Five Business Lessons For Young Professionals From The Nation’s Wealthiest African American, Robert F. Smith
When I attended a session during the 25th Annual Executive Leadership Council’s Mid-level Managers’ Symposium last week, I gained the rare opportunity to hear Robert F. Smith, the billionaire CEO of private equity firm Vista Equity Partners (No. 1 on the BE PRIVATE EQUITY FIRMS List with $46 billion in capital under management), advise the next generation of black business leaders.
In his candid discussion moderated by Leilani Brown, ELC board member and SVP, Strategy and External Engagement, at for-profit education company K12 Inc., Smith shared his audacious journey from his middle-class beginnings in Denver to becoming the nation’s wealthiest African American with an estimated net worth of $5 billion. In fact, the former chemical engineer, who earned two United States and two European patents, told the audience in a jam-packed ballroom at Washington, D.C.’s Marriott Marquis that he shifted to high finance after reading the October 1992 issue of BLACK ENTERPRISE on Top Blacks in Wall Street. After a six-year stint at Goldman Sachs, Smith started Vista in 2000 and eventually joined that exclusive club. Focusing on the enterprise software space, his firm proved so successful that BE named it the 2013 Financial Services Company of the Year and ranked its series of groundbreaking acquisitions No. 12 among BE’s 45 Greatest Moments in Black Business.
Smith used his talk to offer valuable nuggets of career and business advice from his varied experiences and strategies.
Here are his five business lessons for young professionals:
1. Learn to Take Risks
“So what makes me tick? I didn’t want to be ordinary. I wanted to create something that had not been done on this planet,” Smith says of finding his niche of “solving complex problems with elegant solutions.”
That discovery was a byproduct of career moves he made early on. In high school, he applied for a college internship at Bell Labs and called about the position every day until he was chosen when an MIT student was a no-show. Later in his career, the Cornell University graduate decided to leave the engineering career track to earn an M.B.A. from Columbia University and engage in Silicon Valley dealmaking in the late 1990s. Obviously, that career transition paid off big time.
“Take risks while you’re young,” he says, challenging the roomful of Millennial corporate professionals to make occupational shifts and follow entrepreneurial pursuits before becoming too entrenched within companies that they become rick-averse career climbers.
2. Position Yourself to Win
First, find promising sectors and business trends projecting long-term growth. To ultimately gain success within the Fourth Industrial Revolution, Smith stressed, black corporate managers and entrepreneurs should target software technology. “Where vast wealth is being created is with private companies in software technology,” he maintains. “It’s where investment banking was 30 years ago. [Learn about] computing power and connectivity since every company will be facing this dynamic of change. The biggest issue is talent, so blacks must move into this area..”
Smith’s industrial outlook calls for exponential growth of software and service companies within the next half-decade, opening up multitudes of career and entrepreneurial opportunities. Moreover, he maintains that there will continue to be a shortage of U.S. workers to fill demand. To take advantage of this development, skills upgrading will be essential. So that his employees can keep pace with the rapidly-advancing tech environment, Smith provides free coursework in A.I. (artificial intelligence) and machine learning.
He also encouraged entrepreneurship among symposium attendees–among them employees of Amazon, Cisco Systems and Ingersoll-Rand –telling them to connect with one another “based on their shared experiences. Use this as a way to think about opportunities to create businesses of size, scale, and capacity.”
3. Use All Your Traits to Your Advantage–Even Perceived Weaknesses
Smith believes that you should use all your gifts–even those that you don’t readily recognize as such. For example, his discovery of diminished hearing in one of his ears forced him heighten his other senses, trust his intuition, and become even more focused and detail oriented in his business dealings.
He further told the audience that many of them will face institutional racism in business. He urged them not to let such situations become barriers to reach the next level. If underestimated or ignored, he says, use your low profile to access information and build skills while others are not paying attention to you. Asserts Smith: ” You have to learn how to fight.”
4. Take a Wholesale Approach to Diversity
Regardless of the rung you currently occupy in your business career, Smith believes black professionals should engage in “the uniqueness of giving”–and it doesn’t have to be financial. He says black professionals at all levels can play a vital role in the expansion of the diversity pipeline. His rationale is simple: In order for African Americans to ascend in corporate America, they have to first get through the door. He told symposium attendees to lobby their companies to increase the number of interns of color each year in addition to identifying potential recruits.
“To have an impact on diversity and inclusion, we must go wholesale,” he says. “We must get as much mass pushed through the system by opening up the process as wide as you can. We need to take that approach instead of going retail in which corporations only select one or two exceptional students from elite schools.” This tack, he argues, will disrupt corporate groupthink and pave the way for greater innovation.
5. Forget About Trying to Achieve a Work-Life Balance
What does it take to be truly successful? Intention and investment. Urging the young professionals to “invest in yourself,” Smith says that to break away from the pack in business is a 24/7 proposition that doesn’t leave time for much else. Asserts Smith: “Our world isn’t designed for spectacular success and a balanced life.”
Read more about Smith’s journey here for more Smith’s journey.