Eli Broad gave a talk in Mayor Riordan's Leadership class that I'm taking this quarter. It was a nice opportunity to hear him speak about his businesses and his philanthropic efforts.
He told us he was born in NYC, and his parents moved to Detroit when he was 6 from Lithuania. He became a CPA when he was 20. Later he founded Kauffman Broad and KB Homes. He met Kauffman who was married to his wife's cousin, and their first key strategy was building homes without basements. Kauffman was the builder and carpenter, and Broad was in the office. They got along well, and he told us he made lots of mistakes.
Traits of good CEO according to him: Leading by example, never asking others to do something you're not willing to do yourself.
When KB went public, it had a market cap of $1 billion (in the 1970s). He was able to convince Wall Street that their business was not cyclical.
Broad decided to buy insurance companies, which were the only ones to survive the Great Depression. He found insurance boring but discovered a niche in retirement savings, and converted his company to do this. This was a step on his journey that brought him to buy SunAmerica for $68 million, which he later sold for $18 billion.
A quote Broad gave us was, "The reasonable man adapts himself to those around him. The unreasonable man adapts the surroundings to himself. All progress depends on the unreasonable man." This is a key quote for entrepreneurs to keep in mind as being unreasonable is the only way to get out of the status quo.
He told us how he got a JD degree and has found himself to be able to take on many projects and do great in all of them. Right now, his main efforts include philanthropy in education reform, scientific and medical research, and the arts.