Q&A with Chris Burch of Burch Creative Capital: Invest in Being Human and Everything Else Will Follow
Chris Burch, founder and CEO of the New York City based firm Burch Creative Capital that focuses on managing venture investments and brand development, was profiled by Forbes magazine as one of the world’s billionaires. He was recently featured on The Art of Success with Daniel Budzinski. Below is a transcript of the Q&A, titled ‘Investing in Extraordinary Humans with Chris Burch’.
DB: Tell us a little bit about yourself. Where do you live? What is currently keeping you busy?
CB: I’m currently in my apartment in Manhattan, and I’ve actually decided that this is the coolest place to work at the moment. Like a lot of young people, I’ve decided that the office gives me some anxiety and panic. But I hang out all over the world – I live in Miami as my main home. I come to New York City to work, and then of course I live a lot in Asia and China, and I own a house just outside of Paris. I would call myself the traveling, wandering businessman. Technology makes that possible; it’s pretty cool.
DB: Tell me a little bit about your upbringing and some of the things you have learned from your parents and that season in your life.
CB: I wouldn’t say I had a normal upbringing, but I don’t think anyone really does. My parents were great. I grew up in an upper class family, but my dad actually sent me to work early in life. I was picking apples off of trees and mowing lawns when I was five years old. When I was 12, my father sent me to work in construction at the Philadelphia airport. While I was in high school, I was working in construction moving concrete and wheel barrows during my summers and my vacations. I was a disaster at school. I had every ADD and ADHD that you can possibly have. I was a chronic bed wetter and full of anxiety. I had bucked teeth and weighed about 100lbs wet. I lived in a place where I felt disconnected. I couldn’t sleep at night so I listened to talk radio. I would listen to the voices of Philadelphia and New Jersey, and I actually still have them living inside me. I was off the grid, and I believe that hose are the kinds of things that allowed me to be successful. I feel fortunate to be here today.
DB: In some sense, some of the things you’ve been through can be considered traumatic. How did you realize that success in those areas doesn’t actually equate to what people really are looking for? What was the pivot for you?
CB: I couldn’t get into any private school, so my parents sent me to a prep school in New England. When I was a freshman I had low self-esteem up until then. I didn’t know I had low self-esteem, I thought that everyone was just like me. I was a good athlete. I was a soccer goalie, and my coach showed me intimate care, and I felt at that moment that I was really important to the world and that I actually was somebody. At that moment, at 16, my whole life changed. I started using my athletic skills and personality skills to charm and be charismatic. My high school years were still years of horrendous grades, but I was part of a community and I had some self-esteem in other areas. So for younger listeners, no matter how much you struggle there are things that will give you self-esteem, and those are important. You have to find something that you are good at because that is important to have.
DB: What would you say really landed you as a leader and entrepreneur? Can you tell us a bit about your struggles and how they lead to you realizing you’d want to be an entrepreneur?
CB: I think entrepreneur is a great word, but it’s a catch all word, so I don’t really like it. Today, 75% of college kids want to start their own business. When I went to college, I was the only one. When I started my business, it was thought of as a terrible idea. I was advised against it. Nobody wanted me to start my own business. But I had this creative drive. I was obsessed over making money, and I didn’t want to do it through construction per se. So in college I started selling sweaters door-to-door on college campuses. I was running the pin ball machines as well as football games, so I was really making a lot of money, which excited me. So after college, my brother and I found a sweater mill in Scotland. I was able to put together $20,000, which was a huge amount of money back then. We had sweaters made which we either sold on college campuses or fares. We were able to sell all of them, despite the fact that they were way too small. Overall, my brother Bob and I were fortunate because we had this creativity, and we became an instant success. We didn’t really know anyone in the industry and we did everything on our own. We knew absolutely nothing at the time and figured it all out on our own. And this was at a time of no internet or easy access to information. I got my design ideas from magazines from the 50’s that I found at the New York public library. I would copy images I liked and bring them to a design factory in China. To our surprise, the business exploded at a time where there was no information system in place. We began selling to stores all over the country and they all sold out because of creative design. I was very good at picking good ideas – we started with a preppy craze, selling ‘ugly’ Christmas sweaters. We were Nautica’s licensed partners. Over the next 15 years we expanded the business and got up to $100 million in revenue after which we sold it to a great company called Swire who owns Cathay Pacific Airlines. Bob and I were really fortunate.
DB: A lot of people have ambitions, but that doesn’t always mean they have motivations. Based on your story, you sounded hungry! What was your drive when you were waking up every morning? How did you stay hungry throughout all those highs and lows?
CB: I was scared. I had nightmares every day. I had so much fear of failure. It kept me up, and it drove me at the same time. One thing, I feel, is that arrogance has no place. Fear was one my driving forces. Also, I lived in an environment where money was not that important. Like, when you’re with your bros in Philadelphia, and our rent is $36 a month, you didn’t spend any money, so you didn’t really understand the real value of money.
Overall, part of how we perceive our world is born within as, and part of the way we are is learned. I was lucky to be born with natural drive and curiosity. I think curiosity is a critical component of success. Also, I am currently writing a book on the idea of magnetic thought right now that captures all of that.
How do you become more curious? How do you spark that in your life? How do you spark curiosity?
I am curious to the point that every person I meet I want to know about how they grow up. In a way I’m profiling millions of people in my life. I want to learn about their mom and dad and about how they lived. I want to know about their highs and their lows. You have to develop that one thing – how to ask questions and how to talk to people. It’s just like skiing – it’s not how you ski it’s how you stay in line. At first when you learn how to ski you’re not so elegant. When you look at other good skiers, they know how to stand. Entrepreneurs need to know how to stand. They are people, and it is very important to ask questions quietly and softly and to listen. Start talking and always keep the most open of all energies. I would say that that is how I started over 50% of my deals. For example, I met the owner of a company that I am looking at at the moment at a bar. I met another one at a restaurant.
As you start to become more curious, your antenna becomes bigger. The way in which you can control and emotionalize a room, success will come to you. Never be suspicious. Always be open, kind and warm, and always try to understand the human on the other end. It is that human understanding that is a clear way for entrepreneurs to succeed and a clear way to find good investments. I find that people don’t ask questions and aren’t curious is because they are shy and afraid to seem stupid. As an entrepreneur, it is very important not to be too shy and to know how to ask questions.
DB: I want to go back to what you said about suspicions. Would you talk to me about someone you did meet and you knew it was suspicious and wasn’t authentic?
CB: I’ve been asking myself for a long time why me? I went up to Harvard business school to give a speech and about 500 people in the room but at first only 100. They liked what I was talking about. At the end of the speech 400 more. What I like to do after a speech is ask 5 to 6 people to stand up, and I tell them who they are. I tell them what their father and mother were like and I tell them a lot of about who they are I tell them about what they love and don’t love. As I do that, I look around the room for reactions and I read people. So I picked one woman and told her about her life and what she should do or her path.
A few years later, I did the same. I gave another speech, and I asked 4 people to stand up. One woman I felt tremendous energy with and I told her all about herself – who she was and where she came from. She turned out to be that very woman whom I did that for in the first place. So without knowing, I had asked her again to stand up. That leads to the fact that we all always have to be aware. I spend the majority of my time on seeing the quality in people. I am focused 100% on my energy in every different space in everything I do. I have no theme. I invest a tremendous amount of money, and it is always in humans. I’d rather have an extraordinary person with a bad idea than a great idea with an average person.
One of my partners I have recruited is James McBride. He is an extraordinary hotelier. I tried to go after him with no hotel. He helped me build hotels in Nihi. He just knows how to make everything happen. If I was to go against all odds space wise, I’d rather do it with him than with an average person in Manhattan, where all odds are in my favor. James is that good – he’d make the space much more successful. For me, everything is about being human.
DB: Let’s go back to what you said about judgement – you like to spend time with other people and just observe them make decisions. How do you pick up on another person’s judgement?
CB: By constantly asking questions. And asking them in many different ways. Watching the way humans treat people in a restaurant, for example. Watching them talk and carry themselves. Also seeing if they are telling the truth.
DB: What’s been the riskiest investment you’ve ever made? Why did you make it and how did it pan out?
CB: I always like to talk about failures. I’ve had them, but none of them have been about bad ideas. It’s been about me being overly emotional. You know the quote, “What doesn’t kill you makes you stronger”? I actually don’t believe it. The few failures I’ve had have all come out of moments that have been tied to my emotional states. I’m not particularly good if I happen to be going through something difficult at the time. What’s true for all of us is that painful moments in our lives have killed the little boy or girl inside us. But what also happens is that you grow new tentacles of optimism and excitement. So never ever look back and feel pain; just feel the love for the future.
It’s critical for entrepreneurs to not feel terrible about the past. Instead, they ought to go forward and have new ideas. I’ve been fortunate to have made all the investments that I did because so many I’ve made, everyone thought I was crazy to. One of them was in Argentina with an artist named Alan Faena who wanted to auction a piece of land, a development in Buenos Aires, but he didn’t have the financial means for it. I believed in him, and I bought it. Now it’s a whole town of 3 million square feet called Puerto Madero. I sold that company to my friend Len Blavatnik and he has built a development in Miami that is very well known. I’m also investing in a mine for fine gems in Brazil now, and no one would ever do that. I have no interests in safe investments, I want very large returns. I want to do things that will have people say that I am crazy. I hope that I have enough experience and I bring enough great people that can take risks, turn them into opportunities and that those people can support me. One final thing is directed at anyone in retail: think about your customer, and then the people that work for you. Then think about your partner. Put yourself dead last. Don’t move too fast. Build the business. Think and live inside your customer’s brain. If you get so much joy out of your happy customers, you will be a very wealthy man or woman. And that’s the hardest thing for business people these days.
Also, entrepreneurs all tend to want the same things. But the secret is, rather than going in the same direction that everyone else is going in, people should get involved in industries that nobody is looking at. They are more profitable. They shouldn’t pick what they like but what hasn’t been done yet and where there is a need and desire. So many supply chains around the world are broken. Accessing them and building on that are the opportunities of the future. Whether it’s software, or trading, accessing broken supply chains – we live in the world of trading – there is tremendous opportunity.
DB: Do you ever question everything? Whether its where you’re spending your time, whom you’re spending it with and how you’re thinking?
CB: No, not at all. Why should I? That would mean I’m thinking too much about myself and that’s a bad habit. I try to think really hard. Don’t question. What you need to do is do. If you hire anyone and they are not good, fire them within the first month. If they are good, give them a raise. Never question. I would always look for opportunities within the same space and focus. Never give up. Don’t have doubt and have a purpose. Also, you’re never going to learn things from questioning yourself. You’re only going to learn them by questioning others. That reflection will live in you and help direct you. Your first thought is always your best one if you have common sense