This article originally appeared in our August 2008 issue.
Arthur Blank turned sixty-five last September, in the middle of the worst year of his professional life. Just weeks before, Michael Vick, the marquee Falcons quarterback around whom Blank had built the team, had pleaded guilty to running a dog-fighting ring out of his home in Virginia. The season would only get worse: In December, a day after assuring Blank he would remain as head coach, Bobby Petrino slithered out of Atlanta to take the top football job at the University of Arkansas. By that time, the season Blank felt would never end had only gotten longer. When the Falcons beat the Seahawks in the final game of the season, it was small consolation; the team's 4-12 record was its worst in seven years.
Although he said he never considered selling the team, Blank must have asked himself at some point if it was all worth it. He is, after all, the 317th-richest person in America, according to Forbes, with a fortune of $1.5 billion, earned from twenty-plus years building The Home Depot into a retail leviathan. He has his own foundation, to which the vast majority of his fortune is directed. And he has six children, which include, with his second wife, Stephanie, an eleven-year-old son and six-year-old twins. Surely there are better things to do than endure the scrutiny that comes with being the owner of a professional football team whose fortunes were tied to a felon.
This year, though, Blank did what he hasn't done since 1979, when he and Bernie Marcus opened the first Home Depot: He started building an organization from the ground up. He hired a promising young scout from the New England Patriots, Thomas Dimitroff, and named him Falcons general manager. He hired a new coach with a name—Mike Smith—as understated as his personality, And in this year's draft Blank and company settled on Matt Ryan, a towering twenty-three-year-old from Boston College who will step into Vick's position and lead the Falcons to what Blank hopes is a new era. It really is a new team, in virtually every sense of the word.
In late May, Blank sat down with Atlanta magazine's Steve Fennessy for a wide-ranging interview that touched on Home Depot, his hopes for the Falcons, and how turning sixty-five has made him look at things differently.
This spring, for the first time since you left Home Depot in 2001, you were invited to address the annual store managers meeting here in Atlanta. The ovation the employees gave you before your talk brought you to tears. What was going through your mind at that point? It was great to be back in that environment. I spent twenty-three years there, so the company is like a seventh child to me. When you start a company, and you build it from nothing up to 250,000 people working with you, and then you leave and have almost no contact for six years—well, it was very painful for me, that separation, both personally and from a professional standpoint. One of the things I appreciated about Frank Blake was that when he became CEO, he reached out to me and Bernie. When he asked me to attend the store managers meeting, I didn't know I was going to speak. But then he asked me to speak. I got to talk about a lot of things I felt were important—not so much living in the past and the good old days, but that these are the good today days. It was very emotional for me.
Last year was the first year that Home Depot’s revenue were less than the year before. What’s your advice for Frank Blake? My advice for Frank goes back to the very first breakfast we had. The opportunities in the marketplace are different than they were. This housing recession is the worst in a hundred years in America. The company was built on a certain set of values and a culture. I think those continue to be as relevant today as they were in 1979. They're applied differently and the business environment is different, but those things are still the things that make it a great company. They kind of got washed out in the Bob Nardelli era. It's like the foundation for a great cake. The icing may be wonderful, but if it's a shitty cake, it's not going to taste right. Frank is conscious of this. Let's scrape away some of the icing and make sure the roots of the business are what they need to be. Even in the face of a bad economy, he's done a lot of the right things. Hiring better people, investing not only in the quantity of people—putting more salespeople on the sales floor—but hiring experienced plumbers, electricians, and tradespeople that will make a huge difference to the business as the economy begins to turn.
Had Home Depot turned away from customer service? I think it had. I don't think it was intentional. But the focus had gotten onto a lot of growth initiatives, a lot of things about how do you measure this and measure that, a lot of things that came out of a GE mentality. GE is a great company, but those are more appropriate for the kinds of businesses they're running and not a retail environment. My feeling was they'd gotten away from a lot of the roots of the company in ways they should not have.
Your mother recently celebrated her ninety-third birthday. I wanted to ask about growing up in Queens and how that informed the person you are now and the philosophies you say you live by, such as “You’re your brother’s keeper” and “Give back.” My mother has had a very profound effect on my life. My father, too. He was an entrepreneur. He started his own business in his late thirties, died when he was forty-four. We didn't have much in a material sense. We lived in a single-bedroom apartment till I went to college. I didn't live in a house until I was thirty-two years old. My first house was $34,500. My values were rooted in my childhood, and my mom particularly—this notion of working hard, having integrity, giving back to the community. We didn't have any money to speak of, but my mother would always be involved in the community.
Such as what? Any sort of community event. We lived in a big apartment building with 300 or 400 units. She served on the board in the apartment that set rules and regulations. She always was just in the middle of things and was not afraid to express herself. She didn't do it with money; she was just involved and caring.
I read that you were in a gang when you were a kid. That's right. Two of my best friends from my junior high school were killed when I was in high school. One was shot to death, one was stabbed to death. I had spent time with them, did things, ran around. My mother was telling my younger children the other night at dinner that I was a really good son. And I was a good son. But I got in trouble. I remember one day in junior high school I was going to get the crap beat out of me after school. They had closed the school yard and I was inside. My brother, who's three years older than me, ran back and jumped the fence and got in front of me.
How did those things you learned influence the philosophy of your foundation? When the company had no money, we always were involved in the community. We always wanted to do whatever we could. We didn't have money to write checks to philanthropies, but our store associates were always involved. A lot of that came out of [Bernie Marcus's and my] religious orientation—being your brother's keeper, being involved in the community. A core philosophy of the Jewish faith is: It's fine to go on top of the mountain and study the issue, but you need to come off the mountain and deal with the problem. That's always been an important part of my own personal philosophy. You need to be engaged on the ground and give back. We cared about the people who shopped in our stores and the people who couldn't shop in our stores. As the company grew, we wrote over $125 million in checks [to various causes]. We were even prouder of Team Depot—associates spending tens of thousands of hours in the community, building playgrounds, hospitals. It wasn't written up in performance reports or anything, but it was an important part of what we do as a company.
When you formed your own foundation, was there another one you looked to as a model? When [Wal-Mart founder] Sam Walton died, I was in New York. I had dinner with [Walton's son] Rob. We were talking about philanthropies and families. Rob said, "We knew we were a real wealthy family. But my father never spent much time in terms of building a philanthropy. He was interested in building the business. And we had all this money." So his children don't really understand what it means to be a philanthropist and have a foundation. I thought about that in terms of my children and my wife. I really wanted them to be very much involved and not have the same experience, where their father would pass away and have all this money and the children would say, "What do we do with it? We don't have the skills and discipline." So in 1995, we started our own family foundation.
What surprised you most about giving away money? It's very difficult to do it and to ensure you have the impact that you think you're having. There are a lot of great organizations out there, but it's a question of understanding the vision and being sure they're doing what they say they're doing. Follow-up is essential. You can fall in love with visionaries. A lot of grantees have visions in their heads, but their ability to carry them out in the marketplace is pretty limited.
Who’s setting the priorities for what the foundation targets? The family does. I've always said to my adult children and my wife and my brother and daughter-in-law that I don't want to sit at the head of the table. So literally and figuratively, all of our meetings are around a round table. Although I chair the foundation, they all have an equal vote and an equal say. Often I say the least at these meetings. I'm really interested in the children expressing themselves. I don't want to be sitting there on my deathbed thinking, "Oh, what's going to happen now to this big estate? They're not prepared for it, and they don't care about the stuff we've been working on." So a lot of the work we do—whether it's Better Beginnings or Pathways to Success or greenspace issues—they're things the family really cares about, as well as myself.
You’ve been a big financial supporter of the BeltLine. I'm a big believer in community and connecting the dots. I had a conversation once with Shirley Franklin. We were talking about Downtown, and this relates to the BeltLine. She had a real pretty pearl necklace on. I said if you took the necklace off and I cut the strand and you had all these beautiful beads just laid out all over the table, it wouldn't look like a beautiful necklace. And what has to happen Downtown is that you have to connect the pearls. To have a great Downtown, you have to be able to walk, you have to commute easily, you have to be safe, you have to have a lot of greenspace. There's a lot of people looking for that. With the BeltLine, you have an opportunity to connect these pearls of Atlanta in a way that brings together community in the most positive ways. So people don't have to get in their cars and drive seventy miles an hour. They can do it by bike, they can do it by jogging or walking to get from community to community. It's a unique opportunity.