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Contents // JUNE 13, 2017 VOLUME 199 NUMBER 6 

ON THE COVER 

70 | BANGLE BILLIONAIRE 

By turning what women wear 

on their wrists into an affinity 

statement, Carolyn Rafaelian 

has grown the hippie brand 

Alex and Ani into a $1 billion 

company. Now America’s richest 

jeweler is working on world 

domination—and maybe an IPO. 

BY CLARE O’CONNOR 

COVER PHOTOGRAPH BY FRANCO VOGT FOR FORBES 

GROOMING: SUZANA HALLILI FOR DR. GRAF & ANDIS 

2 | FORBES JUNE 13, 2017

JUNE 13, 2017 

11 | FACT & COMMENT // STEVE FORBES 

How to make health care better and cheaper. 

LEADERBOARD 

16 | THE JEWELRY QUEEN’S CASTLE 

In 2012, billionaire Carolyn Rafaelian picked up a decrepit mansion in 

Newport, Rhode Island. Hundreds of workers, millions of dollars and 

some new chandeliers later, it’s getting its shine back. 

18 | HELLO, DOLLARS! 

Billionaires are everywhere behind the scenes on Broadway. 

26 

20 | ON THE BLOCK: TIME MACHINES, WAR MACHINES 

Yul Brynner’s Fabergé clock and an ornate sheep-bone guillotine 

scene: two of this season’s offbeat auction items. 

TIMOTHY ARCHIBALD FOR FORBES. COLE ZUCKER AND GUILLAUME VIDAL ARE WEARING PANTS AND SHIRTS FROM HUGO BOSS; JACKETS FROM SUIT SUPPLY. 

FORBES FASHION DIRECTOR: JOSEPH DEACETIS 

58 

46 

22 | NEW BILLIONAIRE: BURGER BUCKS 

In-N-Out scion Lynsi Snyder has completed her inheritance of the cult 

fast-food chain, boosting her personal fortune to ten figures. 

24 | DEAL TOY: ONE FOR MICKEY’S MANTEL 

Two decades ago, the ABC/ESPN merger with Disney was the rare 

media tie-up that worked. 

26 | LUXURY LINEAGE: THE CORVETTE AT 65 

It’s by no means ready for retirement. A brief history of 

the sports-and-muscle car. 

28 | THE RICHEST RAPPERS 

Who’s on top in the only hip-hop stat that matters? 

Plus: Internet of Things stalwart Tom Siebel talks 

tech—and a memorable safari. 

30 | FORBES @ 100: NOVEMBER 15, 1952: BLADES OF GLORY 

Gillette corners the market on the midcentury male face; U.S. Steel at 

its apex; wide-screen cinema the hot new play; Forbes likes Ike. 

32 | CONVERSATION 

Readers wonder how we can call the congenitally privileged Josh 

Kushner “self-made”; debating the merits of the social-media stars. 

STRATEGIES 

36 | THE WIZARDS FROM OZ 

Enterprise software giants use armies of salespeople to hawk imperfect 

products and endless updates. The two Australian billionaires behind 

Atlassian have built smarter tools that sell themselves. 

BY NOAH KIRSCH 

PLUS: THE GLOBAL GAME CHANGERS LIST 

44 | HOW THE WEST WAS WON 

Despite making a series of smash-hit games for its home Asian market, 

NCSoft struggled to translate to America—until its billionaire founder 

put his MIT-educated wife at the controls. 

BY DAVID M. EWALT 

TECHNOLOGY 

46 | BIG PHARMA’S FRIEND 

Peter Gassner rebooted Veeva Systems, and his gambit has created the 

ultimate pharmaceutical tool. 

BY ALEX KONRAD 

PLUS: THE FAST TECH 25 

50 | CLASS APP 

By listening to its core audience—teachers—ClassDojo’s educational 

software has reached 90% of U.S. schools. Now the real work begins: 

how to get someone to pay for it. 

BY KATHLEEN CHAYKOWSKI 

FEDERICO WINER (TOP) 


Here’s to 

breaking 

more glass 

ceilings 

From boardrooms to the golf course, and 

everywhere else, the sky is the limit for 

women pursuing their goals. 

The 2017 KPMG Women’s PGA 

Championship, a world-class, major golf 

championship, and the KPMG Women’s 

Leadership Summit inspire women to 

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Learn more about KPMG’s continued 

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KPMG.com/WomensLeadership 

@KPMGInspire


ENTREPRENEURS 

54 | GOOGLE SLAYER 

Starting with $15,000, Jorn Lyseggen built a version of Google Alerts 

before Google Alerts. And despite the big-foot competition, Meltwater 

has found the talent to forge a $300 million company. 

BY ZACK O’MALLEY GREENBURG 

58 | LIGHTBULB MOMENT 

It took a trip to China for the founders of Green Creative to spot an 

LED-bulb niche in the U.S. 

BY JEFF KAUFLIN 

INVESTING 

62 

62 | WALL STREET’S ROBOCOP 

Tim Estes’ insights into language and meaning are 

helping detect terrorists, human traffickers and market 

manipulators—and making him rich. 

BY ANTOINE GARA 

66 

66 | BUILD THE WALL! POR FAVOR. 

Trump’s incendiary tweets against Mexico are music to 

the ears of BlackRock’s intrepid emerging-market portfolio 

manager Gerardo Rodriguez. 

BY KENNETH RAPOZA 

FEATURES 

80 | THE IT GIRL 

Former news anchor Jamie Kern Lima began testing makeup 

a decade ago to help cover her red, blotchy skin. That experimentation 

led to the creation of IT Cosmetics, which L’Oréal snapped up 

in 2016 for $1.2 billion. Now she’s plotting to turn IT into the largest 

beauty brand in the world. 

BY CHLOE SORVINO 

86 | AMERICA’S RICHEST SELF-MADE WOMEN 

These 60 entrepreneurs, innovators and entertainers made their money 

in everything from makeup to finance. Altogether they are worth a 

record $61.5 billion, 17% more than a year ago. 

EDITED BY LUISA KROLL 

94 | THE LOOMING RETAIL BAILOUT 

Think America’s retail industry is hurting now? It’s about to get way, 

way worse—and these nine charts prove it. 

BY GEORGE ANDERS 

100 

100 | THE BIG CHEESE 

From Pizza Hut and Domino’s to Little Caesars and Papa John’s, 

the vast majority of pizzas in America feature mozzarella from one 

company. For the first time, secretive billionaire James Leprino 

explains how he built a cheese juggernaut. 


LIFE 

106 | THE SECOND TIME AROUND 

When watch collector Pascal Raffy bought the venerable Swiss brand 

Bovet, he reinvented the company—and himself. 

BY ROBERTA NAAS 

108 | THOUGHTS 

On pioneers. 


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Fast Times 

At Forbes Media 

BY LEWIS D’VORKIN 

THESE ARE BUSY TIMES at Forbes. First, there’s the news cycle. 

I’ve never seen it faster in my four decades in this business. For 

that we can thank Donald Trump. Money, taxes, health care, budget 

deficits, regulatory changes, conflicts of interest and, of course, 

foreign affairs. Our staff reporters and contributors race each day 

to stay on top of it all. Our cover package “In Trump They Trust” 

kicked off a tour de force of coverage in a recent issue of the magazine, 

25 pages from start to finish. 

Another group at Forbes running hard includes our product 

and technology specialists, recently combined into one 50-person 

team. Editors and reporters cannot live without the new jobs of 

journalism: product managers, project managers, developers, interactive 

designers and technologists of every kind. Here’s some 

of what they’re up to: 

t5FTUJOHBDVUUJOHFEHFNPCJMFTJUF'PSNPOUITXFWFCFFO 

building a new technology structure and creating new forms of 

text, video and graphic content on m.forbes.com, a Web application 

running parallel to Forbes.com. It has an entirely new visual 

and navigation construct, and loads in less than a second, one of 

the fastest in the industry. 

t#VJMEJOHBOFXDPOUFOUNBOBHFNFOUTZTUFN"QVCMJTIJOH 

platform is the lifeblood of any news organization. We are starting 

from scratch with a mobile-first sensibility. The system will 

support our new mobile and desktop sites and ultimately feed 

content to the big social platforms. 

t-BVODIJOHBQPEDBTUOFUXPSLXJUIPVSQBSUOFS1PEDBTU0OF 

the largest advertiser-supported podcast network. We now have 

five weekly shows: the Forbes Interview, Forbes Under 30, Sports 

.POFZ.FOUPSJOH.PNFOUTBOEUIF-JNJU%PFT/PU&YJTU8F 

plan to add a Forbes celebrity show and others in coming months. 

t%FWFMPQJOHTVCDPOUFOUCSBOETTVDIBT'PSCFT1BTTQPSU 

XIJDIGPDVTFTPOMVYVSZUSBWFMBOE-FWFM6QXIJDIBEESFTTFT 

younger audiences about money and careers. Each carries 

a newsletter (and may have a podcast)—and lives on both 

Forbes.com and social networks. 

If that’s not enough, our video team is cranking out pilots 

related to our 30 Under 30 franchise, Women@Forbes and other 

topic areas. Sponsors are showing keen interest. 

&EJUJOH3FQPSUJOH1SPEVDUEFWFMPQNFOU5FDIOPMPHZJOOPWBtion. 

These are not silos at Forbes but interconnected groups of 

people who know the job of meeting consumer needs is a shared 

responsibility. In other words, we’re one big newsroom with one 

goal: producing the highest-quality journalistic products. 

That’s how we plan to stay ahead in a fast-paced world—and 

handle whatever Donald Trump throws our way. F 


Suchi Mehta, Sheraton Associate since 2012 

We go beyond 

so you can too.

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auto insurer 

FXVWRPHU 

satisfaction 

OLFHQVHG 

agents 

Helping people 

since 1936 

The other guy. 

The choice is yours, and it’s simple. 

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b 

The same goes for car insurance. Why go with a company that offers just a low price when GEICO could 

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FACT & COMMENT 

“With all thy getting, get understanding” 

HOW TO MAKE HEALTH CARE 

BETTER AND CHEAPER 

BY STEVE FORBES, EDITOR-IN-CHIEF 

THREE BIG THINGS remain to be done to 

turn health care from a seemingly hopeless, 

ever expanding liability into a superinnovative, 

productivity-rich, patient-oriented 

market, in which the costs of cures, medicines 

and devices would rapidly drop. 

t/BUJPOXJEFTIPQQJOHGPSIFBMUIJOTVS- 

BODF Allow individuals to buy insurance 

from any company in any state. This would 

create a more competitive and national 

market. Additional companies and plans 

would be vying for your business. Right 

now if you live in New Jersey and want to buy a policy offered 

in Wisconsin, you’re barred from doing so. Such a change 

would also spur greater growth of multistate insurance plans 

and medical networks. 

House Republicans promise they will someday get around to 

this crucial change. The Senate should add it to its version now. 

t&RVBMUBYUSFBUNFOU Both individuals and employers should 

get tax deductions for buying health insurance (until we get the 

flat tax). Why should only businesses and the self-employed 

get tax deductions for buying insurance? Why not individuals? 

If we’re to get a vigorous and healthy market for individual 

buyers of insurance—and that’s absolutely crucial if 

we’re to avoid a socialist system of inferior care and a lack of 

innovation—we must end this tax discrimination. 

Even if a company offers insurance, why should that be a 

take-it-or-leave-it proposition for workers? If you don’t like 

the employer plan, you should be able to opt out and get a 

better one with your tax-free dollars. 

tćFGSFFEPNUPCVZQMBOTyouXBOU. House Republicans 

took baby steps toward letting states grant insurers some 

flexibility—if they get Uncle Sam’s permission—in coverage 

mandates. Obamacare’s extensive mandates enormously 

increased insurance premiums. Removing most, if not all, of 

these diktats would cut costs for individual buyers. Moreover, 

freeing up the market would make it easier for new types of 

policies and consumer choices to emerge. 

The Trump administration should also promulgate two 

huge regulatory changes. 

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QSJDFTPGBMMQSPDFEVSFTBOETFSWJDFT 

In the upper New England region, for 

example, the price of a nuclear stress test 

for cardiac patients can range from $1,450 

to $7,000. 

Fifty million Americans now have highdeductible 

insurance policies, mostly 

from their employers. Pricing transparency 

is becoming essential. 

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UJPOTDPOUSBDUFEBęFSUIFZXFSFBENJUUFE. 

The number of deaths nationwide is nearly 100,000 a year, 

and you can bet that the vast majority of these could be 

prevented through rigorous internal measures. This would 

also eliminate the substantial costs associated with treating 

these secondary infections. 

All the Way With USAs! 

House Republicans will now be focusing on tax cuts, and 

there’s a great idea for a fantastic consumer-savings vehicle 

that the GOP should be sure to incorporate in any legislation 

they pass. It would be immensely popular and a 

major creator of capital. Called Universal Savings Accounts 

(USAs) by their sponsors, Senator Jeff Flake (R–AZ) and 

Representative Dave Brat (R–VA), these plans possess the 

virtues of Roth IRAs with none of the drawbacks. 

Everyone over the age of 18, regardless of income, could 

open a USA and contribute up to $5,500 a year with aftertax 

cash. The money would grow tax-free. You could invest 

it in stocks or bonds or let it sit in money-market funds. 

Now for its greatest feature: You could make withdrawals 

any time you wanted, tax-free, for whatever reason, with 

no penalties. There would be no Washington/IRS/congressional 

nannies micromanaging your choices. 

USAs would be so popular that Congress would soon be 

under great pressure to raise deposit limits, perhaps by folding 

in other savings vehicles, such as Roth IRAs, rollover 

401(k)s (when you leave a company) and Coverdell Education 

Savings Accounts. (Congress, take note: Britain’s ceiling 

JUNE 13, 2017 FORBES | 11

FORBES 

FACT & COMMENT 

on contributions is $25,000 a year.) 

A paper written by Ryan Bourne and 

Chris Edwards for the Cato Institute 

examines how such accounts have fared 

in Canada and Britain. Bottom line: They 

have been supersuccessful. The flexibility 

on withdrawals has made them especially 

attractive to lower-income earners. In 

Britain, for instance, 55% of the holders 

of such accounts have annual incomes 

of less than $25,000. As Bourne and 

Edwards note, “Relative to their incomes, 

lower earners hold more in [these accounts] 

than higher earners.” In addition, 

these vehicles clearly encourage people 

to save more. They are perfect for all ages 

because they can be used for any purpose, 

from a rainy-day fund to a nest egg 

for a down payment on a house to setting 

aside money for retirement. 

USAs would be good for economic 

growth. And they would be particularly 

nice for the very working families who 

gave the GOP last November’s victories. 

Will the Fed Be a 

Prosperity Spoiler? 

STEVE FORBES 

Will the Federal Reserve continue to 

damage the economy? Its misbegotten 

monetary policies since the crisis of 

2008–09 have warped credit markets, 

thereby thwarting a vigorous economic 

recovery. Loans to small businesses and 

households ended up being restricted, 

while money for the federal government 

and large companies was easily available 

at virtually giveaway prices. Apple, for 

instance, has issued more than $80 billion 

in bonds, even as its cash hoard bloats to 

record levels (it now stands at $257 billion). 

Corporate financial engineering 

went on steroids, while productive capital 

expenditures stagnated. (Business outlays 

this year have improved a bit in expectation 

of tax cuts and other pro-growth 

actions by President Trump.) 

The Fed compounded this felony with 

an unprecedented seizure of assets from 

the U.S. economy via bond and mortgage 

purchases. Its obese portfolio now totals 

some $4.5 trillion. Its gobbling up of longterm 

bonds and its controls on the price of 

money created bond shortages for insurance 

companies, pension funds and other entities 

with long-term financial obligations. 

Treasury chief Steven Mnuchin is 

actively considering issuing bonds with 

maturities of 50 to 100 years. It’s to be 

hoped this will be part of a program to 

meaningfully lengthen the average maturity 

of our national debt, now shockingly 

short. Given current low rates, the 

current policy is truly perverse. Issuing 

more bonds will help ease the shortage. 

Mnuchin should direct our central 

bank to reduce its obscene portfolio, 

immediately. When a bond or mortgage 

comes due, the Fed should not reinvest 

the proceeds. The Fed should also be 

instructed to sell off a big chunk of its 

bonds and buy Treasury bills, as well as 

engage in overnight repurchase agreements 

with money market funds. 

Such actions would free up credit for 

productive use in the real economy. 

Great Show on 

the Great War 

World War I (1914–18), rightly called 

“Armageddon” by Winston Churchill, 

was history’s greatest man-made cataclysm. 

It undermined faith in Western 

civilization and the optimistic idea of 

progress, while bringing in its wake the 

police-state totalitarian horrors of communism, 

fascism and Nazism. (Ample 

traces of those ideologies’ poisonous 

brews can be found in many of the scribblings 

of today’s Islamic terrorists.) 

An excellent way to begin to fathom 

what the world underwent a century ago is 

to watch a series on YouTube appropriately 

entitled The Great War. Each week there’s 

a 9- to 10-minute segment, ably hosted by 

Indiana “Indy” Neidell, which covers the 

battlefield as well as the political and diplomatic 

events that were occurring exactly 

100 years ago. Neidell, an actor and musician 

who was raised in Texas but has been 

a resident of Stockholm for 20 years, not 

only does the narration but also conducted 

most of the prodigious research involved. 

In addition to the weekly episodes, Neidell 

and his crew turn out numerous specials 

on weaponry, culture, aspects of trench 

life, notable individuals and much more. 

This is an impressive achievement. Take 

a look—and then help out financially. F 

Restaurants: 

Go, Consider, Stop 

Edible enlightenment from our eatery 

experts and colleagues Richard Nalley, 

Monie Begley and Randall Lane, 

as well as brothers Bob, Kip and Tim. 

z Indian Accent 

123 West 56th St. (Tel.: 212-842-8070) 

Chef Manish Mehrotra has transported his refined 

Indian classics from his renowned New Delhi 

restaurant to Midtown. Begin with the mathri trio 

of smoked eggplant bharta, duck khurchan and 

chicken khurchan; the delicate crab claws in butter, 

pepper and garlic; or the sweet-pickle ribs with sundried 

mango and onion seeds. Intriguing mains: the 

ghee roast lamb with roomali roti pancakes and the 

pork chili fry, rice-crusted prawn. The kulchas are 

amazing. For dessert makhan malai is a must: saffron 

milk, rose-petal jaggery brittle, with almonds. 

z Market Table 

54 Carmine St. (Tel.: 212-255-2100) 

Lots of brick, atmosphere and friendly, efficient service. 

Duck soup is a perfect starter, the beet salad is 

as good as you’ll find anywhere, and the steamed 

edamame is served with a piquant soy-ginger dipping 

sauce. Sweet potatoes with bok choy is an 

ideal side with Cornish hen, and the risotto special 

and the falafel are delicious. The pear and cranberry 

cobbler is buoyed by just enough crunch underneath. 

z Vitae 

4 East 46th St. (Tel.: 212-682-3562) 

Except for the friendly service, nothing quite 

works in this American-fare spot just off Fifth. 

The 1950s grillwork surrounding the room gives 

one the feeling of eating in a cage—and, sadly, 

not particularly well. Warm Parker House rolls 

are advertised as coming with duck fat but arrive 

with barely a trace. The bland steak tartare leaves 

a red slick suggestive of food coloring, and the 

halibut is nothing to write home about. The dulce 

de leche cheesecake is thick and flavorsome. 

Alas, it’s too little too late. 

z The Cellar 

Beecher’s, 900 Broadway, at 20th St. 

(Tel.: 212-466-3340) 

This informal and cozy Flatiron restaurant’s signature 

dishes all feature cheese, including the inhouse-made 

cheese named “Flagship.” It’s a divine 

addition to the tasty tomato soup, the simple salad 

and the patty melt (topped with bacon and bbq 

onion marmalade). There’s a menu section devoted 

to mac and cheeses (high marks go to the pulledpork 

version). All the desserts will leave you smiling. 

z Hunt & Fish Club 

125 West 44th St. (Tel.: 212-575-4949) 

The sleek, contemporary, mirrored main dining 

room comes as a surprise in this pricey new eatery. 

The food is also surprisingly good. The creamy 

burrata with delicately sliced prosciutto is rivaled 

in taste by the salad of cooked root vegetables. 

The fried chicken with honey dipping sauce 

comes with killer sweet potato fries, and the 

hanger steak can be cut with a fork. The pear tart 

is close to sublime. Service is friendly and efficient. 


Slack is where work happens, for millions of people 

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LeaderBoard 


THE JEWELRY QUEEN’S CASTLE 16 

BILLIONAIRES OVER BROADWAY 18 

ON THE BLOCK: TIME MACHINES 

AND WAR MACHINES 20 

NEW BILLIONAIRE: BURGER BUCKS 22 

DISNEY DEAL TOY: 

ONE FOR MICKEY’S MANTEL 24 

THE CORVETTE AT 65 26 

RICHEST RAPPERS 28 

FORBES @ 100, NOVEMBER 15, 1952: 

GILLETTE’S BLADES OF GLORY 30 

EQUISPORT PHOTOS 

A groom leads a broodmare to her paddock on Spendthrift 

Farm in Lexington, Kentucky. The business was started before 

World War II by Leslie Combs, who introduced the new idea 

of partially owning a Thoroughbred—and began with shares 

in Louis B. Mayer’s champion sire, Alibhai. Spendthrift is now 

owned by the state’s richest person, B. Wayne Hughes. 

PAGE 20 


LeaderBoard 

ABOUT-FACE The rear of the house 

is actually its front. According to local 

legend, Oliver Belmont wanted to show 

Bellevue Avenue his back—but he also 

wanted a better view. 

BRIGHT IDEA An Art Deco sculpture of 

a woman holding two lamps watches 

over the courtyard, a fitting reminder 

of Belcourt’s two guiding lights: Alva 

Belmont and Carolyn Rafaelian. 

GHOST STORY The original entrance of the house, 

which Rafaelian had cleansed by a shaman to remove 

bad spirits and energy. 


SHINE ON Every chandelier in 

Belcourt was taken down and 

disassembled for restoration, 

including one weighing 460 

pounds and held up by a nail. 

FIRE POWER The crest 

above the fireplace in 

the library contains the 

Belcourt motto, Sans 

crainte: “Without fear.” 

WORDS TO LIVE BY “First 

marry for money, then 

marry for love,” Alva 

Belmont once famously 

said. Her first husband was a 

Vanderbilt; her second was 

Oliver Belmont. 

WHOA The courtyard was once used to exercise 

the horses of Oliver Belmont, whose father is the 

namesake of the Belmont Stakes. 

REAL ESTATE 

The 

Jewelry 

Queen’s 

Castle 

DESIGNED IN 1891 by renowned 

Beaux Arts architect Richard 

Morris Hunt, the Newport, 

Rhode Island, mansion known as 

Belcourt was inspired by Louis 

XIII’s hunting lodge at Versailles 

and built for banking heir Oliver 

Belmont. With 60 rooms and more 

than 55,000 square feet of living 

space, the estate was intended to 

be Belmont’s summer bachelor 

pad—with stables on the first floor 

for the horse-loving owner. Shortly 

after the home was completed, Belmont 

fell in love with a neighbor, 

suffragist Alva Vanderbilt, who, 

after divorcing her husband and 

moving out of their mansion down 

the street, brought a woman’s 

touch to the place. (The horses 

were the first to go; then she added 

a library and transformed the halls 

for entertaining.) 

In 1940, the Belmont family 

sold the estate, and it has changed 

hands several times over the 

decades, falling into disrepair and 

disrepute: In 1999, Belcourt was 

reportedly the site of an infamous 

800-person “no underwear” party. 

Then in 2012, Carolyn Rafaelian, 

the billionaire founder of the 

jewelry brand Alex and Ani (see 

story, p. 70) purchased the property 

for $3.6 million—and the spirit of 

Alva Vanderbilt returned. Rafaelian 

has invested many millions in the 

estate, including a complete renovation 

of the library. She also added 

solar paneling to the roof and, of 

course, restored Alva’s bedroom to 

its Gilded Age glory. 


LeaderBoard 

ENTERTAINMENT 

Hello, Dollars! 

EVEN BILLIONAIRES think there’s no business like show business. These six produced or coproduced Broadway shows this year, 

and four have Tony-nominated hits. The headliner: Len Blavatnik (with trophy, below), who financed the most shows by far, putting 

money into seven productions. The Great White Way has long run on the dollars of the ultrarich—even a young Daddy Showbucks 

named Donald Trump produced a 1970 show called Paris Is Out! It was a flop and closed in less than three months. 

STEVE COHEN 

NET WORTH: $13 BIL 

SHOW: A Bronx Tale 

The Musical 

STAR POWER: 

Robert De Niro 

TOTAL BOX OFFICE GROSS: 

$21.9 MIL 

MOST EXPENSIVE SEAT: 

$275 

TONY NOMINATIONS: 0 

MONEY LINE: 

“The grocer, the peddler, 

the whole neighborhood—wherever 

I go 

I know my money’s 

no good.” 

ROBERT SMITH 

NET WORTH: $2.5 BIL 

SHOW: In Transit 

STAR POWER: 

Justin Guarini 


$6.1 MIL 


$249 


MONEY LINE: 

“I got temping skills 

to pay my bills, that’s 

my scheme till my 

dream comes true.” 

LEN BLAVATNIK 


SHOWS: Hello, Dolly!; 

Groundhog Day; 

Sunset Boulevard; The 

Front Page; The Glass 

Menagerie; Sweat; 

A Doll’s House, Part 2 

STAR POWER: 

Bette Midler, Glenn Close 


$61.4 MIL 

MOST EXPENSIVE SEAT 

(HELLO, DOLLY!): $748 


MONEY LINE: 

“Money . . . is like manure. 

It’s not worth a thing 

unless it’s spread around” 

—Hello, Dolly! 

CAMERON 

MACKINTOSH 

NET WORTH: $1 BIL 

SHOWS: Cats, 

Miss Saigon 

STAR POWER: 

Leona Lewis 


$46.2 MIL 


(MISS SAIGON): $248 


MONEY LINE: 

“Tonight I’m out of my 

mind, not to mention 

ten bucks.” 

—Miss Saigon 

BARRY DILLER 


SHOW: A Doll’s House, 

Part 2 

STAR POWER: Laurie 

Metcalf, Chris Cooper 

TOTAL BOX OFFICE 

GROSS: $538,000 


$273 


MONEY LINE: 

“It looks like you’re 

definitely not 

destitute.” 

ROBERT RICH JR. 


SHOWS: Cats, 

Present Laughter 

STAR POWER: 

Kevin Kline, Leona Lewis 


$43 MIL 


(PRESENT LAUGHTER): 

$350 


MONEY LINE: 

“If you offer me fish, then 

I always want a feast.” 

—Cats 

BY MICHELA TINDERA 

ILLUSTRATION BY JOHN UELAND 

18 | FORBES JUNE 13, 2017 

ALL BOX OFFICE FIGURES ARE FOR 2016–17 (THROUGH APRIL 30). 

SOURCE: THE BROADWAY LEAGUE.

You could retire 

after selling 

your business. 

But you won’t. 

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844-242-7650 | bnymellonwealth.com | @BNYMellonWealth 

Source: 2016 Client Satisfaction Survey. BNY Mellon Wealth Management conducts business through various operating subsidiaries of The Bank of New York Mellon Corporation. 

©2017 The Bank of New York Mellon Corporation. All rights reserved.

LeaderBoard 

ON THE BLOCK 

Time Machines 

And War Machines 

AN ARRAY OF artifacts are soon 

to go under the hammer. There’s 

surely something for you here— 

whether you’re into decoration, 

decryption or decapitation. 

YUL BRYNNER’S FABERGÉ CLOCK 

The celebrated Russian jeweler produced 

this gold-and-enamel tick-tock in the early 

1900s; Brynner acquired it in 1966 from a 

London boutique. 

AUCTION HOUSE: Sotheby’s 

DATE: June 6 

PRICE: $300,000 to $325,000 

ENIGMA CIPHER MACHINE 

The German M4 Enigma was significantly 

more complex than earlier 

versions of the device, and it took a 

team of Allied cryptologists, led by 

the famous mathematician Alan 

Turing, ten months to crack its code. 

AUCTION HOUSE: Christie’s 

SALE DATE: June 15 

PRICE: 

$300,000 to $500,000 

RICHEST BY STATE 

Kentucky 

POPULATION: 4.4 MILLION 

2015 GROSS STATE PRODUCT: 

$195 BILLION (1.1% GROWTH) 

GSP PER CAPITA: $43,986 

(RANKS NO. 41 NATIONWIDE) 

NUMBER OF BILLIONAIRES: 1 

RICHEST: B. WAYNE HUGHES, 

$2.7 BILLION 

THE PRIDE AND JOY of billionaire 

B. Wayne Hughes is Spendthrift Farm, a 

lush 1,200-acre patch of bluegrass outside 

Lexington, Kentucky, that’s one of the most 

storied Thoroughbred farms in the nation. 

Nine Kentucky Derby champions—two 

of them Triple Crown winners—stood stud 

there. Hughes, who made his fortune as a 

cofounder of the world’s largest self-storage 

company, Public Storage, bought the estate in 

2004, and the 83-year-old has painstakingly 

restored its grounds and breeding business. 

In 2015, Spendthrift-bred horses made up 

a third of the Kentucky Derby’s lineup. This 

year’s race featured two colts with Spendthrift 

ties, Practical Joke and Gormley, who 

finished fifth and ninth, respectively. Each 

Thoroughbred’s father retired to Spendthrift, 

and Gormley will do the same at the end of his 

racing career. 

19TH-CENTURY MODEL OF A GUILLOTINE SCENE 

Produced by French artisans imprisoned in Britain during 

the Napoleonic wars, this tableau was carved from sheep 

bones and features a working replica of a guillotine. 

AUCTION HOUSE: Sotheby’s 

SALE: June 9 

PRICE: $25,000 to $35,000 

ON THE BLOCK BY ABRAM BROWN; RICHEST BY STATE BY CHASE PETERSON-WITHORN 

ILLUSTRATION BY CHRIS LYONS 


LeaderBoard 

NEW BILLIONAIRE 

Burger Queen 

Lynsi Snyder has expanded In-N-Out 

while keeping the cult hamburger 

chain’s storied ingredients. 

IT WAS A WHOPPER of a 35th birthday for burgerchain 

heiress Lynsi Snyder. On May 5, she received 

the final portion of her inheritance, increasing her 

ownership of the West Coast In-N-Out restaurant 

empire to 97% and making her a billionaire. She has 

received stakes for the past decade, a slow investiture 

process laid out in a complex trust by her grandparents, 

company founders Harry and Esther Snyder. 

Harry and Esther opened their first drive-through 

burger stand in California in 1948. Their sons, Richard 

and Guy, each took a turn running In-N-Out, 

but both died young—Richard at 41 in a plane crash, 

Guy at 48 from an accidental overdose. Esther ran it 

after Guy’s 1999 death; Lynsi took over in 2010. 

Lynsi has capitalized on In-N-Out’s cult following, 

expanding its locations by 29% to more than 320, 

while estimated annual revenue has climbed 57% 

to about $870 million. But In-N-Out mostly hasn’t 

changed since her grandmother’s day: It still doesn’t 

franchise, and heat lamps, microwaves and freezers 

remain strictly forbidden on the premises. 


PRISCILLA IEZZI/ORANGE COAST MAGAZINE 


Learn why enterprises worldwide trust RingCentral, the global leader in cloud communications 

and collaboration solutions, to empower their workforce with voice, video, team messaging, 

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RingCentral and the RingCentral logo are registered trademarks of RingCentral, Inc.

LeaderBoard 

DEAL TOY 

One for Mickey’s Mantel 

Disney’s $19 billion megadeal for Capital Cities/ABC in 1995, pairing the Mouse and 

friends with SportsCenter, was the rare big-media consolidation that actually worked. 

CASH OF THE TITANS 

The July 31, 1995, merger combined 

ABC’s nationwide broadcast channels 

and, crucially, ESPN with Disney’s 

film studios and theme parks. 

Just over a decade later, before 

Disney’s next big acquisition push, 

revenue had jumped more than 70%; 

earnings per share increased 50%. 

THE THRILL OF VICTORY 

In 1984, ABC took control of ESPN for just $188 million. By 2005, the combined 

companies’ cable networks (ABC Family among them) were generating 23% 

of sales and 53% of operating income. Today ESPN struggles amid cord cutting; 

it lost 2 million subscribers in 2016 alone. 

ORACLE—AND 

MATCHMAKER 

The deal wouldn’t have 

occurred—at least not as 

soon—without Warren Buffett, 

then the largest Capital 

Cities/ABC investor. During a 

chance meeting in mid-July 

1995, Buffett helped Cap 

Cities CEO Tom Murphy and 

Disney head Michael Eisner 

solve their biggest dispute: 

whether an acquisition would 

be all cash (as Disney preferred) 

or stock (Cap Cities’ 

wish). Murphy and Eisner 

agreed to compromise, and 

the deal was put together in 

only two weeks. 

WARREN’S WINNING BET 

Buffett had invested in television 

and radio broadcaster 

Capital Cities in 1985 to help 

it finance its $3.5 billion 

pickup of much larger ABC. 

In the end, Buffett’s Berkshire 

Hathaway received $1.2 billion 

cash and $1.3 billion in 

Disney stock, realizing a 

$2.2 billion gain. 

TURMOIL AT THE TOP 

Murphy and Capital Cities 

president Dan Burke were 

nearing retirement when 

Disney made its move. The 

Mouse was changing, too: In 

1994, CEO Michael Eisner fired 

studio chief Jeffrey Katzenberg; 

onetime “superagent” Michael 

Ovitz would leave the company 

in 1997 after a brief tenure 

as president. Cap Cities COO 

Robert Iger replaced Eisner as 

Disney CEO in 2005 and has 

since presided over a fourfold 

increase in company stock. 


DAVID ARKY FOR FORBES 


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LeaderBoard 

LUXURY LINEAGE 

The Corvette at 65 

LIKE A LOT OF sexagenerians, the Chevrolet Corvette still looks 

youthful for one reason—it’s had a lot of work done. Introduced 

by General Motors in 1953, the Corvette (named for a small, fast 

warship) was the first American sports car, and while its initial 

performance didn’t live up to that of its European competitors, 

the Corvette eventually became one of the great muscle cars of 

all time. In April, Chevrolet debuted a 65th-anniversary edition, 

the Corvette Carbon 65—meaning retirement is not in its future. 

1953: C1 

Displayed as a concept car at a 1953 General Motors auto show, 

the C1 Corvette was sped into production in June 1953. Only 300 

were built, with a sticker price of $3,498—about $32,000 today— 

and they now sell for more than 100 times that at auction. John 

Wayne was one of the first owners of the two-seat fiberglass 

convertible, which came with a 150-hp straight-six engine. It was 

available only in white with a red interior, and it had just two 

luxurious options: a heater and an AM radio. 

Boss car: Bruce 

Springsteen bought himself 

a 1960 Corvette after the 

success of Born to Run. 

1963: C2 

Ten years after the Corvette’s debut, Chevrolet 

rolled out a smaller, sleeker cousin, the Sting 

Ray. The second-generation Corvette, the 

C2, had a more powerful engine (250 hp) 

and a controversial split rear window, which 

lasted only a year but is prized by collectors 

today. The Sting Ray, which had a list price 

of $4,252 for the coupe (roughly $34,000 in 

today’s dollars), was a smash—Corvette sales 

increased from a record 14,531 in 1962 to 21,513 

the following year. 

2013: C7 

The Stingray returned after an 

absence of 38 years, featuring a 

carbon-fiber hood and aluminum 

panels to keep the body light. 

Selling for a list price of $51,995, 

the Corvette continued to get more 

muscular, with a 455-hp engine. 

2018: Carbon Fiber 65 

For its 65th birthday, Chevrolet introduced the Carbon Fiber 65 in Grand 

Sport 3LT and Z06 3LZ models in April. But good luck getting one: Chevy 

will produce only 650 of each for all markets, with a price starting at 

$81,490 for the Grand Sport and $99,490 for the Z06. And say goodbye 

to the C7 next year—the eighth-generation Corvette is coming. 


O-mobile: Jerry Seinfeld 

got coffee with Barack 

Obama in a 1963 Sting Ray. 

1968: C3 

The third-generation Corvette, the C3, was produced from 1968 to 1982 and included 

the second-generation Stingray (rebranded as one word). The 1968 models, which 

started at $4,320 ($30,000 today), featured a redesigned body (but maintained 

the hidden headlights) and a more powerful engine, including a turbo option. Mark 

Wahlberg’s Dirk Diggler drove a ’77 Corvette in Boogie Nights, and in honor of its 

25th anniversary, the Corvette was named the official pace car of the 1978 Indy 500. 

Regal ride: Cleopatra 

Jones rolled in a 

1973 Corvette with 

automatic weapons. 

1984: C4 

While the price continued to increase for the 

C4 Corvette (from $21,800 in 1984 to $37,225 in 

1996), sales sharply declined during its 12-year 

production run (from 51,547 to 21,536). The car 

remained popular with collectors, though—a 

1984 Corvette (below) driven by Dirk Benedict’s 

character on The A-Team was listed for an 

ambitious $40,000 several years ago. 

Hot wheels: Austin Powers worked 

his mojo on Felicity Shagwell 

in a 1965 Corvette convertible. 

1997: C5 

As its 45th year approached, the Corvette had 

its most dramatic overhaul since 1953—it even 

finally got a large trunk. The fifth-generation 

C5 (which listed for $37,495) also improved 

performance, with a top speed of 175 mph. In 

the 2002 movie Mr. Deeds, Adam Sandler gave 

an entire town little red Corvettes—2002 C5s— 

after listening to some Prince. 

BY MICHAEL SOLOMON 

2005: C6 

Produced between 2005 and 2013, the C6 Corvette got another new body and 

featured exposed headlights for the first time since 1962. The sticker price for that 

initial C6 was $44,245, and the production run, which ended in 2013, included lots 

of racing variants. After all, the 6-liter V8 engine delivered 400 hp. 

1953 CORVETTE: NATIONAL MOTOR MUSEUM/HERITAGE IMAGES/GETTY IMAGES; 1984 CORVETTE: RON TOM/NBCU PHOTO BANK/ 

GETTY IMAGES; 1984 CORVETTE: RON TOM/NBCU PHOTO BANK/GETTY IMAGES; 1968 CORVETTE: MARVIN MCABEE/ALAMY; 

1997 CORVETTE: OLEKSIY MAKSYMENKO/ALAMY; CLEOPATRA JONES: EVERETT COLLECTION/ALAMY 


LeaderBoard 

THE 10-Q 

How to Survive a 

Stampeding Elephant 

Billionaire Tom Siebel on why small firms outperform mammoth rivals, 

GE’s innovation problem and one very memorable safari. 

Your 2009 elephant goring: What’s 

the story? 

Daybreak in the Serengeti. I’m armed with 

a Nikon. Herd of 15 elephants, 200 yards 

away. Gust of wind. Matriarch charges us. 

Then? 

She hurls the guide about 12 yards away 

and races up to me. I can smell her. I took 

a tusk through my left leg. She stepped on 

my right leg, and my foot came off. 

By “off,” you mean . . . ? 

Detached! Hanging on by a flap of skin. 

That’s your pattern: Start a company. 

Then get almost killed. 

We started Siebel Systems in 1993. Two 

years later, I was kicked by a horse. The 

prognosis: “permanent, irreparable brain 

damage.” It’s hard to tell whether that 

prognosis turned out to be accurate or 

not [laughs]. 

What makes IoT software a hard problem 

to solve? 

Integration. You need a base of big-data 

and predictive-analytics capabilities, and 

a platform for third-party apps. 

So does this mean Silicon Valley wins the 

IoT sweepstakes? 

No. The next generation of IoT apps in, 

say, the aerospace industry probably come 

from Honeywell, not Silicon Valley. Same 

in health care. And so on. 

How did Oracle, your alma mater, spin 

off so many great entrepreneurs: you, 

Marc Benioff and others? 

Larry Ellison hires bright, type A, thinkoutside-of-the-box-type 

people. But 

Oracle never encouraged a lot of internal 

entrepreneurism. So people who were 

entrepreneurs needed to go get that experience 

someplace else. 

ENTERTAINMENT 

Richest Rappers 

THE ONLY THING more predictable than 

a Diddy name change? His place atop our 

annual list of the wealthiest hip-hop artists. 

But the man formally known as Sean 

Combs now has some real competition. 

Jay Z’s fortune has jumped 30% in the 

past year after a $200 million investment 

from Sprint reportedly put the valuation 

of his music-streaming service, Tidal, at 

$600 million, more than ten times what he 

paid for the company two years ago. 

Which rapper will hit billionaire status 

first? Hard to say. Diddy has a lucrative 

Cîroc vodka deal with Diageo, while Jay Z 

augments his portfolio with a champagne 

brand, Armand de Brignac, and a growing 

entertainment company, Roc Nation. 

1. 

DIDDY 

NET WORTH: 

$820 MIL 

Perhaps the verdict comes through your 

latest startup, C3 Internet of Things? 

The Internet of Things needs a software 

platform. Today there are 19 billion 

sensors. In five years, 50 billion. 

But why your startup? Huge companies like 

GE plan to own the IoT market. 

GE is the world’s greatest 19th-century 

company. Its market value the last 17 

years has gone from $475 billion to 

about $250 billion. Nice job. These 

guys make valves and pumps. 

So, small companies always win 

during transitions? 

Microsoft built its first 

product with two people. 

Apple did it with four. 

GE takes 3,000 mediocre 

people and says, “Build 

a software stack.” 

TOM SIEBEL SPOKE WITH RICH KARLGAARD, OUR EDITOR-AT-LARGE 

AND GLOBAL FUTURIST. THIS INTERVIEW HAS BEEN EDITED AND CONDENSED. 

FOR THE EXTENDED CONVERSATION, VISIT FORBES.COM/SITES/RICHKARLGAARD. 

3. 

DR. DRE 

$740 MIL 

2. 

JAY Z 

$810 MIL 

4. 

BIRDMAN 

$110 MIL 

5. 

DRAKE 

$90 MIL 

RICHEST RAPPERS BY ZACK O’MALLEY GREENBURG WITH NATALIE ROBEHMED 

TIMOTHY ARCHIBALD FOR FORBES (LEFT); KEVIN MAZUR/GETTY IMAGES; MIKE 

COPPOLA/GETTY IMAGES; AMANDA EDWARDS/GETTY IMAGES; DAVE KOTINSKY/ 

BET/GETTY IMAGES; ANDREW LIPOVSKY/NBCU PHOTO BANK/GETTY IMAGES 


THE ETERNAL MOVEMENT 

Ulysse Nardin, from the movement of the sea to the perpetual 

innovation of Haute Horlogerie. For over 170 years, the powerful 

movement of the ocean has inspired Ulysse Nardin in its singular 

quest: to push back the limits of mechanical watchmaking, time 

and time again. 

ULYSSE NARDIN SPONSOR OF ARTEMIS RACING, 

CHALLENGER OF 35TH AMERICA’S CUP 

Executive Skeleton 

Tourbillon 

Silicium technology 

170-hour power reserve 

ulysse-nardin.com

LeaderBoard 

FORBES @ 100 

As Forbes’ September 2017 centennial approaches, 

we’re unearthing our favorite covers. 

November 15, 1952: Blades of Glory 

NOTABLE & NEWSWORTHY 

Lights, Cinerama, Action! 

As a young man, Lowell Thomas 

had helped turn T.E. Lawrence into 

Lawrence of Arabia by filming and 

photographing the British Army 

captain during World War I. Now 

stock in Thomas’ new company, 

Cinerama, was soaring after it 

debuted a new style of widescreen 

cinematography that would 

later be used by such directors as 

John Ford and Stanley Kubrick. 

TWO DECADES HAD passed since the death 

of King C. Gillette, but his razor manufacturer 

still ruled its industry. Half of the razors sold in 

America were Gillette, sales of which topped 

$100 million annually (over $900 million today). 

Company president Joseph Spang had run things 

smoothly for the previous 14 years, displaying the 

same knack for advertising and promotion as the 

business’s legendary founder. Under Spang, Gillette’s 

marketing budget had grown almost sevenfold 

to $7.5 million (about $70 million in 2017). 

Gillette’s business practices had some 

sharp edges, though. Its blue-collar employees 

described a highly stratified environment despite 

a professed egalitarian workplace. “We’re 

peasants!” one told Forbes. The company didn’t 

think too highly of its public shareholders, 

either, leaving investors to “ponder skeleton 

statements cloaked in consolidated mystery for 

‘competitive reasons.’ ” 

EPILOGUE 

Sharp-Tongued 

When Gillette made the cover 

again in February 1991, its 

chief, Colman Mockler, wasn’t 

a fan of the way we illustrated 

him. He had fended off four 

takeover bids in two years but 

took umbrage at our depiction 

of the aftermath: a bloody 

handprint on his white shirt. 

He didn’t have much time to 

dwell on it. He died the month 

the issue hit newsstands. 

EDITOR’S DESK 

We Liked Ike 

For the first time in nearly 25 years, 

America had a Republican president: 

Dwight D. Eisenhower. Malcolm Forbes partly 

ascribed the ex-general’s victory to his being 

“outstandingly equipped to deal emphatically 

with Communism at home and abroad.” 


SIGN OF THE TIMES 

The Triplicator 

The Three Unit Copy Typist 

was a trio of typewriters linked 

by an electrical-pneumatic 

mechanism and sold by 

the American Automatic 

Typewriting Co. Whatever was 

typed on the so-called “master” 

machine was simultaneously 

reproduced on the other two. 

AMAZING ADS 

Steeling the Spotlight 

U.S. Steel’s many jobs added up to $3.1 billion in 

sales, some $28 billion today. It’s far less busy 

now, doing only about a third as much revenue. 

BY ABRAM BROWN 

MOVIESTORE COLLECTION/ALAMY; INDEPENDENT PICTURE SERVICE/ALAMY (PIN)

LeaderBoard 

CONVERSATION 

THE INTEREST GRAPH 

Social media stars and top tech investors occupy vastly different worlds, 

but both sparked major interest among online readers of our April 25 issue. 

STEVEN BERTONI’S cover story on Josh Kushner 

(April 25) gave readers an unprecedented glimpse 

into the lesser-known mogul among the Trump 

in-laws. With all eyes on big brother Jared, Josh has 

spent the administration’s early days threading the 

needle as the liberal-minded leader of both venture 

firm Thrive and Oscar, a health care startup whose 

business model is threatened by the uncertain fate 

of Obamacare. Readers fell largely into two camps: 

those surprised that the younger Kushner welcomed 

Forbes’ attention (media outreach is “not 

usually [his] forte,” one observed) and those scornful 

of the insinuation that this 32-year-old venture 

capitalist and entrepreneur remotely resembled 

a modern Horatio Alger. “Cool Josh Kushner 

profile,” tweeted Alice Yin, “but not sure why a 

Harvard grad who grew up rich in NJ is described 

as a ‘self-made man.’ ” 

UNDER THE INFLUENCE 

The world’s biggest social-media 

personalities: charlatans—or enviable 

new avatars of the digital economy? 

CHERIE HERRMANN, POPSUGAR: 

“Influencers have officially 

taken over the (digital) world. 

We stalk-follow their every move, 

and we talk about them like 

they’re our friends. They are our 

real friends, right?” 

KENZIE BRYANT, VANITY 

FAIR: “There’s still a path to 

riches in ‘influencing.’ . . . It’s a 

magic combination of reach, 

engagement and the evernebulous 

but crucial authenticity. 

That authenticity can create 

a barrier to more traditional 

stardom, though.” 

SERGEI ISSAREV: “The age 

of lemmings. The whole 

concept of an ‘influencer’ is 

ridiculous. Think for yourself!” 

Top Influencers: Power Players Who’ve Turned Social-Media Platforms Into Fortunes and Empires 

486,345 page views 

Midas List 2017: The World’s Smartest Tech Investors 

270,854 

Josh Kushner’s Complex World: How Jared’s Little Brother Runs a Billion-Dollar Fund in the Trump Era 

50,310 

A Guide to the Millionaires, Billionaires and Royals Who Live Near Mar-a-Lago 

32,505 

The XX Factor: Inside the Fight to Reinvent 

Financial Advice for Women 

23,704 

The Billionaire and the Drug-Price-Fixing Scandal 

15,541 

Move Over, Peter Thiel: How Brian Singerman 

Became Founders Fund’s Top VC 

“The Ellevest site 

hits the hot buttons, 

promoting itself 

with a ‘Money Is 

Power’ slogan and a 

#FinancialFeminist 

hashtag.” 

9,564 “Through no action 

of his own, either 

Paint, by Numbers: Billionaires 

professionally or 

Behind the Biggest Art Transactions 

politically, Josh 

Kushner gets 

THE BOMB 

saddled with all the 

976 VIEWS 

Trump baggage.” 


“As Facebook’s IPO 

fades into Silicon 

Valley history, 2017 

could be the last ride 

for a group of top 

investors.” 

@FROZENBERRIES: 

“$25,000 per post? 

I’d be happy with £2.50 per 

post right now.” 

RACHEL JACOBY ZOLDAN, 

TEEN VOGUE: “The 10 influencers 

in each category have a 

combined social-media following 

of 250 million people—larger 

than the population of Brazil.” 

@_BHMIRZAYAN: “This 

is a first: @Forbes Top 

Influencer list—a beneficial 

tool for both marketers and 

consumers.” 

CABOT THOMAS: “ ‘Social 

Media Influencer’: code-speak 

for unemployable Millennial.” 

BY ALEXANDRA WILSON

EDUCATION FOR LIFE 

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Verticals 


With personal styles closer to surfer dude than 

technology czar, Mike Cannon-Brookes (left) and Scott 

Farquhar, the Aussie billionaires behind collaboration 

software firm Atlassian, keep these stilted, goofy portraits 

as a reminder not to take themselves too seriously. 

PAGE 36 

STRATEGIES 

2017 GLOBAL GAME CHANGERS 38 

THE KOREANS ARE COMING 44 

TECHNOLOGY 

BIG PHARMA’S FRIEND 46 

THE 25 FASTEST-GROWING TECH COMPANIES 48 

CLASS APP 50 

ENTREPRENEURS 

GOOGLE SLAYER 54 

THE ULTIMATE LIGHTBULB 58 

MONEY & INVESTING 

WALL STREET’S ROBOCOP 62 

BUILD THE WALL! POR FAVOR. 66 

PHOTOGRAPH BY JAMES HORAN FOR FORBES 


STRATEGIES 

36 | FORBES MONTH 00, 2017

GLOBAL GAME CHANGERS 

The Wizards 

From Oz 

Enterprise software giants use 

armies of salespeople to hawk 

imperfect products and endless 

updates. The two Australian 

billionaires behind Atlassian 

have built smarter tools that sell 

themselves. Just ask Tesla, Snapchat, 

NASA and the entire Ivy League. 

BY NOAH KIRSCH 

Mike Cannon-Brookes (left) and 

Scott Farquhar started Atlassian 

to avoid getting “real jobs” after 

college. Half of Australia’s comp 

sci grads apply to their company. 

Fresh off the red-eye from San Francisco, 

Mike Cannon-Brookes enters a rented office 

space in Midtown Manhattan to seal 

the biggest deal in his company’s history. 

Dressed in a Detroit Tigers T-shirt and blue baseball 

cap, he greets the room in an undulating Australian 

twang. Seated around a conference table are 

executives from his collaboration-software firm, Atlassian, 

which is in the final push to acquire Trello, 

a smaller competitor whose founder, Michael Pryor, 

is also present. For four hours, Cannon-Brookes relentlessly 

sells the importance of achieving scale 

and the benefits of uniting their rival firms. 

Pryor is convinced. One month later, in January 

2017, Atlassian will officially acquire Trello in 

a $425 million deal that will help send company 

shares up 47% in four months and add $820 million 

to the fortunes of Cannon-Brookes and his cofounder, 

Scott Farquhar. The 37-year-old Aussies, 

who dress more like off-duty surfers than top-flight 

executives, are worth $2.6 billion each. 

That ascent has vastly outstripped the pair’s 

humble objective when starting Atlassian in 2002: 

dodging a lifetime of corporate IT drudgery. “Our 

aspirations were literally just to not get a real job,” 

Farquhar admits, “and to not have to wear a suit.” 

Those aims thoroughly satisfied, they have managed 

to reach a few extra milestones as well: a 

blockbuster IPO in 2015, annual revenues approaching 

$600 million and status as one of the 

JAMES HORAN FOR FORBES 


STRATEGIES 

most successful technology startups in Australian 

history. 

The founders, who serve as Atlassian’s cochief 

executives, freely acknowledge the improbability 

of their meteoric rise. “I think we’re completely 

under-skilled and under-experienced for 

the job that we’re in,” Cannon-Brookes deadpans. 

But despite the self-effacement, they have 

unquestionably built a highly disciplined business 

with a continually expanding global footprint. 

What began as Jira, a bug-tracking tool for 

software developers, has since morphed into over 

a dozen collaboration products used by many of 

the world’s most prominent innovators, including 

NASA, Snapchat, Twilio and Spotify. 

Atlassian has 85,000 customers who pay as 

little as a few dollars per person per month for 

access to its software. Confluence, its knowledge-sharing 

app for teams, is its most popular 

after Jira. Other products include Bitbucket, 

an online repository for storing code; Bamboo, 

a technical-workflow interface; and Hipchat, 

a messaging service that competes with Slack. 

Trello, the latest addition, is a project-management 

tool that helps Atlassian further appeal to 

individuals and smaller, less technical teams. 

In essence, Atlassian has taken on the unsexy 

mission of bridging organizational and communication 

gaps. If the back-end seems dry, 

the applications are anything but. When developing 

the software underpinning Tesla’s electric 

car, Elon Musk turned to Atlassian. SpaceX 

is using its software to coordinate coding teams 

and rocket scientists, and NASA relied on it to 

help plan the Curiosity Rover’s mission to Mars. 

The customer list extends further: Airbnb, 

BMW, BlackRock, Sotheby’s, Paypal, all eight 

Ivy League universities and 85% of the 100 largest 

companies in America. 

That success has come despite Farquhar and 

Cannon-Brookes’ insistence on skirting industry 

norms. Atlassian has no sales staff, unheard 

of in the hypercompetitive world of enterprise 

software. And in an era when some tech leaders 

helm more than one multibillion-dollar venture 

(Jack Dorsey, Elon Musk), the cofounders are 

the conspicuous duo leading a single entity. 

Growth has come easily so far, but the pressure 

is on for Atlassian—which posted just a 

$4.4 million profit last year—to prove it deserves 

its $8 billion market cap. And as it ventures 

further from its technical core competency, 

competitors are anything but idle. Smaller 

startups like Slack and Asana are nibbling away 

at market share, while industry giants like Microsoft 

pose a persistent threat from above. 

GLOBAL 

GAME CHANGERS 


These global business leaders are changing industries and lives around the world. 

To make our list, leaders needed to run for-profit operations that are growing and 

innovating better than their peers. They also needed to have market values of at least 

$1 billion. —Edited by Lauren Gensler 

Mukesh Ambani, 60 

CHAIRMAN, RELIANCE IND. 

INDIA 

Connectivity 

Bringing the internet to India’s 

masses. Oil and gas tycoon entered 

the country’s telecom market, 

offering fast internet at dirtcheap 

prices. Gained 100 million 

customers in six months. “Anything 

and everything that can go 

digital is going digital. India cannot 

afford to be left behind.” 

Ziv Aviram, 58 

Amnon 

Shashua, 56 

COFOUNDERS, MOBILEYE 

ISRAEL 

Autos 

Making cars smart and safe. Mobileye 

is a leading provider of 

camera-based assisted-driving 

systems. Now building maps 

that use crowd-sourced data 

from millions of vehicles to give 

cars human-like decision-making 

skills. Intel is buying the company 

for $15 billion. 

Stewart 

Butterfield, 44 

COFOUNDER, SLACK 

UNITED STATES 

Workplace communication 

Messaging platform Slack is 

now evolving into something of 

a corporate nervous system at 

scores of businesses. Next: leverage 

AI to automate mind-numbing 

office tasks. 

John and Patrick 

Collison, 26, 28 

COFOUNDERS, STRIPE 

UNITED STATES 

Digital payments 

Irish brothers made it effortless 

for merchants to accept 

online and mobile payments. 

Stripe processes billions in 

trans actions every year in 25 

countries. Its new business-ina-box 

product, Atlas, will help 

countries like Cuba leap into 

e-commerce. 

“Batteries are 

quite exciting 

and sexy things.” 

JAMES DYSON, 

DYSON 

James Dyson, 70 

FOUNDER, DYSON 

UNITED KINGDOM 

Home appliances 

Inventor who built a better, 

bag less vacuum before turning 

his attention to hair dryers, 

fans and now batteries. 

Recent success: a batterypowered 

vacuum that took 17 

years and 1,000-plus prototypes 

to finish. 

Scott Farquhar, 37 

Mike Cannon- 

Brookes, 37 

COFOUNDERS, ATLASSIAN 

AUSTRALIA 

Business productivity 

See story, p. 36. 

Larry Fink, 64 

COFOUNDER, BLACKROCK 

UNITED STATES 

Money management 

With $5.4 trillion in assets, 

BlackRock dominates ETFs 

and is strong in both active 

and passive strategies. Fink 

is using his firm’s vast shareholder 

positions to press 

boards for better behavior 

in areas of executive pay, 

climate-risk disclosure and 

boardroom diversity. 

Ken Frazier, 62 

CEO, MERCK 

UNITED STATES 

Cancer treatment 

When Frazier took over Merck, 

it was scandal-plagued and 

had few promising experimental 

drugs. Now it rivals Bristol- 

Myers Squibb in a new class of 

cancer drugs (including the one 

that saved Jimmy Carter) that 

amp up the immune system. 

“A long-term approach 

should not be confused with 

an infinitely patient one.” 

LARRY FINK, 

BLACKROCK 

ADRIAN SHERRATT/NEWSCOM; SAM KANG LI/BLOOMBERG 


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STRATEGIES 

Farquhar and Cannon-Brookes, unified in 

their drive to fend off such dangers, began their 

lives on disparate trajectories. Cannon-Brookes, 

the son of an English investment banker, spent 

much of his youth jetting between Sydney and 

a ritzy British boarding school. He bought his 

first computer using airline miles and decided 

to pursue a career in technology on a whim 

after being accepted into a prestigious business 

and computer science scholarship program at 

the University of New South Wales. 

Farquhar, meanwhile, was raised in a home 

with far more modest means. His mother 

worked at Target and later McDonald’s, his father 

at a service station, and he acquired his first 

computer—a barely functional Wang model— 

after his dad’s business threw it away. He too 

landed at UNSW as part of the same scholarship 

cohort, one of a few dozen standout students offered 

an annual stipend of roughly $9,000. 

Despite their differences, the pair developed 

a fast affinity. “He just seemed like a really 

good bloke,” Cannon-Brookes recounts with 

signature nonchalance. Nevertheless, they spent 

most of their college years working on separate 

projects: Cannon-Brookes on a couple of mildly 

successful startups, and Farquhar, like many of 

his classmates, as an unhappy intern at a technology 

consulting firm. 

They finally teamed up during their last year 

as undergraduates after Cannon-Brookes sent 

an email to a handful of classmates seeking 

partners for a new startup. The company would 

provide third-party support for a Swedish software 

firm. Farquhar, eager to avoid another 

consulting stint, was the only person to sign on. 

After graduating, they huddled in their respective 

bedrooms, working to cultivate clients 

under the banner Atlassian—named for 

the Greek titan Atlas, who holds up the heavens. 

But the third-party-support model proved 

difficult to scale, so they test-drove a number of 

other projects: a mail-archiving tool, a knowledge-management 

product and Jira, designed 

to help coders track bugs. 

Jira was the first to gain traction, so they 

scrapped the other ideas and went all in. There 

was only one possible business model. “Our 

software didn’t do very much to start with, so 

we couldn’t sell it for much money,” Farquhar 

explains. “If you aren’t going to sell it for much 

money, you need to sell a lot of it. To sell a lot, it 

needs to be sold globally. And if you sell globally, 

it’s got to sell itself online.” 

So Atlassian put Jira on the Web and largely 

let customers find it on their own. Among 

Taavet Hinrikus, 

36; Kristo 

Käärmann, 36 

COFOUNDERS, 

TRANSFERWISE 

UNITED KINGDOM 

Money transfers 

Uses peer-to-peer technology 

to challenge the world’s largest 

banks and giants like Western 

Union in the $3 trillion consumer 

money-transfer business. Transferwise 

matches buyers and 

sellers in over 70 countries. 

Robert Katz, 50 

CEO, VAIL UNITED STATES 

Ski resorts 

Transformed Vail into a global 

ski enterprise with new locations 

from Vermont to Australia, and 

casino-style data-driven marketing. 

His all-access season pass, 

priced at a low $859, is crushing 

competitors and reducing cyclicality. 

Chip-equipped lift passes 

collect data on its skiers. 

David Kong, 62 

FOUNDER, NIRVANA ASIA 

MALAYSIA 

Funerals 

On a continent starved for 

space, Kong sells tiny lockers for 

human remains in ornate columbaria 

where relatives can pay respects 

and even enjoy a meal. 

“Demand for a better service 

was evident,” says Kong, who 

despised burying his father-inlaw 

in a neglected public cemetery. 

(Others face a lottery or allout 

ban on land burials.) Nirvana 

runs cemeteries and columbaria 

across Asia and peddles services 

door-to-door. 

Jeff Lawson, 39 

FOUNDER, TWILIO 

UNITED STATES 

Mobile apps 

Has empowered some 40,000 

customers, including giants like 

Airbnb and Salesforce, to enhance 

their apps with voice, text 

and video messaging. Its usagebased 

pricing system has saved 

businesses millions, obviating 

the need for hardware or costly 

prepackaged solutions. 

Adam Neumann, 38 

COFOUNDER, WEWORK 

UNITED STATES 

Office space 

Rents out co-working space, 

GLOBAL 

GAME CHANGERS 

“The future of 

communications 

will be written in 

software by the 

developers of the 

world.” 

JEFF LAWSON, 

TWILIO 

“These systems get better year 

after year. Our brains are only as 

good as they are.” 

DAVID SIEGEL, 

TWO SIGMA 


with perks like arcade rooms 

and on-site beer kegs, in 44 

cities around the world. “The 

need for human connection is 

more important than ever,” says 

Neumann, who has amassed 

100,000 members. 

Gabe Newell, 54 

COFOUNDER, VALVE 

UNITED STATES 

Videogames 

In 2004, his company released 

Steam, a digital distribution 

platform that became one of 

the videogame industry’s most 

important sales channels. Valve 

is also leading the way into the 

cutting-edge world of virtual reality 

after the release in 2016 of 

the Vive, a VR headset. 

John Overdeck, 47 

David Siegel, 55 

COFOUNDERS, TWO SIGMA 

UNITED STATES 

Hedge funds 

Math geeks who built the fastest-growing 

big hedge fund 

on the planet by rounding up 

hordes of information and using 

algorithms to detect patterns 

of irrational pricing. Two Sigma, 

which now manages $46 billion 

for investors, harnesses 35 

million gigabytes of data from 

10,000 different sources. 

Zhou Qunfei, 47 

FOUNDER, LENS 

TECHNOLOGY CHINA 

Displays 

Developer of super-slim glass 

“Our mission: to create a world 

where people work to make a life, 

not just a living.” 

ADAM NEUMANN, 

WEWORK 

screens on iPhones. Started in a 

factory as a teenager and was 

tapped by Motorola in 2003 to 

help it replace its scratch-prone 

plastic screens. Took Lens Technology 

public. A $9 billion net 

worth makes her the richest 

self-made woman. 

Michael Rapino, 51 

CEO, LIVE NATION 

UNITED STATES 

Entertainment 

The king of live music. Put on 

concerts in 40 countries last 

year and is dominant in ticket 

sales via Ticketmaster. Ra pi no 

has also made a land grab for 

festivals, including Lollapalooza, 

Bonnaroo and Electric Daisy 

Carnival, and is behind big tours, 

including those by U2, Madonna 

and Jay Z. 

TIM PANNELL; JAMEL TOPPIN; THOS ROBINSON/GETTY IMAGES 


Last year, Ben was too sick to dream. 

He has Primary Immunodeficiency or PI. 

Thanks to the Jeffrey Modell Foundation, 

he has been properly diagnosed and treated. 

Now he can search for the cure. 

helping children reach for their dreams 

info4pi.org

STRATEGIES 

Mohammed bin 

Salman, 31 

DEPUTY CROWN PRINCE, 

SAUDI ARABIA 

Energy 

Rebooting Saudi Arabia’s economy 

by taking measures to wean 

it off oil, from raising taxes and 

reducing subsidies to slashing 

over-the-top perks for those on 

the government’s payroll. He is 

also leading the charge for the 

world’s largest IPO, the stateowned 

oil behemoth Aramco. 

Paulo Cesar de 

Souza e Silva, 61 

CEO, EMBRAER 

BRAZIL 

Manufacturing 

Pioneered a now widely used 

outsourcing model by plucking 

parts from companies like GE 

and Honeywell and then assembling 

in Brazil. Came to dominate 

the regional plane industry 

GLOBAL 

GAME CHANGERS 

“Snap is a camera company. 

We’re at the beginning of what 

cameras can do.” 

EVAN SPIEGEL, 

SNAP 

with its sleek and spacious E- 

Jets, which it sells to 70 airlines 

in 50 countries. 

Evan Spiegel, 26 

COFOUNDER, SNAP 

UNITED STATES 

Social media 

Got the world hooked on disappearing 

photo and video messages. 

Snap has 158 million daily 

active users who check the app 

an average of 18 times a day. 

Instagram and Facebook are 

copying. Offers a host of innovative 

mobile ads, like allowing 

brands to sponsor filters. 

Judy Wenhong 

Tong, 46 

CEO, CAINIAO 

CHINA 

Logistics 

Masterminding a vast collaborative 

logistics network for Alibaba 

and others. The onetime 

secretary is maestro over a data-backed 

central-information 

system that delivers 57 million 

packages in 224 countries a 

day. “We work with local partners 

and empower them with 

our data and computing ability,” 

Tong says. 

their first clients was American Airlines, which 

bought a thousand dollars’ worth of software 

without ever speaking to the Atlassian team. 

“American Airlines was the first company that 

just sent us some money and said, ‘We want the 

software,’ ” Cannon-Brookes says. “That was a 

pretty big moment. Obviously, we’ve continued 

to see that model.” 

That low-cost approach gave the company a 

positive cash flow from the get-go, allowing Cannon-Brookes 

and Farquhar to make outsize investments 

in research and development and to 

pay early hires in cash rather than forfeit equity. 

Buoyed by organic growth, Atlassian took 

no outside capital until 2010, when Accel Partners 

invested $60 million at an estimated $400 

million valuation. By the next funding round— 

a $150 million infusion led by T. Rowe Price in 

2014—its valuation had soared to $3.3 billion, 

and its unassuming, shaggy-haired co-CEOs 

were billionaires. The following year, the company 

went public with a $4.4 billion market cap, 

and their fortunes swelled even more. 

The founders downplay their riches, citing 

job creation as a more meaningful metric. But 

belying their low-maintenance public personas 

MICHAEL GRECCO


are some decidedly ten-figure trappings. Cannon-Brookes 

speculates in Bitcoin and invests 

in sci-fi passion projects like nano-satellites. In 

March, he sought to alleviate South Australia’s 

power crisis with the help of Elon Musk, engaging 

in a round of high-profile Twitter diplomacy 

in a bid to import a 100 megawatt-hour Tesla 

battery farm (a plan that, for myriad reasons, 

has so far gone nowhere). For his part, Farquhar 

recently paid $52 million for a 154-yearold 

seven-bedroom New South Wales estate 

that features a harborside tennis court, reportedly 

Australia’s priciest home purchase ever. 

With a lifetime of cash already stockpiled, 

the two are focused on making Atlassian an indispensable 

tool of enterprise that will catalyze 

many of the next generation’s most profound innovations. 

The Trello acquisition, then, is simply 

phase one of a master plan. “In ten years’ 

time we’ll still be very young and doing the job at 

47,” Cannon-Brookes says. “We think about the 

world in decades.” 

Hamdi Ulukaya, 44 

FOUNDER, CHOBANI 

UNITED STATES 

Yogurt 

Turkish immigrant popularized 

Greek yogurt in the U.S. 

Started in an old Kraft factory, 

his Chobani yogurt eventually 

took off, and today the 

company is raking in $1 billion 

in sales per year. Ulukaya gave 

away a tenth of Chobani’s 

equity to his workers and is actively 

hiring refugees. 

Cheng Wei, 34 

FOUNDER, DIDI CHUXING 

CHINA 

Ride sharing 

Saved China from Uber’s grasp 

by defending the ride-sharing 

company’s home turf. “It 

was an epic battle,” says Wei, 

a nicer, humbler version of Travis 

Kalanick. Didi amassed 300 

million users across China in 

four years and just added another 

$5 billion in funding to 

its war chest. 

GLOBAL 

GAME CHANGERS 

“It was an 

epic battle.” 

CHENG WEI, 

DIDI CHUXING, 

ON BEATING UBER 

IN CHINA. 

Christo Wiese, 75 

CHAIRMAN, STEINHOFF 

SOUTH AFRICA 

Bargain shopping 

African retail tycoon made an 

end run on big urban-market 

competitors by targeting rural 

and low-income areas with 

rock-bottom prices and everyday 

items. His central distribution 

system also made more 

efficient work of stocking 

shelves. Wiese presides over 

Africa’s largest retail empire 

and has 11,000 stores across 

30 countries. 

Anne Wojcicki, 43 

COFOUNDER, 23ANDME 

UNITED STATES 

Personal genomics 

When the FDA told 23andMe 

to stop marketing its test, it 

looked like the company was 

toast. But Wojcicki has worked 

to get the product back on the 

market and deploy the company’s 

genetic-data troves for 

drug development, too. 

FINAL THOUGHT 

“If you create a piece of software that’s essentially free to reproduce, you can keep getting paid over and over 

perpetually.” —MARKUS PERSSON

STRATEGIES 

How the West 

Was Won 

Despite making a series of smash-hit games for 

its home Asian market, NCSoft has struggled to 

translate to America—until its billionaire founder 

put his MIT-educated wife at the controls. 

BY DAVID M. EWALT 

NCSoft West CEO Yoon 

Songyee wrote her 

Ph.D. thesis on a new 

method for designing 

virtual creatures with 

realistic personalities and 

emotions. 

In 1998, a startup called NCSoft launched one 

of the most popular videogames of all time, 

although you’ve probably never heard of it. 

The game has earned more than $2.6 billion 

in revenue, including $330 million in 2016, 

18 years after it hit the market. But you probably 

don’t know anyone who has played it. 

Two decades after it was founded, South Korea-based 

NCSoft is one of the biggest game companies 

on the planet, with a long list of hits and 

successful franchises, yet it remains largely unknown 

across the Pacific. Games like its flagship 

title, Lineage, were blockbusters in Asia but 

failed to catch on with Western players. Repeated 

attempts to expand the business into the United 

States never gained traction. 

But Kim Taek-Jin, the company’s billionaire 

CEO, is determined to change that. In the past two 

years, NCSoft has built a new game studio in California, 

pivoted toward a risky mobile strategy and 

begun developing new properties for Western audi 

ences. Kim is so committed to translating NC- 

Soft’s success that he has even bet his family on the 

project: His wife, Yoon Songyee, an accomplished 

executive and neuroscientist known as Genius Girl 

in Korea, moved to California in 2014 with their 

kids to run the company’s U.S. subsidiary. 

“We’ve been keeping our eye on the Western 

market for a long time, and it’s important to us,” 

says Yoon, the CEO of NCSoft West. “We have 

a big presence in Asia and Korea, but that’s not 

enough. We want a global audience.” 

Kim founded NCSoft in March 1997, when he 

was a 30-year-old engineer who had worked for 

Hyundai Electronics in R&D and in the division 

that operated Korea’s first internet provider. NC- 

Soft was initially positioned as a systems-integration 

company, but Kim and several key employees 

were enthusiastic gamers and quickly realized their 

networking know-how could be used to power 

videogames with thousands of simultaneous users. 

In September 1998, NCSoft launched Lineage, one 

of Korea’s first massively multiplayer online roleplaying 

games, or MMORPGs, in which players 

fight and explore their way through a medieval 

fantasy setting. The game was a hit: Three years 

later, it had more than 3 million subscribers paying 

about $25 a month. 

Kim quickly tried to repeat that success in 

America. In May 2000, the company launched 

NCSoft Interactive, a subsidiary in Austin, Texas, 

and just over a year later released an English-language 

version of Lineage in North America. But 

Western gamers were much less enthusiastic than 

their Korean counterparts. The game was built for 

Asian consumers who often played with groups of 

friends, in internet cafes, on relatively underpowered 

computers. Americans played solo, at home, 

on newer PCs, so the game seemed difficult, repetitive 

and dated. 

Lineage struggled in the U.S., but NCSoft didn’t 

give up. In 2001, the company acquired Destination 

Games, also in Austin, but the studio took six years 

to release its first title, the MMORPG Tabula Rasa, 

which sold so poorly that NCSoft shut it down after 

just 15 months. In 2002, NCSoft acquired Seattle developer 

ArenaNet, and that deal went better: Arena- 

Net’s 2005 Guild Wars remains one of NCSoft’s few 

hits in North America. Yet back in Korea, NCSoft 

ETHAN PINES FOR FORBES 


VIDEOGAMES 

HOW TO PLAY IT 

WILLIAM BALDWIN 

Software, intangible bits in a memory, is worth billions. 

But where are the good buys? You could have 

more than quadrupled your money buying either 

of the big videogame companies five years ago: 

Electronic Arts or Activision Blizzard. They are solid 

moneymakers now, but their value hangs on entertainment 

habits, which could change. You’re better off betting on 

software that locks people into business habits (harder to change). 

Microsoft and Oracle have their clients addicted to particular databases 

and office procedures. They’ll be coining money long after 

gamers have gotten bored with Star Wars Battlefront and Destiny 2. 

William Baldwin is Forbes’ Investment Strategies columnist. 

prospered. Today the company has more than 3,000 

employees, operates seven successful MMORPGs 

and had worldwide sales in 2016 of more than $860 

million. “They are a major company in Korea, where 

they generate most of their revenue,” says David 

Cole, CEO of market research firm DFC Intelligence. 

“In the U.S. they are a one-trick pony.” 

If NCSoft is going to fix that problem, the responsibility 

will fall on NCSoft West’s Genius Girl 

chief executive. Korean newspapers gave Yoon the 

nickname after she earned a Ph.D. in computational 

neuroscience from MIT in 2000, when she was 

24, and then quickly climbed the ladder at Mc Kinsey 

& Co. and Seoul-based wireless giant SK Telecom. 

In 2007, she married Kim and, a year later, 

joined him at NCSoft. 

“I studied electrical engineering, computer science, 

artificial intelligence and brain sci ences, without 

knowing that I would be working in the game 

industry,” Yoon says. “But everything is so related.” 

As NCSoft’s chief strategy officer, she pushed 

the company into AI ( to keep customers paying 

and playing) and oversaw the development of Guild 

Wars’ successful sequel. Yoon was made CEO of 

NCSoft West in November 2011. 

In May 2015, Yoon launched Iron Tiger Studios, 

a new mobile-gaming division, based in San 

Mateo, California. NCSoft had only dabbled in mobile 

games before. The company’s main products 

were games that were huge, complex and expensive 

to make, a far cry from the small and inexpensive 

games that dominate the mobile market. 

It’s a risky strategy. Plenty of game companies in 

the U.S. have tried and failed to translate their products 

to the mobile market. But mobile is also an “untapped 

frontier with fewer built-in biases,” says Michael 

Pachter, managing director of equity research 

at Wedbush Securities. “I think that some of their 

FINAL THOUGHT 

“West is where we all plan to go someday.” —ROBERT PENN WARREN 

properties will work better in the West on mobile.” 

If they do, the rewards could be significant. According 

to market research firm Newzoo, mobile is 

the largest and fastest-growing segment of the $100 

billion global game market, with revenues estimated 

to climb 19% in 2017 to $46.1 billion. 

NCSoft built out Iron Tiger quickly. It will 

reach 150 employees by year’s end, and the studio’s 

first game (Aion: Legions of War) is expected 

to be released in the next few months. Meanwhile, 

NCSoft West is also working on building 

better Westernizations of its existing Korean 

games—not simply translating the in-game language 

but adjusting art to Western styles and 

tweaking the action for Western gamers. 

“Bringing games directly from Korea to just 

translate and publish them taught us what works 

and what doesn’t,” Yoon says. “Western players pay 

attention to narratives and their experience within 

the game . . . but don’t necessarily spend a lot of 

time trying to understand the saga and legend behind 

it.” Americans also like being heroes, she says, 

and are more likely to play solo. 

So far, the strategy is working. In January of last 

year, NCSoft West released a Westernized version 

of its martial arts game Blade & Soul, which debuted 

in 2012 in Korea; it was an instant hit, surpassing 

a million players in its first month. Today 

the game has 4 million paying 

players, making it one of the biggest 

Korean-developed games NC- 

Soft has launched in North America 

and Europe. As a result, that 

region had 25% sales growth for 

2016, the most of any of the company’s 

territories. In 2017, analysts 

expect the company’s worldwide 

revenues to top 1.3 trillion Korean 

won—more than $1.1 billion—for 

the first time in its history. 

And soon North American 

gamers will even get to play games 

before NCSoft’s Asian audience 

has a crack at them. The company’s newest franchise, 

a multiplayer online battle-arena game 

called Master X Master, is currently under development 

by NCSoft’s lead studio in Seoul but 

will make its global debut in North America later 

this year. 

“It’s U.S. first, developed in Korea, with all our 

feedback from the Western regions,” Yoon says. 

“And if it’s a great game, then everyone will like it, 

whether they’re from this market or another.” 

BY THE 

NUMBERS 

GREAT FLEET 

FORWARD 

As the Chinese get 

richer, they want 

bigger cars. Good 

news for Detroit? Not 

so—Chinese automakers 

are the ones cashing in, 

offering more affordable 

SUVs. In 2016, three 

of the five top-selling 

vehicles in China were 

domestic brands, up 

from none just half a 

decade earlier. 

2016 

1. WULING 

HONGGUANG 

650,018 sold 

2. GREAT WALL 

HAVAL H6 

580,683 

3. VOLKSWAGEN 

LAVIDA 

478,699 

4. BUICK EXCELLE GT 

370,370 

5. BAOJUN 730 

370,169 

2011 

1. BUICK EXCELLE 

253,514 sold 

2. VOLKSWAGEN 

LAVIDA 

247,475 

3. CHEVY CRUZE 

221,196 

4. VOLKSWAGEN 

JETTA 

217,861 

5. VOLKSWAGEN 

BORA 

207,041 

Source: 

China Association 

of Automotive 

Manufacturers. 

LEFT: THOMAS KUHLENBECK FOR FORBES 


TECHNOLOGY 

FAST TECH 25 

Big Pharma’s Friend 

Peter Gassner rebooted Veeva Systems, and his gambit has created 

the ultimate pharmaceutical tool. 

BY ALEX KONRAD 

In the summer of 2010, when his startup, 

Veeva Systems, was just three years old, CEO 

Peter Gassner summoned his team to deliver 

a surprising message: It was time to think 

about a second act. Veeva was on a roll. It had become 

indispensable to Big Pharma companies, 

who were embracing at a fast clip its software 

for tracking sales and customers. But to build 

a lasting business, Gassner believed, Veeva had 

to think bigger. “Batten down the hatches here,” 

Gassner recalls saying. “We’re in for six years of a 

hard slog.” 

The gambit has more than paid off. Bolstered 

by that second act—an entirely new product 

called Veeva Vault that helps the likes of AbbVie 

and Merck manage the process of drug development 

and clinical trials—Veeva has seen its sales 

grow an average of 37% over the past three years 

to $544 million in the most recent fiscal year. No 

enterprise software company other than Salesforce 

has topped the $500 million sales mark faster 

than Veeva, which ranks No. 8 on Forbes’ Fast 

Tech 25 list of America’s fastest-growing public 

tech companies. 

Today, Veeva counts many of the biggest 

names in the drug industry among its more than 

500 customers, including Abbott, Bayer, Gilead, 

Novartis and Pfizer. Some 60% of the world’s 

pharma sales reps use Veeva to track buyers and 

prospects and to coordinate between sales teams 

globally. Many of them also use Vault, which 

now accounts for nearly a third of Veeva’s revenue. 

“We’re a little bit of an unknown story,” says 

Gass ner, a wiry 52-year-old who is fond of plain 

dark suits. “But in financial returns, we are quite 

surprising.” 

The success of Vault capped a ten-year journey 

for Gassner, who grew up in Portland, Oregon. 

After learning to code in college, he rose through 

the ranks at IBM and PeopleSoft before joining 

Salesforce in 2003, when it was just 200 people. 

Four years later, Gassner saw a big opportunity to 

build software focused on a single sector on top 

Veeva CEO Peter 

Gassner hopes 

to expand his 

software business 

beyond its core 

pharma clients 

to chemical, 

cosmetics and 

manufacturing 

customers. 

CODY PICKENS FOR FORBES 


TECHNOLOGY 

FAST TECH 25 

of Salesforce’s platform. Settling on the $1.6 trillion 

life-sciences industry, Gassner tapped Matt 

Wallach, a Harvard M.B.A. with a background in 

tech sales to big pharma, to cofound Veeva, maintaining 

dual offices in Pleasanton, California, and 

Philadelphia, a life-sciences hub. 

Veeva’s core customer-relationship management 

software struck a chord and propelled 

the company through a successful public offering 

in 2013. At the time, Vault was just “a glimmer 

of hope” for Gassner & Co. and the challenge 

of building it was considerable: It didn’t share a 

single line of code with Veeva’s core product. To 

make matters worse, a year later Veeva hit some 

turbulence as it failed to meet Wall Street’s overoptimistic 

growth expectations. It bottomed out 

in May 2014, when its stock fell to 59% off its 

first-day highs. 

The work on Vault pushed Gassner and his 

team out of their comfort zone and into building 

their own applications for the pharma industry. 

While the Vault applications have none of 

the bells and whistles you’ll find on popular consumer 

apps, they facilitated tasks across the industry. 

They bear names such as Electronic Trial 

Master File, which provides templates to log patient 

types and results for trials of new drugs. 

“When Johnson & Johnson does that with thousands 

of people, they’re not going to do it by 

email,” Gassner says. The result, he says, could 

separate wasted investment from FDA approval. 

Vault sales reached $174 million this past year 

and are on pace to overtake the core business in 

upcoming years. They’ve helped Gassner regain 

the trust of investors, who have pushed Veeva’s 

market capitalization past $7 billion. 

Far from celebrating, Gassner is thinking 

about act three. The company recently launched 

its first app outside of pharma, providing quality 

control tools to two top-30 chemical companies. 

Analysts, such as JPMorgan’s Sterling Auty, 

are raising their price targets for Veeva again. “We 

think this can be a big opportunity,” Auty told investors 

recently. 

Gassner remains cautious. He says he learned 

years ago from PeopleSoft’s billionaire founder, 

David Duffield, not to get ahead of himself with 

ambitions or ego. Veeva may have the healthy 

gourmet catered lunches that are hallmarks of a 

successful tech company, but Gassner still rides 

his bike to work. “I feel we are on to something,” 

he says softly. “But it’s too early to know.” 

FINAL THOUGHT 

“It’s the next work, still to be written, that 

offers the second chance.” —CYNTHIA OZICK 


JON ORINGER : SLAVEN VLASIC/GETTY IMAGES; LARRY PAGE: TIM MOSENFELDER/GETTY IMAGES; KEN XIE : KIM WHITE/BLOOMBERG 

The Fast 

Tech 25 

Our list of 

America’s 

fastest-growing 

tech companies 

screens for 

superior growth 

(past and 

projected) and 

a solid earningsquality 

score from 

Value Line. For 

growth investors, 

these are some 

of the hottest 

names—some 

well-known, 

others not so 

much—in one of 

the most dynamic 

sectors of the 

economy. 

TRAILING 3-YR 

SALES GROWTH 

3-TO-5-YEAR 

EST EARNINGS 

GROWTH RATE 

GrubHub 

Food delivery from 50,000 restaurants in 500+ cities 

Facebook 

Nearly 2 billion social networking users; Instagram; WhatsApp 

Arista Networks 

Networking equipment 

Paycom Software 

Software for payroll and HR 

Ellie Mae 

Software for mortgage applications 

Stamps.com 

Internet-based mailing and shipping services 

NetScout Systems 

Application and network management software 

Veeva Systems 

Software for Big Pharma 

Gigamon 

Network management solutions 

Shutterstock 

Marketplace for stock photography, video and music 

Fortinet 

Cybersecurity software, appliances and services 

EPAM Systems 

Software services 

Salesforce.com 

Cloud-based enterprise software 

LogMeIn 

Connectivity software for remote collaboration 

Total System Services 

Credit card processor, acquirer and issuer 

CoStar Group 

Commercial real estate information provider 

Ultimate Software Group 

Software for HR management 

Athenahealth 

Cloud-based health care data management software 

Amazon.com 

E-commerce; cloud computing 

Virtusa 

IT consulting services 

Vantiv 

Credit card processor 

Alliance Data Systems 

Loyalty and marketing campaigns 

PayPal Holdings 

Digital payments 

Red Hat 

Open-source software 

Alphabet 

Computing conglomerate 

10%

CEO, JON ORINGER 

SHUTTERSTOCK 

Shutterstock served 1.7 million 

customers in the past 12 months 

through its repository of 125 

million stock photos from 190,000 

contributors. For two years, the 

company has been fleshing out its 

editorial photo business. In April, it 

had exclusive access to cover the 

Met Gala, fashion’s biggest night. 

CEO, JONATHAN CORR 

ELLIE MAE 

Pleasanton, Californiabased 

Ellie Mae 

makes software 

that automates the 

mortgage process 

for small U.S. lenders 

by compiling titles, 

income history, 

appraisals and other 

documents. Ellie Mae 

shares are up more 

than 1,400% since its 

2011 IPO, thanks to the 

rise of home lending 

and independent 

mortgage companies. 

CEO, JAYSHREE ULLAL 

ARISTA 

Arista builds 

the networking 

equipment that 

keeps data flowing 

through large data 

centers. It’s eating up 

an increasingly large 

market share in the 

100-gigabit network 

switch market from 

competitors like 

Cisco, with almost 

30% share, according 

to research firm IHS. 

CEO, KEN XIE 

FORTINET 

Fortinet, a cybersecurity 

service provider 

for businesses and 

governments, is growing 

fast on the back of a 

rapidly consolidating 

market for firewalls. The 

company is fourth in line 

behind Cisco, Palo Alto 

Networks and Check Point 

Security in market share. 

CEO, JAMES 

M. WHITEHURST 

RED HAT 

Last year, Red 

Hat became the 

first open-source 

software company 

to reach $2 billion 

in revenue. The 

company develops 

and sells opensource 

software for 

businesses—which 

allows customers to 

avoid proprietary 

software developed 

by giants like 

Microsoft and Oracle. 

CEO, LARRY PAGE 

ALPHABET 

Along with other giants 

like Facebook and 

Amazon, Alphabet has 

defied the law of large 

numbers and continued 

to grow at a blistering 

rate despite its size. While 

its so-called other bets 

in self-driving cars, fiber 

and life sciences have 

yet to pay off, Google’s 

advertising business is 

being complemented by 

growing hardware and 

cloud units. 

20% 30% 40% 50% 


TECHNOLOGY 

EDUCATION 

Class App 

By listening to its core 

audience—teachers— 

ClassDojo’s educational 

software has reached 90% 

of U.S. schools. Now the 

real work begins: how to 

get someone to pay for it. 

BY KATHLEEN CHAYKOWSKI 

Every morning before Cindy 

Price starts teaching her first 

graders in New Castle, Delaware, 

she fires up Class- 

Dojo, a classroom management app. 

She checks parent messages, finds out 

whether any students will be out sick 

and reads school news. When a child 

shows a trait like “amazing thinking” 

or “great listening,” she adds a point 

to the student’s avatar—a personalized 

cartoonish monster—generating 

a bright ping! that makes classmates 

perk up. Points come off for disruptive 

behavior. Twice a day, Price shares 

class photos or videos with parents. 

And during free time, she plays Class- 

Dojo’s short personal-growth videos, 

which use monsters like ClassDojo’s 

excitable green mascot, Mojo, to teach 

lessons on empathy and perseverance. “It’s helping 

teachers be successful in the classroom,” she says. 

Teachers like it because teachers have shaped 

it, in the form of 20,000 who provide constant 

feedback. That bottom-up approach, and kidfriendly 

gamification, has given it penetration 

into 90% of U.S. schools, according to the company. 

“Why don’t we just go to the people doing the 

work?” says CEO and cofounder Sam Chaudhary. 

“It sounds obvious, but it wasn’t being done.” 

ClassDojo has been translated into 35 languages 

and made inroads in 180 countries. The 

company says ClassDojo reaches 7 million kids 

globally every day, or 1% of the 700 million children 

in grades K–8 or their equivalent. Price says 

that at her school, Southern Elementary, nearly all 

the teachers and a healthy dose of parents use it. 

All of this is great, of course, except for one 

sticky problem: ClassDojo is free, and when 

you’re dealing with teachers and young students, 

a freemium model involving in-app purchases 

isn’t a natural winner. 

So what is this company, which is successful in 

every aspect except the bottom line, supposed to 

do? While the core app remains free, the company 

plans to target parents by promoting learning outside 

of school hours. “The home has been very underserved 

for educational resources and doesn’t 

support what’s happening in school,” cofounder 

Liam Don says. Paid features could take the form 

of a content subscription aimed at parents who 

can’t afford a private school but want to invest in 

their kids’ education. It’s all a bit fuzzy at this point, 

though the stakes are huge: Educational software 

ClassDojo cofounders 

Liam Don and Sam 

Chaudhary believe the 

success of their free 

classroom-management 

app will pave the way for 

additional paid services 

meant to support learning 

at home. 



3 0 

3 0 

U 

N 

D 

E 

R 

OFFICE 

MATES 

ORGANIZING A MORE 

EFFICIENT WORKDAY 

WITH THE FORBES 

30 UNDER 30, IN 30 

WORDS OR LESS. 

NICK CANDITO 

Progressly | 29 

Developed 

a cloudbased 

hub that 

digitizes 

and 

centralizes 

businessoperations 

data collection, 

enabling companies 

to review ways they 

can best tackle 

internal issues such as 

safety and regulatory 

compliance. 

TECHNOLOGY 

EDUCATION 

parents are disconnected, popping in every three 

months, and kids aren’t excited to be at school, 

into a community working together?” Chaudhary 

asked. The first version of ClassDojo, which 

let teachers give kids feedback, spread to 35,000 

classrooms in a mere 12 weeks, prompting Y 

Combinator cofounder Paul Graham to personally 

invest in its seed round. 

Six years later, ClassDojo has raised about 

$31 million from investors, earning a recent valuation 

of $100 million. Its 30 employees occupy 

an airy former art gallery in San Francisco’s SoMa 

area. Muhammed Chaudhry, the CEO of the Silicon 

Valley Education Foundation, says gaming 

techniques succeeded in turning ClassDojo into 

“the most widely used and respected behavioral-management 

app out there.” Academic studies 

have found that ClassDojo helped to increase students’ 

positivity, self-control and engagement and 

to reduce behavioral problems. 

ClassDojo now supports a Facebook-like feed 

that teachers use to share photos and video of 

the class, and a “Stories” section that lets schools 

and students post news and projects. “I can look 

through the feed and see they’re studying the letter 

‘m’ and that they had bagels for snacks,” says Jenand 

digital content (preschool through 12th grade) 

represent a market bigger than $8 billion. 

Chaudhary and Don, both Forbes 30 Under 

30 alums, began dreaming up what would become 

ClassDojo after a weekend gathering for 

entrepreneurs in Cambridge in their native England. 

The two quickly bonded over a shared concern: 

The purpose of education has changed dramatically 

over the past century, but classrooms 

haven’t. 

Though just 25 at the time, both had relevant 

experience. Chaudhary taught 20 hours a 

week through his teens in Abu Dhabi and worked 

for McKinsey & Co.’s education group; Don, the 

CTO, was a computer-science Ph.D. student with 

a focus on educational tech. Three months after 

their first meeting, the pair moved to Silicon Valley 

to tap $20,000 from Imagine K12, a startup accelerator 

focused on education that’s part of the 

prestigious Y Combinator program. 

The two spent a month meeting hundreds of 

teachers to gauge needs. Supporting kids’ personal 

growth through playful communication and 

building community became early goals. “How 

do you turn a classroom from an isolated place 

where one teacher is dealing with 30 kids and 

30 UNDER 30 PORTRAITS: BRIAN TAYLOR FOR FORBES; RIGHT: THOMAS KUHLENBECK FOR FORBES 

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BY JOHN DOBOSZ 

Like ClassDojo, many of the companies making inroads into 

the K–12 arena are privately held and off-limits to stock market 

investors. One alternative avenue for tapping into the educational 

software business is to invest in the industry’s dominant 

player, U.K.-based Pearson PLC. Pearson publishes textbooks 

and sells learning technologies that include test development 

and scoring. Teachers use its Dash app for classroom management, and its 

MyLab learning modules are designed for students. At 13.6 times this year’s 

expected earnings, Pearson’s U.S.-listed ADRs trade 7% below their five-year 

average P/E ratio. Dividend investors will like its 7.9% yield. 

John Dobosz is editor of Forbes Dividend Investor and Forbes Premium Income Report. 

nifer Tyler, a working mom with two preschoolers 

in ClassDojo classrooms. “I feel more connected.” 

Teachers say the app helps to promote values like 

responsibility and focus. Students, who have sent 

ClassDojo 250,000 drawings of its whimsical monsters 

and mascot, may be the biggest fans. 

ClassDojo faces a handful of startup competitors 

FINAL THOUGHT 

“Tell me and I forget, teach me and I may remember, 

involve me and I learn.” —BENJAMIN FRANKLIN 

that are more narrowly focused 

on classroom communications 

or ways for 

students to upload homework. 

The company has 

stayed ahead through its 

broader focus and rapid 

product innovation, based 

on pedagogical research 

and teacher consultations. 

It collaborated with educators 

at Stanford, Harvard 

and Yale to develop a 

video- discussion series on 

“big ideas,” with sections 

like “growth mind-set” and “perseverance” as well 

as content to promote empathy and mindfulness. 

Chaudhary vows to double down on ClassDojo’s 

user focus, through ongoing in-depth consultations 

with teachers and parents. “Education is a 

human system,” he says. “You need to work with 

people to change it.” 

MATHILDE COLLIN 

Front | 28 

Created a 

collective 

in-box for 

business 

teams 

that 

consolidates 

messaging 

from emails 

and texts, social channels 

like Facebook and Twitter, 

and project-management 

tools such as Trello and 

Asana. 

PETER JOHNSTON 

Lystable | 28 

Platform helps businesses 

manage communication 

with their remote and 

freelance workers, 

from bringing 

them on 

board and 

organizing 

projects to 

streamlining 

invoicing and 

conducting 

performance 

reviews. 

—Natalie Sportelli 

OD Global offers: 

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For more information, visit odfl.com or call 1-800-432-6335.

ENTREPRENEURS 

Google Slayer 

Starting with $15,000, Jorn Lyseggen built a version of Google 

Alerts before Google Alerts. And despite the big-foot competition, 

Meltwater has found the talent to forge a $300 million company. 

BY ZACK O’MALLEY GREENBURG 

Adecade ago, with Google and Yahoo 

lumbering onto its turf, Jorn Lyseggen’s 

fledgling media-intelligence 

company, Meltwater, faced an existential 

challenge. Getting clients to 

pay Meltwater to track press mentions suddenly 

became a lot harder when Google Alerts was offering 

the same service for free. Rather than cut back, 

Lyseggen went on a recruitment binge—interviewing 

3,000 job applicants face-to-face in a dozen or 

so countries over a span of five years. 

To find unorthodox solutions, he brought on an 

eclectic cast of characters. There was executive director 

Kaveh Rostampor, an Iranian refugee who 

arrived in America via Sweden. Another hire, Sebastian 

Geides, had been a competitive handball 

player on the verge of finishing a theology program. 

When Lyseggen asked him why he would choose 

Meltwater over the priesthood, Geides responded 

that Meltwater’s product was easier to sell. 

“Talent is talent, everywhere,” says Lyseggen, 

48. That philosophy has helped him not only survive 

the challenges from Google and Yahoo but also 

transform Meltwater into a company that produces 

annual revenue approaching $300 million, with an 

estimated profit margin of 15%. Meltwater, based 

in San Francisco, has 25,000 clients—from Harvard 

Business School to the Denver Broncos—all paying 

for what’s essentially a souped-up Google Alerts. It 

notifies clients about media mentions but also offers 

tools that, for example, can distinguish positive 

mentions from negative ones. Prices for Meltwater 

range from $5,000 to $25,000 a year. 

Lyseggen didn’t have to look far for proof that talent 

is talent everywhere. Born in South Korea in 1968, 

he was adopted by a Norwegian family and raised in a 

tiny farming village near the Swedish border. “When 

people meet me, they’re a little surprised that I don’t 

look tall and blond and dashing,” Lyseggen says. “I was 

pretty much a redneck kid. I didn’t know much about 

the world. I have friends that still are pumping gas.” 

He went a different route, enrolling at the Bergen 

University College of Engineering in 1988, where he 

spent nearly all of his student-loan 

money—roughly 

$10,000—to buy the 

fastest personal computer 

available and began to design 

software. After graduating, 

he went to work for 

the Norwegian Computer 

Center, where he grew 

fascinated with Java. He 

then quit and founded an 

internet-consulting outfit, 

EU Net Media. In December 

1995, with Lyseggen’s 

help, Norway’s first online 

transaction was recorded. 

Two years later, he sold 

the consulting firm for $7 

million; he then launched 

a similar firm and got $40 

million for it in 1999. He 

started yet another and 

watched it go public in 

Sweden and soar to a market 

cap of $500 million, 

only to see the share price 

plummet during the dotcom 

bust. 

Lyseggen forged ahead and founded Meltwater 

in 2001, seeding it with just $15,000 and a tiny office 

in an Oslo shipyard—because, he says, he was pouring 

money into other startups that excited him more 

and didn’t want to subsidize a struggling business for 

long. But he believed in Meltwater’s premise. At that 

point, Google was just three years old and hadn’t 

yet launched Google Alerts. In Lyseggen’s view, the 

world was drowning in information, and he wanted 

to find a way to use software to help simplify things. 

“The sell was a subscription to the service that monitored 

all the news that was published online,” he 

says. “Whenever news that was relevant to them was 

published, the clients would be notified.” 

Initially, Lyseggen and his very small sales team 

NANA KOFI ACQUAH FOR FORBES 


HUMAN RESOURCES 

pitched Meltwater to 1,500 companies. The answer 

from 1,499 was no, with one maybe. Lyseggen told 

his team they couldn’t pitch the service until they got 

a sense of their clients’ pain points. Only with that 

context in mind were they permitted to proceed with 

the hard sell. He also required that all subscription 

fees be paid up front for the entire year so he could 

continue bootstrapping the business. Both moves 

worked: By the end of 2003, Meltwater had signed 

1,000 clients and revenue had reached seven figures. 

The following year, it expanded into Sweden. 

Warming up to his own company, Lyseggen brought 

new hires to Oslo and trained them for three months 

before returning them to Stockholm to open a new 

office, which was cash-flow-positive after two weeks. 

He repeated the process as he spread Meltwater 

across northern Europe, and by the end of 2005, annual 

revenue had reached $11 million. 

As Meltwater continued to expand, Lyseggen unfurled 

his exhaustive—and exhausting—approach 

to recruiting: the 3,000-interview binge. With his 

human resources teams, he concentrated on top 

universities, trying to hire only candidates with 

management potential—as well as intelligence, drive 

and wit. The new hires helped Meltwater compete as 

Google Alerts and Yahoo News inundated the media-intelligence 

space in the Web 2.0 world. Lyseggen 

cast his new competitors as entry-level versions 

of his superior service—while constantly trying to 

improve Meltwater’s once-clunky product. Says Ben 

Hunt, director of digital media for the Denver Broncos, 

“The interface has come a long way.” 

Raised in Norway by adoptive 

parents, Jorn Lyseggen says 

people are often surprised he 

isn’t tall and blond. He was 

photographed in Ghana at his 

school for entrepreneurs. 


ENTREPRENEURS 

HUMAN RESOURCES 


BY TAESIK YOON 

For investors, resource-rich Africa is a sleeping giant with 

hundreds of millions of consumers on the cusp of joining 

the global economy. One small-cap harnessing Africa’s 

growth is Net 1 UEPS Technologies, a South African provider 

of payment-processing technology. Despite generating 

strong profits over several years from its lucrative contract 

to distribute welfare grants for the South African Social Security Agency, 

the company has been plagued by controversy over how the contract 

was obtained and accusations that Net 1 improperly used grant recipients’ 

personal data (it has denied the allegations). To improve the stock’s performance, 

Net 1 has been diversifying its offerings and expanding to other 

developing regions, including markets within Africa and India. Net 1 trades 

at a ridiculously low six times earnings. 

Taesik Yoon is editor of the Forbes Special Situation Survey and Forbes 

Investor newsletters. 

When Coca-Cola 

asked for an analytics solution 

that made it easier 

to spot trends affecting 

competing brands, Meltwater 

built it. Other clients 

found new applications 

on their own. The 

CEO of a Swedish window 

company told Lyseggen 

he used Meltwater’s 

hyperlocal media 

tracking to pinpoint burglary 

spikes so he could 

market more heavily in 

the areas affected. 

During this period, 

Lyseggen began pondering 

what African youngsters 

might do with 

high-speed internet and 

computers like the one 

he had bought as a college 

student. “I concluded 

that if I wanted to do 

something impactful,” 

he says, “I needed to do 

something that was built 

on my core expertise.” 

In 2008, Lyseggen established 

the Meltwater Entrepreneurial School of 

Technology, an all-expenses-paid program that helps 

African entrepreneurs learn how to launch companies. 

He selected Accra, Ghana, as its home (see box). 

He raced around the globe, doing 200 interviews 

with NGOs, colleges, software companies and po- 

GOING, GOING, GHANA 

The bridge on the outskirts of Accra, Ghana, looks like something from an 

Indiana Jones movie: a series of creaky wooden planks suspended by rope 

over a fetid stream. Towering palm trees and tin-roofed shacks dot the overgrown 

landscape. Appearances can be misleading. The span was designed 

and built by engineers trained by the Meltwater Entrepreneurial School of 

Technology, a program created by Meltwater founder Jorn Lyseggen to help 

West African entrepreneurs learn how to launch companies. Annual funding 

from Meltwater: $2 million. 

The creek separates the two buildings that constitute the school’s 

headquarters: on the near side, classrooms; on the far side, air-conditioned 

offices connected by a spiral staircase adorned with quotes from Bill Gates, 

Warren Buffett and Nelson Mandela. The bridge reduced the trek between 

the edifices from 20 minutes to 2. Inside, entrepreneurs-in-training create 

startups from scratch and workshop them with other students and faculty. 

The final exam is a pitch session in front of Lyseggen and other investors, 

with up to $200,000 in funding on the line. 

Successful pitches move on to the school’s incubator. Among them: 

Kudobuzz, which amplifies companies’ positive ratings online; it has taken 

$190,000 in investment capital from Meltwater and 500 Startups. Claimsync, 

a platform that processes medical claims, raised more than $100,000 

before getting bought for an undisclosed sum. Tress, a hairstyle app, “became 

the only place to find out what Ghanaian, Nigerian or black women in 

London . . . have on their head,” says cofounder Priscilla Hazel. It also earned 

a $20,000 grant from Y Combinator. —Z.O.G. 

tential students. Today, the program accepts some 60 

of 6,000 applicants a year. Instructors start with basics: 

how to write a business email, how to connect on 

LinkedIn. Then come units on 

coding, marketing, accounting 

and pitching investment ideas. 

“Africa could be a place 

where companies all over 

could find software developers,” 

Lyseggen says. “It’s a population 

of a billion people. It’s 

going to double and triple in 

the next few decades. Some 

people might think that’s 

scary, and of course, there are 

concerning things around that 

as well, but if you think of it 

from a talent perspective, what 

a phenomenal talent pool.” 

In the meantime, Lyseggen 

is happy to tap that pool for Meltwater. He recently 

hired a handful of graduates from the entrepreneurial 

technology school to work on the mobile team. 

FINAL THOUGHT 

“Talent is cheaper than table salt. What separates the talented individual from the 

successful one is a lot of hard work.” —STEPHEN KING 

MARGIN 

PROPHET 

BEST 

INTENTIONS 

Four years ago, plagued by 

egregiously high employee 

turnover, James Ruder, 

CEO of L&R Pallet, a maker 

and recycler of wooden 

packing pallets, tried hiring 

from among Denver’s refugee 

population. It didn’t all 

go smoothly. 

Why did you decide to hire 

refugees? 

I had to do something 

different. The Burmese 

seemed like a good fit, 

because they were used 

to hard, dirty work and 

long days. 

How did your first hires 

work out? 

Within three days, our 

first six refugees were 

outperforming all our 

other guys. 

Did they all work out that 

well? 

We soon had 25, and it 

was a disaster. Injuries 

happened daily. Local 

OSHA had its eye on me. 

[The new workers] spoke 

17 dialects, and none 

could talk to each other. 

How did you deal with 

all this? 

We created a part-time 

position for a person 

who’s like our own 

social worker. 

Did you hire only Burmese? 

We have a lot of 

Congolese and 

also Somalis. 

Can you quantify how the 

refugees have affected your 

business? 

I went from 300% turnover 

a year to 15%. 

—Susan Adams 

LEFT: THOMAS KUHLENBECK FOR FORBES 


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ENTREPRENEURS 

SMALL GIANTS 

Lightbulb Moment 

It took a trip to China for the founders of 

Green Creative to spot an LED-bulb niche in the U.S. 

BY JEFF KAUFLIN 

Haute lighting: Guillaume 

Vidal (left) and Cole Zucker 

design their own lights, 

comparing the process of 

adding components to that 

of a chef mixing ingredients. 

As Cole Zucker drives through San Francisco’s 

Mission District in his white 

BMW M4, he uses one hand to steer 

through busy intersections and the 

other to flip through women’s profiles on a dating 

app. It’s a big change from the weekday evenings in 

the spring of 2011, when Zucker would drive his 

Mazda 3 the roughly 40 miles from San Francisco 

to San Jose and park on a residential street around 

midnight. He’d get into the backseat, hang clothes 

over the windows for privacy and go to sleep. Four 

hours later, knowing it was the best time to catch 

them, he’d walk into one office building after an- 

other, looking for building engineers 

who might want to 

buy his startup’s lighting products. 

Nearly every one of them 

turned him away. 

Six years later, Zucker, 33, 

and his 35-year-old cofounder, 

Guillaume Vidal, are co-CEOs 

of Green Creative, a profitable 

lighting manufacturer with 70 

employees and $52 million in 

revenue. Their bulbs illuminate 

the aisles of many Walmart, 

Whole Foods and J. Crew 

stores. In a market dominated 

by Philips, GE and Osram Sylvania, 

Vidal and Zucker saw an 

opening when LED technology 

started to take off. They bet 

that the giant firms were illequipped 

to make the most of 

the rapidly evolving technology. 

“We used to worry about 

whether anyone would buy 

LED products,” Zucker says. 

“Now we worry about how 

to maintain our breakneck 

growth rate.” 

The big draw of LED bulbs, 

of course, is efficiency. They 

use up to 75% less energy than 

incandescent ones and last 

25 times longer. Even today, 

LEDs represent less than 10% 

of the U.S. market, but they’re 

gaining fast. 

Around the time LEDs 

started to catch on, Zucker 

was fired as a fixed-income 

research associate at Prudential. 

He had entrepreneurial aspirations 

and became fixated 

on China. To his parents’ dismay, 

Zucker, who had studied Mandarin in college, 

moved to Shanghai in 2007 with $3,500 in savings 

and no prospects. He eventually secured a job in 

sales for a lighting and flooring company. 

Vidal, who is from the South of France, started 

working in marketing in 2004 at a Hong Kong 

supply- chain company, helping clients with everything 

from shipping and logistics to finding lighting 

manufacturers. Two years later, he was opening 

a new office in Shanghai. “It’s Asia,” he says. “As 

soon as you have a little bit of understanding or 

people start trusting you, they will just throw crazy 

opportunities at you.” 

TIMOTHY ARCHIBALD FOR FORBES 


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ENTREPRENEURS 

Vidal later joined Tao Light, a Chinese lightmaker 

that supplied bulbs to Osram Sylvania, 

and began working closely with Osram’s R&D 

and marketing teams. He had a front-row seat 

when the industry changed direction and LED 

technology became a plausible option for every 

type of light. At that time, it took Osram roughly 

18 months to bring a new product to market, 

according to Thomas Dreier, then a manager at 

the company. Vidal saw an opportunity, and he 

and Zucker—the two had met through a mutual 

friend—decided to start Green Creative. They 

focused on the business-to-business market, supplying 

bulbs for commercial real estate buildings, 

hotels and retail outlets. 

In the winter of 2010, Zucker moved to San 

Francisco to handle sales, while Vidal stayed in 

Shanghai to find a factory that could make the 

lights. Thanks to his network and experience, Vidal 

landed a factory that was also a major Philips supplier, 

persuading it to create a small volume of 


BY JON D. MARKMAN 

Elon Musk promises an energy-saving future of underground 

urban tunnels for car-carrying electric skates 

powered by the sun. That sounds cool, but the best path 

to energy efficiency now is changing your lightbulbs. 

LED illumination uses 75% less energy and lasts 25 times 

longer than incandescent rivals. Acuity Brands is the 

leading public U.S. maker of commercial and home LED lighting systems. 

The market is about to take off after years of resistance. Acuity began 

investing in sensors that harvest daylight and provide wireless connectivity 

long before its competitors did. It recognized LED cost savings were 

a powerful selling point, but the company also made them beautiful to 

attract designers. Combining LEDs and smart controls can save 90% of 

energy costs. Today, the $7.9 billion company is profitable, and sales are 

growing at 16%. Shares are down 36% from their 2016 high. 

Jon D. Markman is president of Markman Capital Insight. 

highly customized products—an unusually favorable 

agreement for a startup. 

Vidal designed Green Creative’s bulbs himself, 

choosing from a wide range of components 

to create a bulb that projected light at the right 

angle, covered the right amount of surface area, 

had the proper intensity and didn’t get too hot. 

“We’re a little bit like a chef in the kitchen,” he 

says, “except that the ingredients are getting a lot 

better all the time.” 

Even so, their first lights, Zucker says, were terrible—“junky-looking” 

and half as bright as competing 

products. For their second generation, launched 

a year later, they made big leaps but struggled to 

get customers to take a chance on a tiny startup 

with no track record. For prospective buyers, Zucker 

says, “it was pretty much name your price. We 

hoped it wouldn’t kill us on margin.” 

Over time, Zucker learned to focus on distributors, 

which gave him access to a larger base of 

users. In 2011, Green Creative reached $300,000 

in sales, but the company was operating on only 

the $200,000 in savings the founders had invested. 

Their first office, in a refurbished San Francisco 

parking garage, was infested with rats. Besides 

sleeping regularly in his car, Zucker was eating 

mostly peanut butter and jelly sandwiches. 

His mom began sending him brochures for law 

school and M.B.A. programs. 

By the end of the next year, sales were more 

than $2 million, but the partners hadn’t been 

watching the books closely. Vidal came to the 

stark realization they owed suppliers more than 

$1 million and were not going to be able to pay on 

time. “They weren’t real balance-sheet-based people,” 

says Jerry Mix, an industry 

veteran. Vidal and Zucker 

set about contacting everyone 

they knew to ask for money. 

While few people bit, the partners 

persuaded Mix and some 

friends and family to invest 

$250,000. Shortly after, they 

landed a bank loan of $1.25 

million, secured against their 

inventory and receivables. 

Zucker had never gotten 

any formal sales training, but 

after a couple of years of trial 

and error, he was improving. 

“He’s one of the better I’ve ever 

run into, and we have 480 vendors,” 

says Spencer Miles, general 

manager of the distributor Pacific Lamp & 

Supply. Zucker says he called one distributor 20 

times over two years before landing him. Sales quadrupled 

to $8 million in 2013. 

The next year, Vidal and Zucker made a strategic 

shift—they stopped competing on price, focusing 

their pitch more on quality and service. 

Sales reached $52 million last year, but Green 

Creative is now trying to transfer its success in 

bulbs to “fixtures,” the larger, more expensive lights 

used to illuminate office buildings. The fixtures 

market reminds them of where bulbs were four 

years ago. “The opportunity,” Zucker says, “is just 

enormous.” 

FINAL THOUGHT 

“Long is the way and hard, that out of hell leads up to light.” —JOHN MILTON 

SMALL GIANTS 

ELEVATOR 

PITCH 

WILLIS TOWER 

FLOORS: 103 

SECONDS: 60 

WORDS PER MINUTE: 130 

In the time it takes 

to reach SkyDeck 

Chicago in the Willis (né 

Sears) Tower, Medical 

Magnesium cofounders 

Florian Coppers, 29, 

and Kilian Reuss, 28, 

German grad students, 

explain why investors 

ought to back their 

medical-device startup. 

“More than 7 million 

Americans break bones 

every year. For most, 

this means getting metal 

implants and having 

not one but two major 

surgeries: the first to 

screw a metal implant 

in your bone to repair 

the fracture, and the 

second to rip it out once 

you’ve healed. Our tiny 

magnesium implants 

are bio-absorbable, 

meaning they turn into 

bone while healing 

the fracture, and thus 

we eliminate a second 

major surgery. We’re 

patent-protected, and 

our technology can be 

used anywhere in the 

body. We’ve spent five 

years and $600,000 

developing the product 

and getting through 

animal trials, and now 

we need $3.5 million to 

get approval for use in 

the human body.” 

—Susan Adams 

TOP: PETER HOEY FOR FORBES; LEFT: THOMAS KUHLENBECK FOR FORBES 


INVESTING 

FINTECH 

Wall Street’s 

Robocop 

Tim Estes’ insights into language and meaning are 

helping detect terrorists, human traffickers and market 

manipulators—and making him rich. 


Talk is cheap, unless you’re one of the biggest 

banks in the world. Then, offhand, 

typo-filled instant messages and emails 

among traders, such as “dont want other 

numpty’s in mkt to know” or “hopefulyl a fe wmore 

get same way and we can team whack it” or “i’d prefer 

we join forces . . . lets double team them,” can 

lead to billions in fines and even criminal charges. 

Since the financial crisis, regulators have seized 

on traders’ emails and Bloomberg instant messages 

to establish collusion and market manipulation in the 

foreign exchange, commodity and interest-rate markets. 

JPMorgan, Citigroup, UBS and Barclays have 

all pleaded guilty to felony charges, and just about 

every big bank has paid fines exceeding $100 million. 

Today, detecting conspiracies in traders’ cryptic communications—before 

government enforcers do—is a 

critical part of risk management. 

Surprisingly, one of the banks’ best weapons 

comes from a glass-and-steel office park 20 miles 

outside Nashville. That’s the headquarters of Digital 

Reasoning, a 17-year-old machine-learning pioneer 

whose Synthesys technology for surveillance of natural-language 

communications is used by Nasdaq, 

Goldman Sachs, UBS and billionaire Steven A. 

Cohen’s Point72 Asset Management as well as by 

U.S. intelligence analysts tracking terrorists and 

1,000 law-enforcement agencies involved in the 

fight against human trafficking. 

On a quiet Friday afternoon at headquarters, 

Digital Reasoning’s beer tap looks out of use and 

weekend talk among employees surrounds church 

activities and a Nashville Symphony tribute to David 

Bowie. Founder Tim Estes, a 37-year-old Tennessee 

native who sings in the choir at his Presbyterian 

church, sets the tone. Dressed in a professorial gray 

cardigan and ill-fitting dark blue jeans, he walks to a 

whiteboard and writes out a sentence in purple dryerase 

pen, then starts tagging significant words and 

the distance between them with binary numbers. 

“Meaning is indistinguishable from use when it 

comes to language,” he lectures. “The meaning of 

a word is really driven by the expectation created 

by the context around the word over time.” Once 

Estes realized this in the early 2000s, he started creating 

a patented set of algorithms that could approximate 

and expand on the sort of context humans 

apply to what they read. 

Synthesys works in ten languages, linking people, 

places and things, similar terms, aliases and semantic 

labels and even incorporating how word 

relationships change over time. For each industry, 

algorithms get special training. For the banks, 

along with the financial lingo, Digital Reasoning will 

“deeply train” its algorithms on certain word patterns 

that could set off a compliance alert, Estes says. 

(Hint: Calling suckers “numptys” in an email to 

EVAN KAFKA FOR FORBES 


your co-conspirator might give you away.) 

The biggest tell in Wall Street messaging? Boasting. 

“People often try to conceal. What they can’t help 

themselves from doing is to congratulate themselves 

afterwards,’’ says Valerie Bannert-Thurner, head of risk 

and surveillance solutions at Nasdaq, which is in the 

process of integrating Synthesys into its trading surveillance 

system. “Nobody, from what we have seen, 

has the natural-language processing skills, understanding 

and deep learning that Digital Reasoning has,’’ she 

says. “It is a quantum leap.” Nasdaq isn’t exactly a disinterested 

party; it invested in Digital Reasoning’s last 

funding round in May 2016, which took in $40 million 

and valued the company at more than $200 million. 

Estes remains the largest shareholder. 

Neither flagging fraudsters nor getting rich was 

Estes’ goal when he first began developing his technology. 

He was a University of Virginia undergraduate 

who had enrolled to study engineering before 

switching to philosophy, filling his spare time singing 

in the glee club and Black Voices, a gospel choir. 

Given his eclectic interests, Estes thought it would 

be useful to have an online system that would recommend 

events on the busy campus based on a user’s 

networks and activities. The student council declined 

to fund his proposal, but Estes discovered his 

intellectual passion: using math to discover meaning 

and connections in language. “It was about looking 

for algorithms that could tease the order out,’’ says 

Estes, adding that he has “a strong philosophical and 

theological bias” that the world is designed and has 

order, even if we don’t always see it. 

Digital Reasoning founder 

Tim Estes discovered his 

philosopher’s stone using 

algorithms to turn typo-ridden 

emails into gold. 


INVESTING 

FINTECH 

In 2000, in his senior year, Estes launched Digital 

Reasoning with Kenneth Elzinga, now chair of 

UVA’s economics department, as his biggest financial 

backer. He had less than $1 million in startup 

cash and figured he would need a deep-pocketed 

customer to develop a working system. He started 

talks with U.S. Army intelligence shortly before 

the 9/11 attacks and by the mid-2000s had built a 

system, called Interceptor, that enables analysts to 

search intercepted messages for links to terrorism. 

Still, as Estes discovered the hard way, living off 

government contracts, which originally accounted 

for 100% of his business, can be hazardous for a small 

company. In 2008, Digital Reasoning had a neardeath 

experience: The expiration and renegotiation 

of a federal contract that had provided the bulk of its 

revenue led to a half-year gap in payments. 

Estes couldn’t meet payroll for his 15 employees 

and took a second mortgage on his house to cover 

health insurance premiums for workers. Some employees 

worked for months without regular paychecks. 

(Their dedication paid off; they got equity 

and, later, bonuses.) In 2009, Digital Reasoning’s revenues 

exceeded $5 million, up from $1.5 million in 

2008. In late 2010, the CIA’s venture capital arm, In- 

Q-Tel, invested in Digital Reasoning. (Estes won’t say 


BY JIM OBERWEIS 

The explosion of digital communication is like manna 

from heaven for budding cybersecurity firms. Some of 

the top buys can be found among smaller, best-of-breed 

niche firms like CyberArk Software, which specializes in 

and leads the market for privileged account management. 

Amid cloud migration and high-profile insider 

data breaches, CyberArk focuses on stopping bad actors that have already 

breached the network firewall. The company’s revenues grew at 

an average of 46% annually over the last five years, and it counts 45% 

of the Fortune 100 as customers. Another pick, Proofpoint, develops 

email-security software. Revenues grew 41% in 2016 as it gained share 

over outdated offerings from market leader Symantec. 

Jim Oberweis is president of Oberweis Asset Management. 

how much.) 

With the company now healthy, Estes turned to 

his next market: financial services. “There is a longstanding 

tradition in analytics and security of banks 

adopting technology from the intelligence community,” 

he says. 

Lacking Wall Street cred or connections, Estes applied 

in 2012 to the Partnership Fund for New York 

City’s FinTech Innovation Lab, which connects promising 

tech startups to the city’s financial powerhous- 

FINAL THOUGHT 

es. Through the lab he arranged to install his software 

at UBS, Goldman Sachs and Credit Suisse, with 

the latter two investing $24 million in the company in 

2014—Digital Reasoning’s first big funding round, at 

the ripe age of 14. That delay was strategic, Estes says. 

“We were working on a hard problem that is very 

complex. If you raise money too early you only solve 

part of the problem and you create only a fraction of 

the value, but your investors start a clock.’’ 

Having conquered trading surveillance on his 

own timetable, Estes is picking up the pace, expanding 

into other financial regulatory areas, such as 

money-laundering rules, insider threats and interactions 

with customers. (Think Wells Fargo.) Plus, 

in 2015, he tackled a whole new industry, signing up 

HCA Healthcare as both an investor and client. The 

Nashville-based hospital company is using Digital 

Reasoning’s software to comb through medical records 

and doctors’ notes. The aim: to assist in diagnosis 

and improve clinical decision making. 

With all its new commercial work, Digital Reasoning 

hit 170 employees by the end of 2016, up from 

30 in 2012. In April, Estes brought in a veteran tech 

executive as CEO to handle continuing expansion. 

While he does want to spend more time with his 

one-year-old son, Estes is hardly stepping away from 

Digital Reasoning. Instead, 

with the title of president, he’ll 

focus on keeping its technology 

cutting-edge. “We are clearly 

the emerging leader in surveillance,’’ 

he says. “Our ambition is 

to become the best artificial intelligence 

company to understand 

human communication.’’ 

Meanwhile, Estes hasn’t forgotten 

that one of his original 

ambitions was to do more than 

make money. Digital Reasoning 

worked with Thorn, Ashton 

Kutcher’s venture aimed at combating 

human trafficking, to develop 

Spotlight, software that scrapes online ads and 

photos to identify traffickers and victims. Some 4,000 

law enforcement officers nationwide have access to 

the system. Thorn CEO Julie Cordua says in the past 

12 months Spotlight has helped identify 6,000 trafficking 

victims, including 2,000 children, and is expanding 

to Canada and Europe. 

“We are a fairly apolitical place,” Estes says. “Our 

social issue is let’s go rescue underage girls from being 

trafficked. We all can pretty much agree on that one.” 

“The true use of speech is not so much to express our wants as to conceal them.” 

—OLIVER GOLDSMITH 

SOUND 

STRATEGIES 

FOREIGN POLICIES 

Marc Halperin, senior 

portfolio manager at the 

$1.6 billion Federated 

International Leaders 

Fund, seeks discount 

blue chips abroad. New 

bullishness in Europe and 

China has his fund up 15% 

as of early May. Three of 

his current picks: 

CREDIT SUISSE 

Trading far below book 

value, and new CEO 

Tidjane Thiam’s cost cuts 

offer long-term payoff. 

One growth catalyst: its 

$700 billion wealthmanagement 

business. 

DAIMLER 

Down 3% in 2017 but with 

a dividend yield of 4.7%, 

it’s set to exceed $3 billion 

in free cash flow this 

year. Accelerants include 

its truck division and 

improving sales in Asia 

and Europe. 

PRADA 

The Milanese powerhouse 

dominates luxury fashion. 

Its shares, though, are 

50% below 2013 highs 

due to overexpansion and 

a sales tumble in China. 

Halperin believes store 

retrenchment and low 

new-product inventories 

will write Prada’s 

“recovery story” in the 

months ahead. 

—A.G. 

ILLUSTRATION BY THOMAS KUHLENBECK 


INVESTING 

FUNDS 

Build the Wall! 

Por Favor. 

Trump’s incendiary tweets against Mexico are music 

to the ears of BlackRock’s intrepid emerging-market 

portfolio manager Gerardo Rodriguez. 

BY KENNETH RAPOZA 

BlackRock’s Rodriguez: 

His fund has been climbing 

Trump’s “Wall of Worry.” 

Among Mexicans, few get as much pleasure 

from President Trump’s tough talk 

excoriating our southern neighbor as 

Gerardo Rodriguez, portfolio manager 

of BlackRock’s Total Emerging Markets Fund. 

Since January, Total has been seriously overweighting 

Mexican bonds, and the president’s 

rhetoric and tweets about “bad hombres,” building 

walls and dealing NAFTA a deathblow tend to 

send the peso falling. In January, during Trump’s 

first days in office, the peso’s exchange rate with 

the U.S. dollar peaked at nearly 22, its weakest 

level in history. 

For Rodriguez, that moment was somewhat like 

the S&P 500 low in March 2009, after the financial 

crisis. Rodriguez knew it was a great time to 

buy Mexico, and he instructed BlackRock traders to 

pile into peso-denominated bonds when most investors 

were running for cover. At the time, Mexican 

government bonds were yielding 7.8%, compared 

with 2.3% for ten-year U.S. Treasurys. This 

move, plus a big allocation to beaten-down Asian 

stocks like Samsung and Ali baba, has helped Total 

Emerging Markets achieve a 10.4% total return year 

to date and a 4.2% three-year average annual return, 

topping its category and earning it five stars among 

Morningstar-rated funds. 

“All of our analysis was flashing red hot in favor 

of Mexico in January. Trump’s aggressiveness didn’t 

frighten us away. When there’s a big move like that 

in Mexico, you go in,” Rodriguez says from his office 

on Park Avenue in New York, a colorful som brero 

hanging outside on the wall. Rodriguez just returned 

from 90-degree weather in Mexico City, but 

New York on this day was an unseasonable 55. 

“You have a window. It’s now until the end of the 

year. After that, things will start to intensify, and you 

will need to reassess. There will be new themes because 

of [domestic] politics,” Rodriguez says, adding 

that populism in Latin America, recently dormant, 

could be awakened given that ex-Mexico City governor 

Andrés Manuel Lopez Obrador, a populist, is 

leading in the polls for next year’s election. 

According to Rodriguez, Mexico has been 

through far worse than Trump. “He’s not really 

at the top of our minds. Security, corruption and 

the economy are far more important,” he says in a 

strong Mexican accent. 

Rodriguez begins to run down a list of things 

that make Mexico reliable for investors: chiefly, its 

proximity to the U.S., its welcoming stance on manufacturing 

and trade, and relatively conservative fiscal 

and monetary policies. The takeaway: Mexican 

politics are turbulent, but economic policy is not. In 

January, hundreds of Mexicans took to the streets to 

protest gasoline price hikes. He describes the scene 

of looted shops, busted windows and protesters calling 

for President Enrique Peña Nieto’s resignation. 

Mexico’s president is less popular than Trump, so 

the government can’t avoid political stress. But it will 

seek to avoid financial stress, Rodriguez insists. 

He ought to know. He has insider status when it 

comes to Mexico’s finances. Born in Puebla, a state 

with a 64% poverty rate, Rodriguez, 44, is the son of 

DAVID YELLEN FOR FORBES 



FINAL THOUGHT 

a construction entrepreneur and attended Universidad 

de las Américas in Puebla, majoring in economics 

and playing shooting guard for the college’s championship 

team, the Aztecas. Rodriguez went straight 

from there to an entry-level position at Mexico’s Ministry 

of Finance and then on to Stanford, earning a 

master’s degree in engineering, economic systems and 

operations research. 

After graduating in 1999, Rodriguez headed back 

to the finance ministry under presidents Vicente Fox 

and Felipe Calderón, ultimately rising to undersecretary 

of finance. During his 14-year tenure there, Rodriguez 

got to know the Mexican capital markets intimately, 

because he helped create them. From 2005 to 

2011, as head of Mexico’s public-debt management, 

he was the nation’s yield-curve czar. He also created 

an online Treasury Direct platform similar to the 

one in the U.S. and launched a National Infrastructure 

Fund. 

“I was in the finance ministry during the Asian 

Tiger crisis, at a time when we were just getting over 

the Tequila Crisis … and then, bam, it’s 2008,” Rodriguez 

recalls. The Tequila Crisis refers to Mexico’s 

devaluation of its peso in December 1994, which 

sparked hyperinflation and capital flight. At the time, 

Mexico faced default on its dollar debts, and the IMF, 

with the help of the U.S. Treasury, spent $40 billion 

bailing out the country. 

“We became the poster child of the IMF,” he says. 

“None of that compared to 2008.” That’s when the 

world began falling apart. In Mexico City, while Wall 

Street was imploding, Rodriguez and others in the finance 

ministry were looking at their balance sheets 

for ticking time bombs, “and we found nothing,” he 

says. Until Rodriguez realized that Mexican corporations 

had gorged on dollar loans. Companies needed 

more pesos to pay dollar debts. It was the Great Recession 

with a painful reminder of the peso crisis. 

“We spent $25 billion in different forms to stabilize 

the situation, because we thought, No way is anyone 

going to fund us. It was intense,” he says shaking 

his head, with a “never again” look on his face. 

Thanks to Mexico’s good record paying back its 

1990s peso-crisis debts, it got thrown another IMF 

lifeline during the 2009 G20 meeting in London. “We 

got a $47 billion credit line. Until then, we thought we 

were entering another major financial crisis,” he says. 

On the news, the peso rebounded from 15 to the dollar 

to about 13. 

According to Rodriguez, the peso strengthens fast 

on good news. He predicts it will happen again. 

In 2013, Rodriguez was recruited by BlackRock, 

barely a year after he spearheaded the hosting of 

the G20 Summit in Mexico City. During the meeting, 

Rodriguez led the effort to increase IMF funding 

by over $450 billion. Despite his decision to move El 

Norte, Rodriguez continues to be named as a potential 

successor to Agustín Carstens, the current governor 

of Mexico’s central bank. 

In his new role managing BlackRock’s $370 million 

fund, Rodriguez has spread its investments 

around the globe, employing something of a contrarian 

value strategy. The fund currently has its largest 

exposure to equities in China and Taiwan and is 

overweight tech and telecom stocks. From a currency 

standpoint, he is long the Brazilian real as well as the 

Thai baht and Turkish lira. For bonds, his top three 

holdings are Mexico, South Africa and Indonesia, all 

yielding around 7%. Total is leveraged 140% on the 

fixed-income side to help limit 

volatility in equities. In 2016, the 

fund returned 13.2%, beating 

the benchmarks and its category 

average of 8.47%. 

In December, Fitch downgraded 

Mexico’s credit outlook 

from stable to negative amid 

an interest rate hike by its central 

bank. The peso has recently 

strengthened to 18.80, and 

Rodriguez has lightened up his 

positions there. 

“The big mystery for Mexico 

has been Trump, but soon local politics will take center 

stage,” he says. “But there is a strong fundamental 

backdrop in the country.” What if its populist frontrunner 

comes to power and the peso falls back to 22? 

Says Rodriguez, “Buy. Absolutely buy.” 

“Two men look out through the same bars; one sees the mud, and one the stars.” 

—FREDERICK LANGBRIDGE 

BY MARC CHAIKIN 

Our model is bullish on iShares MSCI Mexico Capped 

ETF, but when you analyze its components you get 

seven stocks accounting for 50% of the index, so I 

think you really have to focus on those stocks. Carlos 

Slim’s America Movil, Fomento Economico and airport 

operators Grupo Aeroportuario del Pacifico and Asur 

are all beating the iShares ETF. We are bullish on all of these stocks 

(all ADRs) for the next six months. We also like cement-maker Cemex, 

which is in the exchange-traded fund but underperforming. 

Marc Chaikin is the founder and CEO of Chaikin Analytics, a Philadelphia 

technical research firm. 

FOLLOW- 

THROUGH 

INTO THE 

SUNSET 

One of the most 

skilled investors 

in Silicon Valley’s 

Wild West is 

hanging up his 

spurs. Chris Sacca, 

he of the signature 

embroidered shirts 

and other cowpoke 

attire, made a 

$1.2 billion fortune 

at his venture fund, 

Lowercase Capital; 

his prescient bets 

on tech titans Uber, 

Twitter, Instagram 

and Kickstarter 

earned him a Forbes 

cover in April 2015. 

But after a taste 

of showbiz glitz— 

he was a Shark 

Tank shark in the 

program’s most 

recent season— 

Sacca is trading 

series funding for 

series TV. He’s 

playing himself 

in a comedy pilot 

for ABC about the 

startup lifestyle. 

He’s also appearing 

on Celebrity Family 

Feud and launching 

an anything-goes 

podcast. And 

although he’s a 

self-proclaimed 

“loudmouth in 

the #resistance” 

who gave more 

than $1 million to 

Democrats in 2016, 

Sacca says he’s 

not throwing his 

cowboy hat into 

the political ring 

anytime soon. 

—Madeline Berg 

THOMAS KUHLENBECK (LEFT): JAMEL TOPPIN 


Passion fuels 

potential. 

Inspiration generates 

powerful results. 

With a commitment to excellence and an eye on 

the future, KPMG helps you identify business 

opportunities and achieve your long-term objectives. 

Learn more at KPMG.com 

Anticipate tomorrow. Deliver today. 

Mariah 

Stackhouse 

KPMG Brand 

Ambassador 

©2017 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG 

network of independent member firms affiliated with KPMG International Cooperative (“KPMG 

International”), a Swiss entity. Some of the services or offerings provided by KPMG LLP are not 

permissible for its audit clients or affiliates. NDPPS 670650

Features 


THE BANGLE BILLIONAIRE 70 

COSMETICS’ IT GIRL 80 

THE LOOMING RETAIL BAILOUT 94 

THE WILLY WONKA OF CHEESE 100 

Frustrated that she 

couldn’t find an organic 

supplier of calendula 

flowers, Jessica Iclisoy 

bought 100 acres 

of Santa Barbara 

County farmland in 

2011. She now grows 

4,000 pounds of 

the plants there for 

her California Baby 

products such as rash 

cream and sunscreen. 

Her ownership of the 

firm makes her the 

59th-richest self-made 

woman in America, 

worth $260 million. 

PAGE 86 

ETHAN PINES FOR FORBES 


America’s Richest Self-Made Women 

Bangle 

Billionaire 

By turning what women wear on their wrists into an 

affinity statement, Carolyn Rafaelian has grown the 

hippie brand Alex and Ani into a $1 billion company. 

Now America’s richest jeweler is working on 

world domination—and maybe an IPO. 

BY CLARE O’CONNOR 

PHOTOGRAPHS BY JAMEL TOPPIN FOR FORBES 


CREDIT TK 

Rafaelian in the 

Alex and Ani store 

on the first floor 

of her Cranston, 

Rhode Island, 

headquarters, just 

miles away from 

her late father’s 

jewelry factory. 



hen Alex and Ani 

founder and CEO 

Carolyn Rafaelian 

walks into a room, you 

hear her before you see 

her. She clinks and jangles 

her way into her office 

under layers of bracelets, 

necklaces, cuffs and rings in both 

precious metals and coated brass, 12 of 

which she designed herself. 

The biggest noise emanates from 

her celestial-chic jewelry brand’s 

bestselling products: charm bangles, 

of which it has released thousands 

of iterations, to commemorate 

lifetime milestones or show off zodiac 

signs, sports team allegiances, favorite 

charities and religious totems. 

Peace, love and big bucks, since these 

stackable bangles, made from recycled 

scrap metal, cost customers about $33 

apiece—and Rafaelian is moving over 

10 million a year. 

“It’s not the money that’s the driving 

force behind this,” Rafaelian says 

in her Rhode Island accent, which 

rhymes “force” with “boss,” unable to 

distract from the math that belies that 

claim. From its headquarters in unassuming 

Cranston, Rhode Island, Alex 

and Ani’s revenues have skyrocketed 

from $5 million in 2010 to over $500 

million in 2016, insiders say, with a net 

profit margin, according to private equity 

database Pitchbook, that was recently 

23%. Rafaelian says she believes 

each piece is imbued with energy that 

can have a positive effect on its wearer 

(she has a priest and a shaman bless 

her inventory), but her markups on 7½ 

inches of contorted wire show her to 

be a master marketer. 

“They don’t really sell jewelry,” says 

Brent Cleaveland, executive director 

of the Fashion Jewelry & Accessories 

Trade Association. “They sell positive 

energy. The bracelet is just a vehicle.” 

Every Alex and Ani bangle comes with 

a “meaning card.” A Buddhist om symbol, 

for example, “signifies God, higher 

power and the oneness of all beings 

in life’s cycle.” A simple sailboat charm 

“bestows peace to its wearer in times 

of change.” And this universe of good 

vibes encourages fans of the brand to 

collect them all. Bangles and bracelets 

make up 80% of total sales; an ini- 

Women to Watch 

THESE FOUR ENTREPRENEURS—AND POTENTIAL FUTURE LIST MEMBERS—HAVE FORGED GROWING FORTUNES FROM NEW IDEAS ON 

HOW TO IMPROVE HEALTH CARE, COMBAT WRINKLES, USE CELEBRITY TO PITCH PRODUCTS AND MAKE ECO-AWARENESS STYLISH. 

Jennifer Aniston 

Sarah Kauss 

$200 MILLION 

AGE: 48 RESIDENCE: LOS ANGELES 

Former Friends star still ranks 

among the world’s highestpaid 

actresses, with sevenfigure 

fees for lowbrow 

offerings such as Mother’s Day 

and Office Christmas Party. 

Today she makes more cash 

from modeling than movies, 

thanks to endorsements for 

the likes of Emirates Airlines, 

Smartwater and Aveeno. Still, the bulk of her net worth 

is derived from career earnings of some $400 million 

(pretax), a chunk of which comes from her Friends 

salary and the show’s syndication. By the NBC comedy’s 

final season, in 2004, she was earning $1.25 million an 

episode, more than today’s top TV stars—from The Big 

Bang Theory—make each episode. 

$180 MILLION 

AGE: 41 RESIDENCE: JUPITER, FLORIDA 

A former accountant who 

went to college in Boulder, 

Colorado, Kauss had the 

idea to bring chic, reusable 

water bottles to the masses. 

She launched her first of 

now more than 200 designs 

in 2010, funded with 

$30,000 of her savings. 

Today her sleek, stainless 

steel S’well bottles have 

become one of the most coveted accessories for 

people to tote, from spin class to board meetings. 

The bottles are sold in 65 countries in such stores as 

J.Crew, Nordstrom and Starbucks. Revenues topped 

$100 million in 2016, up from $10 million in 2014. 

She still owns 100% of S’well. 

PORTRAIT ILLUSTRATIONS BY BEN PERINI FOR FORBES 


CAROLYN RAFAELIAN 

tiative to use Alex and Ani jewelry as a 

fundraising tool makes up about 20% 

of total sales, adding another layer of 

karma—and profits. 

That’s how Rafaelian surged from 

a one-woman band run out of her father’s 

Rhode Island factory basement 

into America’s only jewelry billionaire—and 

the No. 18 spot on the 

Forbes list of America’s Richest Self- 

Made Women (see p. 86)—owning 

80% of a company worth at least $1.2 

billion. She’s enjoying the trappings— 

fixing up a 56,000-square-foot mansion 

in Newport that she will open as 

a museum (see p. 16) and testing out 

new grape varietals at her Sakonnet 

Vineyards in nearby Little Compton. 

An IPO awaits. “If I wanted to do that, 

we’re primed, we’re ready,” she says. 

“We can pull the switch at any time.” 

It’s rare that the public markets ever 

encounter a CEO like this 50-yearold 

free spirit, who has been known 

to consult planetary charts during decision 

making. Rafaelian says she was 

the sort of kid who had an imaginary 

friend. And while she was raised in the 

Rafaelian believes her jewelry 

is imbued with positive 

energy—a priest and shaman 

bless each piece. 

Christian Armenian Apostolic faith, 

Rafaelian borrows bits and pieces from 

other religions and traditions. She 

keeps dried bundles of sage in her office 

drawer to burn when she needs to 

smoke out negative energy and a healing 

quartz crystal on a file cabinet behind 

her desk. 

Not quite everyone’s cup of herbal 

tea. But Rafaelian’s products let a generation 

that craves authenticity wear 

their affinities on their sleeve. “There’s 

no ambiguity that jewelry like Alex 

and Ani has become something the 

consumer covets now,” says Christopher 

Burch, who backed his former 

wife Tory (see p. 89) as well as Alex 

and Ani competitor BaubleBar. “It’s no 

longer an afterthought. It’s part of her 

wardrobe.” 

Little-known fact: The world’s costume 

jewelry capital was, for generations, 

America’s smallest state. Just 30 

years ago, roughly 80% of that product 

was made in Rhode Island. Like 

much of American manufacturing, it’s 

mostly gone overseas, but Rafaelian 

traces her roots to this business and 

this state. 

Her father married into the industry, 

working for his brother-in-law 

manufacturing brooches and earrings 

for big names of the age like Trifari 

and Monet. In 1966, the year Rafaelian 

was born, he founded his own 

company, Cinerama Jewelry, based in 

Cranston, just outside of Providence. 

He made costume jewelry of all kinds, 

Jini Kim 

$170 MILLION 

AGE: 36 RESIDENCE: SAN FRANCISCO 

Daughter of South Korean 

immigrants helped her parents 

care for her brother, who was 

diagnosed with severe autism 

and, later, epilepsy. Because her 

parents couldn’t understand 

English very well yet, Kim 

was tasked with the complex 

job of registering her brother 

for Medicaid when she was 

just 9 years old. She helped start Google Public Data 

and worked on the HealthCare.gov launch. In 2010 

she founded Nuna to use data to help make health 

care more efficient. According to venture-capital 

fundraising database Pitchbook, Nuna raised $60 

million in June 2016, valuing the business at some 

$600 million. 

Jamie O’Banion 

$50 MILLION 

AGE: 35 RESIDENCE: DALLAS 

Former model teamed up 

with her dermatologist 

father in 2011 to form Beauty 

Bioscience, which began 

by making antiwrinkle 

creams. After a minority 

equity investment from 

direct-marketing firm Guthy- 

Renker in 2015, CEO O’Banion 

launched GloPro in 2016, a 

$200 at-home “microneedling” device. The tool, which 

splits skin cells to stimulate collagen production, sold 

out in its first day on home shopping channel HSN. That 

helped lift 2016 sales to $30 million. GloPro, which is 

sold in high-end retailers Neiman Marcus and Bergdorf 

Goodman, is slated to launch in Harrods and Sephora 

later this year. 


Sponsored 

Inspiring Greatness: 

ADVANCING 

WOMEN LEADERS 

IN THE WORKPLACE 

It’s no secret: Having more women in leadership roles is good for 

business. It improves financial results, enhances innovation and 

eases talent shortfalls. 

BY LYNNE DOUGHTIE 

Chairman and Chief Executive Officer, 

KPMG LLP 

Study after study finds that companies with 

more women in leadership roles tend to 

be considered “higher quality” companies, 

with better returns on equity. Companies 

that utilize female talent effectively also are 

45 percent more likely to report improved 

market share. 

Having more women in leadership roles is 

good for society, too. According to the World 

Economic Forum, countries with greater 

female representation are more prosperous 

and competitive. 

In the United States, about 52 percent of 

all management, professional and related 

occupations were held by women in 2015. 

Yet women today account for only 5 percent 

of the CEOs of S&P 500 companies and less 

than 20 percent of the board members of 

Fortune 1000 companies. Clearly, there’s still 

plenty of work to do. 

Why aren’t there more high-level female 

executives? It’s not due to a lack of desire. A 

recent Gallup study found that 45 percent 

of women express interest in becoming a 

CEO or holding another position in senior 

management or leadership. Of that group, 

69 percent admit being very determined to 

achieve their goal. 

Companies can and must do their part to 

help make that happen. It means committing 

to advancing and empowering women 

and putting in place steps that will allow 

women to climb higher on the corporate 

ladder. And that must be driven from the top. 

How we, as leaders, drive change that has a 

lasting impact requires getting surgical. We 

have to do more than tell women they need 

sponsors. We have to identify high-potential 

women by name and strategically map them 

to those who can help them get to the next 

level. We have to set goals, measure them 

and hold leaders accountable. 

At KPMG, we believe 

that companies with 

inclusive and diverse 

cultures are better 

positioned to adapt, 

grow and thrive in a 

changing business 

environment. 

At KPMG, we believe that companies with 

inclusive and diverse cultures are better 

positioned to adapt, grow and thrive in a 

changing business environment. After all, 

innovation stems from collaboration and 

the sharing of unique ideas and different 

perspectives. Moreover, data supports that 

diverse workforces outperform their homogenous 

counterparts. Different perspectives, 

experiences and insights improve 

decision-making and lead to superior 

performance. 

We’ve found that what’s good for women is 

good for our entire KPMG workforce. Our 

policies and practices designed to support 

women support everyone, creating greater 

efficiencies and engagement. 

Getting There 

We know that creating an inclusive and 

diverse culture requires more than words. 

It must be developed through strategies and 

actions designed to attract, hire and retain 

women and provide them with the tools, 

resources and career pathways to grow their 

careers and reach their potential. 

At KPMG, where women’s leadership is 

a cornerstone of our growth strategy, we 

sponsor various initiatives committed to 

advancing and empowering women in the 

workplace. Our annual KPMG Women’s 

Leadership Summit, for example, is an 

investment in the next generation of women 

leaders, providing them with content, tools 

and networking opportunities that can help 

pave their way toward C-suite roles. Each 

year, our Summit brings together some of

Sponsored 

the top leaders in business, government, 

sports and the media to “pay it forward” to 

approximately 200 of the next generation 

— women personally nominated by their 

CEOs because of their potential to enter the 

C-suite in five to 10 years. 

This year, we’ve assembled an inspiring 

group of Summit speakers. They include 

66th U.S. Secretary of State Dr. Condoleezza 

Rice, IBM CEO Ginni Rometty, Olympians 

Lindsey Vonn and Michelle Kwan, and 

C-suite executives from Johnson & Johnson, 

Microsoft, Verizon and Hyatt. These 

women have broken the glass ceiling and 

want to inspire others to join them. 

For companies committed to advancing 

women in the workplace, there are many 

ways forward. Some smart strategies: 

• Create new opportunities. In a time of 

unprecedented business change, it’s not 

enough to rely on what’s always been 

done. Companies need to think differently 

about how to create new opportunities 

for women who aspire to lead. One 

possibility: Rather than wait for a man 

to step down from the company’s board 

of directors in order to add a woman, 

increase the total number of board seats 

to accommodate a new female director. 

• Encourage mentors and sponsorships. 

Mentors and sponsors are beneficial for 

personal and career growth. Companies 

can encourage women — indeed, all 

employees — to find mentors and sponsors 

to help them develop their skills and 

build their career paths. Mentors can 

help employees think about their career 

growth, while sponsors can actually help 

make it happen. 

• Provide a network of support. Companies 

can create advisory boards to enhance 

career opportunities for women and 

drive local and national initiatives that 

support, advance, retain and reward 

women. KPMG’s Network of Women, for 

example, drives our Women’s Advisory 

Board’s national programs at the local 

level, including activities focused 

on mentoring, networking, relationship 

building, leadership and skills 

development. 

• Measure progress. Companies can track 

various inclusion and diversity-specific 

key performance indicators, such as 

talent acquisition, attrition, career 

progression, and leadership and account 

team composition. Leadership can 

review this information to help senior 

leaders and their direct reports set goals 

that will move the high-performing 

women they have identified by name 

forward. These business leaders can be 

given relevant metrics specific to their 

business units, location or function. 

Companies can also provide feedback 

at the individual level to reinforce high 

performance. 

• Invest in the future. Millennials represent 

the most educated generation of 

women in history. They are very socially 

conscious and consider a company’s 

purpose and commitment to corporate 

citizenship as top priorities. Connecting 

with this generation of talented women 

requires understanding their values, 

communicating the company’s purpose, 

and engaging them in the company’s 

social mission. 

At KPMG, we seek to invest in future 

women leaders through the KPMG 

Future Leaders Program, which encourages 

high-performing female high 

school seniors to enter STEM fields by 

providing college scholarships, a leadership 

retreat and mentoring opportunities. 

This program is an integral part of 

the KPMG Women’s PGA Championship 

and the associated KPMG Women’s 

Leadership Summit. 

• Inspire others to aim high. Don’t be shy 

about sharing successes. At KPMG, we’re 

proud to be consistently recognized for 

our inclusive and diverse culture. Most 

recently, this includes being named a 

top 10 company for executive women 

by the National Association for Female 

Executives for the seventh consecutive 

year. This award honors organizations 

that have made it a priority to identify 

and advance women to senior positions 

and have created meaningful opportunities 

for their personal and professional 

development. 

These represent just a few of the many ways 

to help advance and empower women 

in the workplace. By establishing clear 

and decisive steps that inspire female 

employees to reach their potential, you’ll 

soon find that your company will be better 

and stronger for it. 

Learn more about supporting the advancement 

of women in the workplace through 

KPMG’s Women’s Leadership Summit. Join 

us for a free online viewing event in real 

time on June 28th. Visit womensleadership. 

kpmg.us/summit.html for more details. 

©2017 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss 

entity. Some of the services or offerings provided by KPMG LLP are not permissible for its audit clients or affiliates. 170305


The company has 

released thousands 

of variations of its 

signature bangle, 

retailing for $33 on 

average. 

but this son of Armenian immigrants 

was best known for American-flag 

lapel pins he sold wholesale. You can 

still find Ralph Rafaelian’s badges, 

with their tiny Swarovski stars and 

stripes, on eBay. 

She and her four siblings were sent 

to the factory basement as punishment 

for misbehaving; strong-willed Carolyn 

remembers hours attaching little paper 

cards to the backs of ostentatious 1980s 

earrings. “It was torture,” she says with 

a laugh. She escaped to the University 

of Rhode Island, then to the now-defunct 

for-profit American College for 

the Applied Arts, before moving to New 

York City at age 22. She worked on her 

first jewelry line from a Tribeca apartment 

above a bookstore, scoring small 

deals with the likes of Bloomingdale’s. 

Her designs couldn’t have been further 

from her father’s faux pearls and floral 

brooches. 

“I created what I wanted to wear,” 

Rafaelian says. “I wanted cocktail 

rings. I wanted sterling silver.” 

At 23, Rafaelian got married. At 25, 

she had her first daughter, Alex. By the 

time her second daughter, Ani, came 

along less than two years later, she had 

returned to Rhode Island and the stable-if-unsexy 

costume-jewelry sector, 

designing private-label earrings and 

necklaces for mall stalwarts like Bebe, 

Express and Victoria’s Secret. She took 

up residence in a corner of Cinerama, 

her father’s factory. As she was 

filling $150,000 orders faxed in from 

New York, Ralph Rafaelian was trying 

to stay afloat, unable to compete 

with cheaper Asian manufacturing. “I 

remember the day that I looked back 

and I realized that every single person 

in the factory was working on the orders 

that I was bringing in,” Carolyn 

Rafaelian recalls. “In a split second I 

realized, Oh, my god—they’re counting 

on me.” 

On the side, she continued to dabble 

with her own label, named after 

her two eldest daughters. “I was calling 

out to them, getting their attention—Alex 

was in her high chair, Ani 

was probably in a bouncer,” she says. 

“It was, like, that’s it.” 

For over a decade, she kept the family 

business’ lights on through those 

unglamorous private-label orders, 

making six-piece earring sets for $3 

that would then sell for $16. Meanwhile, 

Alex and Ani slowly picked up 

steam: Rafaelian bought up vintage 

stones as local companies shuttered, 

turning them into crystal-adorned 

bracelets and butterfly hair accesso- 

ries that cool young things on both 

coasts sought at Henri Bendel and 

Fred Segal. 

Among her bestsellers: seamless 

“endless hoop” earrings, constructed 

from one piece of wire and able 

to carry the weight of beads. During 

one of her many long drives between 

Manhattan and Rhode Island in the 

early 2000s, not long after her third 

daughter was born, she had a careerdefining 

realization: that design could 

be applied to a bracelet if she just increased 

the diameter. “It was after 

midnight, and I went straight to the 

factory,” she says. 

Rafaelian patented the Alex and 

Ani 14-gauge expandable wire bangle 

in 2004; it’s one of about 30 patents 

the company now holds and the 

one she most regularly defends in 

court. “There’s a million sneakers out 

there, but there’s only one Nike,” she 

says. An early sample sale at Cinerama 

was so overrun with shoppers that she 

called the police for protection. One 

woman set up a lawn chair four hours 

before the doors opened. Rafaelian 

ran into the factory to start putting together 

charm bracelets herself. 

Alex and Ani grew steadily, mostly 

as a concession in department 

stores like Bloomingdale’s and Nordstrom. 

In 2009, she opened its first retail 

store in Newport. But it was still 

small-stakes stuff, bringing in less 

than $5 million in sales, including the 

wholesale work. Then, at a University 

of Rhode Island reunion, she met 

a former state senator with a background 

in eyewear, Giovanni Feroce, 

who immediately grasped Alex and 

Ani’s broader potential. 

“It tattoos your body without the 

tattoos,” says Feroce, who joined as 

CEO in 2010. 

To describe the duo as yin and 

yang is an insult to Taoism. An Iraq 

war veteran, Feroce speaks like a 

character in Call of Duty and sought 

to introduce military precision to 

a company run on Rafaelian flower 

power. “I learned my skill set in high 

operational tempo during warfare,” 

he says. “I’d just be literally sitting in 



Kendra Scott: 

Baubles worth 

a billion 

Rock 

Solid 

After her hat boutique 

failed, Kendra 

Scott started 

designing jewelry 

in her spare bedroom. 

Now she 

oversees a chain of 

60 U.S. stores and 

a company valued 

at $1 billion. 

When Kendra Scott, 43, decided to 

launch a jewelry collection in 2002, she 

was coming off a stinging failure. She 

had just shut down her unprofitable hat 

shop in Austin, Texas, which she had 

started eight years earlier at the age of 

19. But while the hats didn’t sell, she’d 

noticed her bold handmade earrings 

and necklaces did. 

“I loved color gemstone jewelry, 

and I couldn’t really find jewelry I could 

afford,” says Scott. “Everyone was 

using the same-shaped stones. I really 

felt like there was white space in the industry.” 

Thankfully, many hundreds of thousands of women agreed. 

In 15 years, Kendra Scott has grown her eponymous firm from a 

wholesale business run out of her spare bedroom to a chain of 

60 stores, mostly in Texas, California and Florida, and over 2,000 

employees. Its estimated 2016 revenues were $160 million. 

Much of the firm’s explosive growth has been thanks to its 

in-store Color Bars, where women can customize their own 

pieces. Shoppers select the style, the metal and any of the 

bright, pristinely cut gemstones that have become synonymous 

with the brand. The pieces are ready within minutes and are 

affordably priced. A pair of the company’s most popular ovalshaped 

drop earrings in a rich purple jade surrounded by rosegold-plated 

brass retails for $65. 

In December 2016, Boston private equity firm Berkshire 

Partners acquired a minority stake in a deal that valued the 

company at $1 billion, according to sources with knowledge of 

the transaction. That makes Scott’s stake worth at least $500 

million, enough for her to rank No. 36 among America’s Richest 

Self-Made Women. 

With its recent infusion of capital, the company plans to open 

new stores in regions where it hasn’t had much traction to date, 

like the Northeast. Scott has also started selling homewares and 

other accessories—think picture frames and jewelry boxes—as 

well as $16 bottles of nail polish with names like Dusty Rose 

Quartz and White Pearl. 

Back when Scott was agonizing over opening her first store, 

she could never have foreseen this sort of success. “I had loans. I 

put everything up for collateral,” she says. “It wasn’t easy. But it 

makes it that much more unbelievable.” —C.O. 

ALEXANDRA VALENTI FOR FORBES 

Qatar and dreaming of how I could 

apply it to business.” 

The next three years were a whirlwind, 

as Feroce infused the family 

business with the kind of professional 

systems that allowed for growth. 

The pair raised a war chest courtesy 

of private equity firm JH Partners, 

which took a 20% stake. (JH Partners 

cashed out in 2014, flipping the stake 

to another investor, Lion Capital, in 

a deal that valued the company at 

$1 billion.) As they began marketing 

aggressively, including a Super 

Bowl ad, their timing couldn’t have 

been better. “Branded” jewelry, as 

opposed to nameless wholesale you 

might grab off a department store 

rack, was in the process of doubling 

its market share, to 20%, as customers 

looked to make a statement with 

their accessories. 

“I always say any company that’s 

faceless has an issue,” says Feroce. 

“It had a face.” In 2011, a northeastern 

gift shop chain, the Paper Store, 

spent $11 million to build Alex and 




Ani “shop within a shop” concessions 

at its 72 outlets. “We turned our company 

upside down,” says Tom Anderson, 

the Paper Store’s chief operating 

officer. “Some would call it a risk. But 

right out of the gate, we couldn’t keep 

it in stock.” 

More big chains like Harvey Nichols 

and Saks Fifth Avenue began carrying 

Rafaelian’s bangles. Another 

master stroke: licensing deals starting 

in 2012 with Walt Disney, the National 

Football League, sororities and, yes, 

the U.S. military, all of which found 

that women loved the opportunity to 

show off their allegiances. With Disney, 

for example, classic Mickey and 

Minnie bangles sit alongside newer 

characters like Elsa from Frozen. 

(Currently, four of the five bestselling 

bracelets on the Disney Store’s site are 

by Alex and Ani.) The company began 

opening its own stores in top markets 

like California and New York; by the 

end of this year, they should number 

more than 80. 

All told, it was a legendary growth 

spurt, if the company is to be believed. 

Sales surged from $5 million 

in 2010, the year Feroce joined, 

to $230 million in 2013. Through it 

all, Rafaelian continued to keep every 

part of the process—from design to 

casting and soldering to marketing— 

within a few miles of the company’s 

Cranston headquarters. Her dad’s 

Cinerama factory was suddenly humming 

and expanding exponentially, 

with row upon row of workers fashioning 

bangles by hand. Like fine jewelry 

purveyor Tiffany & Co., Alex and 

Ani controls its entire supply chain. 

Says Cleaveland: “They’re skipping 

the middleman.” 

For his efforts, Feroce was pushed 

out in 2014. “As the company evolved, 

like many founders, I stepped back into 

the CEO role,” Rafaelian says vaguely. 

(Feroce’s successor, Harlan Kent, the 

former CEO of Yankee Candle, was 

brought in as president but lasted less 

than a year, and other senior managers 

have fled.) Running a company under 

a founder is always difficult; running a 

company for one who looks to the stars 

“It tattoos your body 

without the tattoos.” 

for guidance, doubly so. 

“We got to a point where it was 

time to move on,” says Feroce, who 

Forbes believes sold his equity stake 

back to Rafaelian. He now runs a 

watch company, Benrus. “I prepped 

the battlefield. She made the product. 

We crossed the line of battle,” Feroce 

says. “Now she’s in active combat. The 

whole world knows about [Alex and 

Ani], or if they don’t, they will soon.” 

Mission accomplished. 

One afternoon last November, Rafaelian 

gathered eight members of 

her design team in her office, an airy, 

modern space with a private teakdecked 

terrace. She sits at the head 

of a wooden boardroom table dotted 

with Art Deco sculptures, including 

a seminude dancer with a flapper 

haircut and a striding marble panther. 

The women—they’re all women 

in this meeting, as is most of her 

workforce—seek approval on, among 

other things, billboard ads off regional 

highways; store window displays; 

the merits of soldering epoxy; the size 

of loop closures on bracelets; whether 

some potential models look too 

young and skinny; and a new licensee, 

the Wonder Woman franchise. 

The latest lieutenants in Rafaelian’s revolving 

door arrived in the past nine 

months: Cindy DiPietrantonio, a 30- 

year veteran of apparel giant the Jones 

Group, and CFO Bob Woodruff, a 

veteran of Nike. 

They have challenges. Fashion is 

fleeting; customers are fickle. One 

year’s must-buy is a faux pas the next. 

Rafaelian must continue to stay ahead 

of the curve—and of copycats. A big 

push is abroad; sales outside the U.S. 

account for only 10% of Alex and 

Ani’s revenues. Rafaelian expects this 

to double by 2020, which means competing 

in foreign markets with Pandora, 

the $12 billion (market cap) 

Danish sterling silver brand, which 

operates 2,100 stores worldwide. Like 

Alex and Ani, its charm bracelets are 

collectible and ideal for gift-giving, 

but Pandora’s catalog differs in that it 

sells individual charms that each typically 

costs more than an Alex and Ani 

brass bangle. 

Rafaelian has also launched a slew 

of products beyond jewelry, including 

leather clutches and $28 candles. 

The spiritual ethos always sits at the 

center: Its Scent 7 fragrances give its 

stores a faint smell of lavender and geranium; 

its $12 body mist is supposed 

to realign its wearers’ chakras, the 

Sanskrit term for the human body’s 

centers of energy. “When you call this 

a lifestyle company, it’s not because we 

throw some symbol on a piece of fashion,” 

she says. “It’s my life.” 

That life is reflected 

across the organization. Her 

sister still runs her father’s 

old factory (which the two 

siblings now own; he died 

in 2012). And inside her 

chic office, Rafaelian points 

to a worn leather suitcase atop a filing 

cabinet. It’s all her grandfather took 

with him when he fled what is now Armenia 

in 1913, ahead of the genocide 

there, immigrating through Ellis Island 

en route to Providence. 

Last fall, Rafaelian launched a line 

partly in homage to her grandfather. A 

14-karat-gold pendant from this collection 

dangles just south of her clavicle. 

It features a tiny replica of the 

Statue of Liberty’s torch, surrounded 

by 50 glinting pavé diamonds— 

one for every state. The smooth, raised 

flame is made of copper that was once 

inside Lady Liberty herself. 

She’s already sold tens of thousands 

of incarnations, thanks to her 2012 

purchase of a massive cache of debris 

discarded after the Statue of Liberty 

centennial restoration in 1984. Those 

who know her best would call spending 

seven figures on 19th-century copper 

beams classic Carolyn: impulsive 

and eyebrow-raising, but ultimately 

savvy. “I don’t listen,” Rafaelian says. 

“Which is the best thing I do.” F 


©2017 glacéau. glacéau ® , smartwater ® and label are registered trademarks of glacéau. 

power 

couple. 

vapor-distilled for purity, 

electrolytes for taste.




CEO Jamie Kern Lima (center) 

and her product team gather in 

the boardroom of IT Cosmetics’ 

Jersey City headquarters 

to celebrate the launch of 

Confidence in a Compact, its 

first ever foundation that has 

an antiaging solid serum in it. 

More than 400,000 units were 

sold in the first quarter. 

The 

IT 

Girl 

Former news anchor 

Jamie Kern Lima began 

testing makeup a decade 

ago to help cover her 

red, blotchy skin. That 

experimentation led to the 

creation of IT Cosmetics, 

which L’Oréal snapped 

up in 2016 for $1.2 billion. 

Now she’s plotting to turn 

IT into the largest beauty 

brand in the world. 




Fifty women start lining 

up outside an Ulta Beauty store in 

northern New Jersey at 7:30 a.m. on a 

winter Saturday, here for a two-hour 

workshop in makeup application taught 

by employees of IT Cosmetics. An hour 

and a half later, IT Cosmetics’ founder, 

39-year-old Jamie Kern Lima, arrives. 

She’s wearing a bright-pink dress 

and pumps, and her light-brown hair 

is pulled back in a low ponytail, accentuating 

her flawless complexion. 

She points to her right cheek and 

then wipes off her makeup to reveal 

red blotches that “feel like sandpaper.” 

She pauses, then applies color-correcting 

cream across her face. In seconds, 

the spots are undetectable. “For 

so long, we would never see 

real,” she says. At the end of the 

class, the participants—including 

a lupus patient whose brows 

and eyelashes have fallen out, 

an emergency-room nurse and 

a construction worker—line up 

to meet her and rave about her 

products. 

Kern Lima, who has a skin condition 

called rosacea, which causes redness, 

has been putting on this show 

since 2010. That’s when she began peddling 

her corrective products—hybrids 

of skin care and makeup—live on the 

QVC home shopping channel. Since 

then, Kern Lima has appeared on TV 

hundreds of times, and IT Cosmetics, 

which stands for Innovative Technology, 

has been mentioned in 8.4 million 

YouTube videos. On Facebook, the 

brand is shared or commented on an 

average of 3,600 times a day, according 

to analytics firm ListenFirst Media. 

“When women find something that 

works, they tell somebody. That’s really 

how we grew,” Kern Lima says. 

She calls her loyal customers “IT 

Girls.” But it’s Kern Lima who has become 

the it girl of the $445 billion beauty 

industry. Her popularity has helped 

make IT Cosmetics one of the hottest 

beauty brands in the country. So hot 

that the world’s biggest beauty company, 

L’Oréal, paid $1.2 billion in cash for 

it in August 2016, the French conglomerate’s 

biggest acquisition in eight years. 

Kern Lima, the majority owner, pocketed 

an estimated $410 million after 

taxes. She is staying on to run IT, making 

her the first female CEO of any of 

L’Oréal’s brands (34 in the U.S. alone) in 

its 108-year history. 

The $28 billion global giant was 

drawn to IT (estimated 2016 sales 

of $300 million) by its charismatic 

founder and its popular products, 

but the deal illustrates a much larger 

trend. Right now, the beauty industry 

is growing at a tepid 3% a year. That 

has driven big players like L’Oréal, 

Coty and Estée Lauder into bidding 

wars for the fastest-growing, most 

fashionable brands, pushing them to 

“You have to hold 

your gut and your own 

belief on a pedestal.” 

pay high multiples. IT, for instance, 

received numerous offers and was sold 

for 6.6 times its previous 12 months 

revenue of $182 million. In all, 62 private 

beauty companies were acquired 

in 2016, 38% more than the previous 

year, according to the analytics 

firm CB Insights. Estée Lauder paid 

approximately $1.45 billion for Too 

Faced, an irreverent cosmetics brand 

known for edgy products like Better 

Than Sex mascara, and roughly $200 

million for Becca Cosmetics, known 

for its shimmering bronzers, both in 

2016. L’Oréal bought Toni Ko’s NYX 

Cosmetics (see p. 93) for $500 million 

two years earlier. 

“The organic growth is just not 

there for the established brands,” says 

Hana Ben-Shabat, a partner at the 

global consultancy A.T. Kearney and 

the lead author of the report “Shop or 

Drop: The Inevitable Path for Growth 

in Beauty,” which studied 214 beauty 

transactions over six years. Beauty conglomerates, 

she has said, “cannot afford 

to be inactive in the acquisition game if 

they want to succeed.” 

Small companies can easily create 

new products by working with makeup 

labs, but expanding overseas, with 

the differing regulations and the need 

to find local distributors, is nearly impossible. 

“There are a large number of 

brands that have to survive in a very 

competitive environment. The market 

is not growing fast enough—that’s 

made M&A almost inevitable,” Ben- 

Shabat explains. 

According to A.T. Kearney’s concept 

of “Merger End Game,” based on 

the analysis of hundreds of mergers, an 

industry typically approaches a merger 

tipping point when the top three companies 

have a combined market share 

of 45% or more, making increased 

M&A activity likely. The 

beauty and personal care industry 

arrived there by the end of 

last year, explaining the current 

wave. The beer and telecom sectors 

similarly went through a period 

of consolidation about a decade 

ago. 

L’Oréal has high hopes for IT 

Cosmetics, planning to build it into 

the most popular makeup brand on 

the planet. For now, it ranks 35th in 

the world, according to Euromonitor, 

well below L’Oréal’s top brands: Maybelline 

(No. 1; 2016 sales of $4.9 billion), 

L’Oréal Paris (No. 2; $3.2 billion) 

and Lancôme (No. 5; $1.6 billion). 

Kern Lima is a big part of its gamble. 

“I’m still driven at this moment 

the way I was even before the L’Oréal 

acquisition,” she says. “I’m just scratching 

the surface of what I have to give 

and what I have to do.” 

The beauty industry has long been 

a beacon for female entrepreneurs. In 

the 1940s Queens-born Estée Lauder 

was selling pots of cream in beauty 

parlors around New York City. Her 

heirs are worth $18 billion. In 1995, 


JAMIE KERN LIMA 

Bobbi Brown, a makeup artist 

turned entrepreneur, sold 

her company for about $70 

million, roughly $115 million 

today. There are now 

at least 40 prominent beauty 

businesses founded by 

women. In part, that’s because 

the barriers are quite 

low, says Kern Lima. “I feel 

like what I’ve done, any 

woman can do.” 

The makeup mogul 

began honing her drive at 

an early age. Given up at 

birth and adopted as a newborn, 

she grew up in Seattle 

and at 15 started doing odd 

jobs such as bagging groceries 

and coaching gymnastics. 

The first in her family 

to go to college, she worked 

as a waitress at Denny’s to 

pay her way through Washington 

State. She graduated 

as valedictorian. 

In 1999, she won a competition 

to appear on a Baywatch 

episode and was 

crowned Miss Washington 

USA, which led to a stint 

on the first season of the reality 

show Big Brother. She 

changed gears and headed 

to Columbia University 

in 2002 to earn an M.B.A. Kern Lima 

met her husband, Paulo, in statistics 

class and began writing for the student 

newspaper. After graduation she 

took a job back in Washington at a TV 

station for $23,000 a year and quickly 

moved to a Fox affiliate in Portland, 

Oregon. 

Having to start work at midnight 

most days stressed out her skin, and 

her hereditary rosacea flared up. (The 

disease, which affects at least 16 million 

Americans, typically begins after 

age 30.) Foundation made her condition 

look worse. Fed up, she started 

thinking about new formulations 

and technologies to help people with 

flawed, sensitive skin. In Paulo’s native 

Brazil, the couple met with family 

friends who were plastic surgeons. 

They set up an advisory board that included 

plastic surgeons and dermatologists. 

The newlyweds wrote the business 

plan on a flight to South Africa 

for their 2007 honeymoon. 

Kern Lima left the TV station in 

2008, and the couple began bootstrapping 

in their Los Angeles living room. 

“If you want something, you figure out 

how to make it happen,” she recalls 

from her glassy office in Jersey City, 

which looks across the Hudson River 

at Manhattan. Putting her reporting 

skills to use, she cold-called beauty 

companies to find manufacturers. An 

actress who lived in their spare bedroom 

rent-free spent 20 hours a week 

putting products in boxes and getting 

them ready to ship. A graphic designer 

from her former news station worked 

Mirror, mirror: Kern Lima 

seated at her reflecting desk, 

in her glass office. 

with her remotely on packaging. 

IT’s first products were 

contouring kits that included 

concealers, highlighting 

creams and bronzers. QVC 

told her it wasn’t interested. 

Just a few months later, 

shopping channel HSN 

agreed to feature her darkcircle 

concealer, which uses 

a proprietary “3D Skin Flex” 

technology to allow the foundation 

to move with facial expressions 

without creasing. 

With ample on-air experience, 

Kern Lima thought 

pitching her wares on TV 

would be fun. But the products 

didn’t sell, and she wasn’t 

asked back at the end of her 

contract. Shopping Channel 

Canada did see her segment, 

though, and gave her another 

chance a year later. 

All the while, she was 

hounding QVC, nearly four 

times the size of HSN in 

2010, to give her another 

shot at the American market. 

Allen Burke had been building 

QVC Beauty since 1997, 

when the channel started featuring 

high-end brands like Bobbi Brown and 

Clin ique. After saying no several times, 

he gave her a chance in the fall of 2010. 

“Did she go call me after every Canada 

visit and tell me how she did? Yes,” 

Burke says, who retired in late 2011 

and was hired by IT as a paid consultant 

in January 2012. To prepare, Kern 

Lima watched her competitors’ past 

segments and started figuring out how 

to connect better with her customers. 

She wiped the concealer off her cheek 

(yes, she used under-eye concealer on 

her face) on TV for the first time. She 

also hired a 66-year-old woman to appear 

with her. The products sold out in 

ten minutes. 

QVC brought her back another four 

times before the end of 2010, and sales 



JAMIE KERN LIMA 

topped an estimated $1 million. “It 

took us a while to say, ‘Let’s give this a 

shot,’ but it was an instant success from 

the beginning,” Burke says. In 2011, 

Kern Lima and her husband, who is 

co-CEO and largely handles the operations 

and finances, moved to Bayonne, 

New Jersey, from California to be within 

driving distance of the network’s studios 

in eastern Pennsylvania. 

Investors began calling. “You’re so 

tempted, especially if you were a poor 

entrepreneur like I was,” Kern Lima recalls. 

“You’re just hoping for someone 

to help you grow your infrastructure 

beyond what you can do yourself.” But 

she hesitated and did due diligence, 

ringing up every entrepreneur and 

CEO who had previously worked with 

the suitors. 

which took four years and more than 

200 attempts to perfect. By 2014 sales 

hit an estimated $117 million. Another 

top seller took even longer: Superhero 

Mascara, which lifts even the shortest 

lashes by catching hairs through a proprietary 

elastic-stretch technology and 

has anti-aging ingredients in the tint. 

Launched in February 2016, it took 

three years and 275 tries to formulate. 

ternally” (though she did bring IT to 

Australia in 2014). 

After meeting Carol Hamilton, the 

head of L’Oréal’s Luxe Division, at an 

industry conference in 2013, Kern 

Lima followed up with a handwritten 

thank-you note, which is currently on 

display in Hamilton’s office. Hamilton 

visited IT later that year and walked 

out the door thinking it was the most 

powerful brand she’d seen in a long 

time. “I realized the connection that 

Jamie had with women was authentic,” 

Hamilton recalls. “She absolutely has 

a fierce desire to make every woman 

realize her best self. A lot of women 

might say that, but her commitment 

was what made me really convinced 

that her brand was going to continue 

to be on fire.” 

While both parties were smitten, 

there were several false starts. 

After talks fell apart one time, Hamilton 

called Kern Lima to give her the 

bad news and told her not give up. 

Kern Lima’s response: “I am certain 

someday we’re going to be part of the 

L’Oréal family.” 

Kern Lima considered taking the 

company public and also went ahead 

with plans to expand into Southeast Asia, 

the industry’s fastest- growing region. 

One week before that launch, the sale to 

L’Oréal finally went through. TSG founder 

and CEO Chuck Esserman recalls 

Kern Lima telling him IT would be the 

best investment he ever made. “Every entrepreneur 

tells me that. In Jamie’s case, 

she did it,” says Esserman. Forbes estimates 

his firm made 25 times its money 

on the sale, while Guthy-Ren ker pocketed 

approximately $150 million. 

Under the L’Oréal umbrella, IT 

Makeup 

Mergers 

Cosmetic 

conglomerates 

are snapping up 

smaller brands 

at a record pace. 

Here are some 

of the biggest 

recent deals. 

NYX Cosmetics 

Bold colors, 

drugstore prices 

ACQUIRED BY 

L’Oréal 

$500 MILLION 

2014 

Glamglow 

Facial masks 

and skin care 

ACQUIRED BY 

Estée Lauder 

EST. $100 MILLION 

2015 

IT Cosmetics 

Problem-solving 

makeup 

ACQUIRED BY 

L’Oréal 

$1.2 BILLION 

2016 

Too Faced 

Millennial fave for 

lipstick, eye colors 

ACQUIRED BY 

Estée Lauder 

$1.45 BILLION 

2016 

Becca Cosmetics 

Highlighters 

and bronzers 

ACQUIRED BY 

Estée Lauder 

EST. $200 MILLION 

2016 

She focused on a couple: TSG Consumer 

Partners, a $5 billion private equity 

firm best known for investments 

in Planet Fitness and Glacéau Vitaminwater, 

and Guthy-Renker, the directmarketing 

powerhouse that built Proactiv 

into a billion-dollar acne-treatment 

brand. Both said no. She waited. “You 

have to hold your gut and your own belief 

on a pedestal,” Kern Lima says. “All 

the ones that had said no finally said yes.” 

It wasn’t until 2012, after Ulta Beauty 

signed a deal to sell the brand, that 

TSG invested an undisclosed sum. A 

year later Guthy-Renker followed suit; 

it got an estimated 20% stake in return 

for the right to package and market discounted 

kits to be sold on infomercials. 

Guthy-Renker has spent about $50 million 

a year buying infomercial spots, according 

to cofounder Greg Renker. 

In 2013, IT Cosmetics rolled out 

what became its top seller, CC Cream, 

Interested in re-creating that success 

outside the U.S., Kern Lima began thinking 

about a buyer early on: “We could [go 

internationally] on our own for sure—it 

would just be so much slower. Every entrepreneur 

learns at some point that you 

don’t know what you don’t know. From 

a capacity and infrastructure situation, it 

would be decades longer if we did it in- 

Cosmetics will have the resources to 

ramp up quickly. In addition to international 

expansion, there will likely be 

stand-alone stores and more products, 

such as its first face wash, called Confidence 

in a Cleanser. 

Days after the sale, Kern Lima and 

Hamilton got on a plane for Singapore, 

followed by Thailand and Malaysia. 

Hamilton admits she was anxious 

to see how IT, whose acquisition 

she’d championed, would translate in 

Asia. She got quick relief inside Singapore’s 

biggest mall, where women who 

had just met Kern Lima were suddenly 

crying. Back at L’Oréal’s headquarters, 

Hamilton smiles, promising the deal 

was well worth it: “She allows herself 

to be vulnerable in front of women. 

She knows how to tap into that and 

make us believe in ourselves. Confidence 

is not something that is defined 

by national boundaries.” F 


From March 15-17, Forbes teamed up with SHOOK Research to host an 

unprecedented gathering of the world’s top 500 preeminent wealth advisors 

and industry leaders in Las Vegas. This exclusive forum—convening a group 

that represented nearly $1 trillion of assets under management—provided 

the industry’s highest-level insights tailored for America’s most elite advisors. 

Presented By 

Partners 

Supporting Sponsors


America’s Richest 

Self-Made Women 

These 60 entrepreneurs, innovators and entertainers made their 

money in everything from makeup to finance. Altogether they are 

worth a record $61.5 billion, 17% more than a year ago. There are five 

newcomers and two new billionaires. Among those who dropped off: 

Nasty Gal’s Sophia Amoruso and the Honest Company’s Jessica Alba. 

2. Diane Hendricks 

3. Oprah Winfrey 

1. Marian Ilitch 

$5.1 BILLION S 

AGE: 84 RESIDENCE: 

BINGHAM FARMS, MICHIGAN 

Ilitch and her husband, 

Mike, who died in February, 

had a rare, equal partnership 

dating back to 

1959, when they cofounded 

Little Caesars pizza, 

now a $4 billion (sales) 

chain. Known for her operational 

expertise, she 

also owns the Detroit Red 

Wings and MotorCity Casino 

Hotel. Mike’s Detroit 

Tigers are now in a family 

trust. Son Christopher runs 

everything but the casino. 

Mrs. I, as she’s known, 

is now fulfilling the couple’s 

decade-long vision 

for a $1.2 billion sports and 

entertainment district in 

downtown Detroit. 

$4.9 BILLION X 

AGE: 70 RESIDENCE: AFTON, WISCONSIN 

Chairman of $7.2 billion (sales) roofing giant ABC Supply led its biggest acquisition 

to date in 2016, paying $674 million for L&W Supply, adding drywall, 

ceiling tiles and steel framing to its offerings. The Wisconsin native cofounded 

the business with her late husband, Ken, in Beloit, Wisconsin, 35 years ago. She 

has run it since his death in 2007. Longtime Republican donor, she sat on President 

Trump’s inaugural committee. 

“[You] don’t have to change your goal. Change 

your path, be willing to, and don’t see that as a failure. . . . 

You can’t lose sight of what you really want to do.” 

3. Judy Love 


AGE: 79 RESIDENCE: OKLAHOMA CITY 

Love’s fortune is up $1 billion, as sales of her family’s Love’s Travel Stops & Country 

Stores rose 13% to $16 billion in 2016, thanks in part to 47 new locations. She and 

her husband, Tom, first leased a gas station in Watonga, Oklahoma, in 1964 using a 

$5,000 gift from her parents. Judy, who kept the books and ran the business with 

him, shifted to part-time in 1975, when she returned to college. Today she is the 

company’s executive secretary and chairman of the Love Family Fund. 

5. Doris Fisher 


AGE: 85 RESIDENCE: SAN FRANCISCO 

Fisher and her husband, Don (d. 2009), opened their fashion retailer Gap, 

short for “the generation gap,” during San Francisco’s hippie movement. Don 

couldn’t find a place that sold jeans in his size. Fisher served as the retailer’s 

merchandiser from the time it opened in 1969 until 2003. In recent years, she’s 

been giving her shares away and now owns just over 7%, less than her sons 

John, William and Robert; the latter two sit on Gap’s board. Starting in 2000, 

she has given millions to KIPP public charter schools. 

$2.9 BILLION T 

AGE: 63 RESIDENCE: CHICAGO 

The entertainment mogul is 

having a resurgence of her 

on-screen career. Her performance 

in April’s HBO movie 

The Immortal Life of Henrietta 

Lacks was critically lauded. 

Next up: a part in big-budget 

fantasy film A Wrinkle in Time. 

The onetime Nashville news 

anchor will return to her TV reporting 

roots as a special contributor 

on 60 Minutes this fall. 

Her 2015 investment in Weight 

Watchers may finally be paying 

off: The stock is up 50% in 

the past year. While the fortunes 

of her Oprah Winfrey 

Network continue to improve 

(2016 was its most-watched 

year yet), the bulk of her 

wealth is still derived from her 

years as host of the highestrated 

talk show in TV history. 

“What I learned in all 

of those thousands 

of interviews is that 

there is a common 

denominator in our 

human experience. . . . 

Everybody wants to 

know, Did you hear 

me and did what I say 

matter?” 

B/W PORTRAIT ILLUSTRATIONS BY PATRICK WELSH FOR FORBES 


6. Meg Whitman 

10. Lynda Resnick 

COLOR PORTRAIT ILLUSTRATIONS BY LOUISE POMEROY FOR FORBES 

6. Judy Faulkner 


AGE 73 RESIDENCE: MADISON, WISCONSIN 

Tech innovator launched medical-record software 

provider, Epic, in a Wisconsin basement 

in 1979. According to Epic, sales of the computer 

programmer’s brainchild jumped $500 million 

in 2016, to $2.5 billion. The software supports 

the records of over half the people in the 

U.S. and is used by renowned medical centers, 

including Johns Hopkins and Cleveland Clinic. 

“The work of my life has been to 

develop software that would help keep people well and 

help sick people get better . . . but I never had any personal 

desire to be a wealthy billionaire.” 

8. Johnelle Hunt 


AGE: 85 RESIDENCE: FAYETTEVILLE, ARKANSAS 

The Arkansas native bought five trucks and seven trailers with her late 

husband, J.B. Hunt (d. 2006), in 1969 to kick-start their trucking business. 

She stepped down from the board of now publicly traded J.B. Hunt 

Transport Services in 2008 but remains the $6.6 billion (sales) firm’s largest 

individual shareholder with 17%. 


AGE: 60 RESIDENCE: ATHERTON, 

CALIFORNIA 

The Hewlett Packard Enterprise 

CEO has been cutting deals as 

the company doubles down on 

servers and storage technology. 

Since splitting with HP Inc. in 

November 2015, HPE has spun 

off its enterprise service business 

and some software units, 

and acquired storage-tech firms 

SimpliVity and Nimble Storage. 

Whitman’s fortune comes from 

her decade as CEO of auction 

site eBay. A former Walt Disney 

Co. and Hasbro executive, 

she sits on the boards of Procter 

& Gamble and SurveyMonkey. 

She is the richest self-made 

woman in America who didn’t 

start her own business. 

9. Elaine Wynn 


AGE 75 RESIDENCE: LAS VEGAS 

Wynn is fighting with her exhusband, 

Steve, over her ability 

to sell her 9% stake in Wynn 

Resorts. The couple cofounded 

the casino company in 2002; 

she served on its board until being 

ousted in April 2015. Wynn 

pledged $1 million to Planned 

Parenthood in February after 

Sheryl Sandberg (No. 12) made a 

similar gift. She sits on the board 

of the Basketball Hall of Fame. 

12. Thai Lee 


AGE: 58 RESIDENCE: AUSTIN, TEXAS 

$2 BILLION X 

AGE: 74 RESIDENCE: BEVERLY 

HILLS, CALIFORNIA 

Half of all Americans buy one 

of Lynda and husband Stewart’s 

products each year. Their Wonderful 

Co. owns Fiji Water, POM 

Wonderful and mandarin Halos. 

The company has invested $120 

million in sustainable technologies 

for its substantial farm acreage; 

part of that has gone toward 

developing drought-resistant 

pistachio “supertree” roots. 

Lynda founded an ad agency 

at age 19 after dropping out of 

community college. 

11. Peggy Cherng 


AGE 69 RESIDENCE: LAS VEGAS 

Co-CEO of fast-food chain 

Panda Express, which she runs 

with her husband, Andrew. The 

Myanmar native met her husband 

at Kansas’ Baker University. 

Cherng, who coded simulators 

for the U.S. Navy, gave up 

her electrical engineering career 

in 1983; that same year, she 

built the company’s point-ofsales 

system to streamline operations. 

In March, the couple 

donated $30 million to Caltech 

and had their names attached 

to its medical engineering department; 

Peggy says the aim is 

to inspire the Chinese community 

to follow in their footsteps. 

CEO and cofounder of $7.6 billion (2016 sales) IT provider SHI International, 

whose big customers include Johnson & Johnson and Bank 

of America. The daughter of a prominent Korean economist, Lee did 

stints at Procter & Gamble and American Express before buying a 

$1 million software reseller with her now ex-husband in 1989. 

WEALTH STATUS: UP S DOWN TUNCHANGED X NEW + 



12. Sheryl Sandberg 


AGE: 47 RESIDENCE: ATHERTON, 

CALIFORNIA 

In April, Sandberg published her 

new book, Option B, written with 

Wharton professor Adam Grant. 

Focused on grief and resilience, it 

draws on Sandberg’s experience 

dealing with the sudden death of 

her husband, Survey Monkey CEO 

Dave Goldberg, in 2015. The Facebook 

COO has also been using 

her platform to speak out against 

gender pay gaps and criticize President 

Trump’s travel ban and antiabortion 

measures. 

“Every woman deserves to 

get paid what she’s worth. 

When women are paid less 

than men, it doesn’t just 

hurt women. It hurts our 

families, our businesses 

and our communities.” 

14. Jin Sook Chang 

16. Sara Blakely 


AGE: 46 RESIDENCE: ATLANTA 

There is practically nothing 

America’s youngest self-made 

female billionaire wouldn’t do 

on her path to success. After 

scoring poorly on the LSATs, 

she auditioned for jobs at Walt 

Disney World. Two inches too 

short for the 5-foot-8 Goofy 

costume, she instead buckled 

kids into rides. A onetime doorto-door 

fax-machine salesperson, 

Blakely invested $5,000 

to come up with something to 

wear under white slacks. She 

initially shilled her new invention, 

which became shapewearbrand 

Spanx, at various Neiman 

Marcus stores. Today the mother 

of four is back to running the 

$425 million (estimated sales) 

company, which sells its apparel, 

including maternity wear 

and leggings, in 65 countries. 

16. Eren Ozmen 


AGE: 58 RESIDENCE: RENO, NEVADA 

Ozmen enters the billionaire ranks, as sales of Sierra Nevada Corp., the 

aerospace and defense contractor she owns and runs with her husband, 

Fatih, rose 15% in 2016 to $1.5 billion. SNC announced a partnership 

with the UN in 2016 to use its Dream Chaser spacecraft, whose folding 

wings allow it to land on runways, in an effort to help developing 

countries get into space. The company is also starting a program with 

the European Space Agency and two other European space companies. 

The couple emigrated from Turkey and got master’s degrees in Nevada; 

they bought the company, for which they worked, in 1994. 


AGE: 54 RESIDENCE: BEVERLY 


Chief merchandising officer of 

$4 billion (est. sales) fashion chain 

Forever 21. In March, California’s Fair 

Employment & Housing department 

sued the retailer for an English-only 

policy at its flagship San 

Francisco store; it allegedly prohibited 

employees from speaking any 

other language during work hours, 

even to customers who spoke only 

Spanish. The company denies having 

a language policy. 

15. Gail Miller 


AGE: 73 RESIDENCE: SALT LAKE CITY 

18. Carolyn 

Rafaelian 

$1 BILLION S 

AGE: 50 

RESIDENCE: PROVIDENCE 

The founder of costumejewelry 

firm Alex and Ani 

expanded her business from 

a collection of five cocktail 

rings to a celestial-chic bangle 

company worth more than $1 

billion. She’s now America’s 

richest jeweler. (See story, p. 70.) 

With her husband, Larry (d. 2009), she turned a single Toyota dealership 

into a $4.4 billion (sales) operation with 62 dealerships. The couple purchased 

the Utah Jazz for $24 million in 1986; Miller transferred ownership 

of the basketball team, now worth $910 million, to a family legacy trust in 

January to deter her heirs from selling it. 

19. Alice Schwartz 

$950 MILLION S 

AGE: 90 RESIDENCE: EL CERRITO, 

CALIFORNIA 

With husband David (d. 2012), 

she started Bio-Rad Laboratories 

in 1952. Son Norman now runs 

the $2 billion (revenues) firm, 

which sells 10,000 life-science research 

and clinical diagnostics 

products. In February, a federal 

jury found that Bio-Rad violated 

Sarbanes-Oxley whistle- blower 

protections when it fired its general 

counsel in 2013 for reporting 

potential Foreign Corrupt Practices 

Act violations in China. Bio- 

Rad is considering an appeal. 

20. Christel DeHaan 

$900 MILLION X 

AGE: 74 RESIDENCE: INDIANAPOLIS 

German native donated more 

than $220 million, mostly to 

Christel House, an education 

nonprofit serving poor children 

in India, Mexico and elsewhere. 

She cofounded time-share pioneer 

Resort Condominiums International 

with her husband in 

1974. They divorced; she later 

bought him out. Forbes estimates 

she got $550 million when RCI 

sold in 1996. DeHaan says her 

net worth is overstated but did 

not provide more information. 


21. Jayshree Ullal 


AGE: 56 RESIDENCE: SARATOGA, CALIFORNIA 

The Arista Networks CEO’s fortune increased by $370 million in the past 

year, as the enterprise tech firm’s stock doubled. Born in London and 

raised in India, Ullal owns 7% of the shares, including some earmarked for 

her children, niece and nephew. The $1.1 billion (sales) company has faced 

litigation from Ullal’s former employer Cisco Systems over alleged patent 

infringement and from Arista cofounder David Cheriton’s firm, Optum- 

Soft, over intellectual property ownership. Arista denies all the allegations. 

26. Safra Catz 


AGE: 55 RESIDENCE: REDWOOD CITY, CALIFORNIA 

Oracle co-CEO, who met with the President-elect at Trump Tower in December 

2016 alongside a group of Silicon Valley executives, joined his 

transition team, leading one Oracle executive to publicly resign in protest. 

An 18-year Oracle veteran, Catz has served as co-CEO since September 

2014 and is one of the world’s highest-paid female executives, earning 

$40.9 million in 2016. She is credited with spearheading Oracle’s aggressive 

acquisition strategy, helping close more than 100 deals since 2005. 

23. Weili Dai 


AGE: 55 RESIDENCE: LOS ALTOS 


29. Vera Wang 


AGE: 67 

RESIDENCE: NEW YORK CITY 

22. Nancy 

Zimmerman 


AGE: 53 RESIDENCE: BOSTON 

Cofounder and managing partner 

of Bracebridge Capital, 

Zimmerman is the richest female 

hedge fund founder in 

the U.S. Her Boston-based firm 

manages over $10 billion in assets 

for endowments, pensions 

and high-net-worth individuals, 

and counts Yale University 

as one of its clients. The Brown 

alumna started Bracebridge in 

1994 after a stint at Goldman 

Sachs, where she ran an interest 

rate options group. 

24. Sheila Johnson 


AGE: 68 

RESIDENCE: THE PLAINS, VIRGINIA 

After Black Entertainment Television, 

cofounded by Sheila and 

husband Robert, was sold to 

Viacom for $2.4 billion in 2001, 

the couple divorced. She has 

since sold off her shares and invested 

in hotels and golf courses 

in Florida and Virginia. She also 

owns homes in New York City 

and Palm Beach, a horse farm 

and stakes in the WNBA Mystics, 

NBA Wizards and NHL Capitals. 

Former president of Marvell 

Technology, a semiconductor 

company, is diversifying since 

getting the boot in April 2016, 

after the company alleged that 

she encouraged the recognition 

of revenues prematurely. Dai 

and her husband, Sehat Sutardja, 

who was fired as CEO, bought 

a slew of Vegas properties in the 

past year, including more than 

200 units at a luxury residential 

complex and a penthouse at the 

Trump International Hotel, where 

the pair reportedly now live. The 

couple founded the $2.3 billion 

(sales) company in 1995. They 

remain its largest shareholders. 

24. Neerja Sethi 

$750 MILLION T 

AGE: 62 RESIDENCE: FISHER 

ISLAND, FLORIDA 

Cofounder of IT consulting and 

outsourcing firm Syntel. Her 

fortune dropped after shares in 

the company, which relies on 

the financial and health care 

sectors, plunged 59% in a year. 

Sethi started the firm with her 

husband, Bharat Desai, in 1980. 

Today the $967 million (sales) 

company employs nearly 23,000 

people, 80% in India . 

27. Kathy Fields 


AGE: 59 

RESIDENCE: SAN FRANCISCO 

27. Katie Rodan 


AGE: 61 


Sales at Fields (above) and Rodan’s 

skin-care company surpassed 

$1 billion for the first time 

in 2016. Revenue at the firm, 

known for its antiaging products 

and its multilevel marketing 

sales model, has increased more 

than 800% in the past five years. 

It plans to expand from the U.S. 

and Canada to Australia later 

this year. The women, both dermatologists, 

met in 1984 when 

they were residents at Stanford. 

Their first venture together was 

acne treatment Proactiv, which 

they licensed to Guthy-Renker 

in 1995. The pair sold their rights 

to royalties in 2016. They started 

Rodan + Fields in 1990, sold 

it to Estée Lauder in 2003 and 

bought it back in 2007. 

“We kept turning 

down dark corners, 

and there was a lot 

of failure along the 

road to this ultimate 

success.” —Kathy Fields 

The designer, best known for 

bridal gowns, was a competitive 

figure skater and then a 

Vogue editor for 16 years before 

launching her namesake boutique 

in 1990. Apart from her 

high-end fashion label, Wang 

has lucrative licensing deals with 

Zales, Kohl’s and David’s Bridal. 

She lives at 740 Park Avenue, 

built by the grandfather of 

Jacqueline Kennedy Onassis. 

Wang’s maternal grandfather, 

Wu Junsheng, was reportedly a 

warlord in a Chinese army. 

30. Tory Burch 


AGE: 50 


Art-history grad worked with 

designers Ralph Lauren and 

Vera Wang before opening a 

boutique in New York City’s 

Nolita neighborhood in 2004. 

Her eponymous lifestyle brand 

is best known for its Reva ballet 

flats but also sells handbags, 

watches, beauty products 

and activewear such as ruffled 

sneakers. The stocks of midprice 

fashion outfits have fallen 

out of favor with investors, 

pushing down Forbes’ estimate 

of her company’s value. The 

Tory Burch Foundation, which 

she launched in 2009 to promote 

entrepreneurship among 

women, is collaborating with 

her Tory Sport division to offer 

special-edition bracelets and T- 

shirts encouraging women to 

embrace ambition; proceeds go 

to her foundation. Her fiancé, 

Pierre-Yves Roussel, is CEO of 

LVMH Fashion. 




32. Madonna 


AGE: 58 RESIDENCE: NEW YORK CITY 

The Material Girl’s Rebel Heart tour, which 

ended in March 2016, grossed $170 million. 

She also makes money from clothing and perfume 

lines. A savvy spender, she has scooped 

up New York real estate and amassed an art 

collection that reportedly includes works by 

Picasso and Man Ray. Along with Beyoncé 

(No. 46) and others, she owns a piece of streaming-music service Tidal, 

worth a reported $600 million after a recent investment by Sprint. 

33. Kit Crawford 


AGE: 58 RESIDENCE: ST. HELENA, CALIFORNIA 

Crawford started working at a Bay Area bakery owned by her future 

husband, Gary Erickson, in the 1980s. That venture eventually led to 

the creation of Clif Bar, the nutritional snack bars sold in 14 countries. 

Crawford and her husband own 80% of the company, whose sales have 

reportedly risen to $790 million. They stepped down as co-CEOs in 

2013 but remain co-chief visionary officers. They also run Clif Family 

Winery in Napa Valley and venture firm White Road Investments. 

“Leadership is a lot about listening to yourself. . . . Be brave 

with your decision even if it goes against the grain.” 

33. Mary West 


AGE: 71 RESIDENCE: SAN DIEGO 

30. Anne Dinning 

$600 MILLION + 


A computer scientist by training, Dinning has helped run one of the 

most successful quantitative hedge fund firms on Wall Street for nearly 

two decades. The Seattle native joined D.E. Shaw in 1990, after receiving 

her Ph.D. in computer science from New York University. She quickly 

rose through the ranks, overseeing much of the firm’s hedge fund 

activities by 1995, before retiring in 1999. Three years later, Dinning returned 

as founder David Shaw transitioned the day-to-day management 

of his fund to an executive committee made up of longtime employees. 

Since she came back, D.E. Shaw’s assets under management 

have risen from under $5 billion to over $40 billion. After 15 years on 

the executive committee, Dinning recently moved into a senior leadership 

role as a managing director. She sits on the boards of Math for 

America, which provides resources and training to STEM teachers, and 

Robin Hood, which fights poverty. 

West started her telemarketing 

business in Omaha, Nebraska, 

in 1986. She and her 

husband, Gary, sold their majority 

stake to private equity 

firms Thomas H. Lee Partners 

and Quadrangle Group for 

$1.4 billion in 2006. She still 

owns 10% of the now publicly 

traded West Corp. The couple 

also own boutique hotel West 

Inn & Suites, Bistro West, 

West Steak & Seafood and a 

gas station called Westmart, 

all on the same block in Carlsbad, 

California. 

35. Marissa Mayer 


AGE: 41 


Mayer’s ill-fated five-year tenure 

at Yahoo is coming to an end. 

The embattled tech pioneer is in 

the process of being sold to Verizon 

for $4.48 billion; Mayer will 

no longer serve as CEO after the 

deal closes, which is expected to 

happen in June. Much of Mayer’s 

fortune comes from her 13-year 

stint at Google, where she was 

one of its first employees. 

36. Kendra Scott 


AGE: 43 RESIDENCE: AUSTIN, TEXAS 

Founder of jewelry brand known 

for customizable earrings and 

necklaces debuts following a private 

equity investment valuing 

the company at over $1 billion. 

(See story, p. 77 .) 


36. Victoria Zoellner 


AGE: 74 

RESIDENCE: ALPINE, NEW JERSEY 

Zoellner is chairman of $1.7 billion 

(assets) hedge fund Alpine 

Associates Management, named 

after Alpine, New Jersey, one of 

the ritziest towns in America. 

The former Wall Street portfolio 

analyst cofounded the firm with 

her husband, Robert Zoellner (d. 

2014), in 1976 with $400,000 

from friends, family and other 

associates. The couple wrote 

partnership and offering agreements 

from the living room of 

their apartment; Robert headed 

the trading activities, and Victoria 

focused on merger arbitrage. 

38. Donna Karan 


AGE: 68 


Karan rebuked President 

Trump’s leadership, telling 

Forbes: “[He] does not understand 

what it means to be the 

face of our country. . . . We look 

foolish. He is setting us back 

50-plus years.” Having sold her 

namesake brand to LVMH in 

2000, she’s now focused on her 

luxury lifestyle company, Urban 

Zen, which combines fashion 

and philanthropy. 

39. Liz Elting 



Cofounder of TransPerfect, one of the 

world’s largest translation firms, prevailed 

in a three-year legal battle with 

co-CEO Phil Shawe. In February, the 

Delaware Supreme Court upheld a lower 

court’s order forcing the company’s 

sale in an open auction due to the pair’s 

“dysfunction” and “deadlock.” It also affirmed 

$7.1 million in sanctions against Shawe for secretly accessing 

Elting’s emails and other misconduct during litigation. Shawe says he 

will ask the U.S. Supreme Court to reverse the decisions. The pair, who 

were briefly engaged, started the business in a dorm room in 1992. 

41. Susan Wojcicki 


AGE: 48 RESIDENCE: LOS ALTOS, CALIFORNIA 

One of a handful of female tech CEOs in Silicon Valley, Wojcicki spoke 

out about the discrimination women face in tech in an op-ed in March 

titled “How to Break Up the Silicon Valley Boys’ Club.” The percentage 

of women at YouTube, where she has served as CEO since 2014, has increased 

from 24% to 30%, according to Wojcicki. Google employee 

No. 16, she lent her Menlo Park garage to Larry Page and Sergey Brin, 

who created the Google search engine there. In 2006, she advocated 

for Google’s $1.65 billion acquisition of YouTube; the video site is now 

worth an estimated $90 billion. Her sister Anne, ex-wife of Brin, is cofounder 

of personal-genomics company 23andMe. 

41. Jamie 

Kern Lima 


AGE: 39 RESIDENCE: JERSEY CITY 

Beauty industry’s it girl sold IT 

Cosmetics, which she founded, 

to L’Oréal for $1.2 billion 

in August. (See story, p. 80.) 

43. Céline Dion 


AGE: 49 RESIDENCE: LAS VEGAS 

Last February, Dion resumed a 

lucrative Las Vegas residency 

that had been on hiatus for a 

month following her husband’s 

January 2016 death; she had 

also taken an eight-month 

break in 2014 to care for him. 

She’s back to playing 70-odd 

times a year at Caesars Palace, 

where she banked $27 million 

(pretax) in 2016 alone. Thanks 

to similar gigs, the Canadian 

songstress has made most of 

her money in Sin City. She also 

pulls in earnings from touring 

and record sales. 

44. Barbra Streisand 


AGE: 75 

RESIDENCE: MALIBU, CALIFORNIA 

Still a huge draw at arenas 

around the globe, Streisand 

grossed $46 million on a short 

14-show stint last year, adding 

to a career tour tally in the hundreds 

of millions. Streisand is the 

only act in history to have a No. 

1 album in six consecutive decades. 

She has also been shrewd 

with her real estate investments: 

sources believe her Malibu compound, 

reportedly purchased 

for under $20 million, could be 

worth close to $100 million. 

39. Janice 

Bryant Howroyd 


AGE: 64 RESIDENCE: LAS VEGAS 

Bryant Howroyd’s journey to 

success started with a vacation 

in California in 1976 visiting her 

sister. She stayed and two years 

later, after not finding a job she 

wanted, started an employment 

agency with a single desk, one 

phone and $1,500, including a 

$900 loan from her mother. The 

company, Act-1, now has 17,000 

clients and 2,600 employees 

in 19 countries. Howroyd, who 

has served on presidential commissions 

with Barack Obama, 

George W. Bush and Bill Clinton, 

is once again on a presidential 

commission with President 

Trump. She and her family have 

millions invested in real estate, 

largely in California. 

45. Nora Roberts 


AGE: 66 RESIDENCE: BOONSBORO , 

MARYLAND 

One of publishing’s busiest 

scribes, Roberts has churned out 

around five manuscripts a year 

since 1981. Born Eleanor Marie 

Robertson, she turned to 

writing when snowed in during 

a blizzard and has since authored 

more than 220 romance 

and crime novels as Roberts and 

under the pseudonym J.D. Robb. 

She owns a bookstore, boutique 

B&B, gift shop, fitness center 

and restaurant in 3,400-person 

Boonsboro, Maryland, the town 

she calls home. 

To compile net worths, we valued 

individuals’ assets, including the value 

of stakes in public companies, on April 

28, when we locked in stock prices. We 

valued private companies by speaking 

with an array of outside experts 

and conservatively comparing the 

companies with public competitors. 

To be eligible for this list, women 

had to have substantially made their 

own fortunes and be U.S. citizens or 

permanent residents. In cases where 

they started businesses with and 

still share with their husbands, we’ve 

assigned them half of that combined 

wealth. We attempted to vet these 

numbers with all list entrants. Some 

cooperated; others didn’t. 

Acknowledgments: Euromonitor 

International; FactSet; LW Hospitality 

Advisors; Pitchbook; Privco; Simeon 

A. Siegel, Nomura Instinet; Staffing 

Industry Analysts; Lars Topholm of 

Carnegie Investment Bank. 




46. Beyoncé Knowles 



Last year’s album, Lemonade, was her sixth solo No. 1—and spawned 

the Formation World Tour, which wrapped up in late 2016 and grossed 

a quarter of a billion dollars. Months later, the value of her slice of music-streaming 

service Tidal soared when Sprint invested a reported $200 

million for a 33% stake. Expecting twins with her husband, rapper Jay Z, 

Beyoncé is taking a break from the stage. The active philanthropist has 

been a vocal supporter of Black Lives Matter. 

47. Martine Rothblatt 

$340 MILLION 2 

AGE: 62 

RESIDENCE: SATELLITE BEACH, FLORIDA 

CEO of publicly traded biotech firm United 

Therapeutics is experimenting with pig 

cloning and genetic modification to create 

the ultimate cure for pulmonary arterial 

hypertension, which ails her daughter. 

The company’s pig “pharm” in Blacksburg, 

Virginia, is the world’s largest cloner of pigs. For now, United 

Therapeutics sells five FDA-approved drugs that have drastically 

changed the quality of living with the disease. Rothblatt’s first success 

was Sirius Satellite Radio, which she cofounded in 1990. 

“I’m a person who likes to hear why something can’t be done, 

and I’ll whittle down every one of the ‘can’ts’ one at a time.” 

48. Danielle Steel 


AGE: 69 


With two proposals on Valentine’s 

Day, five high-profile mar riages 

and nine children, Steel has lived 

a life as fantastical as her romance 

novels. Thanks to a knack 

for spinning scintillating stories, 

she has published 130 books and 

sold 650 million copies. Steel 

remains one of the world’s highest-paid 

authors and still writes 

on a 1946 Olympia typewriter. 

Her two charitable foundations 

raise money for preventing child 

abuse and treating mental illness. 

49. Sonia Gardner 



President of investment firm Avenue 

Capital, which manages 

$10.7 billion in assets, down 

$900 million since last year. The 

private equity firm, which closed 

its hedge funds over the past two 

years, is raising a second U.S. energy 

fund, because that is where 

it now sees the greatest opportunity 

in the U.S. It is also raising 

a second aviation fund. Gardner 

cofounded the firm with her 

brother, Marc Lasry, in 1995. 

She is a trustee of Mount Sinai 

Health System, where she 

has been involved in generating 

money for lung cancer research. 

She is global chair of 100 Women 

in Finance, previously known as 

100 Women in Hedge Funds. 

50. Pleasant Rowland 


AGE: 76 

RESIDENCE: MADISON, WISCONSIN 

Unable to find dolls for her nieces, 

Rowland started American Girl 

doll company at age 45. A former 

elementary school teacher and 

textbook author, she reportedly 

funded the venture with $1.2 million 

she’d saved from book royalties. 

She sold the business to Mattel 

in 1998 for $700 million. She 

has since given away millions, 

much of it to revitalize Aurora, 

New York, home of her alma mater 

Wells College, where she restored 

several historic properties and is 

owner of the Inns of Aurora. 

51. Judy Sheindlin 


AGE: 74 

RESIDENCE: NAPLES, FLORIDA 

After 21 seasons, Judge Judy 

remains television’s arbiter du 

jour. Her daytime show has 

been on the air since 1996 but 

is still watched by an average 

of 10 million viewers daily. 

She spent 25 years in New 

York’s family court before getting 

her start on TV at age 52. 

In 2014, she created a spinoff, 

Hot Bench, and more recently 

negotiated the rights to 

her extensive episode library, 

which she reportedly plans to 

sell for up to $200 million. 

“Find something that 

you’re naturally 

adept at and figure 

out how to parlay 

it into a career.” 

51. Diane von 

Furstenberg 


AGE: 70 


What began with an iconic 

wrap dress in 1974 is now 

a fashion house with an estimated 

$540 million in sales 

from shoes, jewelry and accessories 

sold in over 55 

countries. No longer lead 

designer, Von Furstenberg 

is chairman and owns the 

firm with her husband, media 

billionaire Barry Diller, 

and her two children from 

her previous marriage to 

German aristocrat Prince 

Egon of Furstenberg. The 

Brussels-born designer also 

serves as chairman of the 

Council of Fashion Designers 

of America. 


51. Adi Tatarko 


AGE: 44 RESIDENCE: PALO ALTO, CALIFORNIA 

Tatarko’s home-remodeling website, Houzz, is going global. The Silicon 

Valley startup launched platforms in India, Ireland, New Zealand 

and Singapore in 2016, bringing its footprint to 15 countries. Israelborn 

Tatarko, who is CEO, launched Houzz with her husband, Alon 

Cohen, in 2009, when the pair had trouble finding ideas for remodeling 

their home. Valued at an estimated $2 billion, the site attracts 

over 40 million unique users a month. 

54. Kathy Lehne 


AGE: 55 RESIDENCE: HOUSTON 

CEO of wholesale fuel marketer and distributor Sun Coast 

Re sources, one of the largest women-owned businesses in Texas; 

Lehne founded the company at 23 in 1985. Today it has a fleet of 

over 700 trucks and is known for its quick response in emergencies; 

it provided fuel to areas devastated by Hurricanes Katrina and Sandy. 

Lehne reportedly plays high-stakes poker. 

58. Patricia Miller 


AGE: 78 

RESIDENCE: FORT WAYNE, INDIANA 

Cofounder of Vera Bradley, purveyor 

of handbag, luggage and accessories, 

retired in 2012; she and her 

husband, who gave her $250 to 

start the business, sit on the board. 

The company’s stock is down nearly 

50% in 12 months, knocking her 

cofounder, Barbara Bradley Baekgaard, 

out of the ranks. 

59. Dorothy Herman 


AGE: 64 


Herman is CEO and co-owner 

of real estate brokerage Douglas 

Elliman, which sold nearly 

$25 billion worth of homes 

last year, much of it in Manhattan 

and the Hamptons, and had 

$675 million in revenue. The 

firm is facing a new threat. Two 

agents of real-estate-listing app 

Compass sued Elliman, their 

former employer, in October, 

alleging that it withheld commissions; 

Elliman countersued, 

claiming Compass was stealing 

brokers and upending exclusive 

contracts to sell luxury units in 

new developments. Compass 

denies the allegations. 

55. Taylor Swift 


AGE: 27 RESIDENCE: NASHVILLE 

55. Lynda Weinman 


AGE: 62 RESIDENCE: MONTECITO, 

CALIFORNIA 

Former Web-design teacher 

sold her online-learning platform 

Lynda.com, which offers 

nearly 6,000 online courses 

and over 200,000 video tutorials, 

to LinkedIn in May 2015 for 

$1.5 billion in cash and stock; 

she stepped down as executive 

chairman a month later. Microsoft, 

which had been a Lynda 

.com customer, acquired 

Linked In for $26 billion in cash 

in 2016, bumping her estimated 

fortune to $280 million. Weinman 

is board president of the 

Santa Barbara International 

Film Festival and seeds documentary 

filmmakers. 

“You are going to get 

through all the hardships 

and pain, but they are 

necessary to make you 

stronger and wiser.” 

The success of her “1989” 

tour, which smashed North 

American touring records en 

route to a quarter-billion-dollar 

gross in 2015, established 

Swift as one of the world’s 

top entertainers in any genre. 

Even when she has a quiet 

year, as was the case in 

2016, she gets a bump from 

continued earnings from her 

music, endorsements and 

merchandise. 

57. Toni Ko 


AGE: 44 

RESIDENCE: LOS ANGELES 

At age 25, with $25 0,000 in 

seed money from her parents, 

Korean-born Ko started 

an affordable high-quality 

beauty brand called NYX 

Cosmetics. Her first products 

were colorful eye and 

lip pencils that sold for $1.99 

apiece. L’Oréal bought NYX 

in a deal worth $500 million 

in 2014. After a brief retirement, 

Ko is back in the 

game: She launched sunglasses 

company Perverse in 

2016. It’s the official eyewear 

sponsor of hip music festival 

Coachella. 

59. Jessica Iclisoy 



When she was pregnant in 1990, Iclisoy read baby-care product labels and 

was shocked to see that most contained harmful chemicals. She started 

mixing baby shampoo in her kitchen. In 1995, she borrowed $2,000 from her 

mom to launch California Baby. Today her $80 million (2016 sales) company 

sells 90 nontoxic, organic baby products at stores like Whole Foods and Target. 

CEO Iclisoy never brought in investors, has her own manufacturing facility 

and grows some ingredients on her own farm (see p. 69). F 

WEALTH STATUS: UP S DOWN TUNCHANGED X NEW +RETURNEE 2 


THE LOOMING 

RETAIL BAILOUT 

Think America’s retail industry is hurting now? 

It’s about to get way, way worse—and these nine charts prove it. 

BY GEORGE ANDERS 

While the economy finally seems to have recovered from the Great Recession, complete with discussion of full employment 

and rising wages, the memo must have missed the retail industry, where top executives of Macy’s, J.C. 

Penney, Office Depot and the like pepper quarterly analyst briefings with terms like “softening trends,” “disappointing” 

and “not satisfied.” Since January, at least a dozen shrinking retailers have announced nearly 3,000 store 

closings. Even well-regarded companies such as Nordstrom see their shares trading at barely half their 2015 highs. 

Trying to explain their plight, retail executives like to cite hard-to-control factors, such as changing consumer preferences and 

aggressive moves by the industry’s six-letter word, Amazon. They argue that retrenchment and better luck at merchandising will 

turn things around quickly. A close look by Forbes, however, reveals that retailing’s troubles run far deeper, largely because of three 

big, self-inflicted problems. The charts that follow show the painful consequences of retailing’s bare-bones pay habits, a chronic inability 

to innovate and an ill-timed rush into the high-debt world of private equity ownership. 

For many, these problems won’t be fixable. In the short term, expect more store closings, half-empty malls, layoffs and liquidations. 

In a classic Schumpeterian cycle, new and better-run retailers would emerge, benefiting the shopping public and the overall 

economy. The problems for the brick-and-mortar chains, however, seem so entrenched that the entire retail infrastructure could 

collapse. And while there’s little support for a retail bailout—especially when Amazon and its ilk make it look so easy—Greg Petro, 

head of the retail consulting firm First Insight, notes that the closely linked businesses of retail, restaurants and grocery stores employ 

28 million people, far more than the U.S. auto industry. Racks of unsold yoga pants won’t seem so frivolous if the con sequences 

include broken leases, soaring commercial vacancy rates and a real estate sector that falls behind on its debt payments. 

It’s hard to see how debt forbearance and job guarantees would fix the problems of any industry that refused to innovate or provide 

its workers with any realistic path to financial success, but that may not stop politicians—who already subsidize retail’s workforce 

to the tune of many billions of dollars—from promising quick fixes, anyway. 

CREDIT TK 



FORBES 


CHEAP LABOR HAS 

BECOME A WAY OF LIFE 

$25 

$20 

About 4.5 million people in the U.S. work as 

retail salespersons. It’s a tough way to make 

a living. These workers earn about 55% of the 

average U.S. wage. And it’s been getting worse: 

In 2001, that figure was 62%. These are already 

lousy jobs. Given the decent employment 

market, struggling retailers won’t make up 

shortfalls by cutting wages. 

$15 

$10 

$5 

$0 

2001 

2009 

2008 

2007 

2006 

2005 

2004 

2003 

2002 

Source: Bureau of Labor Statistics. 

2015 

2014 

2013 

2012 

2011 

2010 

2016 

U.S. mean hourly pay 

Retail mean hourly pay 

MANY RETAILERS NOW PAY BELOW A LIVING WAGE 

MIT economist Amy Glasmeier has modeled the earnings that different-size families would need to pay for food, housing, transportation, 

clothing and personal effects on their own, without government help. Her “living wage” model doesn’t include vacations, savings or other 

nonessentials. 

Drawing on salary data from Glassdoor, analysts at New York-based Just Capital tested the degree to which typical pay for different retail 

sectors compares with Glasmeier’s norms. They found that between 71% and 96% of the time, depending on the sector, retail workers failed to 

earn a living wage on average. 

The examples below all assume a family of three, with one adult working full-time, another working part-time and a child to support. Given 

the number of single-parent households and those with larger numbers of children, these figures are likely quite conservative. 

$20 

Drugstores 

$18 

$17.51 

$16.93 

$16 

28.59% 

$17.19 

$16.71 

$16.55 

$17.24 

$16.90 

$16.74 

$16.99 

9.55% 

$16.57 

Weighted average payroll-based wage 

$14 

17.92% 

$12 

18.71% 

$10 

$8 

$6 

$4 

$2 

13.3% 

Convenience 

Stores 

Sporting 

Goods 

Stores 

19.68% 

Autos 

and 

Hardware 

Apparel 

and Jewelry 

Stores 

Department 

Stores 

Sit-down 

Restaurants 

9.93% 

12.31% 

3.58% 

đ Weighted average living wage for employees in branches 

đ Percentage making a living wage 

Size of circle indicates average workers per company 

Burger 

Chains 

Other 

Fast 

Food 

Amazon.com m 

Inc. 

6.04% 4926 

Discounters 

BY THE NUMBERS 

Average hourly wage for retail salesperson in 

Washington, D.C. (highest in the U.S.): 

$16.94 

Average hourly wage in West Virginia 

(lowest in the U.S.): 

$11.79 

SOURCE: BUREAU OF LABOR STATISTICS. 

0 

0 500,000 1,000,000 1,500,000 2,000,000 2,500,000 3,000,000 

Total category employment 

Source: Just Capital. 


FAST-GROWING 

GOVERNMENT AID 

FILLS THE GAP . . . 

Since 2000, the U.S. population has grown about 

15%, but the number of people receiving food 

stamps (formally known as the Supplemental 

Nutrition Assistance Program) has climbed 

157%. Medicaid enrollment has doubled. Just 

Capital estimates that the retail industry gets the 

equivalent of a multibillion-dollar annual subsidy 

from the federal government because of the 

income-boosting effects of SNAP, Medicaid and 

other programs on retail employees’ finances. 

Total U.S. enrollees (millions) 

70 

60 

50 

40 

30 

20 

10 

0 

2000 

2011 

2010 

2009 

2008 

2007 

2006 

2005 

2004 

2003 

2002 

2001 

2016 

2015 

2014 


2012 

SNAP (food stamps) 

Medicaid 

Sources: Medicaid & CHIP Payment & Access Commission; USDA. 


Current minimum wage in the 

District of Columbia, highest in the 

U.S.: 

$11.50 

Legislated minimum wage in 

California for 2022: 

$15.00 

BUT GOVERNMENT 

LARGESSE IS 

IN DOUBT 

In April, Agriculture secretary 

Sonny Perdue told senators he 

wants to see SNAP’s food stamps 

administered “more efficiently and 

effectively.” It’s anyone’s guess 

how Congress and the Trump 

administration will ultimately 

resolve health care debates, but 

Medicaid cuts are an important part 

of many reform proposals. 

Expected effect of an early version of 

Trump’s health care bill on Medicaid outlays, 

according to the CBO. 

$0 

-25 

-50 

-75 

-100 

-125 

-150 

In billions of dollars 

2024 

2023 

2022 

2021 

2020 

2019 

2018 

2017 

2026 

2025 

Sources: Congressional 

Budget Office; Staff of the 

Joint Committee on Taxation. 

CHARTS AND GRAPHS BY PETER AND MARIA HOEY FOR FORBES 

STATES RAISE THE MINIMUM WAGE 

While the federal minimum wage hasn’t budged from $7.25 an hour since 2009, many 

state-specified floors are significantly higher—and are slated to keep rising. 

Washington 

$11.00 

Oregon 

$9.75 

Nevada 

$8.25 

California 

$10.50 

Idaho 

$7.25 

Alaska 

$9.80 

Montana 

$8.15 

Utah 

$7.25 

Arizona 

$10.00 

Wyoming 

$7.25 

N. Dakota 

$7.25 

Colorado 

$9.30 

New Mexico 

$7.50 

Hawaii 

$9.25 

Minnesota 

$9.50 

S. Dakota 

$8.65 

Nebraska 

$9.00 

Sources: Department of Labor; 

National Conference of State Legislatures. 

Kansas $7.25 

Iowa $7.25 

Oklahoma 

$7.25 

Texas 

$7.25 

Wisconsin 

$7.25 

Missouri 

$7.70 

Michigan 

$8.90 

Illinois 

$8.25 Indiana 

$7.25 

Arkansas 

$8.50 

Louisiana 

$7.25 

New York 

$9.70 

Ohio 

$8.15 

Kentucky 

$7.25 

Tennessee 

$7.25 

Alabama 

$7.25 

Mississippi 

$7.25 

States that have committed to 

further minimum wage raises 

States with annual cost-of-living 

adjustments to their minimum wage 

New Maine 

Hampshire $9.00 

$7.25 Massachusetts 

Vermont 

$11.00 

$10.00 

Connecticut 

$10.10 

Rhode Island 

$9.60 

Pennsylvania New Jersey $8.44 

$7.25 

Delaware $8.25 

W. Virginia 

Maryland $8.75 

$8.75 Virginia 

$7.25 D.C. $11.50 

N. Carolina $7.25 

Georgia 

$7.25 S. Carolina $7.25 

Federal 

Minimum 

Wage: 

$7.25 

Florida 

$8.10 


FORBES 


10 

5 

0% % 

10 0 

5 

0% % 

10 0 

5 

0% % 

-55 

-10 

2015 

2 2014 


2012 

2011 

2010 

-5 

-10 

2015 

2014 


2012 

2011 

2010 

-5 

-10 

2015 

2014 


2012 

2011 

2010 

Auto Parts 

Furniture & Home Furnishings 

Grocery Stores 

MEANWHILE, 

RETAIL 

PRODUCTIVITY 

HAS STALLED 

Retailing—like much of 

the U.S. economy in the 

past decade—has been 

afflicted by dwindling 

growth in output per 

worker, i.e., productivity. 

One big exception: online 

retailing, where increased 

efficiency yields rich 

payoffs. More bad news 

for the brick-and-mortar 

retailers, where the 

problem is centered. 

10 0 

5 

0% % 

-5 

-10 

10 

5 

0% 

-5 

-10 

2015 

2014 


2012 

2011 

2010 

2015 

2014 


2012 

2011 

2010 

10 

5 

0% 

-5 

-10 

10 

5 

0% 

-5 

-10 

2015 

2014 


2012 

2011 

2010 

2015 

2014 2013 

2012 

2011 

2010 

10 

5 

0% 

-5 

-10 

10 

5 

0% 

-5 

-10 

2015 

2014 2013 

2012 

2011 

2010 

Health/Personal Care Clothing Stores Shoe Stores 

2015 

2014 


2012 

2011 

2010 

Sporting Goods Department Stores Online & Mail-Order 

Source: Bureau of Labor Statistics. 

THERE’S LITTLE 

INNOVATION 

OUTSIDE OF 

AMAZON 

Retailers file patents 

so rarely that the U.S. 

Patent Office doesn’t 

even publicly track them 

as a distinct industry. 

The big exception is 

Amazon, the onlineretailing 

pioneer, which 

has won nearly 5,000 

patents since its founding 

in 1994. Its inventions 

cover everything from 

organizing search-engine 

results to ensuring that 

warehouse robots don’t 

bump into human workers. 

Lowe’s 

52 

Starbucks 

52 

CVS Pharmacy 

44 

Number of patents awarded 

Walgreens 

107 

Home Depot 

169 

Wal-Mart 

332 

Target 

1,137 

Amazon 

4,926 

Source: EnvisionIP. 



The face value of “distressed” 

bonds—with credit ratings of 

triple-C or below—issued by 

retail and apparel companies, 

according to Moody’s Investors 

Service: 

$3.7 BIL 

The number of retail and 

apparel companies that have 

issued such bonds. The total is 

the highest since the recession 

year of 2009: 

19 

An inability to pay distressed 

retail bond debt could trigger 

restructurings or default. The 

amount of distressed retail 

bond debt obligated to be 

repaid by year-end 2018: 

30% 

PRIVATE EQUITY DEALS CREATE DEBT WORRIES . . . 

PetSmart. Neiman 

Marcus. J. Crew. These 

retailers and many 

others have gone 

private or recapitalized 

via private equity deals, 

taking on extra debt 

in the process. When 

operating results are 

strong, debt gets paid 

down and investors 

win. But the current 

climate, in conjunction 

with the previous 

lack of investment in 

innovation, threatens 

to push numerous 

retailers into a debtdriven 

death spiral. 

25 

20 

15 

10 

5 

$0 

100 

80 

60 

40 

20 

0 

DEAL FLOW 

In Billions of Dollars 

DEAL COUNT 

2011 

2010 

2009 

2008 

2007 

2006 


2012 

2017 1 

2016 

2015 

2014 

1 

As of 5/4/2017 

Source: PitchBook. 

LEADING TO A SURGE IN 

CHAPTER 11 AND CLOSINGS 

At least 12 retailers have announced sizable store-closing plans since the start of 

2017. As of May 5, 19 retailers have sought Chapter 11 bankruptcy protection from 

creditors this year, already surpassing the number of filings (18) for full-year 2016. 

550 

500 

450 

400 

350 

300 

250 

200 

150 

100 

50 

0 

RadioShack 

rue 21 

STORES CLOSING 

The Limited 

Payless ShoeSource 

hhgregg 

Family Christian 

Wet Seal 

bebe 

Crocs 

50 

40 

30 

20 

10 

0 

J.C. Penney 

CHAPTER 11 

2016 

2015 

2014 


2012 

2011 

2010 

Kmart 

BCBG Max Azria 

2017 1 

1 

Year to date 

Source: S&P Global Market Intelligence. 

Sources: Company announcements; Forbes estimates. 


THE BIG 

CHEESE 

FROM PIZZA HUT 

AND DOMINO’S 

TO LITTLE 

CAESARS AND 

PAPA JOHN’S, THE 

VAST MAJORITY 

OF PIZZAS IN 

AMERICA FEATURE 

MOZZARELLA FROM 

ONE COMPANY. 

FOR THE FIRST 

TIME, SECRETIVE 

BILLIONAIRE 

JAMES LEPRINO 

EXPLAINS HOW HE 

BUILT A CHEESE 

JUGGERNAUT. 


100 | FORBES JUNE 13, 2017 JOHN PRIETO/THE DENVER POST/GETTY IMAGES

Camera shy: If you Google James Leprino’s picture, 

you’ll get fellow billionaire John Malone. 

This 1970s company portrait is the only known 

image of Leprino Foods’ founder (right). 


THE CHEESE KING 

An avalanche of cheese pours 

into the test kitchen at the 

Denver headquarters of Leprino 

Foods, the mozzarella 

supplier to Pizza Hut, Domino’s 

and Papa John’s. First, thin 

wisps of low-moisture mozzarella, 

then a diced alternative, 

followed by an “artisanal” version, 

cut short and wide. Then 

come flavored cheeses made 

with a mozzarella base, as well 

as provolone, cheddar and 

Monterey Jack. 

Cooks bring out a takeand-bake 

pizza, a New Yorkstyle 

pie and a stuffed crust, 

fresh from nearly a dozen ovens. Another course features frozen 

food made with Leprino products, including ham-andcheddar 

Hot Pockets, Stouffer’s lasagna and Smart Ones baked 

ziti. Then come the cheese cubes marketed as snack pairings: 

pear flavor with nuts or Gorgonzola with pretzels. Team Leprino 

next brings out dessert: salted-caramel-flavored mozzarella 

wrapped in hot dough, rolled in cinnamon sugar. After an 

hour, the plastic shot glasses appear for sampling the company’s 

lactose and whey powders, which end up in protein bars, 

Yoplait yogurt, Pillsbury Toaster Strudel and baby formula 

consumed by millions of infants annually. 

Two floors above this dairy deluge, in a dark-wood-paneled 

office with white marble floors, Corinthian columns and 

gold accents, sits James Leprino, the Willy Wonka of cheese. 

“It’s hard for me to believe I agreed to this,” the 79-year-old 

billionaire says. “I really like to keep my privacy.” 

Indeed he does, to a nearly unprecedented degree, given the 

way he dominates his industry. Leprino has somehow eluded 

photographers for decades: A Google search picks up photos 

of fellow Colorado billionaire Philip Anschutz and cosmetics 

heir Ronald Lauder. There isn’t a single image of Leprino on his 

company’s website. But after nearly 60 years running the business 

and more than a decade on Forbes’ list of billionaires, Leprino, 

worth an estimated $3 billion, is finally willing to be interviewed 

about how his family’s grocery in Denver’s Little Italy 

became the world’s top producer of pizza cheese—the slightly 

derisive term competitors use to describe its mozzarella. In 

all, Leprino Foods sells more than a billion pounds of cheese a 

year, to the tune of $3 billion in revenue. 

The little-known Leprino (he declined to be photographed 

for this article) rates as one of America’s all-time monopolists. 

He lets others worry about fresh mozzarella balls and pizza that 

taste like they were made in the old country. His laser focus on 

large pizza chains has allowed him to control as much as 85% of 

the market for pizza cheese and somehow sell simultaneously to 

a set of customers—Pizza Hut, Domino’s, Papa John’s and Little 

Caesars—that try to cut each others’ throat in every way that 

doesn’t involve where they buy their milk products. Dominating 

the market has its advantages: He’s able to invest in technology 

that no run-of-the-mill dairy farmer ever could, resulting in 

more than 50 patents—and an estimated 7% net margin, which 

dwarfs the dairy-industry average. 

As the diamonds of his watch bezel shimmer on his wrist, 

Leprino takes out his beat-up black leather wallet, removes the 

rubber band holding it shut and reveals a card featuring the 

four company watchwords: quality, service, price, ethics. “I’ve 

got everybody keeping one in their pocket,” Leprino says. “The 

company was growing so fast they were missing this important 

message.” 

Quality is listed first intentionally. It’s easy to mock his 

product (Frankencheese, anyone?), but Leprino Foods is one 

of the few dairy giants that have never had a recall. Every 

Monday at 11:30 a.m., Leprino walks down to the test kitchen 

along with two dozen of his most trusted executives for the 

weekly Monday Melts meeting like the one I attended. The executives 

test samples of the cheese produced for some 300 clients 

in 40 countries and check every complaint received the 

week before. “Your employees have got to know you’re not a 

phony,” he says. “They’ve got to believe in you. 

“I support what’s going on, but I don’t try to lead it,” he 



Whey to go: 

Leprino’s new 

factory is rolling out 

its first direct-toconsumer 

product, 

a protein powder 

called Ascent. 

adds. “My job is to hold them responsible for doing what they 

said they’re going to do.” 

He wasn’t always so hands-off. While acknowledging his 

“genius,” numerous industry executives paint Leprino, in his 

younger days, as an “aggressive” leader who wasn’t above visiting 

individual franchise owners to pitch his technologically 

advanced cheese. But very few will go into detail, and fewer 

still will attach their name to their comments. One pizza entrepreneur 

puts it this way about the man who owns 100% of 

this mozzarella giant: “Jim Leprino is a very powerful man.” 

LEPRINO’S OFFICE BEARS testaments to his roots, including 

a black-and-white photo of his mother on her wedding 

day at age 16 and a bronze relief of James and his father rolling 

fresh mozzarella balls. Leprino Foods’ genesis lies in the mountains 

of southern Italy, which Mike Leprino Sr. left in 1914, 

at age 16. Accustomed to high altitude, he settled in Denver; 

without much of an education or the ability to read and write 

English, he began farming. More than three decades later, in 

1950, he finally opened a grocery store to sell the produce he 

grew. Italian specialties followed, including fresh ricotta, mozzarella 

balls and ravioli made by James’ sister Angie. 

Meanwhile, James, the youngest of five children, noticed 

his classmates spending free time at neighborhood pizza 

joints. After graduating high school in 1956, he started working 

with his father full-time and shared a revelation: “Pizzerias 

in this part of the country were buying 5,000 pounds of 

cheese a week,” he recalls. “I thought, This is a good market to 

go after, so I did.” In 1958, after larger chain grocery stores had 

forced the Leprino market to close, the Leprino Foods cheese 

empire started with $615. 

The timing couldn’t have been better. That same year, the 

first Pizza Hut opened, in Wichita, Kansas. A year later, Mike 

and Marian Ilitch opened the first Little Caesars, outside Detroit. 

Another year went by, and Domino’s began delivering 

pizza, in Ypsilanti, Michigan. Frozen pizzas, introduced after 

soldiers returned home from WWII craving slices, were also 

gaining popularity. After two years in business, Leprino Foods 

was delivering 200 pounds of block mozzarella a week to local 

Italian restaurants. 

Leprino realized he needed to learn the science behind making 

cheese on a mass scale. But with a young daughter at home 

and another baby on the way, he didn’t have time for college. Instead, 

he hired Lester Kielsmeier, who had run a cheese factory 

in Wisconsin only to find out that it was sold during his stint 

in the Air Force during World War II, because his dad believed 

he’d been killed in action. “When Lester came, I went downtown 

to the junkyard and I bought a couple bigger cheese vats 

to make it look like we were really in the business,” Leprino says. 

Leprino’s first coup came in 1968, when Pizza Hut was 

looking for a supplier that could help it cut costs while standardizing 

portions. After hearing that shredding 5-pound 

cheese blocks in the franchises was time-consuming and inconsistent, 

Leprino Foods started selling frozen, presliced 

blocks. For the first time, pizza-makers could simply layer a 

few slices onto each pie. 

While Kielsmeier made the cheese, Leprino fixated on efficiency. 

He quickly realized he was dumping half his raw ingredients 

into the river in the form of whey, the calcium-rich liquid 

left over after curds are strained. Inspired by the 1964 World’s 

Fair in New York, Leprino traveled to Japan to meet with scientists 

using milk proteins derived from whey to help the Japanese 

population grow taller. More than a half-century later, Leprino 

Foods remains the largest U.S. exporter of lactose, a by-product 

of sweet whey, and retains a large market share in Japan. 

On the cheese side, Leprino hustled to satisfy Pizza Hut, 

which went public in 1972 with around 1,000 stores and, at its 

peak in the 1990s, accounted for 90% of Leprino’s sales. Pizza 

Hut franchises would sometimes wait too long to thaw the presliced 

mozzarella and reported that their cheese would crumble, 

so Leprino Foods responded with its first major breakthrough: 

a preservative mist. The scientists there soon realized that this 

method allowed them to add flavors such as salted caramel and 

jalapeño. They could even make a reduced fat “cheddar” by 

using a mozzarella base and then misting on cheddar flavor and 

orange food coloring. Leprino Foods’ production rose sixteenfold, 

to 2 million pounds of cheese a week. 


THE CHEESE KING 

Just as his timing ahead of America’s pizza boom proved 

lucky, so did his location in the center of the country. In the 

1970s, Wisconsin and New York were producing most of the 

country’s milk, but California’s nascent dairy industry often 

priced milk lower. Leprino had the foresight to engage in some 

arbitrage, locking California dairy farmers into multi-decade 

contracts at rates that were often above-market locally but below-market 

nationally. Over the next two decades, Leprino 

Foods also signed sweetheart deals with co-ops that eventually 

became the Dairy Farmers of America, securing a lasting milk 

supply with the country’s largest dairy co-op; the company also 

purchased and renovated some of the older dairy plants, cutting 

off the options for competitors who wanted to process milk. As 

Jerry Graf, a former cheese buyer for Pizza Hut, notes, “Jim was 

always one step ahead of the game.” 

LEPRINO’S MOST IMPORTANT innovation, ultimately, was 

marrying science and sales—a combination that met the needs 

of the four biggest U.S. pizza chains during a period when they 

were growing exponentially, launching one of the greatest turf 

wars in the history of American food. 

The first key was something called “Quality Locked 

Cheese”—shredded and individually frozen portions—which 

Leprino introduced in 1986. Leprino’s competitors, still mostly 

run by Italian-Americans with strong immigrant roots, 

sniffed. “They didn’t believe that was what should go on top of 

their grandmother’s pizza recipe,” says Ed Zimmerman, a 30- 

year pizza-industry veteran. But the franchise-friendly process 

quickly became the industry standard, both for consistency 

and scalability. With a patent in place, Leprino made himself 

indispensable. Graf left Pizza Hut, which was still growing, 

for Domino’s and brought Leprino’s business with him, as 

that chain surged from 200 outlets in 1978 to 5,000 in 1989. 

Meanwhile, Little Caesars, with more than 3,000 stores, was 

growing 25% a year with its deal of “Two great pizzas, one low 

price.” And by 1991, Leprino had become the exclusive supplier 

for Papa John’s, which launched in 1985. 

Leprino was able to grow with them all by putting them 

in silos, granting each company its own specs and then troubleshooting 

as necessary. “We treat every customer like our 

only customer,” says Mike Durkin, a former Pepsi executive 

who came on six years ago to run day-to-day operations as 

president of Leprino Foods. “We don’t discuss Papa John’s 

business with Domino’s—or anybody else’s.” Domino’s agreed 

to an exclusive relationship in 1996—the contract was just 

one page. “It was more of a handshake than it was anything 

else,” recalls Michael Soignet, a former vice president of supply 

chain at Domino’s. 

When Pizza Hut began using a hotter conveyor oven, Leprino 

Foods changed the formula so the cheese wouldn’t burn 

at higher temperatures. As delivery-focused Domino’s expanded, 

Leprino’s head cheese maker, Lester Kielsmeier, manipulated 

the product so that it retained its fresh-out-of-the-oven 

look and taste longer. When Papa John’s insisted it wanted 

cheese without fillers—eschewing a new Leprino product that 

contained some—the big cheese didn’t take it well. “His reflected 

sense of self is his patents, his business,” Papa John’s billionaire 

founder John Schnatter says of Jim Leprino. “That really 

means a lot to him. When I said I didn’t like it, he took it 

personally.” Within two months, Leprino switched Papa John’s 

back to the previous blend. “Jim came at me and said, ‘It’s 

going to cost you three more cents a pound.’ ” 

Price has long been Leprino’s biggest advantage, and a large 

one since cheese accounts for about 40% of a pizza’s cost. Leprino’s 

scale begat better prices, which begat more scale. And 

that scale also led to cost-saving breakthroughs that Leprino’s 

fragmented competitors could neither catch up with technologically 

nor fight in patent court. “They are a biotech company 

that is wrapped inside a food business,” Zimmerman says. 

For example, in the 1990s, Kielsmeier realized that just as 

the cheese changed when ingredients were sprayed on at the 

end, certain additives used early in the process could affect 

how cheese melts—from how big and how brown the bubbles 

get to how many are on the top of the pie. On the manufacturing 

side, Kielsmeier cut down the cheese’s aging period from 

14 days to just four hours, which multiplied the company’s 

production capabilities while cutting costs significantly. 

LIFE 

OF PIES 

HOW PAPA JOHN’S, 

THE WORLD’S THIRD- 

LARGEST PIZZA CHAIN, 

DELIVERED A BILLION- 

DOLLAR FORTUNE TO 

JOHN SCHNATTER. 

SELLING MOZZARELLA isn’t the 

only way to become a pizza 

billionaire. John Schnatter—more 

commonly known as Papa John— 

joined the club earlier this year. 

The founder and CEO of Papa 

John’s owes his $1 billion fortune 

to the company’s rising stock 

price—up 40% in the past year. 

“When you start off broke—and 

we weren’t broke, we were 

negative broke—you never forget 

that. You stay appreciative,” says 

Schnatter, who owns 26% of the 

company’s shares. 

Schnatter (right), who was 

born in Indiana, began washing 

dishes at Rocky’s Sub Pub at 

age 15 and worked his way 

up to making pizza. With his 

earnings, he saved up to buy a 

1971 Camaro Z28. After college, 

in 1983, he started working at his 

father’s bar, Mick’s Lounge, which 

JAMEL TOPPIN FOR FORBES 


“I would tell people, ‘Lester is the man that made me rich,’ ” 

Leprino says. Notably, though, Leprino never gave Kielsmeier 

any equity. While Leprino got rich, Kielsmeier—who came 

to work every day right until his death at 95 in 2012—would 

have to content himself with being very well paid. 

FOR JAMES LEPRINO, THE PERKS of being a billionaire are relatively 

muted. Yes, the company owns three private planes—a 

Gulfstream G450, a Bombardier jet and a small 1980 commuter 

plane—and his house in Denver’s affluent Indian Hills suburb 

has 11 bedrooms, to go with an 8,000-square-foot vacation 

home in Scottsdale, Arizona. But he’s more likely to pick up a 

hammer than call a repairman: Leprino, who has been known 

to operate a forklift at the factory, has also personally bulldozed 

trees around his Colorado home. A devout Catholic, he goes to 

church every Sunday and donates to charity anonymously. And 

the immigrant’s son has no intention to retire, ever. “My success 

is a fairy tale,” he says. 

Leprino’s succession plan is simple: He’ll split ownership between 

his two daughters, Terry, 57, and Gina, 55, who have been 

on the board for years but won’t take day-to-day roles. “I don’t 

want them to be living a corporate life resentfully,” Leprino says. 

And for now he’ll continue to ensure that Leprino cheese is on as 

was headed toward bankruptcy. 

Schnatter sold the Camaro for 

$2,800 and used the money to 

settle some debts. “All I wanted 

to do was make $50,000 a year,” 

Schnatter recalls. “I thought 

I could take a girl shopping.” 

The rest went toward some 

many American pizzas as possible—as well as Asian and European 

ones (Leprino has a joint venture with the U.K.’s Glanbia Cheese). 

America’s fifth-largest pizza chain, the take-and-bake Papa 

Murphy’s, remains in his sights. Cofounder Robert Graham 

says Leprino visited him at least three times to try to get the 

company to sign on, selling the technology above all else. “It 

didn’t perform well for our pizza, which is cooked in a home 

oven,” Graham says. “Because of the moisture content, you 

could see the sauce under the cheese. It evaporated.” Yet Leprino 

executives continue to press. 

And while Little Caesars uses other vendors—industry 

insiders say Leprino isn’t exclusive with Little Caesars, in 

part because the chain’s blend uses Muenster cheese, too— 

Leprino president Mike Durkin predicts that Little Caesars 

will eventually succumb. “Would we want more? Probably 

the answer is yes, and it’ll come at some point,” he says. 

Meanwhile, Leprino will pursue new markets. Leprino has invested 

$600 million in a factory in Greeley, Colorado, that specializes 

in “ribbon cheese”—bulky 2.5-pound blocks that are popular 

among frozen-pizza companies. It’s also created an in-house 

“innovation studio,” designed to ride the coattails of food trends. 

One creation, Bacio (“kiss” in Italian), is catering to artisanal-pizza-makers 

by offering mozzarella with a kiss of buffalo milk. It’s 

Leprino Foods’ most expensive 

cheese—and its fastest-growing. 

used pizza equipment, which 

Schnatter installed in the 

tavern’s broom closet. 

Mick’s eventually turned 

around, and by 1985, the 

first Papa John’s opened in 

Jeffersonville, Indiana. From 

the beginning, the company 

touted its pies as “better 

ingredients, better pizza,” and 

it caught on. Within six years, 

the 100th location opened, and 

Papa John’s brought in Leprino 

Foods to be its exclusive cheese 

supplier. In 1993, Papa John’s 

went public, and the stock 

has since increased thirtyfold. 

There are now more than 5,000 

restaurants in 45 countries. 

As for that Camaro, Papa 

John’s offered a $250,000 

reward to anyone who could 

find Schnatter’s original ride. 

“Everybody around me said I 

was crazy. They thought the 

car was squashed up at the 

junkyard. I had a feeling it was 

still around,” Schnatter says. 

And the incentive worked—in 

2009, the car came back to 

Papa. —C.S. 

Leprino is also rolling out 

the company’s first direct-toconsumer 

product, a whey 

protein powder called Ascent, 

which will have a dedicated 

wing at the Greeley facility. 

While Leprino still produces 

whey protein as a by-product 

of making cheese for its clients, 

Ascent is filtered straight from 

raw milk to protect key proteins 

and vitamins that help aid muscle 

recovery. Leprino hopes that 

will be an edge in the $6.6 billion-and-growing 

U.S. protein 

market. 

There is plenty of history to 

remind Ascent’s team of their 

roots. Ascent’s space sits atop 

the original cheese factory’s 

loading dock and warehouse. 

“I remember the first day that 

we had this set up,” says Mike 

Arnold, who is overseeing 

Ascent’s launch. “Jim Leprino 

walked in here and was like, 

‘Ah, this reminds me of the old 

days.’ ” A new, fractured market, 

primed to be dominated. 

F 


FORBES LIFE 

The Second 

Time Around 

When watch collector Pascal 

Raffy bought the venerable 

Swiss brand Bovet, he reinvented 

the company—and himself. 

BY ROBERTA NAAS 

By the age of 36, Pascal Raffy, a French 

pharmaceutical executive, was enjoying 

early retirement, spending time 

with his family and keeping an eye out 

for new investments. Knowing Raffy was a passionate 

watch collector, with hundreds of vintage 

timepieces, an investment banker friend would 

often tempt him with opportunities in the watch 

world. Each time, Raffy would decline—until one 

day his friend insisted Raffy do a blind touch test 

with a timepiece. 

“My friend put it, with several of my other 

watches, under a cloth,” Raffy recalls. “One by 

one, I felt those watches, and when my hand fell 

on one of them, I knew it was truly different. I felt 

the crown at the top of the strap and realized this 

was a watch with its own identity. Then I looked 

at it, and in a nanosecond it talked to me. I took 

my loupe and saw that it was a beautiful piece of 

horology. It had substance. I was interested.” 

And he had the means to make a significant 

investment. At 25, Raffy bought into a family-run 

French pharmaceuticals company, where, after a 

merger, he became head of the firm Synthélabo. 

After several successful years in France, Raffy expanded 

Synthélabo into North Africa, where he 

not only began the production of drugs but also 

built dedicated facilities for marketing and distributing 

them to doctors on the continent. 

During the ten years Raffy led Synthélabo, he 

turned it into the third-largest pharmaceutical 

group in France. But after his young daughter lamented 

that he worked too much, he decided to 

cash out. It took 18 months to organize the sale 

of Synthélabo to Sanofi, but Raffy wanted to leave 

the company in good hands. “Whenever you start 

something in an area of health and caring for 

human beings—where there is also a moral dimension 

in addition to the business side—it is 

very difficult to stop work,” he says. 

The retirement was short-lived once Raffy 

touched that watch under the cloth. The timepiece 

was made by Bovet. Swiss watchmaker Edouard 

Bovet had founded the brand in England 

in 1822, when the Silk Road was flourishing 

and there was demand in Asia for fine handmade 

pocket watches. Bovet’s earliest watches 

were hand-painted and created in identical pairs 

so if one watch needed to return to Europe for repair, 

the owner still had a fine watch to wear. The 

business operated out of England, but the watches 

were made in Fleurier, Switzerland, where they 

continued to be produced until the late 1930s. 

By 2000, when Raffy learned that Bovet was 

looking for a new investor, the two men who 

The art of time: “You 

should be able to 

take a loupe and 

know it is a Bovet, 

no matter the price,” 

says Raffy, wearing 

one of his Amadeo 

watches, which easily 

converts to a pocket 

watch or table clock 

(at right). 



WATCHES 

owned the brand were operating from a small office 

in Geneva, buying components and assembling 

about 140 watches a year. “I listened to 

what they wanted and told them that I am not 

the person to do quantities,” he explains. “I am 

not jumping into a watchmaking house to build 

a huge brand. I am doing it for my own selfish 

pleasure, for beautiful watchmaking. My ideas 

were totally unaligned with the era we were living 

in then, but I knew I wanted to build Bovet 

into a true watchmaking house with a soul.” 

Raffy purchased the majority share of Bovet 

in 2001 (about a $5 million investment at the 

time) and developed a vertical integration strategy 

derived from his passion as a collector. Bovet 

had to be a true manufacture of unique and exclusive 

pieces. He vowed that he would never 

produce more than 4,000 watches a year. 

“Collectors don’t want what everybody else 

has,” he says. “So I decided that my product would 

be very expensive and be worthy of its costs. We 

would go back to the glory of the 19th century, 

with our own facilities and making every part of 

our watches ourselves.” Raffy estimated it would 

take eight to ten years to build the company to his 

standards. “I spent the first two years listening to 

all of the experts about what I should do, but in 

the end I decided I wanted to do it my way.” 

By 2003, he had bought out his partners and 

had begun earnestly assembling a watchmaking 

team. Three years later, he purchased Bovet’s 

supplier of watch-movement components and, 

within months, also took ownership of its dial 

supplier and bought a minority share in the 

company supplying its cases. That same year, 

the Swiss canton of Neuchâtel approached Raffy 

about buying a local castle. He had no interest 

until he learned that the estate had once belonged 

to the Bovet family. He purchased Château 

de Môtiers, adding it to the House 

of Bovet (which he renamed Bovet 1822), 

and built a state-of-the-art watchmaking 

facility within its ancient walls. 

With those major investments, which 

totaled about $35 million, Raffy brought 

the company full circle. “I waited six years 

to see a return on investment,” Raffy says, 

“because I knew I wanted the facilities 

in place for the brand to be seen as true 

manufacture.” 

For the past decade, Raffy, now 53, has 

dedicated his efforts to garnering a cult following 

for Bovet among collectors. True to his promise 

of exclusivity, he has kept watch production 

down. For the past two years, the brand has produced 

about 1,800 watches annually. 

Bovet’s core watches range in price from 

$20,000 to $65,000, and those with grand complications 

range from $220,000 to about $1 million. 

The revenue split between these categories 

is just about 50/50. Signature features include 

Bovet’s iconic “bow” atop the crown, unusually 

placed at the 12 o’clock position (the feature that 

first attracted Raffy to the brand) and the patented 

Amadeo case, which converts the wristwatch 

into a table clock or pocket watch in a matter of 

seconds. 

Every Bovet timepiece is handcrafted 

to the same exacting standards, 

whether the watch costs 

$30,000 or a half-million. “You 

should be able to take a loupe and 

know it is Bovet, no matter the price,” 

Raffy says. “Otherwise it is like treating 

two children differently. I accept 

that this means I will have varying 

profit margins.” 

Today, Raffy claims Bovet has net 

profits of more than 15%—with profits 

as high as 25% in some years, 

roughly $20 million annually. “I have 

investments that are big businesses 

with mass production. But this is 

not for Bovet,” Raffy says. “Bovet is a 

jewel, and it will remain a jewel.” 

FINAL THOUGHT 

“A loafer always has the 

correct time.” —KIN HUBBARD 

SPECIAL PROPERTIES/CHRISTIE’S INTERNATIONAL REAL ESTATE 

BUY 

THIS 

CASTLE 

AMERICAN 

VERSAILLES 

Built in 1907, this 

50,000-square-foot 

mansion in Mahwah, 

New Jersey, may 

be known as “the 

American Versailles,” 

but it was in fact 

modeled on an 

English castle. With 

58 rooms (including 

his-and-hers master 

bedroom wings), a 

wine cellar, a billiard 

room, a spa and a 

home theater, the 

estate sits on more 

than 12 acres within 

25 miles of New York 

City. Now, after seven 

years of restoration, 

the Gilded Age 

mansion, formally 

known as Darlington, 

is back on the market 

with an asking price 

of $48 million—which 

is a bargain compared 

to the actual 

Versailles. 


THOUGHTS ON 

Pioneers 

“I don’t repeat 

myself well. I want 

and need that 

stimulus of walking 

forward from one 

new world to another.” 

—MARGARET BOURKE-WHITE 

“IF YOU WANT 

SOMETHING 

NEW, YOU HAVE 

TO STOP DOING 

SOMETHING OLD.” 

—PETER DRUCKER 

“WE ARE THE PIONEERS 

OF THE WORLD, THE ADVANCE 

GUARD SENT ON THROUGH THE 

WILDERNESS OF UNTRIED THINGS.” 

—HERMAN MELVILLE 

“I have set my life upon a cast, and 

I will stand the hazard of the die.” 

—WILLIAM SHAKESPEARE 

“SOCIAL GAINS ARE 

NEVER HANDED 

OUT. THEY MUST 

BE SEIZED.” 

—SHERYL SANDBERG 

“WE PUSH ASIDE BRANCHES OR CUT THEM BACK, WE TRAMP 

DOWN NETTLES AND LONG GRASSES, FORD RIVERS AND STREAMS, 

THROUGH THE INNER AND OUTER LANDSCAPES.” 

—LUCY H. PEARCE 

“Pioneers may be 

picturesque figures, 

but they are often 

rather lonely ones.” 

—NANCY ASTOR 

“THE ADVENTURES MAY BE MAD, BUT 

THE ADVENTURER MUST BE SANE.” 

—G.K. CHESTERTON 

“It is always painful 

to set oneself 

against tradition, 

especially against 

the conventions and 

prejudices that hedge 

about womanhood.” 

—HELEN KELLER 

“You will 

observe that the 

stories told are 

all about money 

seekers, not about 

money finders.” 

—EDGAR ALLAN POE 

“Our wretched 

species is so 

made that those 

who walk on the 

well-trodden path 

always throw 

stones at those 

who are showing 

a new road.” 

—VOLTAIRE 

“AT THAT TIME HIS VOICE SHOOK THE 

EARTH, BUT NOW HE HAS PROMISED, 

‘ONCE MORE I WILL SHAKE NOT ONLY 

THE EARTH BUT ALSO THE HEAVENS.’ ” 

—HEBREWS 12:26 

“One does not 

discover new lands 

without consenting 

to lose sight of the 

shore for a very 

long time.” 

—ANDRÉ GIDE 

FINAL 

THOUGHT 

“ ‘Life is a gamble.’ 

Yes, but at least 

you play your 

own cards.” 

—B.C. FORBES 

SOURCES: WHITE JACKET, BY HERMAN MELVILLE; REBEL LIVES, BY HELEN KELLER; 

PHILOSOPHICAL DICTIONARY, BY VOLTAIRE; BURNING WOMAN, BY LUCY H. PEARCE; 

LEAN IN, BY SHERYL SANDBERG; GOODREADS.COM; THE GOLD BUG, BY EDGAR ALLAN POE; 

THE MAN WHO WAS THURSDAY, BY G.K. CHESTERTON; RICHARD III, BY WILLIAM SHAKESPEARE. 

CLOCKWISE FROM TOP LEFT: EVERETT COLLECTION/NEWSCOM; GEORGE C. BERESFORD/BERESFORD/GETTY IMAGES; BETTMANN/GETTY IMAGES; CULTURE CLUB/HULTON ARCHIVE/GETTY 

IMAGES; GRAPHICAARTIS/GETTY IMAGES; PATRICK T. FALLON/BLOOMBERG; FALKENSTEINFOTO/ALAMY; BETTMANN/GETTY IMAGES; LEE CELAN/GETTY IMAGES 


PROMOTION 

POSITIVE RETURNS 

MEET THE PASSIONATE ENTREPRENEURS 

WHO ARE DOING WELL BY DOING GOOD

LET’S LACE UP OUR SHOES. 

LET’S CHOP SOME WOOD. 

LET’S PUT OUR BACKS INTO IT. 

LET’S WAKE UP EARLY AND GET THE WORM. 

LET’S MAKE HAY. 

LET’S SHARPEN OUR PENCILS. 

LET’S USE SOME ELBOW GREASE. 

LET’S BREAK A FEW EGGS. 

LET’S PRACTICE AND MAKE IT PERFECT. 

LET’S HAMMER SOME NAILS. 

LET’S PLANT SOME TREES. 

LET’S MAKE LEMONADE. 

LET’S JUMP IN. 

LET’S REACH OUT. 

LET’S GO THE DISTANCE. 

LET’S DO IT OURSELVES. 

LET’S GET FIRED UP. 

LET’S TAKE HEART. 

LET’S GIVE BACK. 

LET’S DO SOME GOOD. 

LET’S NOT WAIT ON ANYBODY ELSE. 

LET’S MAKE THIS THE YEAR WE ALL DO BETTER. 

BECAUSE THERE’S A LOT WE CAN DO. 

TOGETHER. 

LET’S ROLL UP OUR SLEEVES. 

SINCE 2012, WE’VE HIRED MORE THAN 600 PEOPLE AND CREATED 200 

MEANINGFUL MANUFACTURING JOBS. WE’RE PROUD OF WHAT WE’RE BUILDING, 

BUT WE KNOW THERE’S MORE WE CAN DO, AND WE BELIEVE THAT’S TRUE 

FOR EVERYONE. TOGETHER, WE CAN GET THERE. 

DETROIT • NEW YORK • CHICAGO • WASHINGTON DC • LOS ANGELES • SAN FRANCISCO 

SHINOLA.COM #ROLLUPOURSLEEVES 

SHINOLA PRODUCTS ARE BUILT IN AMERICA WITH U.S. AND/OR IMPORTED PARTS.

PROMOTION 

GROWING NEW LIVES 

IN CALIFORNIA SOIL 

L 

os Angeles County has an overabundance of two things: 

parolees and underutilized land. Richard Garcia 

considers both to be major community assets. 

“I look at it as an opportunity,” says Garcia, the executive 

director and co-founder of Alma Backyard Farms, an 

organization that teaches former prison inmates about urban 

farming, food sharing and horticultural therapy. 

“It’s a new population,” Garcia says. “Their lives are still valuable 

and worthwhile, and they can still make a contribution.” 

Alma Backyard Farms started in 2013, fueled by Garcia’s desire 

to empower former offenders through horticulture based on his 

IDPLO\KLVWRU\LQIDUPLQJDQGWKHLQÁXHQFHRIKLVVHUYLFHGULYHQ 

Jesuit high school education. 

“I’ve always had this sense that I’ve been given much, so it’s my 

responsibility to share,” Garcia says. “There’s something wholly 

therapeutic about working with soil and plants and working 

with young life. It draws you away from an unhealthy sense 

of self-centeredness.” 

Garcia says his organization is a work in progress — not 

unlike the people it serves. Alma Backyard Farms started at a 

few residential homes, but Garcia found the amount of effort 

needed for such a small return wasn’t the best use of the urban 

growers’ time. 

“We ended up rethinking how could we generate the greatest 

impact in terms of space,” Garcia says. 

Garcia’s crew now operates about 50 raised beds on small plots 

of land, and the organization has served more than 30 former 

prison inmates from the community. 

One ex-gang member traveling with Garcia to a new farming 

plot noted, with trepidation, that the last time she was in that 

area was to attempt a drive-by shooting. 

“It was an aha moment that she was going to that neighborhood 

now to plant life instead of to take it,” Garcia recalls. 

While the work is not easy, Garcia says it’s the ideal grounding, 

therapeutic and service-based experience many former 

offenders need when transitioning back into society. 

“They become better for other people,” Garcia says, “and they 

become better for themselves.”

HOW ONE WOMAN LAUNCHED A PUBLIC 

HEALTH REVOLUTION FOR KIDS 

W 

hen Dr. Nadine Burke Harris stumbled upon a study linking childhood trauma to 

VHULRXVDGXOWLOOQHVVHVVKHUHDOL]HGLWVÀQGLQJVZHUHNH\WRDSXEOLFKHDOWKFULVLV 

Extreme stress in children — also known as adverse childhood experiences (ACEs) — has 

been connected to adult conditions such as heart disease and cancer. Nearly two-thirds of 

Americans have at least one ACE. 

Armed with this information, she decided to revolutionize pediatric medicine. 

“I was raised with an ethic in my family that there is nothing I can’t do,” says Burke Harris, 

whose family came to the United States from Jamaica when she was 4. “Part of the 

immigrant experience is you have to have this deep belief that your efforts make a difference 

in the world.” 

As the founder and CEO of the Center for Youth Wellness 

(CYW), Burke Harris lives that belief. Her organization’s 

work builds on research showing that the more adverse experiences 

children endure — such as domestic violence or 

parental mental illness — the more negative health outcomes they 

will suffer as adults. 

“I want to share not only the challenge, but the solutions,” Burke Harris 

says. “The treatment includes reducing the child’s dose of adversity 

and enhancing the ability of a caregiver to be a buffer to child stress.” 

In addition to its involvement in research, policy advocacy 

and raising awareness, the CYW aims to have 1,000 

pediatricians screen 300,000 children for ACEs in the next 

three years. Its longer-term goal is for the practice to be universal 

by 2028. 

“That’s our moonshot,” Burke Harris says. 

To achieve its goals, CYW has partnered with the Clinton Foundation, 

WKH6DQ)UDQFLVFR'LVWULFW$WWRUQH\·V2IÀFHDQG7KH6KULYHU5HSRUW 

among other organizations. 

Even with all those hands on deck, overcoming the negative 

health outcomes connected to ACEs and toxic stress will 

require intense and prolonged efforts. But with Burke Harris 

at the helm, there’s little doubt the movement will continue to 

see success. 

“I’m an impatient person,” she says. “It’s never fast enough, but I’m 

thrilled with the progress we’ve made.” 

PROMOTION

REBUILDING SOCIAL HOMES 

K 

evin Adler’s approach 

to ending homelessness 

includes changing the 

GHÀQLWLRQRIWKHZRUG 

His organization, Miracle 

Messages, operates according 

to the belief that homelessness 

isn’t exclusively the result of 

losing the roof over one’s head. 

Adler believes homelessness also 

happens when people on the 

streets lose touch with family 

and friends. 

“We see people without 

housing, and we almost 

forget they have other needs 

DV KXPDQ EHLQJVμ $GOHU 

says. “We’re building social 

KRPHVIRUSHRSOHRQWKHVWUHHWVμ 

Miracle Messages records 

videos of homeless people who 

want to reach out to their family 

and friends. It then tries to 

ÀQG WKH UHFLSLHQWV DQG GHOLYHU 

the video messages through 

social media. To date, about 

40 percent of those reunited 

with loved ones are now off 

the streets. 

Adler was inspired to launch 

Miracle Messages by his 

uncle, who lived in and out of 

homelessness for 30 years. 

“I see everyone as intrinsically 

YDOXDEOH DQG LQWHUFRQQHFWHGμ 

he says. “The knowledge that 

I can wake up every day and 

live my values, and that I can 

connect with extraordinary 

people and volunteers from all 

RYHU WKH ZRUOG ³ , ÀQG WKDW 

UHDOO\H[FLWLQJμ 

PROMOTION 

UNLOCKING OPPORTUNITY 

W 

W 

hat makes Brit Gilmore’s 

leadership style special is 

the strong bond she creates 

with her employees. In fact, 

their personal lives are at the center 

of everything she does. 

At The Giving Keys, a Los 

Angeles-based jewelry company 

where Gilmore serves as 

president, nearly 30 percent of 

employees are transitioning out 

of homelessness. So it’s incredibly 

rewarding when they tell her 

things like, “I’m going apartment 

VKRSSLQJIRUWKHÀUVWWLPHμRU 

´,JRWFXVWRG\RIP\NLGVEDFNμ 

Their work making necklaces 

from keys engraved with inspirational 

messages helps teach them 

job skills, earn an income and 

begin to turn their lives around. 

Gilmore had for years 

envisioned a career that merged 

fashion with philanthropy. Taking 

a pay cut to be a production 

manager for the then-tiny startup 

in 2012 was a no-brainer. 

“I had been incubating this 

desire to do something impact- 

IXOLQWKHIDVKLRQVSDFHμ*LOPRUH 

says. “It was so aligned with what 

,YDOXHGμ 

Gilmore is also passionate 

about the broader social 

enterprise space and helping 

people make positive changes 

in their lives, one small step at 

a time. 

“I love encouraging people to 

not try too hard to see the end 

from the beginning — just start 

VRPHZKHUHμVKHVD\V 

Stories by Natalie Burg 

Photos by Perry Ogden

THE ZIP SHOULDER TOTE 

DETROIT • WASHINGTON DC • NEW YORK 

LOS ANGELES • CHICAGO • SAN FRANCISCO 

SHINOLA.COM 

DESIGNED IN DETROIT WITH AMERICAN-TANNED LEATHER.

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