Engineering Carlos Slim Helu's interview performed by Estela Caparelli, published by Epoca Negócios magazine, number 6, August 1th, 2007.
THE RICHEST MAN IN THE WORLD: WHO HE IS, HOW HE LIVES AND WHAT HE THINKS.
We interviewed Carlos Slim, the Mexican businessman that displaced Bill Gates in the billionaire ranking. With one foot in old economics and the other one in new economics, he doesn’t use computers but makes money as no one does in the global age. His advisor is futurologist and friend Alvin Toffler.
Estela Caparelli, in Mexico City
www.epocanegocios.com.br
As the taxicab enters the Lomas De Chapultepec neighborhood, I’m thinking that there is no better place in Mexico City for the house and office of the new richest man in the world, the Mexican of Lebanese descent Carlos Slim Helú. In “Las Lomas”, as the area is commonly known, great homes and buildings were built in the most expensive land in the country by renowned Mexican architects like Luis Barragán and Ricardo Legorreta. Driving along the Paseo de Las Palmas, through the car window I can see well-dressed, young executives who work in companies neighboring Carlos Slim: the J.P.Morgan and Tokio-Mitsubishi banks. “There’s 736”, says the cab driver, pointing to the three-story building, headquarters of Grupo Financiero Inbursa which houses the businessman’s office. The building itself is nothing special. The small main hall has marble floors and walls. I cross the reception area, walk up two flights of stairs and sit down in a leather couch waiting for a sign from the secretary to get to Mexico’s most powerful man, whose fortune and influence causes heated conversations among Mexicans of all social levels. The austere taste suggests that decorators have no influence in this place, but at the same time, that sense of simplicity dilutes when you get a view of the paintings and sculptures of Slim’s personal art collection distributed all around. They constitute one of the personal glories of the businessman and occupy every wall and corner. Works by painters such as Van Gogh, Renoir, Diego Rivera share the space with The Eternal Spring, one of the hundreds of works by sculptor Auguste Rodin, acquired by his most important private collector, Slim himself.
“THAT (BEING THE RICHEST) IS IRRELEVANT; I’M NOT IN A GAME OF FOOTBALL”
I’m called out for the interview and I discover that the man that controls Claro and Embratel in Brazil, works in a large and austere 80-square-meter office. The place exudes his presence. In the right corner there is a rectangular table full of papers and with no computer. The businessman does not and has never used such equipment. He does not read on-screen documents, nor does he receive or send out e-mail. Slim usually says that all the information necessary to make a business decision has to fit in one sheet of paper. Up against the wall, next to the main door, is a group of green leather couches and a crystal ash tray with a lighter on it, signaling the presence of an aficionado of Cohiba cigars, of which he smokes at least two a day. Close to the couches, on a pedestal is the sculpture The Last Days of Napoleon by the Swiss sculptor Vicenio Vela (“It’s there as a reminder that it is always necessary to keep one’s feet on the ground”, says a source close to the entrepreneur.) In the left corner, there’s a wall filled with books about history, economics and his favorite sport: baseball. Next to it is an oval meeting table, full of papers too. Surrounding the place are paintings by Mexican artists such as Gerardo Murillo and José María Velasco. The decor reflects in a minimalist way, some of the main principles of the Slim management model: practicality, austerity, adoption of simple structures and investment on profitable assets.
Finally, a man of medium height and affectionate gestures enters the office. He’s 67; wears a white dress shirt with his initials embroidered, a mint-green tie and no jacket. During the conversation, the latin giant talks about his personal recipe for management, globalization and subjects such as Brazil, redistribution of wealth and even happiness. He did not refuse to answer a single question. In a good mood, sitting in front of me with an arm resting on the chair next to him, he barely hardened his tone when addressing the most recent epic event in his biography: having been named last month the richest man in the world, displacing the founder of Microsoft, Bill Gates, who occupied the top position in Forbes Magazine’s list for 13 years. The event, made known by a respected Mexican economics website, Sentido Común (Common Sense), which closely follows the evolution of Slim’s fortune in the stock market, caused all kinds of comments and drew an avalanche of unwelcome attention, opening up again the debate about Telmex’s virtual monopoly, which holds 91% of Mexico’s fixed telephony. The paradox of Slim’s immense wealth in a country of millions of poor was talked about openly, discussing once more the business man’s dedication to philanthropy and comparing him to generous donors such as Gates or Warren Buffet, the third man in Forbes’ list.
A MAN ENTERS THE HALL AND GREETS AFFECTIONATELY. IT’S HIM; SLIM.
During the interview, Slim insisted on disdaining his new position as the richest man in the world. “I didn’t get the news, but it’s irrelevant”, he says with serious demeanor. “It’s not a competition; I’m not playing football”. What worries him, he says, is how much his companies are investing and what’s happening with them. His main challenge, he explains, is using the Carso Foundation and other of his Group’s philanthropic arms to fight marginalization and poverty, investing in health, education and employment. Budget is US$10 billion for the next 4 years. “No one takes anything from this world when he dies”, he says, “Wealth should be administered with efficiency, honesty, effectiveness and sobriety”.
There are shortcuts to understanding the personality of a man that controls the equivalent of 7.5% of Mexico’s GNP (a comparison that he loathes). In the first place, there’s his father, a Lebanese merchant that arrived in the new world close to the political convulsions of the Mexican Revolution at the beginning of the 20th Century. LIke his father, Slim is a family man that lives surrounded by his sons and sons-in-law, in life and in business. As his father was, he is an obstinate business man, heir to a Lebanese tradition that comes from the Phoenicians, the first international salesmen in the world. In contrast to other recent millionaires, Slim is not a modern man in the technological or cosmopolitan sense of the word. He was shaped in the old economics and his entrepreneurial idols are Warren Buffet – with whom he learned to buy low – and Jean Paul Getty, who died in 1976, art collector and American oil tycoon. In 1957, Getty coined the phrase - famous for its melancholy – “A billion dollars isn’t what it used to be”. Slim discovered Getty when he was still young, reading an article in Playboy Magazine.
BASEBALL STATISTICSOld fashioned, the creator of pre-paid cell phones in Mexico likes old fashioned things like Sofia Loren and boleros. His favorite movies are Charles Chaplin’s Modern Times and Anthony Mann’s El Cid, the historical epic starring Charlton Heston. His personal simplicity is legendary: he wears ties from his own store: Sanborn’s, and he entertains himself by re-working baseball statistics. He doesn’t use computers, even when one of his best friends is American scientist Nicholas Negroponte – father of the $US100 computer, who promised to pay out US$50 million to distribute them among Mexican and Central American students – and Alvin Toffler, the futurologist. The latter is a sort of mentor of the business man and his sons, to whom he usually gives domestic, informal talks. Along the interview, in more than one occasion, Slim explained his own ideas supporting them with Toffler’s ideas, as when defining the new world of services created by technology and education: “The wonderful thing about the new civilization is that it develops and thrives on the welfare of others. Nobody benefits by exploiting someone else, poverty”.
There’s a story told by Arturo Ayub, Slim’s son-in-law, which helps to understand how the lack of technological information is unable to impair the natural shrewdness of the business man. Tells Ayub: “I started Prodigy, an Internet Service Provider. One day, I went into a meeting boasting that we had 90,000 users. Slim asked me: “But, why only 90,000?” I explained that we were having problems growing because there weren’t that many people with computers in Mexico. Then he said: “The problem is that people don’t have computers? Then we’ll sell them the computers in easy installments. Out of nothing he created a scheme for financing computers in 24 monthly payments with no interest and payments charged in the monthly telephone bill. I can now tell you that today Telmex is the largest computer seller in Mexico. Since 1999, we’ve sold over 1.3 million computers. When promotion of the financing plan started, we were selling 3,000 computers a day.”
Since the website published by financial journalist Eduardo García put him at the top of the ranking of the world’s wealthiest men in the world, Slim has tried to downplay the repercussions of that information. Leading the list of billionaires means overexposure and bad press: a dreadful combination at a moment in which his companies are preparing strategic decisions for growth. Those that know him say that if anything can cause “El Ingeniero” (the engineer) to lose his temper, it’s interference with his discreet and efficient business routine. Nevertheless, whether he likes it or not, the list exists, and in it, Slim’s stock market value is US$62.9 billion, more than Gates’ US$56 billion and Buffet’s US$52.4 billion, as published by Forbes Magazine in March, 2007.
SLIM ASKS ME: “IF YOU HAD MONEY, WHAT WOULD YOU DO?”
If measured in assets rather than in numbers, Slim’s fortune is impressive. He controls or participates in more than 200 companies of sectors diverse as telecommunications, mining, food, financial services and restaurants. Mexicans use to say that it is impossible to live a day in the country without buying one of Grupo Carso’s companies’ products or using some of its services. In Brazil, there is no one that comes even close to being as powerful. For example, banker José Safra is the best ranked Brazilian in Forbes’ list; he shares position 119 with eight other billionaires, owner each of a U$S6 billion fortune. Safra’s fortune, however, is equivalent to only 0.3% of Brazil’s US$1.77 trillion GNP. If anyone in Brazil owned 7.5% of the GNP, that hypothetical superbillionaire’s fortune would be US$133 billion, 22 times José Safra’s fortune.
What is Slim’s reaction to this situation? “I’m very pleased that there is a company in Mexico, a developing country, which has created an international company such as America Movil, which creates value for investors and that competes successfully with the big ones of the world”, he says. “It is important that globalization can be done starting from our countries, as (the Brazilian mining company) Vale do Rio Doce is currently showing.”
The story of Slim’s extraordinary build up started in 1966, when at only 26 years of age, he already had the equivalent of US$40 million acquired through investments in stocks and the support of his family’s wealth. At the time, recently married to Soumaya Domit Gemayel, with whom he’d have 6 children, he launched into the business world acquiring companies in the real estate, construction and beverage bottling sector. In the following two decades, his group experienced a gradual growth typical of Mexican companies. In 1982, everything changed. In an open defiance of the “herd spirit”, he started shopping in the midst of one of the most severe crises of modern Mexican economy. While local and foreign investors tried to get rid of their assets at any price, Slim did the opposite: he bought mining companies, retail stores, cable factories and more. Along the crisis, he built the largest economic conglomerate in the nation – Grupo Carso – which sells US$8.5 billion a year. That was the first phase of its economic metamorphosis. “The decisions I made in those years reminded me of the decision my father made in 1914, when during the Mexican Revolution, he bought 50% of the family business from his brother, risking all his capital and future”, recounts Slim’s biographer José Martínez.
The second metamorphosis took place in 1990, when along with France Telecom, Southwestern Bell and other 35 Mexican investors, he entered the privatization bidding and seized control of Telmex, the government’s telecommunications giant. It was through the rise in telephony that he got to the top of the international business world. Together, his two telephone companies, Telmex and América Móvil, are worth 16 times Grupo Carso’s value which has existed for four decades. In 1991, when his name appeared for the first time in Forbes’ list of billionaires, Slim was known by only a few people in the Mexican business world. In those days, he drove a 1989 Thunderbird and had a fortune estimated at US$2.1 billion. Today, 17 years later, he dominates the telecommunications sector in Latin America, his face is well-known in all the world and he has become, much to his chagrin, the richest man in the world.
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