Richard C. Perry: Perry Capital

Richard C. Perry learned early on about the importance of being deeply involved with his investments. One of his first successes at Perry Capital was at FTD, the giant floral-delivery service. In 1994, FTD was a nonprofit cooperative, but it was looking for a buyer to turn it into a profitable business. Perry bought it for about $130 million, with $20 million of his own equity, about $10 million from Bain Capital and Bank of Boston, and the remainer borrowed money. The CEO of FTD quit before the deal even went through, wary of various terms. There were many angry florists: Many of the 25,000 or so were afraid that they would lose the power of the network they had depended on for marketing their produce. FTD’s board approved the deal, but Perry couldn’t finish it unless more than half of the member florists were onboard. So Richard C. Perry traveled state to state visiting florists, telling them about his intensions to spend $12 million a year on advertising and make a big push to get more florists into the network. He received their vote.

“It was the first time I’d won anything since I was student council president in the ninth grade,” he says. Perry put in Meg Whitman, who later became CEO of eBay, as CEO of FTD (she was recommended by Bain, where she had already worked). In 2004, Perry sold FTD for $450 million and made a 28% annualized return on his $20 million investment. The FTD experience led Perry into searching for struggling companies in which to invest, thereby creating his own opportunities.

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