bay Area’s most successful investment bankers, generous philanthropists, and athletic 68-year-olds, but you’d be unlikely to learn any of that from him.

Hellman takes a casual, often humorous view of his accomplishments. He’d rather talk about his love for bluegrass music than The Nasdaq Stock Market, Inc., an organization his firm made headlines with when it invested $240 million in it. His conversation is peppered with self-deprecation — “I didn’t know what the hell I was doing” — and he often prefaces his statements with “I don’t mean to sound arrogant, but....” He leaves out details that others might find hard not to mention. Hellman was the youngest person (at age 28) to be named a partner at Lehman Brothers, serves as a trustee of The San Francisco Foundation, and has been a director of more than a dozen corporations.

If pressed, however, Hellman will fess up. Although he insists that his father — Marco F. Hellman (MBA ’29) — helped him get his only job offer out of HBS, he will admit that the work at Lehman Brothers suited him. “My advantage at Lehman was that I knew I wouldn’t stay there. I was planning to go back to San Francisco and work for my dad,” he explains. Hellman seemed to have a natural ability — he calls it genetic, given the legacy of banking in his family — to understand the nature of the business. “There was hardly any learning curve,” he says, still sounding surprised. “It was a good fit.”

The investment business changed during his tenure at Lehman, and in 1976 he left and moved to Boston to launch Hellman, Ferri Investment Associates, a venture capital firm he and Paul Ferri cofounded. (The firm is now Matrix Partners.) “I moved to Boston because my four kids were in New England; they moved away almost immediately,” Hellman jokes. “So I moved back to San Francisco and decided I’d better get a real job.” By all accounts, being chairman of Hellman & Friedman fits the bill of “real job.” Highly regarded for its distinctive investment philosophy as well as its bottom-line results, the firm has raised and managed over $4.8 billion of committed capital in its eighteen-year history. Its investments in some forty companies — including PowerBar, VoiceStream, Digitas, Formula One, and Young & Rubicam — have yielded solid returns, and it is now investing $2.2 billion in its fourth fund.

Hellman is, in fact, proud of the business that he and Tully Friedman have created. “From the beginning, we’ve been committed to making a company where our business interests are aligned with our values.” One of the things that sets the firm apart from its competitors is its investment in the service sector. “Human assets have different management requirements,” Hellman notes, adding, “We give a large part of the action to the people who run the business. We don’t necessarily want ownership.”

Such a down-to-earth mentality is also apparent in Hellman’s athletic endeavors. He grew up riding horses and later played varsity water polo at the University of California, Berkeley. Often attributing his athletic achievements to an ability to endure pain rather than to skill or coordination, he has run numerous marathons, twice competed in the 100-mile Western States Endurance Run, and three times completed the 100-mile Tevis Cup horse race. His most frequent event, however, is the Ride & Tie, a 22- to 35-mile combination of cross-country running and endurance horseback riding. He is the five-time age group champion for this unusual competition.

Although he shies away from social events, Hellman and his wife of 47 years, Chris, are involved in numerous philanthropic endeavors. He is chairman of the board of The Magnes Museum, and she has chaired the San Francisco Ballet. The couple funds the San Francisco Free Clinic, an organization that provides free health care to the needy and is run by one of their children. The proud grandparents of twelve, Warren and Chris Hellman have a seemingly endless amount of energy. When a competitor recently told him that he planned to “whip his [butt],” Warren Hellman’s reply sums up his jovial, generous spirit: “Most people who have tried have succeeded, so I’ll feel really bad for you if you don’t!”

Susan Young


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