Welcome, Steve! Maybe we’ll be able to meet face-to-face at the next EFM potluck.
Anyway, I somehow missed an amazing article written by Matthew Rees in The American, which gives fresh insight to the part of Gov. Romney’s personality that’s receiving little attention right now–his financial acumen.
The article begins with the story of how fledgling entrepreneur Tom Stenberg challenged then Mr. Romney him to actually go into his office-supply invoices and see how much money his company was spending on office supplies. He’d said it to many people before, but Mr. Romney was the only venture capitalist who took him up on his offer. He realized that Mr. Stenberg’s business plan was correct, “Staples” was created, and 69,000 employees now work there. Evidently, there was a lot of money in paperclips.
The episode highlights what would become the defining characteristic of Romney’s career as a venture capitalist—and later as a government executive. He was willing to pursue—and analyze—data that others wouldn’t bother to chase down. His dogged persistence paid off. During the 14 years Romney headed Bain Capital, the firm’s average annual internal rate of return on realized investments was a staggering 113 percent. At that growth rate, a hypothetical $1,000 investment would grow to $39.6 million before fees. Few, if any, VC firms have ever matched Bain Capital’s performance under Mitt Romney.
His way with money is an attribute none of the other probably candidates share.
Romney was obsessed with numbers. “My favorite thing to do is to bathe in data,” he says now, “do analysis, reach conclusions, and then find a breakthrough. There is nothing as exciting as that ‘aha!’ moment—seeing something that looks insoluble and finding a way to make it work.”
This attention to detail came in handy during the health insurance reform he enacted in Massachusetts.
True to form, Romney became deeply immersed in crafting the health-care proposal. Moffit recalls that when he was asked to brief Romney, he found the tables turned. Romney was the one who gave Moffit the comprehensive PowerPoint presentation. “In 25 years of briefing elected officials and senior government executives, this was the first time I was the one who got briefed,” Moffit says. “It was like being in a private class with a very high-energy professor, and Romney was the professor and I was the student.”
The health care achievement quickly raised Romney’s national profile. “His candidacy is taken very seriously among insiders,” says Thomas Mann of the Brookings Institution. “He increasingly appears likely to be the strongest challenger to John McCain for the Republican nomination.”
The whole article is worth a read. The good thing about Gov. Romney is that he’s socially conservative, a financial genius, and quite good at turning things around. I’m sure he could put those qualities to good use as President. Plus, he might be able to get a good deal on Oval Office supplies.