Bill Gorelick | Crain's Philadelphia

In this ongoing series, we ask executives, entrepreneurs and business leaders about mistakes that have shaped their business philosophy.

Bill Gorelick

Background:  

Bill Gorelick, 82, is a longtime entrepreneur in Charlotte with a long history in finance, and more recently, real estate. While semi-retired, he advises his two sons on business matters for Gorelick Brothers Capital, which owns more than 2,000 rental homes.

The Mistake:

My father started out with a small shoe store, and as I grew up, I went to college at the University of North Carolina for a couple of years and then transferred to the Wharton School to study business. That’s in Philadelphia, and I was scared to death. There were all these guys from New York who talked so fast I couldn’t keep up with them, and they were just so smart. They had to be to get into that school. I got in there because I represented geographical diversification. I managed to do okay. After getting a little older, I thought those guys may talk fast and think fast, but I’d rather have somebody who talked slowly and thought faster.

I came home and my daddy had gone into the small-loan business. I told him he didn’t have enough money to be in that business. I told him he had to go public, to use other people’s money, which we did. We made loans to maids and construction workers who made at most $25 a week back in the early ‘50s. They had been using pawn shops, and the banks wouldn’t lend you any money unless you had an endorser or owned real estate. You didn’t have credit cards in that day. Consumer credit really started at that time.

The company did well and merged with Georgia Railroad Bank when we had grown to about 40 offices and had $30 million to $40 million in receivables. The bank became a statewide bank and then merged with First Union Corp. When First Union merged with Wachovia Corp., we got Wachovia stock. Then they sold the business and my brother and I left. Then came the financial crisis. We got out of Wachovia stock in the $20s after it had been in the $60s. I would never sell it because I thought the banks were solid. I was blind; I was in love. That was another learning lesson – never fall in love with any business. Everything grows like an S – you will reach the top, and somewhere down the road, it can turn down to nothing. That’s the history of progress.

Business is all about people.

The Lesson:

If I had to do it all over again, one of the first few people I’d go after in running a business is a human resources person, a head-shrinker who could look into someone’s head and tell me who they really are. They could advise you on whether that person was a good fit for the job. We never did that, and I think that was our biggest mistake. We could’ve gotten there much faster with fewer mistakes. Business is all about people. We should have had someone who could recruit and evaluate candidates, You could find three people who were qualified, and then it would be a matter of chemistry. That’s very important.

I don’t have that skill to evaluate people. I have a gut reaction, but there are people who are really good at that; they can talk to a candidate for an hour and tell if that person is the right fit. The more people you have, there’s always personnel issues. How do you deal with it? Can you change the stripes on a tiger? It’s very difficult. You can change a small percentage of people, but it depends on how they are wired.

If you can surround yourself with whoever the right people are at any given moment, that’s the name of the game. But that’s a moving target. The Peter Principle is an example of the problem. Does that mean someone shouldn’t stay too long in a job? I don’t know the answer to that. But the point is, this is still a business, and everyone has to grow with it.

Pictured: Bill Gorelick | Photo courtesy of Gorelick Brothers Capital

 

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