Spring 2002 commencement address – Louis A. Holland

Saturday, May 18

This is a very exciting time for me. I’m honored to be here. I’ve done a lot of wonderful things in my life. I make lots of speeches, normally about the stock market, but truly to come home to Wisconsin speak to some young people like yourself — I’m really excited.

When John Wiley asked me to speak, he asked me to talk a little bit about the 37 years of mistakes that I’ve made. He said, “Then Lou, not only do I want to get the 37 years of mistakes, but I want you to do it in 10 minutes.”

It would probably take me two years to tell you all of the mistakes that I’ve made. What I’d like to do at this point is to get into my background a little bit and then I want to focus on what I consider to be the 10 Golden Rules for Success.

Needless to say, there are lots of things that we can do to help us be better, and in most cases, I’ve made the mistakes, and as a result, hopefully you can learn from some of the mistakes that I’ve made.

I’m a product of Wisconsin. I went to a one-room school — my brother and myself — two African Americans in a small school. We ended up fighting pretty much every day, went to Union Grove High School, which is a small school in the country. (I was) an honor student there, National Merit Scholar, Badger Boys State. I was in 4-H. My family had a farm implement business. We sold Massey-Ferguson and John Deere tractors. I used to carry water to the animals in the wintertime when the running water wasn’t working. Then I decided I would go away to college.

I had 40 offers to go to college with regard to track and football scholarships. I had some academic scholarships. However, Wisconsin went to the Rose Bowl in 1959. I was born and raised in the state, I knew nothing else but Wisconsin, so I said, “Why don’t I go to Wisconsin?” I was fortunate enough to play in the Rose Bowl game in ’63.

Generally speaking, Wisconsin has been a blessing to me, so what I’d like to do is talk about a few things that I think are important for all of you as it relates to mentors. I had two very important mentors. One was a guy by the name of Bud Biener, who lives here in Madison.

When I came to Madison, I didn’t really know anybody African American. I was an athlete, and he brought a number of us people who were African Americans to his home to have a Sunday dinner and to give us a place to stay. It was sort of like home and they became family to us and one of our mentors.

There was another gentleman from Chicago by the name of Bill Nathanson who also was a champion of African American athletes out of Chicago. He was the guy that pointed me to my career in the investment business.

When I first started in the investment business, when I’d go in to call on one of these companies, they’d look at me like I was crazy, like “What does you daddy do?” They were looking for my pedigree. How much money do you have? Well, if I had a lot of money, I probably wouldn’t be there. Does you family own any big companies? Do you hang around with very wealthy people? Well, the answer was no to all of those. It was a white glove business back in those days.

Bill Nathanson introduced me to a company called A.G. Becker and I went to work there in 1968. Of course, it’s been blue sky and sunshine ever since.

The notion of you finding a mentor in your life, which is the beginning of what I consider to be the 10 Golden Rules for Success, is a very, very important part of that. Y You have to make your own decisions, regardless of what your parents, teachers or friends think. Try to identify your interests and how you feel you would be happy…what you would be happy doing. The problem is that your parents really can’t do that for you, and so you have to use your gut, your instincts. As you know, your brains are as good as theirs.

John Wiley was telling me that you guys are so smart that this is one of the smartest classes ever to come through the university. Well, when I came here, the chancellor said, “Look in front of you, look behind you, and look to your right and to your left — none of those people will be there when you graduate.” So clearly, you guys are much sharper than us, but nonetheless, some of these golden rules still probably will be helpful to you.

Before you go out into this job market, which is, needless to say, poor at best, research the company before you accept a position. Who you work for is as important as what you do. If the company has a poor reputation, it will ultimately reflect on you. So you’ve got to like the people, you’ve got to do some digging around to find out if the company is a great company. Hopefully that will help you make the decision.

If you like the company and its various businesses and you like the people and you join the company, your financial success will be determined by your efforts. The company doesn’t determine how well you do.

Once you get to this company, you have to show that you can cut the mustard, and sometimes that’s very, very difficult. They might stick you in a back room somewhere and that’s o.k. If you can’t get a job anywhere else, you go in the back room and work very hard to get out of the back room. So again, another very important rule for success.

I used to tell my children that the world is run by C students. I said that the important thing is that you must understand that C is average. So once you get your diploma and you go out into the real world, the people who will be working for you and many of the people you’ll be working with are C students. The only way you can manage them is to have compassion for them being C students and try to maximize their potential, rather than demeaning them because you’re an A student and arrogant and all those kinds of things.

Obviously this will affect your ultimate performance — your success or failure will depend on how well you deal with these young people who are not as smart as you. So you’ve got to empower them and nurture them and give them confidence in themselves to do the very best that they can do.

Another important variable — don’t expect your family or anyone else to support you. They probably have done a terrific job. That’s why you’re here. Otherwise you might have imploded somewhere along the way if you didn’t get good guidance.

The notion is that you really have to take care of yourself, and the sooner you get out there in the real world and figure out that, hey, I’m independent, I can make it on my own and that’s what I aim to do, it’ll make you a better person and it’ll make them happier with your progress and they’ll be pointing to you and saying, boy, my daughter just graduated from Wisconsin, she’s going on to Chicago, she’s got a job already with some big consulting firm in New York, she speaks five languages, she’s doing all kinds of beautiful things. This is the kind of thing that will make your parents happy.

If you have done research on a company and determine that this is the company you want to work for, be prepared to take a position beneath what you believe your capabilities are. If you go in and think you’re up here and the job you’re being offered is down here, you probably ought to think, well, I like this company, I like the people, it’s in an area that I like, I’ll take one of these underling jobs and outwork everybody and then I’ll move up into the position that I ultimately want to achieve. That’s an important goal.

There was a young guy that came in (to my office) and I said, “We’ve already filled up in terms of analysts and so I don’t know what I would do with you.” He was very talented, he was a CPA and an MBA from Kellogg School. He went away and was kind of upset about the whole thing, and then he called me back and said, “Mr. Holland, I’ll do anything.”

That was music to my ears and, as a result, I then said, “Gee, maybe I can find something for you.” So I started him out and I said, ” No, I’m going to make you an analyst, because that’s what you wanted to be.” And so I made him an analyst, because I liked his attitude. He was willing to do anything in order to get with our company, which means he’ll do anything in order to stay. So it’s very important that when you go into these companies, you go in there with the notion that, hey, I like the company, I like the people, I like their products, this fits with what I want to do in my life, and boom! Take whatever they give you and then work your way up. Ånd if you’re smart enough, you’ll be able to do it.

I think those are rules to live by.

Be willing and prepared to fail. After evaluating all of the possibilities and you find out that you don’t like the opportunities available to you and/or the people you’re working with, you should leave. If you don’t like the company, don’t stay there. This doesn’t qualify as a failure on your part.

Sometimes you go out and get your first job and you make the decision to leave. You make a mistake. Don’t look at it like you’re a failure, because you’re going to make lots of mistakes. I’ve made 37 years of them and I’m still making them. The only way you can learn is by experiencing them, not reading about them in the textbook.

Don’t expect anyone else to support you financially — America is the land of opportunity. I wouldn’t want to live any place else in the world. I had the pleasure of spending a week in Russia about six weeks ago. Russia is not America. They don’t do business like us. Do they have potential long-term? Yes. They’ve got energy, but the reality is, there’s no place like America. We’re in the best place in the world.

We talked a little about mentors. Every one of you should have one. A mentor provides you with a totally objective opinion about a subject that might be of great importance to you in your life, and parents usually tend to be more protective and somewhat biased. I’m sure none of you have had that problem with your parents! They’ve never tried to guide you into anything you do. The reality is, you need to find somebody else to get the opinion from. In some cases, it’ll be very effective to you.

Last, but not least, and maybe the most important of all is that you should always practice intellectual honesty. If you tell a lie or fabricate the truth, you must remember the story that you told.

I always reflect back to “Wall Street Week,” which I’ve been a panelist (on) and a friend of Louis Rukeyser’s for 17 years on his show. He always demanded intellectual honesty of people who appeared on his show. So if I would say something on one show, meaning I’d recommend a stock and say, “Gee, Lou, I think this is a great stock — low cost producer, great producer, great company, great technology, great R & D — all the things you’re looking for in a great company — I think the stock’s going to do very well,” Louis would come back in six weeks and say, “Lou, you were on six weeks ago and that stock is down 30 percent. What do you have to say for yourself?” And I said I made a mistake.

That’s all you’ve got to say. It’s not bad to make a mistake, and that’s a very important thing that young people have to learn, and particularly when they’re as talented as you are.

That concludes my golden rules. I’m delighted to be here, it’s been a pleasure, good luck to all of you And if any of you are in the financial services business or are interested in it, you can call on Holland Capital Management one of these times, ok? Thank you very much.

Louis A. Holland is the managing partner and c hie investment officer of Holland Capital Management, president and CEO of HCM Investments, Inc., and portfolio manager of theLou Holland Growth Fund. He received a B.S. degree in agricultural economics from UW–Madison in 1965, and later attended Loyola University’s Graduate School of Business. He was a halfback on the UW football team that played in the 1963 Rose Bowl and he also played for the Chicago Bears.