David Rubenstein speaks at the Robert H. Smith School of Business

I know who to bring to my eulogy thank you very much before I get started I wanted to know how many people here are undergraduates okay how many people are graduate students and how many people are faculty how many people are administrative people how many people are just lost them right how many people are from the state of Maryland grew up in the state of Maryland how many from outside Maryland how many people from outside the United States originally okay anybody from Baltimore anybody go to Baltimore City College nobody okay how many people here are glad they're at the University of Maryland okay how many people here want to go in the business how many people want to be an entrepreneur anybody for private equity investment banking how many people want to make a billion dollars and how many people want to give away a billion dollars okay how many people wish they listen to their mother and go into Medical School okay couple my mother wanted me to be a dentist let me tell you a little bit about my background and the reason I do it is not so much to tell you what a wonderful person I am but it's to tell you how you can overcome certain disadvantages or maybe you make them into advantages and how I came to start a firm that is now the largest private equity firm in the world with no qualifications for it and by making a lot of mistakes and so all of you I hope will think that you know if you're not first in your class you're not the start of your class and I was not you don't need to necessarily feel your future is doomed I also have a view and I'll talk a little bit later about what I think it takes to be a good investment professional what it takes to be a good entrepreneur and what I would give you a some career advice and then I'll you know take time for questions I will give you a little bit about my views on the economy before we end let me give you my background I it might be most time if you meet somebody whose last name is Rubenstein you say okay's father probably a doctor a lawyer maybe a dentist now but there are a lot of blue-collar Jews and in Baltimore I grew up in Baltimore Baltimore was the most rigidly segregated city in the United States by religion because the mortgage is for bad you to sell a home to somebody who was Jewish or black so when I was growing up in the 50s the United States and in Baltimore you know we had the younger than a Jewish ghetto because the Jews couldn't buy homes in other parts of Baltimore they all lived in Northwest Baltimore and basically it was a very close third area I was you know before I was 13 I I thought everybody in the world was Jewish I didn't know anybody wasn't Jewish after 13 I realized not that many people were Jewish but in this area Baltimore it was filled with them to my part of it blue-collar Jews my parents my mother was 17 when she got married my father was 20 came back from World War two met my mother I was married I was they were married and then I was born more than nine months after they got married and my father had no did not graduate from college and graduate high school my mother didn't graduate from high school either so my father worked his entire career in the postal service in Baltimore never made more than seven thousand dollars a year so I was their only child and so I knew that although we didn't have a big family that I couldn't afford to go to college I couldn't afford to go to any college probably without scholarships and so I decided I would try very hard to get scholarships and when I was in the sixth grade I remember watching John F Kennedy give his favorite famous speech ask not what your country can do for you ask what you can do for your country and although I was only a sixth grade our teacher came back the next day and tried to get me to understand that speech much more and I realized that the making of money has had no appeal to me didn't understand my mother had the view that people that had money or a different species and that we weren't going to be able to be in that species we were lower collar blue collar people we just had to stay in our and our kind of class and that she thought the highest calling of mankind was to be a dentist because she said you know if you're a dentist you don't have to work on weekends and and you have to get call yet they call you a doctor and it's great and I said what about I get arthritis in my fingers what am I going to do so I didn't have any interest in that but I wanted to go into public service that speech by John Kennedy inspired me to do so so I figured I'm going to be a lawyer go into politics and ultimately go into government so I went to Duke University I got a big scholarship there I applied to lots of schools and I was an equal opportunity person whoever gave me the biggest cow that's where I was going and and Duke was a bit of a change for me because Duke had a Jewish quote in those days only 5% of student body wasn't public then but later I learned that only 5% of student body could be Jewish they had a Jewish quota so I got them Duke I and I bought him wherever I knew was my area was Jewish I get the bar Duke it was virtually nobody Jewish so I decided I'd study hard and I you know got a good recently good grades I got into law school I applied to every law school I could not ever give me the biggest scholarship I would take it and I I wanted to go to Harvard Law School and I was going to go there and then all of a sudden universe Chicago showed up with a full scholarship and I said wow this is great then in those days it was it seemed like a lot of money then it costs $2,000 a year in tuition I guess here's a little bit higher now right here so $2,000 and they guaranteed my tuition and room and board for everything for three years but I didn't have that much money so I I it took $50 to send in the deposit for the law school to reserve your place and $50 for the for the student housing so I figured you know why do I'm going to waste $50 sending 250 dollars in I'll just send $50 into the housing people and they will surely tell the law school people that I'm going to show up why would I need the housing if I was going to show up so I'm you know show up the day of law school and all of a sudden I go to register and they say well you didn't send your $50 in we've given your scholarship away and your place is gone so the blood drained out on my face hello I don't have a place to go to law school I lost my scholarship I said wait a second don't you understand I sent $50 into the housing people why would I need that housing if I wasn't coming to law school that's a different department the University of nothing to do with with the law school so I was really very nervous about it and then they came back 20 minutes later and I said okay they said okay I'll give you the scholarship and you can come so I went there and I I was very fortunate than and I repaid them recently by giving them ten million dollars that give out scholarships so it was a good investment for them but um so I went so I wanted to go into politics and that person who wrote that famous inaugural dress by John Kennedy's name was Ted Sorensen some of you may have heard of him he was 31 years old when he was the top advisor to President Kennedy Jacqueline Kennedy the first lady was only 31 when she became first lady it's hard to believe that she'll be first lady at 31 but Ted Sorensen had left the practice and when President came is assassinated shortly thereafter with President Johnson then he went to practice law at Paul Weiss and Paul Weiss was a famous law firm in New York because it in those days law firms in New York with their Jewish or not Jewish and if you were not Jewish law firms you know you're Jewish you weren't gonna get a job there this one was half Jewish half not Jewish so I went there because they had people like Ted Sorensen and Adlai Stevenson been there and a lot of other prominent political people I thought they would give me contacts after I spent a couple years there I was thinking about doing something else and I said to the people at I was practicing a lot with you know I'm thinking of doing something else I want to go into politics and government I might need this firm nobody said don't leave I said to my clients I might be leaving you know I won't be here anymore nobody said don't leave so I took it that I wasn't that great a lawyer I took a hint and I finally persuaded Ted Sorensen to get me an interview with somebody who's running for president so I could maybe wind up in the White House and he got me an interview with a man who was running for president States in 1976 this man's name was Birch Bayh and his son Evan Bayh just retired from the Senate Birch Bayh was thought to be a likely candidate get the presidential nomination 76 and Democrats are clearly going to win because Nixon and Ford were pretty unpopular so I thought if I get with Birch Bayh he's going to be nominee I'll get the job at the White House I'll be like Ted Sorensen I can do great public policy things unfortunately 30 days after I joined his operation he dropped out so I figured oh I wasn't that great at practicing law nobody thought it was a great lawyer and 30 days after I joined birch Boyd's operation he dropped out so my career is going nowhere and all of a sudden I got a call out of the blue as some of you will in your career from somebody I didn't know and I still can't remember the person's name who said I heard about you would you like to have a job working somebody else's campaign so I rolled my eyes and said who is it and they said Jimmy Carter and he's going to get the nomination and you can work in his general action campaign so I took the interview I got the job and I moved down to Atlanta to work in the campaign at that time Jimmy Carter was 33 points ahead of Gerald Ford at the end of after my work was done he won by one point so harder often said to me like what was your contribution you know I was doing much better before you showed up but White House staffs are not filled on merit they're filled on people working campaigns so at the age of 27 three years out of law school I became the deputy domestic policy advisor to the president I'd state's a job for which I was completely unqualified but I thought Carter was unqualified too so you know he he'd only been governor Georgia for four years he didn't know anything either so here I am I have an office in the West Wing the president I states is calling me asking me my advice and the reason was calling me all the time was this right in the transition he said I want to honor all my promises it was a usual thing for a politician to say maybe and the internet internet didn't exist then so you had to go back and and and if you want to know what people said and and while his promises where you had to go back and do all this research so he asked me to go back to read every speech he'd given the two years and all the questionnaires all the interviews and compiled all his promises so he knew exactly what he promised and then has sit in all the meetings with him so I could tell him whether somebody's proposing something would violate a promise so I'm sitting in meetings with the secretary of state security fence they're recommending things and and he president United States would say well David what do you think of that I said well violets are promised mr. president and he'd say I'm not going to do it so you know I had a lot of influence and you know there's no doubt there's no doubt you know if your parents are you know have no money and they're not very famous people and you're 27 years old and you are you know walking out of the Oval Office with the president ID states and you just the two of you getting on marine one to go to Camp David it's pretty heavy thing your parents are sitting there your friends are sitting there saying hey how did this guy get this job so it was great time unfortunately one of my Jobs was to fight inflation and I got it to 19 percent very difficult to do that and you know but people thought that I might get promoted and Carter's view is that the rumor that I would be the senior domestic adviser in the second term was what kept him from getting reelected I don't know if that's true but I long we lost the election and then I found out what people said in Washington is true if you want a friend in Washington get a dog because all of a sudden all the people told me how brilliant I was they wouldn't call me back I couldn't get a job couldn't get a job took me four or five six months before I could convince a law firm to hire me here I was in one day I'm at Paul Weiss next day I'm at the White House and then we lose an election nobody wanted next Carter White House aide so I had to go back and practice law again started at the bottom and once again none of my clients thought I was that great and none of my colleagues thought I was that great but I really didn't like what I was doing and my view in life is if you don't love what you're doing every day you've got to do something different you're never going to be great at what you're supposed to do if you don't love what you're doing if you don't want to come into work every day and do what you're supposed to do then you should do something else because life is too short and I didn't love what lawyers do in Washington DC so I was thinking about what to do and I read about a man named Bill Simon who was Secretary of Treasury and under under President Ford and after he left what he did is he bought a company called Gibson greeting cards and he bought it from RCA he put in a million dollars of his own money and he and he made 80 million dollars in two and a half years it was called a leveraged buyout which a new phrase and I said I see I like that you put a million dollars in and you get 80 million dollars doing it years so I went down the street to Bill Miller who was secretary of the Treasury in the Carter Administration he also been chairman the Federal Reserve and I said look you were Secretary of Treasury bill Simon secretary Treasury why don't you set up a firm in Washington that'll be the first firm in Washington does leveraged buyouts and he said yes let's do that and I would help out from the law firm but he set it up and he didn't really want to be a princess we want to be more of advisor so I was frustrated that for two or three years nothing was getting done so finally I said I'm going to get a leveraged buyout firm started and then as I was reading it reading about it thinking about it I read a thing in the newspaper that said that entrepreneurs have a time clock not unlike a woman's biological time clock and between the age of the 28 and 37 is when you're most likely to start a company and after the age of 37 your chance of starting company reduces just like a woman chances of reproducing let's say after certain age goes down so I was 37 years old when I read this and I said oh I my chance of ever starting a company is going down is going to be diminished if I don't do it so I said all right I'm not going to find other people my goal had been to find people knew something about leveraged buyouts and finance get them together and I would be maybe the lawyer for them but I said no I tell you what I can't wait nobody ICANN wants to do this I'll do it myself so I recruited two guys from Marriott and one guy from MCI person on a cold call I met him and we recruited him he had been the CFO and then the four of us came together and I convinced them all I had some money to do this with but they got there they realize that and have any money so we had to go out in the first six months we raised five five million dollars that's all we could raise two million to operate the company for two years and three million to invest that's all we had and then gradually we started doing deals and one got better than the other and the returns are good in the word spread and the firm grew and today as you heard it's the largest private equity firm we actually manage now at the end of April it'll be 150 billion dollars and we now have invested about seventy billion of equity over the years and it's out of gross internal rate of return of about thirty percent so if you can invest seventy billion dollars to get a 30 percent growth rate of return you're probably going to attract a lot of money and so we now have the largest investor base in the private equity world and the largest number of people and it's worked out pretty well for us and the reason it did what a couple things we did we did you know anybody that starts a company by definition you have to do something that somebody else didn't do if you're going to really be successful if you just try to replicate what somebody else did you're probably not going to be that great entrepreneurs or people who want to do something that somebody else didn't do and so aren't what we try to do was worth several things that nobody else had done the first was course located in Washington Washington was not a place that people thought you could do leveraged buyouts you did that out of New York so we try to say we're going to make an advantage of it and what we're going to do is is follow the advice of Everett Dirksen Everett Dirksen had been a Senate minority leader in the 1960s it helped the Civil Rights Act get passed since I'm an already leader and he said when you're getting kicked out of town get out in front and pretend you're leading a parade now what does that mean that means take advantage of the situation you find yourself in if you're getting kicked out of town tell everybody you're leading a parade well we said we're in Washington DC but we don't want to be in New York because we want to invest in companies that are heavily affected by government and what better way to do that by being in Washington so investors say well that makes sense you probably understand companies affected by government like Booz Allen Moore better than people in New York so we started raising money on that basis and we started doing deals companies based in Washington aerospace area defense area or telecommunications and then we came up with three ideas that really change the face of the private equity world one of which we got criticized for and we ended but one of them won that idea was to bring in people who are very famous from government because our theory was nobody ever heard of us but if I could in people who had been high fischels in government I could get my calls returned I could get meetings with people so we brought in Frank Carlucci been Secretary of Defense he could get people to call him back and and so forth then four years later when built when Jim Baker was leaving a Secretary of State I figured now what could be better than bringing Jim Baker great secretary of state record here Treasury in and I figured also if you want to raise money in the Middle East taking Baker there better name than Rubenstein probably raised the money the Middle East so so he came in and then we got former President Bush 41 to come in and help us in China and Asia where he was well known and then John Major so we had all these former people who were very very prominent it helped us get get going after a while we were criticized for it in the end I changed and I brought in Lou Gerstner as our chairman because we were being criticized or having undue influence which wasn't the case but but it helped us get started people knew who we were and even today people still think that Jim Baker or president Bush are still with us but the two things that we did that really changed the entire face of private equity were these things private equity was a mom-and-pop business historically you've had a small fund three or four people they have a fund and after they were done investing that fund they'd raise another fun when KKR did the famous RJR deal in 1989 they only had seven investment professionals that's all it was very small and we went out and raised the buyout fund then what we after we raised our second buyout fund somebody came to me and said are you going to put that in venture capital and I said no it's a buyout fund they said a 2-bit I'm looking for a venture fund well a light bulb went off my head said wait a second maybe I can have a venture fund now why is that such an unusual idea well all the partnership agreements said in all these buyout funds and venture capital funds you can only have one fund at a time you have to spend 100% of your time on that one fund well and people didn't think I was a great investor I'd made myself into the fund raiser and the guys managing the funds were somebody else so I thought nobody would care if I went out and started recruited a venture team and raised the venture fund around them and I did and we had a set we had a second fund that had never been done in private Airport nobody had ever had two different funds in the same time I said well this works when we do out of real estate and then we came up with the idea of having multiple funds centralizing the fund raising accounting legal and tax in Washington and having people that we'd give a large stake in the fund to and they'd also get some stake in the parent but we recruit all these people and so we ultimately created about 90 different funds which we now manage all over the world and now everybody else is more or less followed that pattern the second thing we did that change the face of private equity was to globalize the business historically private equity was a business where you if you're American you invest in America if you're Asian and Asia European and Europe we said why don't we take our brand name Carlyle and go to Europe and put it higher some Europeans and put our brand name on it and say we can do buyout deals in Europe just the way we do the United States now there's that's a big leap of faith just because you can do deals the United States doesn't mean you can do em Europe it's different culture different way of doing things but we convince people so we raised a Europe fund and Asian funds japan fund so we globalized and then we basically built the firm that way by institutionalizing it and globalizing and as you know the other large private IP firms are doing this as well today we've we now are in a situation where the firm is pretty well known around the world we invest all over the world and our biggest source of profits these days actually in China we are the largest project Lee firm investing in the emerging markets the emerging markets are clearly where the great upside is for people like us in part because the world has shifted a bit when President Kennedy was elected president the United States had 46 percent of the world's GDP we have 22 percent today so with for one-fifth of the GDP of the world and you're going to be a global investor you can't put all your money United States you shouldn't also in the under President Kennedy's day the United States economy was growing at 6% or so 7% a year today it's growing at 2 or 3% the emerging markets where the great growth is and where you can buy things at lower prices and so forth so it's a much more attractive area and we're spending a lot of our time in the emerging markets and now we actually have more people out of the United States and in the United States and we have more people we're investing more money out of United States we are in the United States and that trend Robbie will continue for a long time in my own case as we got to be moving forward the firm became successful I began to realize that I've made a fair amount of money and I when I turn 54 I read that somebody who was a white Jewish male at the own average would live to be 81 years old so doing arithmetic quickly I realized I had lived 2/3 of my life I said this on television once a Warren Buffett sent me a letter saying no your rithmetic was terrible because it's 81 if you're born in when you're born but actually if you've already lived to 54 you'll probably live to 85 he says I'm an actuarial guy because I own insurance company but ok so whether I love to be 81 or 84 85 I realized I'd lived 2/3 of my life more or less and I'd made a reasonable amount of money by a normal human standards and I decided that I didn't want to take it with me you know the ancient Egyptian pharaohs thought you could be buried with your wealth and there's no evidence that you really need that when you're dead so so I decided I wanted to start giving away I didn't want to be like these people you read about who have all this money and they die and then some executor gives it away in ways they didn't know or care about or would have cared about so I decided to start getting involved in philanthropy and starting helping organizations that helped me and helping cause that I thought were important and now I spend a fair amount of time on it I'll tell you sometimes I you know the things that are obvious like giving scholarships the universities I went through or or scholarships in areas that I live in or helping in medical research and things like that but sometimes you don't really know what's going to happen and sometimes I try to do philanthropic things in areas I didn't anticipate I'll just mention one of those areas one is is an area of trying to get people know more about our country in our history and toward that end when I was one day reading about an auction that was going to occur in in New York it was an auction of the Magna Carta the most famous document and let's say Western civilization and I wanted to go see this famous document so I went to Sotheby's where is it going to be auctioned off the next day and they explained to me that there are 17 copies of the Magna Carta the most famous document in Western civilization 15 of those are in British institutions will never be sold one is in the Australian Parliament and one was bought by Ross Perot in 1982 and he bought it from a British family had in his possession for five hundred years he paid about a million half dollars for it brought it back the United States and it was important because this is the document that really inspired the founding fathers when they were writing the Declaration of Independence the Constitution of Bill of Rights and we really part of our whole legal fabric and I thought it'd be important to keep in this country the curator said it was going to probably be sold to somebody in the Middle East the Far East but out of this country so I just resolved in my mind that I was going to go back the next night and as a gift of the country buy it and give it to the country now I didn't want to tell my wife I was going by the Magna Carta the next day you know sound a little presumptuous I'm gonna go buy the Magna Carta tomorrow I talked about it and I want to tell my children because I know they would say how much less money does this mean for us but I went back the next day and I rushed in there and I get to the other bees and since I don't really collect art I didn't know a place I said I got there five minutes before the auction and I say okay I want to go down there and bid like I see on TV you put your hands up I said no not go in this little side women will call you so the equipment on the side room I think they lock the door and then they put you in a phone and they start bidding and the next thing I know i won i bought the magna carta so the head of saw the beast comes in and says like who are you you know we don't know you and you do have the money right yes yes I have the money so okay you can slip out the side door and nobody will ever know who you are and as long as you pay and or you can talk to these reporters and they want to know who bought it so I said no I'd like to say that this country has been really good to me I came from very modest circumstances and what I want to do is make a down payment on my gift and my debt to the country so I'm going to give this to the country and so I gave it to the National Archives and since then it's led to my buying other things that I think are in the same thing I bought a copy a rare copy of the Emancipation Proclamation I gave it to the White House where it's in display in the Oval Office and I recently bought a copy of the Declaration of Independence and I put that in the State Department where people can see it now at the Benjamin Franklin room so my idea is they've let people see these documents and talk about American history so that's one of the kind of philanthropic things I try to do but anyway I think philanthropy is a really important thing that increasingly is a subject that businessmen should focus on because as we all make money we can't spend all this money really and we can't you know ruin our children's lives by giving them all this money so I think it's important to give it away and I am trying to do that it's not as easy as making it but I do feel that if you you know anybody honestly can make money if you work hard you can make money it's ring I what to do intelligent with your money is not as easy as it might seem to you but I do think that the advantage of philanthropy a you'll make somebody feel good and you'll make actually help something you'll make yourself feel good and then you know it's an option value you know there may actually be a heaven and in case you've taken out an option if there is a heaven you're giving away this money you know you never know you'd be better off anyway I do think that something I'm spending a lot of my time when it's philanthropy I would like to mention what it takes to be an entrepreneur and what it takes to to be in private equity or investing for a moment to be an entrepreneur and it was President Bush who famously said the problem with France is they don't have a word for entrepreneur but entrepreneurs are people who are driven to try to change the world let me talk about business entrepreneurs as opposed to social entrepreneurs for a moment business entrepreneurs are people who want to do something and change something generally they're not as focused on making the money as proving that their idea works and so the appeal of being an entrepreneur is you can be your own boss and you can say to yourself if it succeeds I created something I built something I made something happen I made the world a better place if your idea works now it's not that always that easy to do everybody doesn't have an idea that's going to work and everybody can't be Bill Gates or Mark Zuckerberg or at least people but you know a lot of times if you wanted to really change the world and make yourself your own boss being an entrepreneur is a very attractive way to do it it's not for everybody but the people who do well in that are people who don't listen to the parents because your parents will never tell you to be an entrepreneur the parents will say go be a dentist a doctor a lawyer or go work at IBM or something like that or Carlisle if you're one if you know you know you have to ignore your parents they're not going to want you to be an entrepreneur and kind of struggle for a while you have to be driven to try to prove that your idea works you have to be willing to recognize that your idea it probably isn't going to be the ultimate thing of what you do most people who start companies actually change what they do during the road Carlile's original business plan bears no relation to what we're doing now Bill Gates original idea bears no relation to what he's doing down the same would true with Mark Zuckerberg and others so you have to be willing to adapt you have to be willing to work through lots of tough problems and and and work very long hours and ignore creature comforts because you're not going to have a lot of creature comforts when you're starting you also have to be able to communicate you know if you don't know how to communicate people convince people to do what you want you're not going to convince people to buy your product your service so in making sure you know how to talk and communicate with people or write is very very important you also have to want to not make a billion dollars you have to want to you have to want to you know create a company if you're focused only on the money you probably won't be a great entrepreneur most entrepreneurs really wanted to prove that their concept work as opposed to just making money now at carlow we don't hire a lot of entrepreneurs to be honest entrepreneurs or people who are a little quirky and sometimes they don't fit in sometimes they're different different they may turn out to be Mark Zuckerberg but you know gets bigger and bigger you tend to hire people with different kinds of standards the best people in the world the best entrepreneurs are not going to work in car law if you're a great entrepreneur you wouldn't come to Carlisle you start your own company so generally we don't hire entrepreneurs we hire people with these standards I like to hire people who are reasonably intelligent I don't want geniuses geniuses are too complicated to manage and you know every time I've hired a genius I've regretted it I don't want genius I want smart people but not geniuses I want people that are willing to work hard you can never accomplish anything great nine to five five days a week nobody who ever admired for whatever they have accomplished did it 9:00 to 5:00 five days a week it just doesn't happen so I want people that are willing to work hard and you know not obsessively so to the point where they're just fatigued and can't get anything done but I want hard workers I want people that actually know how to work with each other you know people who are just don't always say I want this I want to do this this is my idea people that learn how to talk the word we and work as teams because that's what's going to work in a company like ours I'm looking for people that want to make a lot of money not necessarily spend a lot of money I want people that want the measurement of their success perhaps the men amount of money they make but they're not interested in buying yachts and all kinds of other things and living a lifestyle that seems inappropriate I'm interested in people who know who want to be part of a bigger company and want to make it grow better and feel like when they make a company grow it's something that's important to them and will recognize the firm is more important than they are because you need that mindset as well if you're going to work in a company like ours or some other thing and I want people that actually like the idea of being a principal the advantage of being a private equity is you make something happen you own something you're the boss as opposed to being an advisor and people that have that mindset I think are going to do well and every firm like ours so those are the kind of people that we are often looking to hire now let me conclude by talking about what I think the country's problems are in the economy then I'll be happy to take your questions and this is something that's very serious when I grew up although we had a modest circumstances in my family the United States was the dominant economy in the world and it has been the dominant economy for quite some time we've been the biggest economy world since 1870 we'll lose that title probably in 2030 or so depending how you measure to China now being the second biggest economy award isn't so terrible but we were going to recognize that our lifestyle of your lifestyle and your children's lifestyle is not likely be the same as your parents because the United States in relative terms is not going to be as wealthy and we have to make some changes and the reason we have to make some changes is that the so called emerging markets are now have emerged we've told the China and India and Brazil and other countries you should have a capitalist system you should have free trade you should let your people be well educated you should let information come in you should adapt to the best technologies well they've done it and now they're beating us at our own game so we have to adapt now one of the problems is we're playing with one hand behind our back and the reason is we've gotten fat and happy and the result is we have a government that's somewhat dysfunctional and we have a financial system that can't go the way it's going much longer let me explain what I mean we went into a recession the recession was deep it went all over the world but the result of the recession being so deep in the United States was that we've come out of it and a kind of half-hearted way we have too much debt still too much too high a deficit we have too high unemployment rate our dollar is really devalued in many ways and our moral authority that tell the rest of the world what to do in the economy is gone let me talk about the debt for example when President Kennedy was elected president United States we had a total debt of the United in the United States of about 240 billion dollars the total debt the United States government was 240 billion today it is fourteen point two trillion dollars fourteen point two trillion dollars Fannie Mae and Freddie Mac debt on top of that is five trillion more the unfunded Social Security Medicare and Medicaid liabilities are one hundred and seventeen trillion so we have debt or unfunded liabilities of the federal government for of 1 million dollars for every taxpayer in United States or 350 thousand dollars every man woman and child completely and totally unsustainable and to make sure you understand what a trillion is if a million dollars was put in a bank account the day that Jesus Christ was born and another million dollars of putting that bank account every single day for the next two thousand eleven years you wouldn't have a trillion about 700 billion well we've got you know 14 half trillion of debt plus the made debt plus the unfunded liabilities and we've about five trillion of unfunded liabilities in the States with the pension funds are underfunded so if we don't tackle that problem soon we are just going to be paying interest and we're just going to basically be in a country that cannot sustain itself the annual deficit in the United States today is 1.3 trillion dollars our budget the United States is 3.75 trillion dollars we had a fight in Washington last couple days should we cut that or not we cut it by about 3% 3% so right now we take in tax revenues every year of two point six trillion and we spend three point seven five zero trillion the amount of money we take in equals exactly the amount of money we need for entitlements plus defense spending everything else we're borrowing for we can't sustain that third is unemployment all of you are going to who are going to be in the job market will know this better than me the unemployment market the unemployment rate in the United States is a little deceiving historically in college textbooks it would say that the under full unemployment is four or five percent in Europe that was much higher we are heading towards a permanent higher unemployment rate as Europe is unless we do something about it and here's what I mean right now the unemployment rate in United States is officially eight point eight percent that is a completely fallacious number the reason is it counts only people who are looking for jobs in the last four weeks we don't count people if you stopped looking for jobs or you stopped looking you know a month or two ago two months ago the real unemployment rate the so-called marginally attached rate is fifteen and a half percent the black unemployment rate in United States is really about 20 percent the Hispanic unemployment rates about 16 percent that black teenage unemployment rate the United States is over 50 percent over 50 percent so unless we attack this problem we're never going to really and get jobs and we're going to have a very high unemployment rate it's going to make our country much less productive and in the recent recession three-quarters of the people who lost their jobs were male now we have more women the workforce the first time in our country's history and it's probably going to prove a lot of I'd say social dislocation as a result of that the dollar we are the only reserve currency in the world and the reason that our dollar has stayed as well as it as that's high as it has relative other currencies because we're the only reserve currency but the dollar is really steadily going down in value a dollar from 1960 buys 14 cents today dollar from 1980 buys 55 cents today and the dollar is going down it's going down about real value about 10 percent over the last year and a half or so if the Euro had gotten its act and the euro had worked better the Euro would be much higher than it is against the dollar today and the RMB is what if it was freely traded we much higher than it is today right now if because we're the only reserve currency people have to buy dollars but if there are other reserve currencies that come along that dollar will go down dramatically so if we don't solve our dollar problem and make it clear that it's going to be the really the only reserve currency in the world and deserves to be if we don't solve our debt problem we don't say our deficit probably don't suffer unemployment well the United States cannot be competitive with other emerging markets or emerging markets around the world we were the greatest emerging market at one point and then the 1700s 1800s the United States was an emerging market and we became the greatest emerging market in history of the world Japan was the greatest more emerging emerging mark in the 20th century the last half 20th century they became the second biggest economy world obviously in this century China is the great emerging market in India and Brazil and we have to play catch-up a bit now we have some advantages in playing catch-up we have the greatest university system the world it's our India system in the world we have the freest economy in the world we have the I'd say the best rule of law in the world we have the the most transparent financial system in the world but we have a lot of problems we have to attack them and then people in Washington are not tackling them Washington is very good at solving crises when it's right on top of them and the world's about to fall apart chronic problems they can't solve whether they can solve the debt limit problem and the other entitlement problems I don't know but right now you have to be somewhat pessimistic about the United States ability to solve these problems so my hope is that all the great resources we have and all the great things about the country will ultimately come together and make Congress do what it needs to do to solve our debt problems our deficit problems and other things so I hope all of you will recognize that you've got to do a lot of work to build a lifestyle and build a job and a career for yourself more than you would have done 20 years ago because it's been harder to find good jobs in this country unless we make some changes and we're going to have much more competition from overseas than we once had now many of you are from overseas and maybe going back to those countries those countries are going to be much more competitive the United States than we've ever had before and for United States to be what it once was and I think we've got to make some real changes I'm not completely optimistic we can do them in the short term but anyway let me end there and say that I think all of you you know have the potential to be entrepreneurs no doubt if you want to all the other potentially private-equity I'm happy to talk about the virtues of private equity versus other things or how to get a job and I don't have one for anybody but their resumes but I'm happy to talk to you about any of the subjects I talked about so thank you very much yes sir Deputy Assistant sorry I was wondering if you could talk about your time as Deputy Assistant for domestic policy and what advice you would give to someone that was looking to go on the public policy or public service quit okay when President Kennedy made his famous speech I thought that public service meant going into government because that was really what government and public service meant I now think that the world has changed and NGOs can do a very effective job of helping one contribute in public policy and I think there's so many socially on social entrepreneurial related companies who could our organizations one could join you can do a great deal so well I don't think you have to go in the government in order to serve your country or to serve improve the public policy but if you do want to go in the government I do think it's you have to do it one of two times do it very early or do it relatively late you know I think going to government when you're in your 40s in your mid of your career it's very difficult because transitioning in and out is not as easy as people would like it to be we do allow people to transition in and out of government in this country much more than other countries other countries you're either in government or you're in business you can't go back and forth this country you can but I think it's very good to do it early and and as you do it early you know you're you're young and you can afford the lower incomes you're probably going to get you have the energy to work these long hours and I think you know it's a matter of luck yet in getting these jobs again they're not filled on merit I think to be honest it doesn't make much difference what you do before you're 30 my theory is that that you know you should try many different things because you won't know what you're really going to do or want to do with your life until you're probably in your 30s and you should try different things you don't want to be 40 years old or 45 and looking back and say I wish I tried different things when I was younger I did I'm glad I'm upset I spent all my career at 25 years at one place or another try different things and experimenting try to get a job in public policy or public service if you want I think it's much more fulfilling in many ways than business in some respects because you think your chin you're helping the world a little bit or you're helping the country a little bit but I would recommend doing it earlier rather than later yes ma'am okay the greatest challenge facing my company and in the industry or my company alright the greatest challenge facing the private equity industry now is this we've gone through a deep recession and now we're coming back out of it and deals are getting done again and distributions are occurring but we have to make sure that the thing that made the private equity industry grow was the rates of return the rates of return in private equity overall are better than the rates of return in public market indexes so if you were in overlay us five years 10 years 15 years in a public market index United States S&P 500 for example and you were in an equivalent of a private equity index you would be better off by being in the private equity by 300 to 600 basis points but if you run a top quartile private equity firm you would have been better anywhere by two to nine times over the public market index so whether we can continue to get these rates of return that make it so appealing that people to give us money is a challenge I think rates of return for private equity to come down probably public market returns have probably come down as well but I think the challenge is sustaining the returns secondly is keeping the Congress away as Will Rogers once famously said the country is never safe as long as Congress is in session and I think that's my view so Congress could do some things to upset the private industry and change the way things are taxed or a whole bunch of other things so I'm always worried about Congress third we have to recognize that the challenge that the private equity tree has is a bit global in this sense that all the global private equity firms are based in America we're 22 percent of the world's economy we're 100 percent of the global private key firms that can't continue very long right now people in China are invested Chinese let's say insurance companies or people in China or Chinese government is investing with us in China to invest in China and I have Chinese natives doing the investing for us at some point people in China will say wait a second what do I need Carlow in the middle of the Act well let me create a Chinese global private IP firm based in China and just give the money to Chinese natives and it does and have all the profits go to China so at some point other parts of the world we're going to wake up and build global private equity firms like we have in the United States another challenge is is just making sure that the industries image is better than it has been the industry's image hasn't been wonderful for birthday parties and other things that people have done that got bad press and so we have to make sure people understand we actually create jobs pay our taxes don't take jobs offshore care about the environment extent we convince people that that and it's true we'll be better off if we if we ignore all those concerns we're going to have some problems it for my own company the biggest challenge is at the moment that the founders are 61 years old which when my father turned that age you know I thought it was ready for nursing homes 61 seems like a teenager today but at some point the laws of inevitability are such that I have to have younger people ultimately run the firm and so the transition will be difficult because all transitions are going to be difficult and when you have an entrepreneurial company all entrepreneurs do not think that anybody can succeed them because they'd say look if you are a great entrepreneur you wouldn't be at this company you want to start your own company so the people that I have that are below us now are really good but they're not entrepreneurs and all of us who are the senior people that started their company maybe you want people with more entrepreneur instincts but in the end we will ultimately have the transition and whether whether the firm can sustain a transition you never know sometimes firms can do it and sometimes firms cannot we're not leaving anytime soon but that's an ultimate challenge we have it's as a transition of management and leadership yes sir right it's disappeared I couldn't hear your question no I all right let me let me explain for those who ah like the Orioles better but let me explain for those who are not intricately I'd say following this with with the care that I have here here's what happened and it just shows you the power of an idea in the mid-1930s when people were developing or drilling for oil in the United States the people that were raising the money to drill for oil they were called promoters and when they kind of raised the money to drill for oil they would get a piece of the profits it was caught a promote or something like that a carried interest and they it was taxed the IRS said then well you kind of took a risk it's not a salary you might not get paid it doesn't well well doesn't come through yeah well tax that as a capital gain so when real estate partnerships were formed in the 60s and 70s they had the same principle and venture capital partnerships and private equity partnerships the same principle the people that put these deals together even though they or may not be investing their own money they are taking a risk is the theory and therefore it the profit the profit share the 20% should be taxed at capital gains rates not ordinary rates now that wasn't such a big deal when the ordinary rate in the capital gains rate wasn't that big a difference as when the ordinary rate went outside it's 35 and the capital gains rate is 15 it's a big difference well a law professor at the University of Illinois our article several years ago saying by the way do you realize that these terrible private equity people they're being taxed at capital gains ordinary rates not capital gains rates and not adding any value to society why doesn't Congress do something about this well he then got 535 copies that article and sent one to every member of Congress it's good idea and they all said hey this is interesting I don't think more than three members of Congress knew about it so all of a sudden it was seen as a way to pick up revenue and all of a sudden people are saying you know that Warren Buffett's or the my assistant or has a higher tax rate than then or pays more taxes than I do or something like that higher tax rate I should say not more taxes the higher tax rate so it got to be a good bumper sticker issue and so forth it I was surprised that it didn't pass the Congress because private equity people are not beloved we were not beloved and we didn't have the sway in Capitol Hill and so what happened was it's an effort was made the change at a couple times it almost passed this time and the reason it didn't is this and this is a lesson when you have something within your graph don't get greedy and reach for too much what happened is Congress had the ability and the votes probably to pass this that would change the rate from the ordinary to cap the Capitol ordinary but the people on Capitol Hill on the house side thought they had so much leverage that what they did is they said not only do we want to change the rate for people like us but if people like Carl I want to take their company public and sell shares that the that the shares when we sell them are to be taxed once the profits we get are to be taxed at ordinary rates not capital gains so in other words if Bill Gates sells his company his shares are taxed to him at capital gains rate if you're in private equity you'll be taxed at ordinary rates so people began to say well why is that fair that we're treated differently than other companies and so by overreaching and not focusing just on the rate for the private equity the house I think reach for too much in the Senate wouldn't swallow it so in the end it got killed today it was thought that we're not going to change taxes for two years we just went through this in the lame-duck we did some things with taxes and people said we're done with taxes for two more years day after the presidential election but because we have such a financial problem now and Congress begin to focus on it I suspect that there'll be some changes in taxes before the next presidential election and this is a target it doesn't pick up that much revenue picks up about if you change the capital gains or the carried interest rate it picks up about 22 billion over ten years not a gigantic sum but politically it's difficult to keep from doing it so I suspect at some point it would change but I don't think it will change quickly that's more than you wanted to know but yes sir right so when you're sort of the success that you achieved over the years how much of it would you attribute to sort of picking winners side how much would you attribute to being able to bring resources to your portfolio companies in terms of customers and connections and on exit as well and then in that context what advice would you give to a smaller fund that didn't necessarily have that influence okay well the private equity industry was relatively easy to do in the early days when these deals were called bootstrap deals now they would originally were called bootstrap deals in 1970s then bootstrap was not seen as of good words they went to leveraged buyout then word leverage became odious they went to management buyout biopic a modi's they went to private equity now we're looking for a new name still but we in the early days of private equity you were by companies or three or four times cash flow 5% equity 95% debt and the US GDP was growing at 6% so you could go to the beach and the leverage would enable you to kind of make a fair amount of money just by incentive manager today if you're putting in 50% equity 50% debt u.s. GDP is growing at 2 or 3% and you have to pay eight or nine or ten times cash flow you got to really roll up your sleeves and and and do something to make that company so much more efficient that you can get 25% rates return so all the private equity firms have cogniser and all the larger ones now say hey we're different than the other guys because we have operational managers we have Lou Gerstner we have Jack Welsh we know how to roll up our sleeves we add value we're really much better at adding value post the acquisition and I think all of them have really struggled to actually prove that any one model works in other words the large global private key firms have more or less the same rate of return on their major deals even though they all use different methods to get there so it's not clear that any one method is better in Carlile's case what we try to say that our competitive advantage is is that we have a global network we have people all over the world who are able to have expertise and give an industry so we're buying a kardama build company in China I can take my automobile pay for New York move them over and and and they can understand the industry and by being so global we have the ability to help all of our companies all over the world so what we're selling is our global reach we're also selling our kind of not high risk-taking profile which we we have a kind of modulated way a low beta way of doing investing and so we don't take high risks and that's kind of what we're selling other firms are selling different things but the surveys show that most of the investors don't think that the big private equity firms are all that different honestly from each other so we're trying to each distinguish ourselves from each other but I don't think we're successfully doing so at the moment for the smaller firms they have a more competitive problem because they're not as well known and it's hard to get people to listen and the surveys show that people don't want to be in first funds anymore or new organizations they want to be with the tried and true you know the old saying you can't get fired for buying IBM well now you can't get fired for investing a black Center TPG is the theory so getting new funds off the ground is very very difficult I have to look at each specific case but my view is generally find something that is distinctive about you and just push it push it push it make it you know people remember what your why your different to somebody else you've got to make people think about you and they and they're only going to remember one or two things and you got to you know push that one or two things - they just can't forget it yes sir yes most about the habits well I won't mention names but there are a lot of people who the Bill Gates pledge the Warren Buffett and Bill Gates pledge what it says is you're going to give away half your money by the time you die or went your death to me what good is that I mean you should give it away while you're alive so you can enjoy it and actually see the benefit of it but why wait till you're dead to have give away half their money they wanted that to front-load it earlier but a lot of the people just wouldn't have signed up for it because they'd already got their state's plans a lot of people were afraid of it what it frustrates me the most is you'll see a very wealthy person might be worth five billion ten billion dollars gives away nothing during his or her lifetime and at death they leave it all to somebody else to figure it out jack kent cooke I'll mention his name he he was a football owner on the western Redskins gave away virtually no money while he was alive he dies he doesn't leave his team to the Sun he puts it all up to being a foundation at the foundation is great it gives away scholarship money maybe some of you have the scholarship but it's about two billion dollars under two and a half billion dollars gives away a lot of scholarships of good people why didn't he do it when he was alive there's another well-known man who died recently John Kluge who's a great philanthropist but at one point when he was 94 years old he gave Columbia University his alma mater I think four hundred million dollars for undergraduate gifts upon his death what you know when he was 93 or for what how much more did he need to wait for me did he need that extra 400 million for the last two years of his life I don't know so my frustration is a lot of people give away money way too late or they wait till they're dead and they don't they should they should actually get involved and try to manage it with the same care that they do with their investments so I wish people would just give away not the other problem with the pledge that I'm trying to deal with is it's associated with billionaires giving away their money in extent that philanthropy is seen as a billionaire boys club and people are giving away 50 percent of the money upon their death I don't think it's going to be that useful what we need to do is convince everybody that everybody is a philanthropist and can be a philanthropist with their money or their time and everybody should be encouraging away something it's not 50% 10% 5% so that everybody in the country is doing something not just the billionaires and that's when my frustrations with that pledge so question yes sir good aspects of faith a couple of times could you talk a little bit about how your faith in Franklin decisions career-wise lifeWise - Biddle um well you know I was in this Jewish ghetto but I wasn't that Jewish really in the sense that I went to synagogue a lot and so forth and dot I was operating the premise that you know maybe I could get to heaven by just you know not doing something bad as opposed to doing something good and so I'm not that religious in that sense but I do have a view that you know you don't have to be particularly gene or be religiously observant in order to do things that are good or to worry about what other people are helping to make other people better than they are what my view is that we're all on this earth for a very short period of time you might seem long to you when you're studying one-nighter and you've got a problem but we're going short we're on earth very short period of time relative to the amount of time that the earth has been around and during that period of time you have a relatively small period of time where you could really make a difference and so what I think everybody wants to do on their deathbed or near their deathbed is say I spent more time with my family everybody always says the same things I want to spend I wish I'd spent more time with my family and I wish I'd done some things to make the what a better place and what I want to do is convince more people that they should think about how to make the world a little bit better place in their own neighborhood a better place and in my view that's kind of a religion which is to try to get other people to feel better about what their situation is how to help other people and you can if you have money give it away your time give it away to out ideas give that away and try in the end to use that as a religion so I kind of that's how can I look at my religion really and you know I I probably am not as observant or involved in Jewish affairs as some people might think that somebody in my background is I just tend to be not as involved in the organized religion as other people yes sir yes the ones that win Oh what got away here are the ones that got away one I sort of got away recently was my daughter went to Harvard she met a person she married recently his roommate it Exeter was a guy named Mark Zuckerberg and so when he was at Harvard when I bought my daughter started going out with him he said you know I got this guy named Mark Zuckerberg he's going to start this new company he's going to drop out of college would you like to meet him I think he's gonna look for some money I said now what's the chance of another Harvard dropout really making a success himself now I don't know but I'll give you an example of another one that I screwed up on Karla bought a company called Baker & Taylor the second largest book distribute United States starting 1839 had not made a profit since 1839 not not a very profitable company but from WR grace and in a book book distribution wasn't that big of business and so it's a very modest margin so one day at a board meeting a Salesman said well I got a new idea how to make money we published the only bibliography in the United States of all the books in print other than the library Congress and they don't sell theirs so we can sell our bibliography that people want to know about bibliographies and I got an idiot they came in the other day and wanted to buy it for a hundred thousand dollars a year for five years five hundred thousand dollars so we're going to get extra profits it's not a good idea so a couple months later I'm reading about a guy in Seattle who's going to start a book company where he's going to sell books over the Internet I call it the salesman said hey there's another idiot out there probably needs a bibliography says no that's the idiot that I already sold it to so wait a second you're only getting $100,000 a year from this guy I think I heard his company's going to go public I got to go out and see him so I went out to see Jeff Bezos and I said you know I read this contract and you know I wish we'd gotten stock instead of cash he said I would have given you a half the company the time I had nothing you had the only thing I needed I don't want to give you half the company now but I'll give you some stock and he gave us up stock that became worth if we held on till a couple billion dollars we sold it right away at the IPO because we didn't think to come to get anywhere but but I wish we had taken the half the company the beginning we should have thought about that but a lot of deals like that got away the best deal we ever did and the deal actually is the most successful deal in the history of private equity we did it co in China we bought an insurance company in China called China Pacific Life it was unprofitable the time we put in about seven hundred twenty million dollars and with partners and we've made about a six and a half billion dollar profit and that is a big profit for anybody and on one deal I don't think anybody else in Project has done that we're now in the process of liquefying it but it's a great deal that was our best deal I wish I had more like that yes the key what the key thing missing for business school education today I never went to business school I don't know but I would say you know I do think that business ethics is something that should be taught I don't know whether all the schools doing it maybe they do but it is surprising to me that some schools I don't think have a strong enough emphasis on business ethics I also think that one thing I would recommend that people do that isn't just business is this and I alluded to it earlier there's a guy named Richard Neustadt who was a famous professor at Harvard Kennedy School and he wrote a book called presidential power came out in 1960 around then and what he said as a president only has the power to persuade people only has a power to persuade he can't force people do anything and I thought about that for a long time and really what business people have is only the power to persuade somebody because in business all you can do is convince somebody to buy something from you or you're trying to convince somebody to buy something a service or something and you're always trying to convince somebody something else in business you can't do business by yourself a writer can write something by himself Einstein could sit by himself and come up with a theory but in business you're always selling somebody something or another or trying to convince somebody something and I think business schools don't from my judgment have a good enough emphasis on how you can improve one's communication skills and they're two types of communication skills writing and talking and very often students come to me who are you know straight A's and their best business goals but they can't talk they can't communicate and they can't write and I think business schools will be better if they learn how to teach people how to communicate because in the end communication is everything I also think people should learn in business school a little bit more about philanthropy and what to do with money once they get it as opposed to how to make it all and then they're not often taught in business schools how to be socially responsible with the money you get and how to be philanthropic and I think those would be improvements for two more questions okay yes sir well principals were these one always put the investors first we always emphasize that the investors have made it possible so we have to have a fiduciary mindset we say the investors always come first second we put our money where our mouth is we put up four billion dollars of our own money alongside the investors so we try to convince the investors that we believe in everything we're doing we're parallel to them third we have a philosophy called one Carlyle everybody is part of the firm if you want to worry only about your fund or your area you're not going to be in the firm very long if somebody from Australia calls somebody from in Europe and says help me on something it doesn't help they want going to be the firm very long so everybody has to pull together and have a common culture great organizations like McKinsey or others when you study them what they have in common is a common culture and what we're trying to do is have a common culture and we think we've done that and that's one of the important things as well we also try to make sure that we spread the wealth within the firm we don't want this the founders and the senior people have all the wealth so we spread the wealth to everybody in the firm and let me think that's an important principle that's helped us a lot and also taking not taking undue risk we try to be very mod modulate that the kind of risk-taking we take in in the public equity world there's a thing called the Sharpe ratio which more or less tells you whether you're your stock is very volatile you've taken undue risk to get the return an equivalent statistic or measurement doesn't exist in private equity so if I tell you my rate to return to 30% and somebody else is 30% you don't know whether I've taken bigger risk to get that or not but generally we think we don't want to take big risk and we think we've convinced people that to get the rates of return we have we're taking very very modest risk and last ethics we have a strong emphasis on ethics and making sure that people are highly ethical in the conduct that they that they engage in yes ma'am how did you convince people to give you guys five million dollars for your first fund when you guys say about again how did you convince people to give you five million dollars for your first one even though you guys did have a track record up down on my knees they go ah well we didn't have a track record but we had some people that knew us so we you know we he talked about our resumes and our backgrounds and and we had a lot of strings attached to it and so we didn't have that much money the trick was how do we go from five million to our first fund of a hundred million then a next one about 1.2 billion and what we did is we you know we would do one deal and then the deal would lead to another deal and the long as the record was pretty good people would give you money money flows very quickly if you have a good track record so we're very cautious and and originally we just use some original context whenever you're raising money initially you're probably going to raise it more likely people you know the people you don't know and it's very difficult today to get first funds off the ground but we were lucky and it took us a long time to raise that money wasn't overnight and our first deal anybody wants to know what our first deal was not like successful was called chichis anybody ever heard of the Mexican restaurant chain so in those days we bought four point nine percent of the company and we went to see the CEO and said we want to buy the company the whole company we thought he'd throw us out of his office because you know he never heard of us and we were to our shock he said yes I hate my board I hate being a public company let's go well we only had enough money for the 4.9% we didn't have the rest so we had to go out to a guy who then had in those days had minted money our way to make money they Michael Milken he had invented more or less than using a junk bond for financing and we went out to see him and I never forget and he's I know I'm reasonably long now he talked about this Mexican food company kept talking about the the value and the joys of Mexico we said no this is Mexican food it's the United States not Mexico but ultimately gave us the money in those days he had the ability to print money more or less he gave you a letter that said highly confident he was highly confident that he could raise the money and that was like it's worth its weight in gold it was the equivalent of money so that was our first deal we made some money on it but in the end one thing leads to another and we had a reasonably good track record and it kind of fed on raising more money so let me thank you all for your attention and I appreciate you take the time okay well what a wonderful experience for everyone that's been here tonight and we definitely did save the best for last thank you we could not I can't thank you enough for coming here and sharing all your work your vision and your your words of inspiration and making everybody laugh a few times as well just thank you on behalf of the University of Maryland president LOH lean on it and Dean Courtney thank you thank you very much I tell you I almost almost didn't make it here there I'm very happy I did but I'll tell you how it came about and just keep this in mind I had some other things to do today and and I had that I wanted to change and look a little fresh when I got here because I doing a whole bunch of different things so I was coming here I said to the driver look I need a motel so I can change and shave and go for so let's find a motel on the way here if I was coming from Washington and and we driving along confronting motels nothing finally we find an old beaten down motel and I go there and I say I need a room for 30 minutes and I really yes are you by yourself no I have this guy in the car with me and I said and she said do you have any credit cards no I don't have my credit cards with me oh really and and how am I going to know who you are well I'll just pay you cash oh really let me talk to the manager the manager comes out and says now you want a room for 30 minutes you know what kind of place you think we are you know I said well I don't know what kind of place you are but I only need for 30 minutes just want to take a shower and change and he said well you can't just do this by the hour here so you'll pay the full rate what is it $40 okay so I'm in there I'm taking a shower and I'm thinking you know if I have a heart attack now and die the headline is going to be Carlile co-founder wanted to rent a room for 30 minutes anyway fortunately that didn't happen thank you

Channel: Maryland Smith

Views: 51,144

Rating: 4.8821054 out of 5

Keywords: equity, Rubenstein, David Rubenstein, Carlyle, The Carlyle Group, private equity firm

Id: E7AyYjAUumA

Length: 63min 9sec (3789 seconds)

Published: Wed Apr 13 2011