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All credit decisions subject to credit approval. © 2016 Wells Fargo Bank, N.A. All rights reserved. Member FDIC.
 An office wall isn’t
the only place to display
your credentials.
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INQDCNDGPEJOCTMHQTOCPCIGOGPVCEEQWPVCPVU9J[!$GECWUGVJG%/#KUKPETGFKDN[
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Contents // JANUARY 24, 2017 VOLUME 199 NUMBER 1

ON THE COVER
68 | 30 UNDER 30
Meet the Class of 2017. These 600 young
innovators—30 game changers in 20 industries,
including YouTube star Tyler Oakley (at right)—
are challenging the conventional wisdom and
rewriting the rules for the next generation of
entrepreneurs, educators and entertainers.
EDITED BY CAROLINE HOWARD
WITH NATALIE SPORTELLI

22 | 30 UNDER 30:
WE KNEW THEM WHEN
Our impressive track record of spotlighting
young actors, athletes and
musicians on our annual 30 Under 30 is
showcased ably by these stars.

86 | THE BLACK SHEEP

At 25, James Proud has a quarter-billion riding
on reinventing how you sleep. And this original
Thiel Fellow is determined to do it his way—
or fail trying.
BY BRIAN SOLOMON

100 | THE FLIP TURN

By 30 he was the most decorated Olympian of all
time. Now he seeks to translate his prodigious
accomplishments into an everlasting brand. Can
Michael Phelps be like that other Mike?
BY MONTE BURKE

COVER PHOTOGRAPH BY JAMEL TOPPIN

JASON DERULO WEARS A LEATHER JACKET
($3,795) AND A COTTON DRESS SHIRT ($795)
BY DOLCE GABBANA AND COTTON PANTS BY
PAL ZILERI ($395).
HALSEY WEARS A LACE DRESS BY DOLCE &
GABBANA ($8,995).
MICHAEL PHELPS WEARS A LEATHER BOMBER
JACKET BY PAL ZILERI ($1,995), A COTTON
SHIRT BY CHARLES TYRWHITT ($69), TROUSERS
BY KENZO ($305), AND A SEAMASTER AQUA
TERRA 150M CO-AXIAL GMT CHRONOGRAPH BY
OMEGA ($46,300).
JAMES PROUD WEARS A MERCER CREWNECK
T-SHIRT BY ZACHARY PRELL ($65) AND JEANS
BY MARCELO BURLON ($378).

4 | FORBES JANUARY 24, 2017

JANUARY 24, 2017

24 15 | FACT & COMMENT // STEVE FORBES

India’s sickening and immoral move.

LEADERBOARD
20 | THE SECOND ANNUAL 30 UNDER 30 EUROPE
Is Europe fated to a future of economic sclerosis? Not if this group of
top young entrepreneurs has any say in the matter.
24 | ROAD WARRIOR: PILOT’S WATCHES
There’s no better way to keep track of a high-flying, peripatetic career
than with a fine timepiece designed to be worn aloft.

26 | THE $4.5 BILLION CABINET

Donald Trump might have run as a populist, but he has
assembled the most plutocratic group of top advisors in
recent American history.

28 | NEW BILLIONAIRE: ROCKY ROAD

Trucking executive Jerry Moyes has built himself a ten-figure fortune
over the years—but his journey has been anything but a smooth ride.

29 | ON THE BLOCK: HAMILTON, AN AMERICAN AUCTION

Renewed interest in the first U.S. treasury secretary means
a Sotheby’s auction of his personal effects will be popular.
Don’t throw away your shot.

30 | FORBES @ 100: ROCKET MEN

In July 1958 Cold War considerations gave an economic boost
to the country’s manufacturers of missiles, rockets, submarines
and spacecraft.

31 | CONVERSATION
Readers ride along for an in-depth look at what Uber’s Travis Kalanick
is planning next; our annual Powerful People list exerts a
Ready for takeoff: Navitimer 46 Blacksteel by Breitling ($9,225). powerful pull.

36

8 | FORBES JANUARY 24, 2017

Each day at The Kahala we are grateful for the opportunity to
make your stay unforgettable. The Spirit of Aloha has never
been greater at The Kahala. We can’t wait to share it with you.

Time is precious. Spend it graciously.

1.800.367.2525 | KahalaResor t.com

JANUARY 24, 2017
THOUGHT LEADERS
32 | CURRENT EVENTS // AMITY SHLAES
Revolution at Labor.

33 | INNOVATION RULES // RICH KARLGAARD

What Trump can do—and can’t.

STRATEGIES
36 | HARDENED TARGET
Never mind Trump’s tweets. Lockheed Martin will continue to thrive,
because for the Pentagon and politicians alike, the world’s biggest defense
contractor is Silicon Valley and Detroit combined.
BY DANIEL FISHER

ENTREPRENEURS
42 40 | NEW HOUSE ON THE BLOCK
Thanks to companies like Concierge Auctions, buying a luxury home
can be done with the swipe of a finger on a smartphone.
Is this where the future of real estate sales is going . . . going . . . ?
BY SAMANTHA SHARF

42 | PET SMARTER
Four years ago Chewy’s college-dropout founders couldn’t get a
meeting in Silicon Valley. Now they’re running one of America’s
biggest privately owned e-commerce sites.
BY SUSAN ADAMS

TECHNOLOGY
46 | TRASH TECH
Rubicon Global CEO Nate Morris is building the Uber of garbage collection,
disrupting a $60 billion industry dominated by giants.
BY ALEX KONRAD

INVESTING
58 | 401(K) INTERRUPTED
Trump says he will cut tax rates. Should you pause your
retirement plan contributions?
BY ASHLEA EBELING

46 60 | THE TRUMP DISCOUNT

Cartica Management is proving that when it comes to emerging markets,
activism is probably more important than who’s living in the White House.
BY STEVE SCHAEFER

62 | PROTECT YOURSELF FROM UGLY CURRENCIES

For a modest fee, these funds will strip foreign exchange risk out of
your international portfolio.
BY WILLIAM BALDWIN

FEATURES
94 | A BOUNTIFUL MIND
A successful career as a doctor, investor and inventor wasn’t enough for
Philip Frost. In his 60s he earned his first billion globalizing the generic-medicine
business. Now, as he enters his ninth decade, Frost is tirelessly
adding to his fortune—and giving it away—with Buffett-esque skill.
BY MATT SCHIFRIN

112 | THOUGHTS
On tomorrow.
86

10 | FORBES JANUARY 24, 2017

 INSIDE SCOOP
EDITOR-IN-CHIEF
Steve Forbes

CHIEF PRODUCT OFFICER

New Opportunities
Lewis D’Vorkin

FORBES MAGAZINE
EDITOR
In Our New Century
Randall Lane BY LEWIS D’VORKIN
EXECUTIVE EDITOR
Michael Noer
ART & DESIGN DIRECTOR I JUST RETURNED FROM ASIA,
Robert Mansfield
my sixth or seventh trip there in
FORBES DIGITAL
VP, INVESTING EDITOR
the past two years, I can’t seem to
Matt Schifrin keep track anymore. I always go to
VP, DIGITAL CONTENT STRATEGY Hong Kong, where we’re building a
Coates Bateman
VP, PRODUCT DEVELOPMENT
digital editorial operation to cover
Salah Zalatimo the region. This time I also stopped
VP, WOMEN’S DIGITAL NETWORK
Christina Vuleta
in Shanghai. In November we re-
ASSISTANT MANAGING EDITORS launched a Chinese FORBES maga-
Kerry A. Dolan, Luisa Kroll WEALTH zine. Each time I visit I come away
Frederick E. Allen LEADERSHIP
Loren Feldman ENTREPRENEURS with a new revelation, always revolving around a single
Tim W. Ferguson FORBES ASIA
Janet Novack WASHINGTON
word—BIG. On this trip, I was struck by the sheer magni-
Michael K. Ozanian SPORTSMONEY tude of China’s digital landscape.
Mark Decker, John Dobosz, Clay Thurmond DEPARTMENT HEADS
Avik Roy OPINIONS The Chinese powerhouses Baidu, Alibaba and Tencent,
Jessica Bohrer VP, EDITORIAL COUNSEL called BAT, are well-known. During a daylong strategy
BUSINESS meeting at our spanking new Shanghai office, which looks
Mark Howard CHIEF REVENUE OFFICER
Tom Davis CHIEF MARKETING OFFICER out over the city’s old train station (we’re atop a building
Jessica Sibley SENIOR VP, SALES EAST & EUROPE mostly leased to WPP, the worldwide ad agency), I heard
Janett Haas SENIOR VP, SALES, WESTERN & CENTRAL
Ann Marinovich SENIOR VP, ADVERTISING PRODUCTS & STRATEGY some startling statistics. Every 60 seconds in China Baidu
Achir Kalra SENIOR VP, REVENUE OPERATIONS & STRATEGIC PARTNERSHIPS
Alyson Papalia VP, DIGITAL ADVERTISING OPERATIONS & STRATEGY racks up 4.2 billion search queries, Tencent’s QQ transmits
Penina Littman DIRECTOR OF SALES PLANNING & ANALYTICS 11 billion messages and the app Miaopai plays 500,000
Nina La France SENIOR VP, CONSUMER MARKETING & BUSINESS DEVELOPMENT
Michael Dugan CHIEF TECHNOLOGY OFFICER short videos. It’s no wonder that Chinese social, video and
FORBES MEDIA digital-commerce companies few of us have ever heard of
Michael S. Perlis CEO & EXECUTIVE CHAIRMAN carry valuations of billions, if not tens of billions, of dollars.
Michael Federle PRESIDENT & COO
Terrence O’Connor CHIEF ADMINISTRATIVE OFFICER The Asian digital ad market is also growing in interest-
Michael York CHIEF FINANCIAL OFFICER
Will Adamopoulos CEO/ASIA FORBES MEDIA
ing ways. Influencer marketing is on the rise much like it is
PRESIDENT & PUBLISHER, FORBES ASIA in the United States—except the numbers seem unimagi-
Rich Karlgaard EDITOR-AT-LARGE/GLOBAL FUTURIST
Moira Forbes PRESIDENT, FORBESWOMAN nable, at least to me. Big brands in America now work
MariaRosa Cartolano GENERAL COUNSEL
Margy Loftus SENIOR VP, HUMAN RESOURCES
with YouTube stars and others to get their messages out to
Mia Carbonell SENIOR VP, GLOBAL CORPORATE COMMUNICATIONS young audiences. These influencers are building nice little
FOUNDED IN 1917 careers. In China, a single influencer can reach tens of mil-
B.C. Forbes, Editor-in-Chief (1917-54)
Malcolm S. Forbes, Editor-in-Chief (1954-90)
lions of consumers, commanding $100,000—and more—
James W. Michaels, Editor (1961-99) for a single post (yes, one post). In the U.S., cash like that
William Baldwin, Editor (1999-2010)
translates into a multifaceted ad campaign.
JANUARY 24, 2017 — VOLUME 199 NUMBER 1 Asia is still in good part about aging tycoons and their
FORBES (ISSN 0015 6914) is published Monthly, except Semi-monthly in June, September and December, children—in banking, property development and other
by Forbes Media LLC, 499 Washington Blvd, Jersey City, NJ 07310, Periodicals postage paid at Jersey City,
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forward, extending our message of entrepreneurship and
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many other Asian nations. F

12 | FORBES JANUARY 24, 2017

Can a simple sheet of paper renew
your faith in humanity?
Putting thoughts on paper can be a powerful way to express feelings, heal
and inspire. We asked five people whose lives have been touched by violence
or cruelty to write Letters of Peace that reflect their enduring faith in humanity.
Meet the authors, read their letters and learn more about the power of paper.
Visit howlifeunfolds.com/lettersofpeace | #lettersofpeace

A charitable donation was made on behalf of the author of this letter.

© 2016 Paper and Packaging Board. From the Makers of Paper and Packaging
 FACT & COMMENT
“With all thy getting, get understanding”
INDIA’S
SICKENING AND IMMORAL MOVE BY STEVE FORBES, EDITOR-IN-CHIEF
IN NOVEMBER India’s government
perpetrated an unprecedented act that
is not only damaging its economy and
threatening destitution to countless
millions of its already poor citizens
but also breathtaking in its immorality.
Without any warning India abruptly
scrapped 85% of its currency. That’s
right: Most of the country’s cash
ceased to be legal tender. Shocked
citizens were given only a few weeks’
notice to take their cash and turn it in
at a bank for new bills.
The economic turmoil has been compounded by
the fact that the government didn’t print a sufficient
amount of the new bills, lest word leak out as to what
was about to take place. The new bills are also a dif-
ferent size than the old ones, creating a huge problem
with ATMs. Even though India is a high-tech power-
house, hundreds of millions of its people live in dire
poverty. Many workers are leaving the cities to go back
to their villages because so many businesses are clos-
ing. Countless companies are having difficulty meet-
ing payroll, as they can’t get the cash to do so. The real
estate market has tanked.
India’s economy is based mostly on cash. Moreover,
much of it operates informally because of excessive
rules and taxes. The government bureaucracy is notori-
ous for its red tape, lethargy and corruption, forcing
people to get by on their wits.
The World Bank’s annual survey, Doing Business,
measures how difficult it is to start and manage a busi-
ness in 190 countries, using such metrics as what it
takes to set up a legal business, obtain construction
permits and get electricity. India ranks among the
worst in the world in these areas.
Not since India’s short-lived forced-sterilization
program in the 1970s—this bout of Nazi-like eugenics
was instituted to deal with the country’s “overpopula-
tion”—has the government engaged in something so
immoral. It claims the move will fight
corruption and tax evasion by alleged-
ly flushing out illegal cash, crippling
criminal enterprises and terrorists
and force-marching India into a digi-
tized credit system.
News flash: Human nature hasn’t
changed since we began roaming this
planet. People will always find ways
to engage in wrongdoing. Terrorists
aren’t about to quit their evil acts be-
cause of a currency change. As for the
digitization of money, it will happen in its own good
time if free markets are permitted. And the best cure
for tax evasion is a flat tax or, at the least, a simple,
low-rate tax system that renders tax evasion hardly
worth the effort. Make it easy to do business legally
and most people will do just that.
India is the most extreme and destructive example
of the anticash fad currently sweeping governments
and the economics profession. Countries are moving
to ban high-denomination bills, citing the rationales
trotted out by New Delhi. But there’s no misunder-
standing what this is truly about: attacking your
privacy and inflicting more government control over
your life.
India’s awful act underscores another piece of im-
morality. Money represents what people produce in
the real world. It is a claim on products and services,
just as a coat-check ticket is for a coat left at the coat
check in a restaurant or a ticket is for a seat at an
event. Governments don’t create resources, people
do. What India has done is commit a massive theft of
people’s property without even the pretense of due
process—a shocking move for a democratically elect-
ed government. (One expects such things in places
like Venezuela.) Not surprisingly, the government is
downplaying the fact that this move will give India a
onetime windfall of perhaps tens of billions of dollars.
By stealing property, further impoverishing the
JANUARY 24, 2017 FORBES | 15
FORBES
FACT & COMMENT STEVE FORBES
least fortunate among its population
and undermining social trust, there-
by poisoning politics and hurting fu-
ture investment, India has immorally
and unnecessarily harmed its people,
while setting a dreadful example for
the rest of the world.
What India must do to fulfill its
desire to become a global power-
house is clear: slash income and
business tax rates and simplify the
whole tax structure; make the rupee
as powerful as the Swiss franc; hack
away at regulations, so that setting up
a business can be done with no cost
and in only a few minutes; and take
a supersize buzz saw to all the rules
that make each infrastructure project
a 100-year undertaking.
Can the EU Survive?
Is Italy on its way out of the EU? Ital-
ian voters’ rejection last month of a
referendum on alleged governance
reform led to the fall of the govern-
ment and forced that question into
play. Support is growing for an exit,
but that option isn’t a solution for
Italy’s woes.
Italy’s problem—as is the case with
many of the other EU countries—is
structural. The flaws will still be
there if Italy goes out on its own. Its
banking system is a mess; one way or
another, bailouts are coming. Govern-
ment debt is ballooning to Greece-
like proportions. Internal reforms—
big tax cuts and radical simplification
of the whole tax code, less rigid
antigrowth labor laws, less suffocat-
ing regulations and a less bloated
bureaucracy—have been minimal,
which is why economic growth is
virtually nonexistent.
A breakup of the EU—and Italy’s
pulling out would mean just that—
would be a geopolitical disaster. All
the demons that have been bottled up
since WWII would be let loose. Com-
bined with an increasingly belliger-
ent China in the Pacific, the situation
would be too ugly to contemplate.
16 | FORBES JANUARY 24, 2017
Mismanaging
The Debt
In an era of epic economic malpractice,
one operation that has received scant
attention is the U.S. Treasury Depart-
ment’s mismanagement of the national
debt. With interest rates abnormally
low—thanks to their suppression by
the Federal Reserve—you’d think
Uncle Sam would go heavy on the is-
suance of long-term bonds to lock in
ultralow costs. It wasn’t so long ago
that a 30-year Treasury bond would
routinely yield more than 7% instead of
what it has paid recently: less than 3%.
But the geniuses at Treasury
shortened the average duration of
government debt to five years. This
was a short-term expedient, artifi-
cially cutting the cost of financing
the debt and thereby freeing up more
money for wasteful domestic pro-
grams. The move was all too typical of
the Obama regime in all facets of its
governance. (The most egregious ex-
ample of this destructive myopia was
Obama’s precipitous withdrawal of
U.S. forces from Iraq in 2011 in order
to bolster his reelection chances.
Look, America, Obama proclaimed,
the war on terror is winding down,
and we’ve won. But the reality was
that our painful victory over Islamic
terrorism in Iraq was thrown away. In
the ensuing vacuum ISIS emerged.)
Interest rates are moving up. If the
bulk of Donald Trump’s tax, health
and regulatory proposals come to
pass, the U.S. economy will genuinely
expand again; demand for credit will
grow, as will the cost of gaining access
to it. Washington’s interest outlays
will mushroom in the years ahead.
Thankfully, there’s still time to
issue significant amounts of long-term
bonds with historically low costs. In
fact, we should follow the examples
of other countries that have issued
debt with really long maturities. Eco-
nomic guru Larry Kudlow suggests
that Uncle Sam auction off bonds
with 100-year maturities. If Mexico,
Ireland and Belgium can pull this
off—and they have—so can we. Austria
issued one for 70 years, and Britain
floated a number of issues with ma-
turities of 40 to 50 years.
When Donald Trump takes of-
fice, the Treasury should announce
that within the next 15 months or so
Uncle Sam will be selling upwards
of a trillion dollars in century bonds.
Would such a long-maturity bond
sell? There’d be a stampede for them.
Thanks to the Federal Reserve’s
disastrous buying of several tril-
lion dollars’ worth of U.S. bonds and
mortgage-backed securities, there
is a shortage of bonds in nongovern-
ment hands. This shortage, combined
with superlow interest rates, has
wreaked havoc with pension funds
and insurance companies. These
entities and others with long-term
liabilities badly need safe bonds with
“normal” interest rates in order to
meet future obligations.
The new administration should
also prevent the Fed from purchasing
any of these securities. In addition,
the Fed should be instructed to wind
down its $4 trillion-plus portfolio.
When a bond matures, the principal
should not be reinvested; instead, it
should flow back into the private credit
markets, where it can be productively
put to work to expand the economy.
By the way, even though quan-
titative easing formally ended, our
mistake-prone central bank has been
extending the duration of its bonds.
Monetary expert David Malpass has
correctly emphasized that the end
result of this perverse exercise has
been not only a shortage of bonds
but also a lack of credit for small
and new businesses. In other words,
both Uncle Sam and the Fed have
been doing the opposite of what they
should have been doing: The federal
government has been shortening the
maturity of its debt, and the Fed has
been elongating the maturity of its
bond holdings. F
LeaderBoard
JANUARY 24, 2017

Think you’ve never heard

a song by Jason Derulo?
You’re probably wrong. He
has sold 50 million singles,
streamed 1 billion tracks
on Spotify and racked up
2 billion YouTube views
with earworms such as
“Whatcha Say” and “Want
to Want Me.” He also grosses
$232,000 per tour stop—
just one of our 30 Under
30 alumni (Class of 2016)
cashing in on entertainment.
PAGE 22

EUROPE’S TOP YOUNG

ENTREPRENEURS 20
HIGH-FLYING PILOT’S
WATCHES 24
THE $4.5 BILLION
PRESIDENTIAL CABINET 26
HIS TRUCKS HAULED A
BILLION BUCKS 28
HAMILTON UNDER THE
HAMMER 29 JASON DERULO WEARS A VELVET
TUXEDO JACKET ($2,695), WOOL
TROUSERS ($1,195) AND SILK BOW
FORBES @ 100, 1958: TIE ($185) BY DOLCE & GABBANA;
COTTON SHIRT BY CHARLES
THE MISSILE ECONOMY 30 TYRWHITT ($69). YACHT-MASTER II
WATCH WITH DIAMONDS BY ROLEX.

PHOTOGRAPH BY JAMEL TOPPIN

JANUARY 24, 2017 FORBES | 19

 LeaderBoard
SCIENCE AND HEALTH CARE
ARANTXA UNDA 29, SPAIN
CEO
SIGESA
Unda abandoned a budding career
in investment banking to pursue a
more fulfilling one in health care. After
earning a Harvard M.B.A., she acquired a
41% stake in Sigesa, a medical-software
company founded by her father in the
late 1990s, and took over as its CEO.
INDUSTRY
JORDAN DAYKIN 21, U.K.
Founder
TECHNOLOGY
EDWARD BOYES 27, U.K.
Cofounder
GRIPIT FIXINGS HELLOFRESH
At 18 Daykin became the youngest person A food-subscription business that
to secure an investment on Dragons’ sends pre-apportioned ingredients
Den—the U.K.’s version of Shark Tank—for and cooking instructions to
GripIt, a small device that makes simple the consumers’ doorsteps weekly,
usually maddening act of hanging art and HelloFresh offers quick and
fixtures on plasterboard walls. Three years healthy meals developed by chefs
later his company is valued at $31 million. and nutritionists. Boyes is the
company’s U.S. CEO, based in
New York City for the time being
and charged with expanding its
American operations.

30 UNDER 30

Old World, RETAIL AND

E-COMMERCE

Young Promise PHILIPP MAN

25, GERMANY
Cofounder
IS EUROPE CONSIGNED to a grim future of economic sclerosis? Not if the CHRONEXT
An online marketplace for
members of our second annual 30 Under 30 Europe list are any indication. new and pre-owned luxury
In addition to receiving thousands of nominations online, our reporters watches, Chronext (which
combed the Continent for leading innovators in all fields. They then handed has landed $18 million in
venture funding) makes the
over their winnowed short lists to panels of industry-leading judges, who experience of buying a high-
made the final selections: 300 of Europe’s boldest young entrepreneurs in end timepiece online more
streamlined and secure. The
ten categories that encompass the arts, finance, technology and more. son of Russian immigrants
The cross-section of that august group you see here gathered in London to Germany, Man launched
last month to talk shop and trade insights. They’re a welcome rebuke to his first venture, a clothing
retailer, at age 17.
anyone unduly bearish on Europe’s future.
MEDIA
EMILIE TABOR
28, THE NETHERLANDS
Cofounder
IMA (INFLUENCER
MARKETING AGENCY)
The company Tabor founded
with her friend Maddie
Raedts is helping an array of
notable brands figure out their
European youth-marketing
strategy. Through its network
of more than 6,000 bloggers,
YouTubers and other social-
media personalities, IMA gives
such clients as Nike and Calvin
Klein insight into Europe’s
young consumers.

EDITED BY ALEXANDRA WILSON, KATHRYN DILL AND STEVEN BERTONI

REPORTED BY MADELINE BERG, ANDRÉS CALA, STEFANIA D’IGNOTI, THOMAS FOX-BREWSTER, ALEX KNAPP, SHAENA MONTANARI, PARMY
OLSON, NATALIE ROBEHMED, LEONARD SCHOENBERGER AND NATHANIA ZEVI

20 | FORBES JANUARY 24, 2017

 FINANCE
ABBAS KAZMI 24, U.K.
Founder
COLLEGIATE CAPITAL
Kazmi raised $100 million
to seed Collegiate Capital, a
venture firm that focuses on
fintech, cybersecurity, energy SOCIAL ENTREPRENEURS
and gaming; he’s Europe’s FILIPPO YACOB 29, ITALY
youngest founder and Cofounder
managing partner of a VC PRIMO TOYS
fund of that size. He started Inspired by the birth of his son, Yacob invented Cubetto,
his first business, a game a wooden robot that teaches children as young as 3 the
called U-Design, at age 16; rudiments of coding—the kids “program” symbols that
he also now serves as CEO govern the robot’s movement—without increasing screen
of the Oxford Accelerator, a time. Primo Toys pulled off the largest educational-
business incubator hosted by technology crowdfund in Kickstarter’s history, raising
the prestigious university. nearly $1.6 million from backers in 96 countries.

ENTERTAINMENT
MICHAELA COEL 29, U.K.
Actress and writer
The London-born Coel writes
and stars in Chewing Gum,
a comedy that premiered
on U.K. television but has
POLICY
LIFESTYLE GUILLAUME CAPELLE 29, FRANCE
garnered global acclaim after
DAVID ANDRÉS 29, SPAIN Cofounder
its acquisition by Netflix.
Her role as the pious virgin
Chef and owner SINGA
ABAC RESTAURANT & HOTEL; Capelle founded Singa in 2012 to help refugees acclimate
Tracey Gordon earned her
RESTAURANT SOMIATRUITES to Europe. Last year it provided intercultural training for
a BAFTA (a British Oscar,
In addition to his role as chef de cuisine for the some 2,000 new arrivals in France. (It also has operations
essentially) for best female
two-Michelin-starred ABaC Restaurant & Hotel in in Belgium, Germany and Switzerland.) Among its
performance in a comedy.
Barcelona, Andrés runs his own place, Restaurant initiatives is a startup incubator for refugee entrepreneurs
She also acts in theater and
Somiatruites, a Catalan eatery just up the road in that accepts 30 applicants a year; one company it recently
on the British television show
Igualada. For two years running, he has been named graduated was WelcomHere, an online platform whose
Aliens.
“best of the Spain/Portugal region” by the Europe- network helps refugees find homes and jobs in France.
wide San Pellegrino Young Chef Competition.

ARANTXA UNDA: BLOUSE BY CAROLINA HERRERA; TROUSERS AND SHOES BY MASSIMO DUTTI. PHILIPP MAN: SUIT BY HACKETT; SHIRT BY ERMENEGILDO ZEGNA; SHOES BY
CHURCH’S. JORDAN DAYKIN: SUIT BY HUGO BOSS; SHIRT BY STUDIO JEFF BANKS; SHOES BY LOUIS VUITTON. EDWARD BOYES: SHIRT BY J.CREW; TROUSERS AND SHOES BY TED
BAKER. EMILIE TABOR: BLOUSE AND SKIRT BY SUI STUDIO; SHOES BY ZARA. MICHAELA COEL: CLOTHING BY TOPSHOP; SHOES BY OKI KUTSU. DAVID ANDRES WEARS HIS OWN
CHEF’S JACKET. ABBAS KAZMI: JACKET BY ARMANI COLLEZIONE; SHIRT BY BURBERRY; TROUSERS BY J BRAND; SHOES BY FERRAGAMO. FILIPPO YACOB: JACKET BY BEN SHERMAN;
TROUSERS BY LEVI’S; SHIRT BY MUJI; LOAFERS BY FRATELLI ROSSETTI. GUILLAUME CAPELLE: SUIT BY NOUVEAU ATELIER; TIE BY CELIO; SHIRT BY PINK; SHOES BY BEXLEY.

PHOTOGRAPHED IN LONDON BY LEVON BISS FOR FORBES. FORBES STYLE DIRECTOR: JOSEPH DEACETIS; STYLIST: LOUISE SYKES; STYLIST ASSISTANT:
LOUISE COLLINS; HAIR & MAKEUP: MARK ENGLISH; HAIR & MAKEUP ASSISTANT: LYDIA JEFFCOAT;
MICHAELA COEL’S HAIR: KEVIN FORTUNE. PRODUCTION: PHILLIPA COOPER.

JANUARY 24, 2017 FORBES | 21

LeaderBoard
30 UNDER 30

We Knew
Them When
ADELE. JENNIFER Lawrence. Halsey (shown
here). On our annual 30 Under 30 lists—see page
68 for this year’s iteration—we’ve scored an
impressive track record of spotlighting young
actors, athletes and musicians who were on the
cusp of achieving still greater fame and fortune.

ADELE
30 Under 30 debut: 2012
Then: 2 Grammys
Now: 10 Grammys

LEBRON JAMES
30 Under 30 debut: 2013
Then: 1 NBA championship ring
Now: 3 rings, plus a budding
Hollywood career

JENNIFER LAWRENCE
30 Under 30 debut: 2012
Then: 0 Hunger Games films
Now: 4 Hunger Games films—
and a new role as Hollywood’s
top-earning actress

KENDRICK LAMAR
30 Under 30 debut: 2013
Then: 0 Grammys,
0 White House visits
Now: 7 Grammys,

BY ZACK O’MALLEY GREENBURG WITH MADELINE BERG AND NATALIE ROBEHMED

2 White House visits

JASON DERULO
30 Under 30 debut: 2016
Then: Had played London’s
20,000-seat O2 as a co-bill
Now: Played the O2 as a solo
headliner

HALSEY
30 Under 30 debut: 2016
Then: Top song (“New
Americana”) peaked at No. 60
on Billboard Hot 100
JAMEL TOPPIN FOR FORBES

HALSEY WEARS A JERSEY TOP BY

Now: Top song (“Closer,” GIVENCHY ($750), A LEATHER MINI-
SKIRT BY LISA PERRY ($695), PATENT
performed with the LEATHER BOOTIES BY GIUSEPPE
Chainsmokers) spent ZANOTTI DESIGN ($995) AND A GOLD
ROSARY NECKLACE ($975) AND
12 weeks at No. 1 TORTOISESHELL SUNGLASSES ($240)
BY DOLCE & GABBANA.

22 | FORBES JANUARY 24, 2017

Slack is where work happens, for millions
of people around the world, every day.
LeaderBoard
ROAD WARRIOR

1 2 3

1. 1858 Automatic Small

Flight Time Second by Montblanc ($3,045).

2. BR03-93 GMT by Bell &
Ross ($3,700). 3. Engineer
Hydrocarbon AeroGMT by Ball
WHAT BETTER WAY to keep track
($3,499). 4. Pilot Type 20 Extra
of a high-flying career than with Special by Zenith ($6,700).
a pilot’s watch? The origin of the 5. Big Pilot’s Watch by IWC

PHOTOGRAPH BY DAVID ARKY; CREATIVE STYLE DIRECTOR: JOSEPH DEACETIS; STYLE ASSOCIATE: JUAN BENSON
style dates back to the dawn of flight ($12,900).
itself—when Louis Cartier designed
the Santos in 1904 for his friend
Brazilian aviator Alberto Santos-
Dumont—and the signature elements
of the timepiece have remained rela-
tively unchanged. A pilot’s watch typ-
ically has a big, clean dial with large, 5
legible numbers. The most common
complication is usually a GMT (for
Greenwich Mean Time), which
monitors two time zones. Because,
as any good pilot knows, time flies.
BY MICHAEL SOLOMON

24 | FORBES JANUARY 24, 2017

 Classroom.

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understanding how we perfected that customer experience? Well, we think we offer you the most amazing
classroom in the world. With courses offered by Disney Institute, you’ll discover ways to positively impact your
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experience, no matter your business.
 LeaderBoard
BILLIONAIRES

The $4.5 Billion Cabinet

A POPULIST WAVE may have propelled Donald Trump to the nation’s highest office, but he is proving to be no
man of the people. Trump has already proposed what appears to be the wealthiest Cabinet in modern U.S. history, a
collection of elites that includes a billionaire heiress, Exxon Mobil’s CEO, a former Goldman Sachs partner and an
investor who made millions off underwater mortgages during the financial crisis. All told, Trump’s Cabinet is worth
an estimated $4.5 billion, 60% more than Barack Obama’s second-term Cabinet. That sum doesn’t include Trump’s
own fortune or that of any billionaire officials outside the Cabinet, such as Army secretary pick Vincent Viola—and
as of press time, Trump still has two picks (the secretaries of agriculture and veterans affairs) to make.

BETSY DEVOS
$1.25 BIL
RYAN ZINKE Secretary of Education WILBUR ROSS
$800,000 Daughter-in-law of JOHN KELLY $2.5 BIL RICK PERRY
Secretary of the Interior Amway cofounder $4 MIL Secretary of Commerce
$2 MIL
The Montana Richard DeVos, she’s Secretary of For a quarter-century, Secretary of Energy
congressman Homeland Security Ross ran Rothschild’s Since Perry left the
married to Richard
Kelly spent over four bankruptcy advisory
owns a number of REX TILLERSON Jr., the eldest of Texas governor’s office
rental properties in $325 MIL decades in the mili- business before start- JEFF SESSIONS in 2015, he has banked
DeVos’ four children;
Whitefish, Montana, Secretary of State tary, rising to become ing his private equity $6 MIL at least $100,000 from
FORBES estimates
Tillerson started at a four-star general. firm, WL Ross & Co., Attorney General
his hometown (pop. that the couple has speeches and another
7,073); an art collec- Exxon Mobil straight He has two sons in 2000. He sold it to Sessions, a senator $250,000 consulting
about one-fourth of
tion worth at least out of the University who’ve served, one of investment manage- from Alabama, owns for a Caterpillar heavy
the family fortune. She
$100,000; and of Texas. As chairman whom died in combat ment firm Invesco more than 1,500 acres equipment dealer.
previously served
a garage full of auto- and CEO he accumu- in Afghanistan. The in 2006 for some in the western part About 20% of his
as chair of the
mobiles that includes lated more than bulk of his wealth $375 million while of the state that are portfolio is in oil-and-
Michigan GOP.
a 1938 Cadillac. 2.6 million shares of comes from his gov- staying as chairman worth at least $2.5 gas partnerships and
company stock and ernment pension. and chief strategy of- million. The rest of his energy stocks.
hefty pay packages ficer. He made millions fortune is in Vanguard
(nearly $90 million servicing subprime mutual funds and
over the past three mortgages during the municipal bonds.
years alone). financial crisis.

SOURCE: TIM VOIT, CERTIFIED QDRO SPECIALIST WITH THE AMERICAN ASSOCIATION OF CERTIFIED QDRO PROFESSIONALS.
ESTIMATES BASED ON MOST RECENTLY AVAILABLE FINANCIAL DISCLOSURE FORMS; INCLUDES SPOUSES’ ASSETS.

26 | FORBES JANUARY 24, 2017

 OBAMA’S
CABINET
$2.75 BIL
DONALD TRUMP Trump’s gilded
$3.7 BIL Cabinet raises the
America’s first billionaire bar, but Obama’s
president brings to the inner circle isn’t
Oval Office unprec- exactly full of
edented potential for paupers. All but three
conflicts of interest just are millionaires; his
about everywhere from commerce secretary,
Chicago and Istanbul to Penny Pritzker, is a
Scotland and the Philip- Hyatt heiress and a
pines. More than half of billionaire.
Trump’s fortune is tied up
in Manhattan real estate.

MIKE PENCE
$800,000
Vice President STEVE
MNUCHIN ANDY PUZDER
BEN CARSON The Indiana gov- ELAINE CHAO $300 MIL
$29 MIL $24 MIL TOM PRICE $45 MIL
ernor and former Secretary of Treasury Secretary of Labor
Secretary of Housing and Secretary of $10 MIL
Urban Development congressman lives Transportation After buying subprime After negotiating a
Secretary of Health and
The neurosurgeon modestly and has Married to Senate Human Services JAMES MATTIS mortgage lender Indy- deal to help Carl’s Jr.
earned millions largely stayed away majority leader Mitch The orthopedic $5 MIL Mac for $1.6 billion
Secretary of Defense
founder Carl Karcher
from six bestselling from commercial McConnell, Chao is surgeon and Georgia in 2009 with a group escape financial trou-
gigs. He gets most Most of his fortune of billionaire investors,
books, media roles the daughter of a congressman owns a ble in the early ’90s,
of his wealth from comes from his mili- Mnuchin sold it to
at Fox News and the shipping magnate, medical office building Puzder eventually
his state and federal tary salary and pen- CIT Group for
Washington Times and and the bulk of her in his home state, plus became CEO of CKE
pension accounts; sion (nicknamed the $3.4 billion six years
numerous speaking and husband’s wealth rental apartments and Restaurants, parent
the father of three “warrior monk,” Mattis later. A former Gold-
gigs. He accumulated comes from her family condos in Virginia, company of Carl’s Jr.
also owes at least is a four-star general man Sachs partner, he
more than $6 million (including an invest- Washington, D.C., and Hardee’s, and has
$95,000 in Parent who retired in 2013). also dabbles in financ-
worth of stock serv- ment account worth North Carolina, earned at least $25
Plus student loans. The ex-Marine sat on ing movies (Avatar,
ing as a director at at least $5 million South Carolina and million in salary and
the board of disgraced American Sniper).
Kellogg and Costco given to the couple). Tennessee. bonuses since 2000.
blood-testing unicorn
before leaving their The Harvard grad sits
Theranos and is still
boards in May 2015 to on four corporate
a director of General
run for president. boards, including
Dynamics.
Wells Fargo’s.

REPORTING BY CHASE PETERSON-WITHORN AND JENNIFER WANG WITH KEREN BLANKFELD, DANIELA SIRTORI, CHLOE SORVINO,
MICHELA TINDERA AND KATE VINTON. ILLUSTRATION BY JOE MCKENDRY

JANUARY 24, 2017 FORBES | 27

LeaderBoard
NEW BILLIONAIRE

Rocky Road
Jerry Moyes built one of America’s largest
trucking concerns—and a three-comma
fortune—but it’s been far from a smooth ride.
IN 1966 Jerry Moyes founded Swift Transportation
with his father and one truck, moving imported steel
through Los Angeles to Arizona and then Arizona cot-
ton back to California. In the ensuing decades he built
it into a $4 billion (sales) business with 20,000 trucks,
amassing a $1 billion fortune. He still owns about half of
Swift’s stock—it went public in 1990—but has pledged
64% of his stake as collateral for personal loans.
The road to this point has been bumpy. In the early
2000s Moyes came under fire for arranging contracts
between Swift and a truck-leasing firm he owned. He
stepped down as Swift CEO in 2005 after an insider-trad-
ing case in which he admitted to no wrongdoing but paid

ILLUSTRATION BY AARON SACCO; TOMOHIRO OHSUMI/BLOOMBERG (BOTTOM)

$1.5 million to settle with the SEC. A year later a lawsuit,
ultimately dismissed, sought to make him repay $110 mil-
lion he borrowed from a trust set up for his children.
After leading a buyout that took Swift private in 2007,
he relisted it on NYSE in 2010 before announcing his re-

NEW BILLIONAIRE BY DANIELA SIRTORI-CORTINA

tirement this past September—after investors questioned
if a stock-buyback plan was intended primarily to shore
up the value of his Swift stake. “Industry people believe
Jerry Moyes could be one of the best trucking executives
ever,” says Jeffrey Kauffman, an analyst at Aegis Capital.
“But right or wrong, there was a discount attached to
Swift shares because of some financial decisions made
while Jerry was running the company.”

SCORECARD UNICORN METER

MASAYOSHI SON Middling Message
+$2.6 BILLION WHICH UNICORNS will become tomorrow’s blue
NET WORTH: $19 BILLION chips? Our ongoing poll of the world’s top venture
The SoftBank CEO—while capitalists provides an exclusive take on the long-term
standing in Trump prospects of these billion-dollar startups. The VCs
Tower after meeting couldn’t help but kick the shins of Kik, a messaging app.
with the president-
elect—announces his firm
will invest $50 billion
ID EXIT đ T
in American startups. IT đ SOL EN
2 -B
Company shares jump T BA AG
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14%; Son overtakes Uniqlo YO R
boss Tadashi Yanai as U
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28 | FORBES JANUARY 24, 2017
ON THE BLOCK SCORECARD
JOHN KAPOOR
Hamilton: An –$230 MILLION
American Auction NET WORTH: $1.6 BILLION
Two months after FORBES
cast a critical eye on
BRING PLENTY OF Benjamins when Kapoor’s company, Insys
Sotheby’s auctions an archive of Alexander Therapeutics, federal
Hamilton’s letters and manuscripts in prosecutors say six of its
former executives conspired
New York on January 18. Thanks to the
to bribe doctors to prescribe
smash Broadway musical, interest in a powerful narcotic to
documents and memorabilia from the patients who didn’t need it.
“Founding Father without a father” is Insys stock tumbles 29%.
expected to be high.
Included in the sale are love letters
between Hamilton and his wife, Eliza,
as well as the condolence note his
father-in-law, Philip Schuyler, sent to
his daughter after America’s first sec-
retary of the Treasury was killed by
Aaron Burr in an 1804 duel (estima-
ted to sell for $15,000 to $20,000).
For those who want something
even more personal, Sotheby’s is
auctioning a lock of Hamilton’s hair
with a letter from Eliza, estimated
to bring $15,000 to $25,000.
Don’t throw away your shot.

RICHEST BY STATE

Massachusetts
POPULATION: 6.8 MILLION
2015 GROSS STATE PRODUCT: $477 BILLION (2% GROWTH)
GSP PER CAPITA: $70,167 (RANKS NO. 6 NATIONWIDE)
RICHEST: ABIGAIL JOHNSON, $14.3 BILLION

IN DECEMBER Abigail Johnson, 55, took full command of her

family’s Boston-based Fidelity Investments, adding the chairman
ON THE BLOCK BY MICHAEL SOLOMON; RICHEST BY STATE BY MICHELA TINDERA
title her father held for nearly four decades to the CEO job she ILLUSTRATION BY CHRIS LYONS; KAY NIETFELD/DPA/NEWSCOM (BOTTOM)
has done since 2014.
With $2.1 trillion under management and $5.6 trillion under
administration, Fidelity is the world’s fourth-largest asset mana-
ger and the U.S.’ top 401(k) administrator. But Johnson, a Harvard
M.B.A. who joined Fidelity as an analyst in 1988, must execute a
tricky balancing act to protect its margins and market share.
The firm built its reputation with actively managed mutual
funds (think Peter Lynch and Magellan). Yet investors have been
moving to low-cost, market-tracking index funds. In July John-
son dropped fees on 27 index funds and ETFs, in some cases
undercutting Vanguard, the indexing pioneer and leader. Fidel-
ity’s 500 Index Fund, with an investor-class expense ratio of
just 0.09%, has grown to $106 billion in assets, edging past
its largest actively managed offering, Contrafund, which picks
large-cap growth stocks and charges 0.71%.

JANUARY 24, 2017 FORBES | 29

LeaderBoard
FAST-FORWARD
FORBES @ 100 Finance’s Iron Ceiling
As FORBES’ September 2017 centennial approaches, 1956: Wall Street is almost entirely a boys’
we’re unearthing our favorite covers. club, and it’s a breakthrough when Merchants
Exchange in St. Louis begins to consider
allowing women on its trading floor.
2016: Although finance has become far more
July 1, 1958: Rocket Men diverse overall, women still occupy less than a
third of the industry’s top jobs despite making
up about half of its lower ranks.
“EVEN IN THE toy stores you see nothing
but space helmets, rockets, satellites, space
ships and guided missiles,” remarked George
M. Bunker, CEO of Martin Co. Government
officials had a similar fixation on missiles
and rockets. Those often nuclear-tipped pro-
jectiles made up more than 50% of Martin’s
backlogged orders, up from virtually nothing
five years earlier. Martin had struggled to
find its way once military-aircraft spending
dried up after World War II—it didn’t have a
strong consumer aviation business to fall back
on—and Bunker had ambitiously pushed it
into missiles.
The company’s trajectory hadn’t been
flawless, however. One early Martin missile, a
10-ton, seven-story device, rose from its Cape
Canaveral launching pad with America’s
first earth satellite—and exploded shortly
after ignition. Still, Bunker looked ahead to
lucrative government contracts, such as the
$900 million Titan project (nearly $8 billion
today), and vowed to stay the course: “The
companies that went into consumer goods—
as a lot of people said we should do—now are
coming into defense work.”
Martin would merge with American
Marietta three years later—and then with
Lockheed in 1995, creating one of the world’s
largest defense contractors (see p. 36).

NY DAILY NEWS ARCHIVE VIA GETTY IMAGES; BETTMAN/GETTY IMAGES

AMAZING AD
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THE EDITOR’S DESK

Cold War Commentary
”The American people have
spent and will continue to spend
countless billions to insure our
nation and the free world against
BY ABRAM BROWN

military enslavement by Soviet-

led Communists.”
—Malcolm S. Forbes

30 | FORBES JANUARY 24, 2017

CONVERSATION
THE ODD COUPLE
Fittingly, much of the chatter
MIGUEL HELFT’S December 30 cover story of-
about our Powerful People list
fered a glimpse into the “philosophy of rigorous focused on Nos. 1 (Vladimir Putin)
experimentation” that animates Uber cofounder and 2 (Donald Trump).
and CEO Travis Kalanick. But as the firm, valued
JOE SCARBOROUGH,
at $68 billion but booking annual losses in the MSNBC’S MORNING JOE:
ten-figure range, moves to reinvent global trans- “Vladimir Putin stands alone
portation, many readers questioned its finan- as the dictator. Has there been
cials. “How about trying to turn a profit before anyone as powerful as this guy
in recent history?”
expanding?” wrote Gurinder Chahal. “Paper
billions don’t mean much.” Alex Candee offered a
spot analysis of its business model: Its latest app MARK HALPERIN, MORNING
update “has privacy advocates freaking out, but JOE: “I’ll take issue with one,
[it] showcases that Uber = a data company that [No. 69] Mike Pence. I predict
does transport.” Peter Rieder, meanwhile, praised by April you’ll run an editor’s
note saying that guy’s in the
Kalanick’s intensity, for which he’s often derided: top 20. He’s going to be really,
“Self-interest and obsessive dedication create the really powerful.”
foundation for entrepreneurial success.”

THE INTEREST GRAPH

AUSTIN KENNEDY, AT
FORBES.COM: “Vlad’s streak
Power corrupts, but it also entices: By a huge margin, our annual list of the is coming to an end. Next year
globe’s heaviest hitters was the most popular story in our final issue of 2016. Donald Trump will be No. 1!”

The World’s Most Powerful People 2016 764,072 views

Stripe Investment Makes Cofounder the World’s Youngest Self-Made Billionaire

180,237

America’s Richest Celebrities 2016: George Lucas Leads Steven Spielberg and Oprah
CHRIS SUMMERS, THE DAILY
119,865 MAIL: “Facebook is widely
perceived to have had a
“Golf. Rhyming verse. disastrous year, with a number
The 2017 Investment Guide: Trumponomics “The tax roulette Even fancy card tricks: of public-relations gaffes,
wheel is spinning. There are innumerable
28,029 You have to place but that hasn’t stopped Mark
ways to earn great Zuckerberg from climbing
your bets now, before fame and fortune by
the marbles land.” from 16th place to 10th.”
How Travis Kalanick Is Building the Ultimate Transportation Machine entertaining people.”

25,026
MIKE HUCKABEE, CNBC’S
Despite a Comeback, Lululemon Can’t Shake Its Gadfly Founder “The ousted Chip MORNINGS WITH MARIA:
Wilson retains a big “I think the list is full of junk.
14,063 enough stake to It’s a terrible list. I’m not on
remain relevant—and the list, and I’m very offended.”
is unable to let go of
The Largest U.S. Charities for 2016
his baby.”
13,634 MARIA BARTIROMO,
MORNINGS WITH MARIA:
BY ALEXANDRA WILSON

Original Bob Dylan Lyrics Sold at Auction for $300,000 “I’m not surprised in terms
of Putin. Most people believe
he’s the richest person in the
THE BOMB world because he takes a cut
146 VIEWS of everything.”

JANUARY 24, 2017 FORBES | 31

THOUGHT LEADERS AMITY SHLAES // CURRENT EVENTS

REVOLUTION AT LABOR
A THUMB in the eye to the minimum- ing strikes at the Homestead Steel Works in
wage lobby is how most journalists Pittsburgh, the labor secretary marched with
depict the nomination by President- workers to assemble at a government site,
elect Donald Trump of Andrew Puzder a U.S. post office, so that she might remind
to the post of labor secretary. them of the merits of collective bargaining.
But offering up a fast-food entrepre- The change that voters may have expected
neur for the labor post does more than didn’t come when Republican Dwight Eisen-
offend a particular interest group. The hower took office. Ike, a conciliator by nature,
Puzder nomination represents a struc- selected a Democrat and former director of
tural blow to the whole edifice that labor for the state of Illinois, Martin Durkin,
we have called “labor relations” since to lead the department. Even George Shultz,
the Department of Labor was created a free-marketer, had more experience in aca-
more than 100 years ago. demia than in business when he took office.
First, consider Andrew Puzder. As the head of CKE Restaurants, a
company that directly or through franchises employs 75,000 workers, PERSECUTION OF DONOVAN
Puzder has more involvement with labor regulations every day than Among all of the labor secretaries to date, one
many executives do in a lifetime. He’s worked with nonunionized stands out: Raymond Donovan, whose main
labor, not the union establishment. credential was running the business side of
Next, consider Puzder’s two-dozen-odd predecessors. The pro- Schiavone Construction in New Jersey. Ronald
gressives who established the Department of Labor, Democratic or Reagan’s selection of Donovan so irritated pro-
Republican, believed that government ought to support the unions and labor Democrats that even before his confirma-
that wage increases were always beneficial. These same progressives tion they sought to prove he was some kind of
also took a top-down approach, reckoning that just a few establish- Tony Soprano, operating corruptly. Once Dono-
ment parties—Big Labor, Big Business, the government and maybe an van was confirmed, the Democrats kept assail-
academic or two—could and should determine whether unemploy- ing him. It was Donovan, who, after a Bronx
ment was 3%, 5% or 10%. Nonunion workers, small-business employ- jury had acquitted him of both fraud and grand
ers, company owners and innovators—none of these were in the room. larceny, posed the poignant question: “Which
The first labor secretary, William Bauchop Wilson, set the pat- office do I go to to get my reputation back?”
tern. Wilson had served as secretary-treasurer of the United Mine Succeeding labor secretaries have sometimes
Workers and then as a congressman representing the 15th district in fought harder for the private sector—the Bush
Pennsylvania. Wilson applied his thumb not to someone’s eye but to Administration’s Elaine Chao comes to mind.
the scales of government, tipping them toward organized labor and It takes chutzpah to select for a cabinet
pushing hard to help coal strikers in Colorado and Michigan. James post someone from the fast-food industry.
“Puddler Jim” Davis, Wilson’s successor, came out of the steel mills Left-leaning periodicals vilify this fast-food
and also had a political bent, successfully running for the U.S. Senate executive for sport. But maybe chutzpah is
after his service. (Davis became cosponsor of the Davis-Bacon Act, necessary. The fact is that Democrats have
known for forcing wage hikes on small employer-contractors.) long counted on Republican presidential
Franklin Roosevelt tapped Frances Perkins. She hadn’t led unions, winners’ being too timid to appoint a labor
but Perkins had experience in both academia and government. The secretary who might challenge Big Labor.
New Deal’s labor secretary helped to elevate the Department of Labor If confirmed, Puzder is likely to do some-
from office to edifice. It was during the Perkins era that the Wagner thing that demonstrates that the economy ex-
THOMAS KUHLENBECK FOR FORBES

Act, wildly pro-union, became law and the National Labor Relations pands better without government, powered by
Board, an independent agency and court system for labor, was cre- those shadowy figures who don’t usually win
ated. The New Deal also established the national minimum wage, the places at the top table. He’s likely, too, to re-
very device that Puzder challenges. mind us that a union-tilted Labor Department
Perkins didn’t merely side with union members—she led them. Dur- doesn’t necessarily serve the country best. F
AMITY SHLAES, PRESIDENTIAL SCHOLAR AT THE KING’S COLLEGE AND CHAIR OF THE COOLIDGE FOUNDATION BOARD; PAUL JOHNSON, EMINENT BRITISH HISTORIAN
AND AUTHOR; AND DAVID MALPASS, GLOBAL ECONOMIST, PRESIDENT OF ENCIMA GLOBAL LLC, ROTATE IN WRITING THIS COLUMN. TO SEE PAST CURRENT EVENTS COLUMNS, VISIT OUR
WEBSITE AT WWW.FORBES.COM/CURRENTEVENTS.

32 | FORBES JANUARY 24, 2017

THOUGHT LEADERS RICH KARLGAARD // INNOVATION RULES

WHAT TRUMP CAN DO—AND CAN’T

TRUMP SAYS he’s a winner. To be a older voters, who want to return to an Amer-
winning president, Trump needs to ica they once knew.
fix what investor Scott Grannis calls Who’s going to stop demographic change?
the Obama Gap. The gap is American The Millennials are the first age cohort to
growth that fell into the ditch. From exceed the Baby Boomers in population. Mil-
1966 to 2008 U.S. GDP averaged 3.1% lennials are different, and they will have their
a year in real growth. Since 2009 it’s way, as Boomers had theirs. U.S. population is
been barely 2%. headed to 440 million people by midcentury.
Grannis notes how the U.S. has If you want to stop that growth, then agree
bounced back after every recession to give up your Social Security and Medicare.
except the last one: “Never before has There aren’t going to be enough working
the U.S. economy posted such a weak people to pay for them.
recovery and such a long period of subpar growth.” Global population will go from 7.3 billion
What went wrong? Grannis ticks off the reasons: weak business to 9 billion, even as it becomes older, richer
investment, low job growth, microscopic productivity gains and, de- and more urban.
spite record-setting profits, a strange, depressive risk aversion. Then there’s technology. It continues to
What’s been at fault? Writes Grannis: “Beginning in 2009, the ride the Moore’s Law rate of improvement,
economy has been burdened by (1) an unprecedented remaking of the becoming twice as good every two years or
entire health care industry (ObamaCare), which in turn has impacted so. On a logarithmic scale you can see a nice
the lives and health care costs of nearly everyone; (2) sweeping new straight line, going up and to the right. But on
regulatory burdens on the financial industry (e.g., Dodd-Frank); (3) the human scale the change is exponential. We
a massive increase in government spending and transfer payments tell ourselves that change is a continual pro-
(the American Recovery & Reinvestment Act); (4) higher marginal tax gression. But it has sudden impact: robots that
rates on income, dividends and capital gains; and (5) a huge increase teach autistic children, cars that drive them-
in the federal debt burden. You don’t have to have a political bias to selves, drones that deliver IKEA furniture,
believe that these changes could go a long way to explaining why the human organs that pop out of a replicating
economy has been so weak during the Obama years.” machine, jet engines that tell you when they
So weak, in fact, that about $3 trillion in economic activity that need maintenance, metals that are “grown” and
ought to have occurred during Obama’s eight years didn’t happen at never fail, live concerts featuring new songs
all—as if it were stillborn. Three trillion dollars would have meant a by long-dead artists, such as Elvis, Michael
lot of new jobs, bigger raises and higher hopes. But they never hap- Jackson and Prince, rendered in holograms
pened. Grannis says it would take eight years of 5% growth to get the to audiences that can’t tell the difference.
U.S. back to its 3.1% trend line. It’s all speculation, of course. In reality en-
What Trump and the Republicans can—and must!—do is fix items 1–5. trepreneurs will try stuff and try stuff again.
No, we won’t get 5% growth, but we can get a lot more than we have now. They will be backed by hundreds of billions
of dollars in risk capital. Markets will form
PEDAL TO METAL—BUT DON’T MEDDLE and disappear, as will companies and profes-
Trump and the Republicans can set the table for higher growth. But sions. Sure, it’s speculative, but the distance
they can’t direct the growth—and let’s hope they don’t try. Trump between speculation and reality is fast closing.
won’t have any impact at all on what KPMG calls the Great Rewrite. This time the old guard sees the next wave
“How we interact, how we buy and sell, how we make things, how coming. Perhaps because it’s so big and pow-
we get from place to place” is all being rewritten, says KPMG. The erful. At the Original Equipment Suppliers
THOMAS KUHLENBECK FOR FORBES

Great Rewrite is what you get when you combine accelerating tech- Association conference in Detroit a few weeks
nology with Millennial wants and needs. It’s a global phenomenon, ago, I saw leaders in the automotive and parts
and it’s unstoppable. This won’t go down well with some of Trump’s industry with their eyes wide open to outside
change and to partnerships with entrepre-
RICH KARLGAARD IS EDITOR-AT-LARGE / GLOBAL FUTURIST AT FORBES. HIS LATEST BOOK, TEAM GENIUS: THE
NEW SCIENCE OF HIGH-PERFORMING ORGANIZATIONS, CAME OUT IN 2015. FOR HIS PAST COLUMNS AND BLOGS neurs. That’s a new mind-set—and it’s good.
VISIT OUR WEBSITE AT WWW.FORBES.COM/KARLGAARD.
Donald Trump should step out of the way. F
JANUARY 24, 2017 FORBES | 33
ENTREPRENEURS
LUXURY REAL ESTATE, UP FOR BID 40 Verticals
CATERING TO “PET PARENTS” 42 JANUARY 24, 2017

TECHNOLOGY
TRASH PICKUP: THERE’S AN APP FOR THAT 46

MONEY & INVESTING

A LESS TAXING RETIREMENT 58
RE-EMERGING EMERGING MARKETS 60
KEEP FOREX RISK AT BAY 62

Lockheed’s F-35A, shown

here refueling during a
test flight over the Pacific
Ocean, first rolled off the
factory floor in Fort Worth,
Texas, in early 2006. The
stealthy multi-role fighter is
capable of speeds of up to
Mach 1.6 (1,200 mph) and
reportedly will soon be able
to deliver nuclear weapons.
Donald Trump has publicly
lambasted Lockheed
for F-35 cost overruns,
but the company’s
Washington-savvy CEO,
Marillyn Hewson, is
confident it can withstand
politicians’ fire. PAGE 36

JANUARY 24, 2017 FORBES | 35

STRATEGIES DEFENSE

Hardened Target
Never mind Trump’s tweets. Lockheed Martin will continue to thrive, because
for the Pentagon and politicians alike, the world’s biggest defense
contractor is Silicon Valley and Detroit combined.
BY DANIEL FISHER

W
ith a single tweet Donald cels the program—about as likely as his nomi-
Trump carved $4 billion off nating Hillary Clinton to the Supreme Court—it
the market capitalization of would be painful but hardly fatal for Lockheed,
Lockheed Martin, the world’s whose 2016 revenues will likely exceed $46 bil-
largest defense contractor. “The F-35 program lion. The taxpayers have already covered some
and cost is out of control,” Trump grumbled on $45 billion in development costs on the F-35,
Twitter at 8:26 a.m. on December 12, attack- and Lockheed sells billions of dollars’ worth of
ing the F-35 Joint Strike Fighter, which at more other gear to the government, from Trident bal-
than $1 trillion is the biggest defense project in listic missiles to helicopters to highly classified
history. Lockheed shares plunged 5% as inves- spy satellites. Trump can tweet his displeasure,
tors fretted Trump would kill or maim the effort. but Lockheed is one of a handful of companies
Lockheed hopes to make more than 3,000 F-35s, on Earth that can both invent an entirely new
at $100 million each, in the next 30 years. defense technology—say, radar-evading stealth—
Investors needn’t have worried. That 5% and then mass-produce it on an assembly line.
decline was a blip in comparison with the “Our business is not all around who is the
170% gain in Lockheed’s share price since president of the United States,” says Hewson, 62,
chief executive Marillyn Hewson took over who’s the daughter of an Army hospital manager
in January 2013. During that period the com- and worked her way through the University of
pany, based in Bethesda, Maryland, has de- Alabama as a night telephone operator. “We’re
livered consistently higher profits and given managing a huge supply chain, we have interna-
back $12 billion to shareholders, despite tional partners around the world, and we expect
declining defense budgets. a fair return for that.”
Trump will soon learn that the bullying Hewson, who started at Lockheed in 1983
tactics he uses at real estate closings don’t work working on C-130 cargo turboprops in Marietta,
so well with defense Georgia, has long since
contractors. The F-35 BIG-TICKET mastered the vagaries
was engineered not just ITEMS of doing business with
for stealth but for con- the government. For
LOCKHEED’S TOP FIVE DEFENSE
gressional support. As- instance, Congress likes
CONTRACTS—THAT WE KNOW OF. BLACK-
sembled at a 14,000-em- to break contracts into
BUDGET PROJECTS REMAIN CLASSIFIED.
ployee complex in Fort bite-size annual chunks,
Worth, Texas, the fighter ANNUAL COST OF PROGRAM/ obscuring the total cost
PROGRAM % REVENUE
draws 300,000 parts of huge weapons pro-
from suppliers in 45 F-35 LIGHTNING II $6.7 BIL / 20% grams like the F-35, even
states, with a total esti- C-130 $1.7 BIL / 5% though that makes them
mated economic impact F-16 $1 BIL / 3% more expensive and
of almost 150,000 jobs. PAC-3 MISSILE $1 BIL / 3% less efficient in the long
Even if Trump can- TRIDENT BALLISTIC MISSILE $1 BIL / 3% run. Lockheed’s internal

36 | FORBES JANUARY 24, 2017

 systems are optimized to deal with this sort of
governmental nonsense.
Hewson is all in on defense, which accounts
FRANCO VOGT FOR FORBES
for over 90% of sales. One of her boldest moves
was the $9 billion purchase of the Sikorsky hel-
icopter unit from United Technologies in 2015,
securing the $3.9 billion contract for Marine
One (the president’s personal fleet of 23 heli-
copters), which Lockheed had lost a few years Lockheed CEO Marillyn
Hewson parlayed a
before. That program is ripe for an outraged master’s degree in
Trump tweet, but Sikorsky also helps president- economics at the
proof the company: Sikorsky helicopters are University of Alabama
into the top job at
popular with foreign governments as low-cost Bethesda.
weapons platforms and should help push over-
seas sales to 30% from around 25% today.
Sikorsky also allows Lockheed to dis-
JANUARY 24, 2017 FORBES | 37
STRATEGIES DEFENSE

FIGHTING TRIM BY THE

NUMBERS
The F-35 is one of the most complex machines ever built, a 1,200mph
single-engine fighter/bomber. Lockheed won’t confirm, but according to
GlobalSecurity.org stealth technology reduces its radar profile to that of YIELD TO
a golf ball. Assembled in a mile-long building, the plane is crammed with ONCOMING
sensors that allow the pilot to “see” through the bottom of the cockpit via TRAFFIC
a helmet display. The outer skin is attached to the titanium-and-aluminum U.S. AUTO DEALERS
frame with a precision that Mercedes-Benz can only dream of. A variance ARE LOOKING WITH
TREPIDATION AT A JAM
of several ten-thousandths of an inch from spec is enough to produce OF LEASED CARS THAT
radar reflections that degrade the plane’s stealth capability. Onboard WILL COME ONTO THE
RESALE MARKET OVER
computers running 9 million lines of code allow multiple F-35s to share THE NEXT FOUR YEARS.
encrypted communications to triangulate enemy positions. With an inter- THAT WILL LIKELY LOWER
USED-CAR PRICES AND
nal bomb load of 4,700 pounds in stealth mode and 18,000 pounds when HURT NEW-MODEL SALES
carried on noisier underwing pylons, the plane is designed to sneak in AS WELL. SMART DEALERS
WILL LIKELY RESPOND BY
and destroy enemy air defenses and return for full-scale bombing. —D.F. RESELLING MORE SUCH
VEHICLES AS “CERTIFIED
PRE-OWNED,” WHICH
play some of its Skunk Works-bred technical and power a city of 100,000. “My job is to make TYPICALLY FETCH HIGHER
prowess. Take autonomous flight. Lockheed sure that as our customers’ priorities change, as PRICES BECAUSE OF
THE EXTRA CARE AND
engineers are masters at the technology. The the environment changes, we shift that portfolio ATTENTION DEALERS GIVE
pilotless K-Max helicopter, for example, has of products to meet them,” Hewson says. THEM. A LOOK AT THE
FIGURES DRIVING THEIR
hauled more than 4.5 million pounds of cargo to But Lockheed isn’t just a massive research lab; DECISIONS:
remote military posts in Afghanistan since it was it’s also a manufacturing giant, producing not only
deployed in 2011. In a few years most of Lock- sophisticated aircraft like the F-35 at scale but
also robotic submarines and
HOW TO PLAY IT high-speed combat ships for
the Navy. It built the Patriot
BY KEN FISHER missile, the Aegis antimissile
Big defense contractors tanked the week after Trump won
the election. The Republicans won’t get blamed for being system and the Viking rovers
too soft on defense, so they needn’t be strong on it. And still cruising around Mars.
as we’ve seen, Trump won’t like big firms charging him Trump will discover that if he
big-ticket prices. If you’re doing defense, think smaller, wants programs like these, he
cheaper and diversified, such as TEXTRON, led by its
has few other options.
smaller, cheaper Cessna line of planes, bought by defense and nondefense
customers alike. UNITED TECHNOLOGIES is bigger but has a similar profile. The Pentagon can buy
Expect cheaper-ticket items to move—at least until the next election cycle. Sidewinder missiles from
Raytheon and nuclear subs
from General Dynamics, but VEHICLES CERTIFIED
COMING PRE-OWNED
heed’s helicopters could be pilot-optional. Lockheed is probably the only contractor that OFF LEASE SALES
R&D is another defensive strategy. On aver- can pull together a project the size of the F-35.
2015
age, Lockheed spends $700 million a year to Hewson’s biggest challenge is persuading Con-
come up with technology the Pentagon can’t gress—and the Donald—to place larger orders
2.5 MIL 2.5 MIL
afford not to buy. The company’s Silicon Valley so Lockheed can wring costs out of its immense 2016
presence dates to the 1950s, when its engineers supply chain and bring the price down to be- 3 MIL 2.9 MIL
were pioneering the ballistic missile technology tween $80 million and $85 million (less than the 2017
(forecast)
designed to deliver nuclear warheads. Now en- cost of Trump’s personal 757 jet).
3.6 MIL 2.9 MIL
gineers in Palo Alto and elsewhere are working “If you look at the global security environ-
2018
on hypersonic aircraft that could traverse the ment and how challenging and crazy that is,
country in less than an hour, as well as on direct- and it’s our products that are going to help 3.9 MIL 3.1 MIL
ed-energy weapons to blast incoming missiles with that, I think we’re a great growth story,” 2019
TYRONE TURNER/GETTY IMAGES

apart with laser beams and a compact fusion Hewson says. “As I look at companies in our 4.3 MIL 3.3 MIL
reactor that can fit in the back of a pickup truck industry, I’d bet on us.” 2020
4.6 MIL 3.5MIL
FINAL THOUGHT
Source: Cox Automotive.
“Diplomacy is letting someone else have your way.” —LESTER B. PEARSON

38 | FORBES JANUARY 24, 2017

ENTREPRENEURS

New House on the Block

Thanks to companies like Concierge Auctions, buying a luxury
home can be done with the swipe of a finger on a smartphone.
Is this where the future of real estate sales is going. . .going. . . ?
BY SAMANTHA SHARF

K
aren Redekop designed Casa Karen, Over the years Concierge has worked with celeb-
a palatial hillside estate in Los Cabos, rities (including Michael Jordan and Cher) and bil-
Mexico, to exacting specifications. lionaires (including GoDaddy founder Bob Parsons)
She hired local artisans to paint or- who want to maintain privacy on their properties.
nate murals and imported pieces from India, In- “Our sellers want to make wise decisions,” says
donesia, Thailand, Europe and the Middle East. Laura Brady, Concierge’s 37-year-old founder and
But after five years perfecting her creation it was president. “Watching money leave to keep up an
time to move on. asset they are not using is not fun.” Brady began
The 60-year-old Canadian was eager to start selling real estate in 2004 and quickly became one
her next project, a 4-acre compound in nearby of the top-selling agents in Florida. By the next year
Palmillia, so she hired a local real estate agent, the state’s housing stock was starting to balloon, a
who listed the home for $2.7 million. A year later sign of trouble. Brady also had concerns about the
she hadn’t received a single offer. way high-end properties were sold in this country.
Enter Concierge Auctions, a New York-based The standard list-offer-negotiate model is
real estate company that sells luxury homes to relatively efficient for homes under $250,000,
the highest bidder, promising clients premium because the buyer pool is large. For multimillion- Bidder up: Concierge
Auctions founder
marketing and immediate sales. Two months dollar properties, prospective buyers are harder to Laura Brady and
after Redekop listed on Concierge, the house sold find. (Only 2.3% of U.S. homes sold last year went company chairman
for $2.6 million in a 30-minute mobile auction. for over $1 million.) Luxury properties tend to Chad Roffers in an
Austin, Texas, estate
Helping wealthy clients buy and sell homes sell quickly near the asking price or languish for that sold in 2016 for
in a timely fashion propelled Concierge Auc- months before selling at a significant discount. $2.68 million.
tions to sell $270 million worth of real estate in “The higher the price point and the more unique
2016, bringing in more than $30 million in reve- the property, the less the traditional method of sell-
nue and pushing the company above $1.2 billion ing worked,” Brady says. Auctions were a perfect
in all-time sales. Not all auctions are as success- solution. They’re quick and competitive, adding
urgency to a transaction
and establishing fair value
HOW TO PLAY IT
for a hard-to-price asset.
BY NICHOLAS GALLUCCIO (In Australia many homes
A housing recovery, steepening yield curve, easing of regulations
and lower corporate taxes are like manna from heaven for financial are sold this way.) Brady
firms, especially regional banks. Those exposed to dynamic econo- persuaded her boss, Chad
mies and improving housing trends, like Bank United in Florida or Roffers, to test the theory.
Legacy Texas in Texas, will continue to benefit—Legacy doubly
so with its mortgage warehouse lending line. Another, Glacier After a few successes,
Bancorp, has a core lending base in Montana, home to a seasonal Brady started Concierge
economy and luxury-home buyers. Similarly, Ethan Allen touches both fronts: a re- and moved to New York
freshed product line of high-end home furnishings and a sizable real estate portfolio.
in 2008. Roffers, now
chairman, soon followed.
MATTHEW MAHON FOR FORBES

ful as Redekop’s—around 30% don’t result in Today many companies sell homes by auction,
sales, and many bring in lower amounts than the particularly properties that have entered foreclo-
seller had expected. Nevertheless, Concierge is sure, but few have succeeded at the price range
a leader in a small but growing group of auction where Brady and Roffers operate. Concierge sold 85
houses selling homes like works of art. of the 133 homes it auctioned in 2016, up from 60 of

40 | FORBES JANUARY 24, 2017


80 in 2015. For 2017 it’s projecting 150 auctions. (By
comparison, competitor Platinum Luxury Auctions
holds about 25 auctions a year.)
On both sides of the sale, Concierge works with
local real estate agents, who receive the traditional
5% to 6% sales commission and gain national ex-
posure for a property. On the buyer side, Concierge
takes a hefty 12% premium—as an auction house
does with art—but then many homes sell for less
than their original (and often aspirational) list price.
Auctions with Concierge typically have no reserve
and range from $2 million to $40 million, with an
average of about $4 million. The company says it
has been profitable since year one, but a new pricing
program may test its model.
To entice homeowners, Concierge began cover-
ing the seller commission in November. It also cut
a $50,000 upfront fee that was refunded upon clos-
ing. In other words, sellers hire Concierge but now
absorb none of the costs directly.
To Jonathan Miller, CEO of real estate apprais-
al firm Miller Samuel, pushing the costs to the
buyer is a bit of marketing magic, akin to person-
FINAL THOUGHT
“To be happy at home is the ultimate result of all ambition.” —SAMUEL JOHNSON
LUXURY
al-injury attorneys who gain client trust
by taking a cut only after a settlement is
reached. “It is not that the seller is going
to net out more money,” he says, reasoning
that buyers will factor in the cost. “It’s a
stronger sales pitch.”
These concessions may be an effec-
tive marketing ploy, but they do nothing
to offset the staggering costs buyers face.
Brady claims buyers haven’t complained
about the high fees but says the solution for
anyone offended by the price is simple: Bid
less or not at all. “If they don’t want to pay
the extra premium, then they don’t have to
bid,” she says. “From a buyer’s perspective
if they don’t want to lose a property, they
have to come and abide by the rules.”
That may seem like an unfriendly stance
toward clientele, but agents who have
worked with Concierge say auctions can
provide better deals than purchases made
on the open market.
Sellers praise Concierge for generat-
ing more showings in the month before an
auction than their homes received in years
on the market. The company estimates that
a seller unloading an $8 million property
could be spending $40,000 a month on carry
costs—taxes, insurance and maintenance—often
to maintain a home the seller is not even living in.
On average, properties spent six months on the
market before Concierge was brought on.
Technology is also changing the way Con-
cierge services buyers and sellers. Watch a video
on its site multiple times and a sales agent will
be in touch. If you replay footage of, say, a pool,
it’ll send a roundup of the best homes for swim-
mers. Currently 90% of auctions are conducted
on Concierge’s Instant Gavel mobile app, rolled
out a year ago. Matthew Magnotta, an agent
with Berkshire Hathaway HomeServices Utah
Properties, recalls staring at a client’s iPhone as
he bid on a medieval-inspired “castle” in Park
City, Utah.
“In normal real estate there is a lot of discus-
sion and investigation that makes it a real thing
that the transaction is actually happening,” Mag-
notta says. “When you’re buying a $10 million
house by clicking on an iPhone, like you’re buy-
ing something on eBay, it’s surreal.”
JANUARY 24, 2017 FORBES | 41
ENTREPRENEURS
Pet Smarter
Four years ago Chewy’s college-dropout
founders couldn’t get a meeting in Silicon Valley.
Now they’re running one of America’s biggest
privately owned e-commerce sites.
BY SUSAN ADAMS
I
n December 2012, desperately needing
money to expand Chewy, his year-old pet-
supply startup, Ryan Cohen traveled from
Fort Lauderdale to Palo Alto and walked
into a half-dozen venture capital firms on
Sand Hill Road unannounced. He didn’t get past
the receptionists. Three months later he tried the
same tactic again. “I’m relentless,” says Cohen,
a college dropout from Montreal. “It felt like it
should work.” It did not.
Yet four years later Chewy is one of the na-
tion’s largest and fastest-growing privately
owned e-commerce companies, on track to
book revenue of $900 million in 2016 and more
than $1.5 billion in 2017. Relying on a customer-
service strategy Cohen calls “Zappos on steroids,”
Chewy deploys 416 of its 3,400 staffers to answer
phones and texts in round-the-clock shifts at the
company’s 70,000-square-foot headquarters in
Dania, Florida. To ensure speedy delivery to his
3 million patrons, he has built three fulfillment
centers, each the size of ten football fields, and
has plans to open three more by early 2018.
Chewy has already grabbed 43% of the online
sales of pet food and litter in the U.S., just behind
Amazon’s 48%, according to market research
firm 1010data. (Big-box retailers Petco and
PetSmart are both in the single digits.) “We want
to be the No. 1 pet retailer in the world,” Cohen
says. He has a long way to go. Chewy has yet to
turn a profit, and the way it’s spending money to
acquire customers, it’s not clear it ever will.
Cohen, 31, is compulsive about executing, and
about other things, too. “I have OCD,” he says—
though he’s never been diagnosed—while digging
into a lunch of steamed salmon and vegetables
at Chewy HQ. His diet is primarily two meals:
steamed vegetables with fish or chicken. He
sleeps three hours a night, reading feedback on
42 | FORBES JANUARY 24, 2017
Chewy’s Facebook page into the
wee hours. Positive reviews, he
says, “give me goose bumps.”
The son of a teacher and
a glassware importer, Cohen
fixated early on becoming an
entrepreneur. At 15 he discovered
the dark art of affiliate marketing,
collecting fees for referring cus-
tomers to e-commerce sites. He
got so good at it that he started
banking thousands of dollars a
month. While looking for a pro-
grammer to help build his affili-
ate sites, he met Michael Day in a
Java chat room. Day dropped out
of the University of Georgia to
join forces with him, and in 2011
they sank $150,000 of their own
money into an online jewelry
startup in Florida. But after a visit
to a Miami trade show, they felt
intimidated by how much there
was to learn about gems and pre-
cious metals and realized they
had no passion for the business.
Then Cohen had an “aha” moment while Going to the dogs:
buying food for Tylee, his apricot-colored teacup Ryan Cohen says it
was Tylee, his teacup
poodle. “She’s my No. 1,” he says, “and I’m mar- poodle, who inspired
ried.” Cohen, who shares his bed with Tylee the decision to sell pet
and his pregnant wife, sees himself as a “pet food instead of jewelry.
“For me, it was feeding
parent.” Typically, pet parents spend freely on my baby.”
premium foods, often made with ingredients fit
for humans, like grass-fed, free-range, hormone-
JAMEL TOPPIN FOR FORBES
free New Zealand lamb, the main ingredient
in K9 Natural Lamb Feast, available on Chewy.
com at $190 for an 8-pound box. Pet parents
who don’t sleep with their furry offspring can
buy a Big Barker pillow-top orthopedic dog bed

on Chewy for $400. In 2016 the U.S. pet-product
market was projected to hit $47 billion, accord-
ing to market research firm Packaged Facts, with
e-commerce accounting for as little as 5%.
Betting that the population of big-spending
pet parents would grow and that their buying
would move online, Cohen and Day sold their
jewelry inventory for 80 cents on the dollar,
scraped up some more cash from their personal
bank accounts, converted their jewelry site into
Chewy.com and started buying products from
distributors. They found a third-party fulfillment
center in Easton, Pennsylvania, and launched
STARTUPS
in late 2011 with 50 dog- and cat-food brands,
matching online prices with competitors’ and
offering discounts on first-time orders. Even
though Cohen and Day answered customer calls
themselves, 24 hours a day, and didn’t take sala-
ries, Chewy lost money. But sales grew, hitting
$26 million by the end of 2012.
Though Cohen had struck out in Silicon
Valley, Chewy attracted interest from Boston’s
Volition Capital. In late 2013 Volition invested
$15 million after watching Chewy exceed
its growth targets. “Ryan had crushed all his
numbers,” says Volition partner Larry Cheng.
JANUARY 24, 2017 FORBES | 43
 ENTREPRENEURS STARTUPS

When Cheng asked Cohen whom he’d most ten holiday cards, which cost the company
like to have as board chairman, Cohen named $940,000 in postage alone. MARGIN
Mark Vadon, founder of jewelry site Blue Nile One pet industry veteran, who says he PROPHET
and flash-sale site Zulilly. Cheng made the in- knows three people who are familiar with GETTING BUZZED
troduction, and Cohen flew to Seattle to meet Chewy’s finances, doubts the company will IN 2008 HIGH SCHOOL
TEACHER MERRILEE KICK,
with Vadon, who was impressed by Cohen’s reach profitability. He says Chewy’s average NOW 53, GOT THE IDEA FOR
attention to detail. “He knew the specific eco- sale is $75, its average margin after discounts BUZZBALLZ, SINGLE-SERVE
COCKTAILS THAT COME
nomics of his transportation contracts with 30% and its average cost of delivery—which IN BRIGHTLY COLORED
carriers,” says Vadon, who agreed to serve as Chewy offers for free on orders of more than CONTAINERS. TODAY HER
CARROLLTON, TEXAS,
Chewy’s chair and to invest $5 million of his $49—around $12. A competitor estimates that COMPANY EMPLOYS 60 AND
own money. Five more investors followed, Chewy’s customer-acquisition cost could run SELLS ITS DRINKS IN 40
STATES. ANNUAL REVENUE IS
including T. Rowe Price and BlackRock, for a as high as $200 per first sale, given that the $20 MILLION.
combined total of $236 million. Cohen won’t company pays to appear at the top of Google
reveal Chewy’s valuation, but longtime e- searches for each of the hundreds of brands
commerce analyst Sucharita Mulpuru, who it carries. “The bottom line is that Chewy is
recently moved from Forrester Research to incredibly predatory, and they’re willing to lose
Shoptalk, a retail conference organizer, pegs it money to grow their volume,” says the industry
at $4 billion. veteran.
The capital allowed Cohen to shift his plans Confronted with those numbers, Cohen
into high gear. He decided to take fulfillment merely smiles. He won’t specify his unit eco-
in-house, even though he and Day, now Chewy’s nomics but says they’re positive. He says cus-
chief technology officer, knew nothing about tomer retention is high, as is the lifetime value How much cash did you
warehouse operations. To find experienced staff, of those customers. “They’re smart to be really need to get off the ground?
Chewy sent out hundreds of invitations to Ama- aggressive and to push really hard right now,” I was trying to get
says e-commerce ana- $300,000. I was told,
“You’re a woman, this is a
lyst Mulpuru. “There’s
HOW TO PLAY IT male-dominated industry,
a window of opportu- and we don’t think you’re
BY WILLIAM BALDWIN nity to be this darling going to survive.”
Ransom E. Olds, James Cash Penney, Howard Johnson, BlackBer-
ry and Netscape were pioneers in assembly lines, merchandising,
in the e-commerce
franchising, messaging and browsing. But Henry Ford, Sam Wal- space. But I do ques- What about family money?
My husband said, “I will not
ton, Ray Kroc, Apple and Google made the big money. Investors tion the lifetime value
support this. Don’t use any
captivated by the first-mover advantage of Pets.com 17 years ago of their customers. In of our 401(k) or savings.”
suffered a spectacular flameout. The winner in online dog food is the age of the Internet I took $27,000 from an
going to be a latecomer. You can make a big score with the inventor of an industry
(Amazon, FedEx). But balance out any what-if bets in your portfolio with a good
it’s so easy to switch.” inheritance. I took out a
measure of what-is. A place to start: Vanguard Small-Cap Value ETF. Starting with Ama- home-equity line of credit
for $69,000. A bank said if
zon, the competition
I put that amount down, it’d
is formidable. Jet.com, give me $178,000.
zon employees on LinkedIn and managed to the bulk e-commerce site acquired by Wal-Mart
hire 100 of them. By mid-2014 the company had last year for $3.3 billion, has moved into pet sup- Why didn’t your husband
opened a 600,000-square-foot fulfillment center plies and is undercutting Chewy’s prices on bulk want to help?
He’s a CFO, and he was
in Mechanicsburg, Pennsylvania. sales of some products. And Petco and PetSmart,
terrified I’d lose every
Cohen also poured money into customer ser- with revenue of penny. He changed his
vice. Your schnauzer doesn’t like the Blue Buf- $4 billion and $7 billion, respectively, remain the direct deposit from our
falo Wilderness Salmon Grain-Free dog food you biggest specialty players in pet retail. But Cohen checking account to a
bought for $48? Chewy will issue a refund and says he is convinced that e-commerce will even- private bank.
suggest you donate the food to a local shelter. tually take at least 50% of total pet product sales
How did you get Buzzballz
Canceling your auto-ship order because your and that Chewy will log more than $5 billion in into retail outlets?
Siamese passed away? Chewy sends flowers. revenue by 2020. “We’ll be done growing,” he I sent a letter to 17,000
Last year Chewy mailed 2 million handwrit- says, “when we’re 6 feet under.” convenience stores and
5,000 liquor stores. All of a
sudden sales started taking
FINAL THOUGHT
off. —Susan Adams
“Make your customers comfortable and they will give you their lives.”
—PAUL ORFALEA

44 | FORBES JANUARY 24, 2017

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 TECHNOLOGY LOGISTICS

Trash Tech
Rubicon Global CEO Nate Morris is building the Uber of garbage
collection, disrupting a $60 billion industry dominated by giants.
BY ALEX KONRAD
CLAY COOK FOR FORBES

46 | FORBES JANUARY 24, 2017

 L
ike other entrepreneurs who head
blockbuster tech startups, Nate
Morris these days finds his social
calendar sprinkled with glitz and
glamour: invitations from Leonar-
do DiCaprio to a premiere of The Revenant (he
declined) and from billionaire Marc Benioff to
a private dinner with Arianna Huffington and
Billie Jean King (he accepted). But much of
his business at Rubicon Global is a world away
from Hollywood and Silicon Valley, in places
like Jeffersonville, Indiana, a
town of 45,000. On an unseason-
ably warm November day, he’s
there meeting with local garbage
boss Bob Lee, who has a plea for
Morris: “We need your help.”
Lee has been in the garbage
business since he snagged a gig
hauling trash for the local unem-
ployment office as a young Army
vet in 1971, and his company, Eco
Tech Waste Logistics, based in
Louisville, Kentucky, is the kind
of mom-and-pop operation that
has powered Rubicon’s ascent.
With 96 employees and 69 haul-
ers (trucks), Eco Tech is one of
the area’s leaders. But like almost
every other small hauler in the
country, it faces a daily chal-
lenge from national players with
resources that dwarf its own, and
Rubicon’s tech offers a way to
fight back.
Rubicon is the Uber of trash.
Its software connects waste
collectors (the guys with the
trucks) with the waste creators
(an office or business or perhaps
even homes), then makes sure
the pickup runs smoothly. For
the haulers, Rubicon’s app helps
detect when the collection hap-
pens without any input from or
distractions for the driver. The
dispatchers know where their
trucks are and who’s working the
most stops. The consumer gets
With a model straight out of Uber’s a big-picture view that shows
playbook, Rubicon Global CEO Nate how much waste they’re sending
Morris is helping thousands of small
garbage haulers compete with industry to landfills versus recycling and
giants like Waste Management. how frequently they really need
service, helping to cut costs.
Rubicon charges both sides—the haulers and
their customers—for access to its tech.
Eight years after Morris launched the
company with childhood friend Marc Spiegel
in Louisville, where they grew up, Rubicon
works with 5,000 small hauling businesses
and with big customers like 7-11 and Weg-
mans. It snagged its first municipal contract
in October in Atlanta. Revenue has tripled
to more than $200 million in the past year.
Rubicon has lured top-tier investors such as
Goldman Sachs and Wellington Management
and is now poaching talent from Silicon Val-
ley. And with a new partnership with Suez
Environment, a $15 billion French multina-
tional hungry to learn from Rubicon’s techni-
cal chops, Morris is gunning for a $60 billion
industry in the U.S. that’s dominated by giants
Waste Management (revenue: $13 billion) and
Republic Services ($9 billion).
Suez is leading a new $50 million invest-
ment in Rubicon, bringing its valuation to
$800 million. Already the owner of Waste
Management’s former assets overseas, Suez
plans to reenter the U.S. market by working
with Rubicon, which will share its best tech
practices and what Morris considers its most
valuable asset: its data. “The U.S. model is old-
fashioned,” says Jean-Marc Boursier, CEO of
Suez’s Recycling & Waste Recovery, Europe,
who has kept his company’s plans with Rubi-
con secret until now. “We hope it will astonish
and surprise—then they will need to evolve
and evolve very fast.” For Rubicon, the Suez
deal opens a clear route to markets overseas
over time. For now, its Morris’ ace up his
sleeve to take more share from the incum-
bents. “That’s when it gets fun,” he says.
Morris, 36, was elected student-body
president in fifth grade, and by high school
he had met Bill Clinton and hosted a morn-
ing news telecast. As a scholarship student at
George Washington University, he woke up
early on weekends for internships and began
moonlighting for the state GOP to help reelect
Senator Mitch McConnell.
Morris went off to China to teach business
management and work for Kentucky’s cabinet
for economic development before heading to
Princeton for graduate school in public and
international affairs. Firsthand exposure to in-
dustrial sprawl in China had put sustainability
on his mind, and with Spiegel, whose family
had worked in the garbage hauling business
JANUARY 24, 2017 FORBES | 47
TECHNOLOGY LOGISTICS

for years, the two decided the industry was year, according to the Solid Waste Association
ripe for a tech-based disruptor. “They made of North America. Rodoni also helped develop TRENDING
all their money from landfills,” Morris says. a software management suite, Caesar (later re-
WHAT THE 50 MILLION
“We could be the brain for the industry.” named Augustus), to track volume and routes, FORBES.COM USERS
To friends and family the move was a shock. and an e-commerce program, Rubicon Pro, ARE TALKING ABOUT.
FOR A DEEPER DIVE GO TO
“I asked, ‘Do you understand who is in this which offers customers a discount market- FORBES.COM/TECHNOLOGY
business?’ And he said, ‘I don’t mind fighting,’” place for supplies and loans.
recalls Morris’ grandfather Lewis Sexton, a Much of Rubicon’s model is straight from COMPANY
ONSHAPE
former president of the local union for the Uber’s playbook. It keeps risk and capital
The Cambridge,
Ford plant in Louisville. The union liked Mor- costs down because it doesn’t own trucks Massachusetts, firm’s
ris’ vision of empowering independent haul- or disposal centers itself. Former Uber CFO all-cloud software aims
ers, and when he proved he could save them Brent Callinicos, who also joined Rubicon’s to greatly simplify
60% on their waste disposal, the union hall board, says the company’s growth potential the creation of 3-D
signed up as Rubicon’s second customer. rests in its ability to empower its small-busi- computer-assisted
design for medical
Getting investors proved harder. To do ness base. devices, electronics
business in several states, including New York, For all its success, Rubicon remains mi- and more.
Rubicon had to ask every investor to get fin- nuscule compared with its national rivals. Its
gerprinted. Eventually QuarterMoore Capi- deal with Atlanta was the company’s first with
tal’s Lane Moore, who had cofounded Bagster, any city. By comparison, Waste Management
a company he sold to Waste Management, works with 3,500 municipalities and Republic
agreed to invest and join the board—but only if with 2,700. Meanwhile, Waste Management
Rubicon moved to Atlanta, where he worked. has invested $150 million in IT in the past
The move attracted more high-profile sup- year and has been outfitting 16,500 trucks
porters, and Rubicon’s next big break came with mobile devices. “I don’t want to be the PERSON
guy on the sidelines LEONARD KIM
when it comes to The 31-year-old
HOW TO PLAY IT disruptive technol-
Angeleno has
transformed himself
BY MARILYN COHEN ogy,” says James Fish from homeless and
One of the ways giant garbage haulers like Waste Management Jr., who was appoint- adrift to a social media
and Republic Services got so big was through acquisitions. If
Rubicon is really the Uber of the garbage business, it could be
ed in November as and branding specialist
Waste Management’s sought out for his youth-
a perfect future acquisition for one of the industry giants. With marketing insights.
Waste Management’s stock hitting all-time highs, think bonds. new CEO. “I want to
Steady businesses like garbage hauling are tailor-made for throw- be the disruptor.” IDEA
ing off the income streams bondholders love. Waste Management bonds maturing But Morris isn’t MASS
on March 1, 2025, yield 3.2%. If disruptors like Rubicon can prompt an old industry to CARTOGRAPHY
reboot itself, Waste Management could get upgraded from Baa2/A- to A+ or better.
the only one who
Autonomous vehicles’
sees plenty of op- increasing prevalence
portunity ahead. in the years ahead
when Morris befriended Uber founding CTO Analysts say incumbents are under pressure will drive demand for
Oscar Salazar, who became an investor, board to cut costs and provide steady dividends, not crowdsourced maps

member and pipeline to tech talent. Salazar
helped recruit Phil Rodoni, the software chief
at Esurance, who led the team that built Ru-
bicon’s Shake app, which measures proximity,
speed and the shaking motion of an emptying
trash bin to confirm service. That hands-free
monitoring, which allows the driver to remain
focused on the street, helps to eliminate the
top cause of fatal accidents involving garbage
trucks. Such accidents led to 21 employee fa-
talities and several dozen civilian injuries last
EVAN DUNING
seek Uber-like hypergrowth. Still, Waste Man- via technology that will
make today’s GPS look
agement and Republic combined are already like an AAA TripTik.
worth nearly $50 billion. “Maybe it takes them
20 years, but if the other guys can get to $50
billion, I don’t see why Rubicon can’t either,”
says Salesforce’s Marc Benioff, who invested
in Rubicon after meeting Morris in 2014. Take
that with a grain of salt—it’s Benioff, tech’s
hyperbole king, speaking. But even at a small
fraction of that, garbage could prove to be a
mighty good business for Rubicon.

FINAL THOUGHT
“Ours is a culture and a time as immensely rich in trash as it is in treasures.”
—RAY BRADBURY

48 | FORBES JANUARY 24, 2017

 SPECIAL ADVERTISING SECTION

Index
03 Masahiro Okafuji
ITOCHU Corporation
www.itochu.co.jp/en/

05 Yuzaburo Mogi
Kikkoman Corporation
www.kikkoman.com

06 Fujio Mitarai
Canon Inc.
global.canon

09 Akihiro Teramachi
THK CO., LTD.
www.thk.com

39th Annual Special

Japan Section
Writers
Martin Foster
David W. Russell

Photography
Kentaro Ishibashi
Mao Yamamoto

2 Japan
 SPECIAL ADVERTISING SECTION

Traditional Values Bring Tectonic

Shift to Trading Sector
When Masahiro Okafuji became President and CEO of one of Japan’s best-known general trading
companies (sogo shosha) in 2010, he had his work cut out for him. Once-proud ITOCHU Corporation had
fallen to fourth place in the shosha rankings. President Okafuji promised to help the firm at least regain its
former third-place standing.

Y
et even that promise looked dif-
ficult to keep. Shosha are ranked
by global sales, and the top two
firms have held those positions
seemingly forever. Moving up just one
notch would require both brilliant strat-
egy and a Herculean effort.
Then came a tectonic shift that sent
shock waves through the business. When
the big shosha closed their books last
year, ITOCHU had rocketed to number
one. The common explanation was that,
at Okafuji’s direction, the company had
decreased its massive energy and resource
investments just before those markets
tanked. However, inside ITOCHU, people
spoke of the “Okafuji Reforms,” a series of
major internal policy changes that turned
the company into a tiger almost overnight
and stunned the competition.
“I didn’t set out to be a reformer,” Oka-
fuji explains. “I just wanted our staff to
rediscover what it means to be a shonin.”
He uses the traditional Japanese term for
the hardworking merchants of old times,
who met with their customers face-to-
face every day and placed their needs
above everything else. “ITOCHU was
born from shonin culture,” he continues,
“and if we lose that, we have lost our soul.
I wanted to remind everyone of why we
are proud to be called shonin.”
In short order, Okafuji instituted policy
changes to refocus staff. For example,
he ended ITOCHU’s f lextime system.
“We had people coming in at 10:00 a.m.,
talking about working ‘core hours.’ Maybe
that’s OK for other firms, but not for a sho-
sha. We exist to serve our customers. The
second we forget that, we start to go out
of business. Our customers begin to work
early in the morning; if they want infor-
mation or need help with something, they
won’t wait until 10 to call us. If our rep
isn’t there to take their calls, the custom-
ers will find someone who is.”
Get Out of the Office!
To boost efficiency, Okafuji slashed the
number of meetings and the volume of
paperwork being generated. “No one ever
sold anything by sitting in a meeting,”
Okafuji says, his voice rising slightly with
characteristic passion. “You can’t serve
your clients by designing a PowerPoint.
You have to get out of the office and go do
real work. You have to meet with your cus-
tomers every day. That’s what shonin do.” Masahiro Okafuji
A sign on his office wall sums up Oka- President and CEO, ITOCHU Corporation
fuji’s management philosophy: “Earn,
Cut, Prevent.” “It’s essential to examine all our busi-
“Everyone is focused on earning; that’s nesses and anticipate problems before
natural because it feels good. Other sho- they arise. We must look at our strategy
sha all focused on making money … stra- and constantly adjust it to respond to
tegically or not, that’s another story,” he changes in the global economy. Prevent-
says with a smile. “But everyone dislikes ing losses is much cheaper than dealing
cutting off the fat—eliminating waste— with the consequences.”
because it can be very painful.” The sho- He concludes: “People ask if there will be
nin of old understood that, he explains, a role for shosha in the future. I say, as long
but too many of today’s executives lack as we provide useful functions and serve
the will to do what is necessary. our clients faithfully, there will always be
As for “prevent,” Okafuji explains, a need for hardworking shonin.”

Masahiro Okafuji joined ITOCHU in 1974 after graduating from the University of Tokyo. He was
appointed Executive Officer in 2002, Managing Executive Officer in 2004, Director and Executive
Vice President in April 2009, and President and CEO in April 2010.

www.itochu.co.jp/en/

Japan 3
 SPECIAL ADVERTISING SECTION

Healthy, Sustainable
Growth on the Menu
Many Japanese companies have long histories, so it’s not at all unusual
for a firm to proudly remind customers that it’s been in business for 100
or 150 years. But very few companies can clearly trace the origins of
their business back over 300 years. None is more famous for its long-
standing tradition than Kikkoman Corporation.

H
onorary CEO and Chairman Yuz-
aburo Mogi is the living embodi-
ment of t hat t ra d it ion. Hi s
ancestors helped grow a small,
village-based soy sauce business into a
major Japanese corporation, and Mogi
himself helped nurture it into a powerful
international brand that produces reli-
able investor-friendly growth in sales and
operating income year after year.
In person, Mogi is a true old-school
gentleman, always well dressed and
articulate, and one of the few Japanese
senior executives who speaks English
fluently. This is not surprising, consider-
ing the fact that he lived in the U.S. for
years and earned an MBA from Colum-
bia University.
When asked about the goals outlined in
Global Vision 2020—the company’s vision
and basic strategy for the future—Mogi
explains that while none have specific
numerical targets, the most important
one will continue well past 2020.
This key goal is “to make Kikkoman
Soy Sauce a truly global seasoning,” Mogi
shares. “So many people around the world
have still not tried shoyu (soy sauce) in
their everyday recipes, and have not yet
discovered it is an all-purpose seasoning
that can enhance the flavor of almost any
food. That is what I most want to change
in my lifetime.”
Kikkoman seems to be well on its way
to achieving that goal. Sales in North
America have been growing steadily for
half a century, European sales are still
growing in double digits on average, and
Asian business, too, is expanding.
A World of Flavor Awaits
Mogi notes that Asia is an especially chal-
lenging market for the company.
“Unlike the U.S. or Europe, most Asians
are already familiar with soy sauce,” he
explains. “People there have grown accus-
tomed to the f lavor of their own local
varieties, so it is harder for us to convert
users.” He points out that most of the local
products are much cheaper because they
do not use the slow fermentation process
that Kikkoman has mastered over centu-
ries. Still, the Asian economies are grow-
ing, tastes and incomes are changing, and
Mogi is sure that Kikkoman has a pros-
perous future ahead in the region.
“Then,” he says, smiling, “down the road
there is South America, and eventually
Africa as well.”
True, there are plenty of new shoyu
markets to conquer, but is Kikkoman a
one-product company?
“Certainly not!” Mogi replies with a
laugh. “Our wholesale foods business—
through one of our subsidiaries, the JFC
Group—is growing tremendously. This
Yuzaburo Mogi
Honorary CEO and Chairman of the Board
Kikkoman Corporation
group is the world’s largest distributor
of what we call Oriental foodstuffs. The
popularity of Asian-style cooking and the
demand for ‘Asian-fusion’ cuisines contin-
ues to grow.
“In addition, our Del Monte business,
which covers most of Asia, is doing well.
We are also developing a promising soy
milk business, and we have invested in
the health foods and supplements busi-
ness through companies such as Country
Life in the U.S.”
Mogi notes that the firm’s real goal
for the coming years is to harmoniously
blend many local and regional foods and
ingredients with the essence of tradi-
tional washoku (Japanese cuisine) and,
of course, with shoyu, to create exciting
new varieties of local dishes. This inter-
national exchange of “food culture” is at
the heart of Kikkoman’s thinking.

Yuzaburo Mogi is a descendant of one of the founding families of Kikkoman, which is one of the oldest
continually running businesses in Japan. He became company President in 1995, was named Chairman
in 2004, and assumed the title of Honorary CEO and Chairman of the Board of Directors in 2011. Mogi
holds an MBA from Columbia University.

www.kikkoman.com

Japan 5

A Sharper Focus on
Constant Transformation
The first time we visited Canon, back at the beginning of this century, the company was excited about the
second five-year installment of its Excellent Global Corporation Plan. CEO Fujio Mitarai explained that the
plan was designed to evolve Canon from a good company to a great one. We recently revisited Canon, and
once again had the pleasure of speaking with Mitarai, now Chairman and CEO.
Fujio Mitarai
Chairman and CEO, Canon Inc.
H
e explains how the company’s
various five-year plans, called
Phases, have carried it and why
the newest plan is the culmina-
tion of Canon’s strategy. “During Phase IV
of the plan (2011–2015), a global recession
impacted all areas of our business,” he
says. “In response, we focused our ener-
gies on further strengthening our finan-
cial structure so that we could emerge
stronger and better positioned.”
Mitarai says he is determined to see
the company rise to even greater heights
through Phase V, which began last year.
“I want the Canon of 2020 to look com-
pletely different from the way it looks
today,” he says. “Two key strategies are
driving that transformation: First, we
6 Japan
SPECIAL ADVERTISING SECTION
are strengthening our manufacturing
capabilities by reinforcing our commit-
ments to robotics and automation; sec-
ondly, we are expanding all our current
business lines while at the same time pur-
suing M&A in areas such as commercial
printing, network cameras and advanced
medical equipment. All of that is aimed at
maximizing new growth opportunities.”
A Shift Toward B2B
Mitarai explains that Canon has three
major business groupings—cameras,
office equipment and industrial equip-
ment—and all of them are currently work-
ing to boost their B2B offerings.
“Cameras have always been a consumer
business,” he says. “But now we are look-
ing beyond the consumer market and
developing more equipment for profes-
sionals, particularly for filmmaking.
“Our Cinema EOS System lineup of
digital cinema cameras and lenses is
already a hit in the film industry. Cin-
ematographers around the world like
getting such exceptional image quality
in a compact, lightweight system that is
extremely durable and so maneuverable
that they can shoot in incredibly tight
locations and even in low-
light conditions.
“Our of f ice equipment
l i ne s—pr i nt er s , c opier s ,
projectors and more—are
already well known, and we
will continue striving to cre-
ate state-of-the-art multi-
function office-automation
equipment. We are also mov-
ing into commercial print-
ing,” Mitarai adds. “There is
An Océ JetStream
high-speed continuous-feed
commercial printer
a strong and growing market for corpo-
rate in-house printing solutions that offer
accurate color reproduction and high-
quality output. Thanks to our acquisition
of Océ, a Dutch maker of printing equip-
ment, our lineup now delivers all of this
plus excellent productivity.
“As for industrial products, IC (inte-
grated circuit) chips keep getting smaller.
Desktop PCs have given way to tablets
and cell phones, which means increased
demand for extremely high-precision
ICs. Our excellent semiconductor lithog-
raphy equipment can meet the challenge
of ultrafine nanometer-level patterning,”
he explains.
Network Video Systems
Canon always has so many new tech-
nologies. What is the biggest story of
the moment?
Mitarai responds, “That would be
network surveillance systems. They’re
already becoming a hot grow th area
worldwide, and we are confident they
will keep on growing for the foreseeable
future. One of the keys to that business is
having outstanding cameras in place, and
that is our specialty.

“For example, our new ME20F-SH
ultrahigh-sensitivity multipurpose cam-
era makes use of Canon’s most advanced
image-sensor technology. As a result, it
can operate in extreme low-light situa-
tions, capturing clear color images with
minimal noise in as little as 0.0005 lux
of ambient light (roughly equivalent to an
ISO of 4,000,000), which means it can
use starlight to take photos that look as
though they were shot in broad daylight.
This is a truly amazing camera, and it is
already beginning to revolutionize net-
work video surveillance.
“To grow this business, Canon has
acquired some of the top players in the
field, such as Axis Communications of Swe-
den, which is the leading company in net-
work video solutions and is well known for
its outstanding image-processing technol-
ogy. We also acquired a Danish company,
Milestone Systems, which is the market
leader in video-management software.
Each of these companies is outstanding
by itself, but combining them synergisti-
cally with Canon’s own technical expertise
produces something greater than the sum
of the parts. For one thing, Axis connects
us to roughly 75,000 partner firms includ-
ing system integrators. By combining our
state-of-the-art imaging technology with
Axis’s network image-processing technol-
ogy and Milestone’s video-management
technology, we can offer a broad spectrum
of innovative network video solutions.
“In the first quarter of this year Axis
will release an interchangeable-lens net-
work camera, the AXIS Q1659, that can
use a range of standard Canon EF lenses.
By combining our various areas of tech-
nical know-how, we can create new value
for this growing field. This will reinforce
our position as the market leader for some
time to come.”
So, this technolog y is all aimed at
security surveillance, crime prevention
and the like?
“Of course, security is a major concern
around the world today. But these systems
A native of Kyushu, Japan, Mitarai decided not to follow his father and brothers into medical school, but
instead joined Canon, where his uncle served as the first President. Five years later, he was posted to the
U.S., where he stayed for 23 years, eventually becoming President of Canon U.S.A. Back in Japan, he was
later appointed President, CEO and then Chairman of Canon Inc.
SPECIAL ADVERTISING SECTION
are just as valuable for monitoring the
manufacturing process in a factory, for
example, or doing market research in a
department store. Any situation that
benefits from having high-definition
color video and outstanding image-
management technology will showcase
these new systems,” Mitarai explains.
The ME20F-SH is Canon’s first-ever
ultrahigh-sensitivity multipurpose camera.
The AXIS Q1659 interchangeable-lens
network camera combines Canon imaging
and Axis network technologies.
Imagining Better Health Care
Is there any other area of which the
Chairman is especially proud?
“That’s a difficult question,” Mitarai
says with a smile. “But the answer is yes:
medical equipment. Canon has a very
long history with medical equipment.
We even made an X-ray camera back
in 1940. Since then, we have developed
many new technologies, from portable
X-ray devices to retinal cameras and
“I want the Canon of
2020 to look completely
different from the way
it looks today.”
—Fujio Mitarai,
Chairman and CEO, Canon Inc.
optical coherence tomography (OCT)
equipment that can scan high-resolution
3-D images inside the eyeball, such as the
blood vessels in the retina, to help diag-
nose ophthalmic disorders.
“We plan to continue making advances
in the field of medical equipment and
aim to be a major player worldwide.
We have already begun a program of
both internal development and M&A to
achieve that goal.”
Mitarai sits back for a moment, looking
pleased with something. Perhaps his com-
ing profit forecasts?
“To be honest,” he says, “nothing makes
me happier than to see Canon products
being used to support global health care
and to save lives. That has long been one
of our missions, and it is one we have
never forgotten. Our health care opera-
tions are not yet the biggest contributors
to our sales and profit numbers, but they
are among the operations of which we are
most proud.”
Mitarai’s dream of completely trans-
forming the company now seems close
to realization. Will Phase V be the final
step, the culmination of his efforts?
“No, there is no such thing. There is
always more to do,” says Mitarai. “Canon
is all about undertaking challenges, not
simply growing for the sake of getting
bigger. We are happy that while both
the parent company and the group are
growing sustainably, we are also mak-
ing a meaningful contribution to global
society. That’s why Canon exists.”
global.canon
Japan 7
 SPECIAL ADVERTISING SECTION

THK: Embarking on a New Era

For Akihiro Teramachi, Chief Executive Officer and President of THK CO., LTD., the future rests on the
coexistence of humans and robots. The uptake of robotics and artificial intelligence (AI) is now proceeding at
an accelerated pace, and THK has accordingly enacted a new business strategy. “New business opportunities
have emerged, and we must aggressively promote robotics and AI,” he says.

T
he proliferat ion of robot ic s
and AI is fundamentally alter-
ing the relationship between
workers and the machines that
were developed during the Industrial
Revolution. “So far, humans have used
machines, but now I am convinced that
machines are beginning to move in an
equal relationship with humans, as our
partners,” Teramachi says.
In some areas, AI is already outpac-
ing human beings, and many expect
that computers and AI will outpace the
capacity of the human brain sooner than
the original projection of 2045.
Teramachi has also been surprised by
the data-refining capabilities of AI, and
is concerned that humans may be losing
out to machines.
“We must reconsider the relationship
of humans and machines, and make Akihiro Teramachi
efforts to become aware of what our ideal Chief Executive Officer and President, THK CO., LTD.
situation should be, without turning
away from the present reality,” he says. While THK continues to favor con- believes the Japanese people should
ducting business face-to-face—believing quickly adopt a new way of thinking in
An Evolving Business Strategy the personalized approach helps it better order to move forward.
Traditionally, THK has focused its busi- connect with clients—a new generation “Japan is an adaptable society. When
ness on two main pillars: global market of potential clients prefers to interface people from other countries view us,
expansion and the increased adoption of with machines. they probably think we are unbelievably
linear motion technology in new busi- “Amid expanding business opportuni- compliant! If we can understand and
ness areas, beginning with its LM Guide ties, we must significantly change the way accept the necessary changes, I believe
core products. we do business; and in order to put these we will be capable of seizing the lead and
Over the past year, in an effort to efforts on firmer ground, we also need to aggressively changing.”
keep pace with emerging technological change ourselves,” Teramachi says. Ultimately, Teramachi notes, “On a
advances, Teramachi has added a third longer-term trajectory, if we can alter
directional pillar—the thorough appli- Standing at a Crossroads the direction of education, in line with
cation of robotics and AI, as well as IoT- Japa n it self fa ces numerous major this stance, then in 20 or 30 years’ time,
based products—in order to promote events in the lead-up to 2020, and it now I believe Japan will be a country capable
dynamic change throughout the company. stands at a major crossroads. Teramachi of leading the world.”

Akihiro Teramachi graduated from Keio University in 1971 and joined THK CO., LTD. in 1975.
He became a Director in 1982 and Vice President in 1994, before taking over as CEO in 1997.

www.thk.com

Japan 9
INVESTING RETIREMENT CHECKUP

in a taxable brokerage account.

“I’d hang back and wait and see what hap-
pens on tax rates,” says Robert Gordon, presi-

401(k) dent of Twenty-First Securities in New York.

“Until you know what the story is, you can’t
make an informed decision on it.”

Interrupted Warning: Before you pause 401(k) contribu-

tions, make sure you won’t forfeit any of your
employer’s match. A majority of companies
Trump says he will cut tax rates. allow you to stuff money into your 401(k) late
Should you pause your retirement in the year and capture the full match. But a
plan contributions? third require you to contribute each paycheck
to snag the full amount, Aon Hewitt reports.
BY ASHLEA EBELING
If the employer match isn’t a problem, here
are three other issues to consider. First is your

H
ere’s a heretical idea: Suspend tax rate now versus what you guess it will be in
contributions to your 401(k) in retirement. You get no tax deduction for con-
early 2017 while you wait to see tributing to a Roth, but all withdrawals in retire-
how much President Trump ment are tax-free and you aren’t forced to start
and the Republican-controlled taking money out when you turn 70½, as you
Congress cut income tax rates and how they re- must from a pretax account. If your overall tax
vamp the tax code. This advice is meant for high rate will be the same or higher in retirement, a
earners who max out their allowed 401(k) con- Roth has the edge. But if, for example, you live
tributions, possibly early in the year. (In other in high-tax California or New York City now
words, it’s not for average workers struggling to and plan to retire to income-tax-free Florida or
save 5% of each paycheck.) Nevada, your combined rate will likely go down.
Say you’re earning $500,000 and years ago So you should grab your deductions now.
elected to contribute 10% of your salary, pretax, The second factor: Congress is fickle and
to your 401(k). In 2017, as in 2016, the legal dollar future tax rates unknowable. Hedge your bets,
maximum for employee pretax contributions is building up separate pretax, Roth and regular
$18,000 for younger folks and $24,000 for those taxable savings. “It’s tax diversification,” ex-
50 or older. So you’ll plains Robert Keebler, a CPA in Green Bay, Wis-
reach that deferral consin. The top federal income tax rate on salary
limit in May or June. is now 39.6%, and Trump wants to cut it to 33%.
But depending on If he succeeds, consider it a window to build up
how deeply rates are your Roth stash, not a forever promise.
cut and the state and The third consideration? Not all income is
local income taxes taxed equally. Under current law, withdrawals
where you live and from pretax retirement accounts, including
plan to retire, you 401(k)s and IRAs, are taxed at high ordinary
might be better off income rates. But if you invest through a tax-
using some or all of able account, you pay a lower top rate on long-
that $18,000/$24,000 term capital gains and corporate dividends.
allotment to fund a That rate is now 23.8%, and Trump would
Roth 401(k)—an op- drop it to 20%. Moreover, House Republicans
tion now available in want to chop the top rate on capital gains,
about 60% of larger dividends and even interest income to just
plans, according to 16.5%. If that happens, Gordon points out,
benefits consultant those high-yield corporate bonds you’ve been
ROBERT BABBONI FOR FORBES

Aon Hewitt. Or, if stuffing in your pretax 401(k) might be better

you aren’t offered held in a regular brokerage account.
a Roth, you might Complicated? Yep. But 2017 could end up
decide to put less in being the year to rethink how you save for re-
your 401(k) and more tirement and which assets you hold where. F

58 | FORBES JANUARY 24, 2017

NINETY SIX
The Fidelity Retirement Score.
Another way we’re making retirement planning clearer.
We introduced the Fidelity Retirement Score to make it easy to know where you stand.
But getting your score is just the beginning. If you move your old 401(k) to a
Fidelity Rollover IRA, you’ll get:

• Clear, transparent language to help you understand your options

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It’s your retirement. Know where you stand.

800.FIDELITY | Fidelity.com/score
Be sure to consider all your available options, including staying in plan,
and the applicable fees and features of each before moving your retirement assets.
There is no opening cost or annual fee for Fidelity’s traditional, Roth, SEP, and rollover IRAs. A $50 account closeout fee may apply. Fund investments held in your account may be
subject to management, low-balance, and short-term trading fees, as described in the offering materials. For all securities, see Fidelity.com/commissions for trading commission and
transaction fee details.
IMPORTANT: The projections or other information generated by the Fidelity Retirement Score regarding the likelihood of various investment outcomes are hypothetical in nature,
do not reflect actual investment results, and are not guarantees of future results. Results may vary with each use and over time.
The Fidelity Retirement Score is a hypothetical illustration and does not represent your individual situation or the investment results of any particular investment or investment strategy,
and is not a guarantee of future results. Your score does not consider the composition of current savings and other factors.
Guidance provided by Fidelity through the Fidelity Retirement Score is educational in nature, is not individualized, and is not intended to serve as the primary basis for your investment
or tax-planning decisions.
Investing involves risk, including the risk of loss.
The trademarks and/or service marks appearing above are the property of FMR LLC and may be registered.
Fidelity Brokerage Services LLC, Member NYSE, SIPC. © 2016 FMR LLC. All rights reserved. 773775.15.0
 INVESTING EMERGING MARKETS

past three years.

Trump’s election
sent Alsea plum-
meting by 16%, but
Barger, 61, is doubling
down. Having nerves
of steel in the face of
volatility is a prereq-
uisite for investing in
developing markets.
The Trump So far Cartica has an-
nual returns of 9.9%

Discount since 2010, compared

with an emerging-
markets benchmark
Cartica Management is proving that that has fallen 1% an-
when it comes to emerging markets, nually over the same
activism is probably more important period.
Cartica’s approach
than who’s living in the White House.
starts with a top-
BY STEVE SCHAEFER down analysis of eco-
nomic data, currency

A
s the aftershocks from Donald
Trump’s stunning presidential
victory keep investors guessing,
few sectors have suffered more
than emerging markets. That’s
just fine by Teresa Barger, chief executive of
the $2.7 billion emerging-markets specialist
Cartica Management, who gives little credence
to Trump’s blustery rhetoric.
“Being against globalization is like being
against winter and refusing to buy a winter
coat,” Barger says, paraphrasing Nelson Man-
dela. She launched Cartica in 2008 with three
cofounders—Farida Khambata, Steven Quamme
and Mike Lubrano—after 21 years largely spent
funding businesses in developing countries.
Riddled with corrupt government actors,
empire-building families and outright fraud,
emerging markets are viewed as the Wild West
by most institutional investors. Many take a
diversified-index-fund approach, but Cartica
insists on activism, targeting unloved companies
with good businesses.
Take Cartica’s largest holding—Alsea, a Mex-
ico City-based franchisee of Starbucks, Burger
King and Chili’s. Before Cartica’s intervention in
2012, the company buried its results by brand.
movements and po-
litical developments
to find “green light”
countries. The common traits: a strengthening Cartica Management’s
local currency, improving credit profiles and a Teresa Barger is making
emerging markets great
sense that the government is pursuing market-
again.
oriented reforms. Another favorite, more anec-
dotal measure is checking with local stockbro-
kers to see if well-heeled natives are bringing
investment dollars back into the country.
“By the time equity flows show up, it’s too
late,” says global strategist Khambata from Car-
tica’s Washington, D.C., office.
From there Cartica screens stocks using 40-
odd financial metrics. Its sweet spot is underfol-
lowed companies with market caps between
$1 billion and $5 billion. Another key is tapping
local contacts—typically family members or
controlling shareholders.
What Trump-safe regions does Cartica like?
The Philippines, despite belligerent rhetoric
from President Duterte, is a favorite. Top hold-
ing: infrastructure conglomerate Metro Pacific.
“The Phillipines has self-sustaining growth
because they’re generating a surplus—not living
off capital flows,” Khambata says.
India, a “flashing green light.” Equities aren’t
JAMEL TOPPIN FOR FORBES

Cartica took a small stake, joined its board
and began pounding the table for more disclo-
sures. Alsea ultimately set up an investor
day in New York, which it now holds annually.
The stock is up more than 50% over the
cheap, but Prime Minister Modi is a “doer,”
Barger says, and the rupee is appreciating.
Mexico, Trump’s chief target, warrants cau-
tion, but according to Barger, tough talk on trade
doesn’t have to equal Draconian tariffs. F

60 | FORBES JANUARY 24, 2017

 THE HORATIO ALGER ASSOCIATION OF DISTINGUISHED AMERICANS PROUDLY PRESENTS THE

2017 HORATIO ALGER

AWARD WINNERS

Alain Bouchard (Canada) Mellody Hobson Roger S. Penske Richard J Stephenson

Founder and Executive President Chairman and CEO Founder and Chairman
Chairman of the Board Ariel Investments, LLC Penske Corporation Cancer Treatment Centers
Alimentation Couche-Tard Inc. of America
Harold B. Matzner Byron Pitts
John A. Elway, Jr. Chairman Chief National Correspondent Marcia G. Taylor
Executive Vice President of CBA Industries Inc. ABC News President and
Football Operations and CBA Insert Distribution Chief Executive Officer
General Manager Systems, Inc. John H. Scully Bennett International Group LLC
Denver Broncos Football Club Co-founder and
Valerie Montgomery Rice Managing Director Lenard B. Tessler
President and Dean SPO Partners & Co. Vice Chairman
Morehouse School Cerberus Capital
of Medicine Management, L.P.

Honoring Perseverance, Integrity and Excellence

Each year the Horatio Alger Association of Distinguished Americans presents the Horatio Alger Award to select
individuals who have achieved success with hard work, perseverance and integrity in spite of facing personal and
professional obstacles. Award winners become lifelong Members of the Association, which provides deserving
young people with college scholarships. Our Members serve as role models and mentors, demonstrating what can
be achieved through the free-enterprise system.

GER ASS
AL
O
HORATI O

CI

www.horatioalger.org
ATION

www.horatioalger.ca
O A
F C
ANAD
INVESTING ETFS
Protect Yourself From
Ugly Currencies
For a modest fee, these funds will strip foreign
exchange risk out of your international portfolio.
BY WILLIAM BALDWIN
B
ritish American Tobacco shares
have had a nice run in the past year,
rising from £37 to £46 in London.
But American buyers did not enjoy
the ride. Pounds lost value almost as
fast as the shares gained it. Translated back into
dollars, the stock went sideways.
Stack currency risk on top of equity risk and
it’s no surprise that venturing overseas makes
some investors seasick. But there is the option
to take Dramamine. When you invest, you can
make a side bet against the currency you’re in-
vesting in. You could couple a purchase of BAT
or AstraZeneca or Shell with a short position in
sterling. You could marry Toyota to a yen short
and Roche to a Swiss franc short.
More realistically, unless you are investing
a gigantic sum: Have a fund do the shorting for
you. Eighty-nine exchange-traded funds have
currency hedges built into their portfolios, and
they account for $37 billion of the $456 billion in
62 | FORBES JANUARY 24, 2017
foreign-stock ETFs, according to a Morningstar
tabulation.
WisdomTree Investments was the first in
this business, with a hedged Japanese fund that
dates to 2006. It’s now getting stiff competition
from PowerShares, BlackRock’s iShares family
and Deutsche Bank’s X-trackers line. Their sales
pitch: Take some of the worry out of foreign
portfolios by removing the hefty contribution to
volatility (a fourth of it over the average five-year
period) that comes from currency moves.
Insurance against weak foreign currencies
will cost you some money but not as much as
you might think. Hedged ETFs run roughly a
quarter of a percentage point more in annual
fees than unhedged ones. If the hedge gives you
the peace of mind to undertake global diversifi-
cation you would otherwise have shunned, it’s
money well spent.
What about the cost of the forex positions?
In developed markets, currency hedges have a
cost pretty close to zero; arbitrageurs see to that.
Indeed, low interest rates in Europe mean that
currencies there can be off-loaded in the futures
market at a slight premium to spot prices.
Currency hedging is a wonderful excep-
tion to the rule that reducing volatility reduces
returns. Here’s the theory, as expounded by
Jeremy Schwartz, director of research at Wis-
domTree. British investors in Shell are taking on
volatility in the value of the business—from oil
prices and so on. U.S. investors who buy Shell
and do nothing more are taking on that risk plus
additional volatility that comes from changes in
the value of the pound. By shorting the pound
ROBERT BABBONI FOR FORBES
when you buy Shell, you eliminate the second
contribution to volatility. “You can’t expect cur-
rency to add to return,” Schwartz says. “It’s un-
compensated risk.” So you should get rid of it.
Note what is not part of the argument in
 RULES OF
LEADERSHIP

ACT WITH
CONFIDENCE
Trading nearly 16 million times an hour,* the SPDR S&P
500 ETF has given investors the confidence they need to
get in, or out of, the market with ease.

Visit spdrs.com/spy to learn more about SPDR S&P

500 ETF (SPY).

*Source: NYSE Arca, as of 9/30/2016.

ETFs trade like stocks, are subject to
investment risk, fluctuate in market value and
may trade at prices above or below the ETFs net
asset value. ETF shares may not readily trade in
all market conditions. Brokerage commissions
and ETF expenses will reduce returns.
SPDR ® S&P 500 ® ETF Trust, an exchange
traded fund listed on NYSE Arca, Inc., seeks
to track an index of large-cap U.S. equity
securities.
SPDR ®, S&P and S&P 500 are registered
trademarks of Standard & Poor’s Financial
Services LLC (S&P) and have been licensed
for use by State Street Corporation. No
financial product offered by State Street or
its affiliates is sponsored, endorsed, sold or
promoted by S&P.
ALPS Distributors, Inc. is distributor for SPDR
S&P 500 ETF Trust, a unit investment trust.
ALPS Distributors, Inc. is not affiliated with
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Before investing, consider the funds’ investment objectives, risks, charges and expenses. To obtain a prospectus or summary
prospectus, which contains this and other information, call 1.866.787.2257 or visit www.spdrs.com. Read it carefully.

IBG-20879 Not FDIC Insured • No Bank Guarantee • May Lose Value

INVESTING ETFS

INTERNATIONAL ETFS FOR THE COST-CONSCIOUS

FEES ON CURRENCY-HEDGED FOREIGN FUNDS HAVE BEEN COMING DOWN BUT STILL RUN A QUARTER OF A TRENDING
PERCENTAGE POINT ABOVE THOSE ON RISKIER, UNHEDGED PORTFOLIOS.
WHAT THE 50 MILLION
ASSETS DATE EXPENSE FORBES.COM USERS
EXCHANGE-TRADED FUND TICKER ($BIL) STARTED RATIO ARE TALKING ABOUT.
FOR A DEEPER DIVE GO TO
HEDGED FORBES.COM/INVESTING

DEUTSCHE X-TRACKERS MSCI EAFE HEDGED EQ DBEF $7.7 6/9/11 0.35%

WISDOMTREE DYNAMIC CCY HDGD INTL EQ DDWM 0.3 1/7/16 0.35
ISHARES CURRENCY HEDGED MSCI EAFE HEFA 3.1 1/31/14 0.36
IQ 50 PERCENT HEDGED FTSE INTL HFXI 0.2 7/22/15 0.36
DEUTSCHE X-TRACKERS MSCI ALWD EXUS HGDEQ DBAW 0.1 1/22/14 0.40
UNHEDGED

VICTOR J. BLUE/BLOOMBERG
SCHWAB INTERNATIONAL EQUITY SCHF 6.9 11/3/09 0.07
ISHARES CORE MSCI EAFE IEFA 14.9 10/18/12 0.08
VANGUARD FTSE DEVELOPED MARKETS VEA 39.2 7/20/07 0.09
ISHARES CORE MSCI EUROPE IEUR 1.0 6/10/14 0.10
ISHARES CORE MSCI PACIFIC IPAC 0.8 6/10/14 0.10
SOURCE: MORNINGSTAR.
PERSON
STEVE ELLS
favor of hedging. Schwartz is not predicting that What happens over the very long pull?
Founder of Chipotle
the dollar will continue to steam ahead, which it Morningstar fund analyst Patricia Oey studied takes back company
has been doing since the election. He is simply this question by comparing global portfolios that reins; co-CEO Marty
arguing that stripping out currency exposure mix U.S. stocks with either hedged or unhedged Moran heads for the exit
will make your foreign adven- foreign stocks. Oey’s paper port- in the wake of food-
tures less scary. folios were a 60/40 blend of the safety mishaps.
THE DOLLAR
The past half-decade has MOVES SIDEWAYS S&P 500 and the MSCI indexes, COMPANY
been a good time for dollar A TUMULTUOUS RIDE HAS TAKEN rebalanced annually. There were GOLDMAN SACHS
THE DOLLAR BACK ALMOST TO
patriots. Or, to put it equiva- years when the hedged portfolio The bank’s stock has
WHERE IT WAS 25 YEARS AGO.
lently, the period has been bad, raced ahead, others when the been a standout since
130 Election Day; meanwhile,
collectively, for the euro, yen FOREIGN unhedged one did. But over 25
Donald Trump names
and pound. That means U.S. EXCHANGE years the two approaches to
120 COO Gary Cohn to
VALUE OF A
investors who bought stocks DOLLAR going international had identi- the White House’s top
overseas and did not hedge 110 cal risk-adjusted returns. economic job.
are full of regrets. They have Oey’s comparison was on
100 IDEA
lost in the currency markets index returns; real-life perfor- MILLENNIAL MISERY
half of the 11% a year they mance will be lower by what- A new study finds that
90
were gaining with their stocks. NOV 1991 = 100
ever fees you pay to the fund’s just half of America’s
(This is the return on an MSCI manager. Whether these fees 30-year-olds are making
index of developed foreign 80 are worth paying is a matter of more (inflation-adjusted)
than their parents did
markets, which include Eu- TRADE-WEIGHTED INDEX OF DOLLAR AGAINST how much safety you seek.
MAJOR CURRENCIES. SOURCE: ST. LOUIS FED. at their age, down from
rope, Japan and Australia but 70
WisdomTree’s oldest 92% in the 1970s.
not China or Brazil.) Those 11/91 12/00 12/08 12/16 hedged ETFs levy 0.48% to
who hedged got something 0.58% in annual expenses.
close to the full 11%. Newer offerings from both WisdomTree and its
There have been other stretches, though, rivals are better buys (see table). One can hope
when the dollar tumbled (see graph). There that Vanguard gets into the fray, but for now
weren’t any hedged ETFs around at the time to this mecca for cheapskates offers hedged stock
prove the point, but if one had opened for busi- funds only in Canada and Australia.
ness in 2002 it would have looked like a clunker It’s a scary world out there. But it’s getting
for the next five years. less scary.
FINAL THOUGHT

“Risk is like fire: If controlled it will help you; if uncontrolled it will rise up and
destroy you.” —THEODORE ROOSEVELT

64 | FORBES JANUARY 24, 2017

A NEW ALLIANCE OF SCIENCE AND SPIRITUALITY

A NEW FUTURE OF UNLIMITED POSSIBILITIES

YO U A R E A C O - C R E AT O R O F R E A L I T Y.
New York Times bestselling author D E E PA K C H O P R A and leading physicist
M E N A S K A FAT O S offer a bold understanding of who we are and how we can
transform the world for the better while reaching our greatest potential.

Visit discoveringyourcosmicself.com.

S TA R T R E A D I N G AT P R H . C O M / YO U A R E T H E U N I V E R S E HARMONY BOOKS
EDUCATION FOR LIFE
 Features
JANUARY 24, 2017 SILICON VALLEY’S BLACK SHEEP 86
PHILLIP FROST: DOCTOR, INVENTOR,
INVESTOR, BILLIONAIRE 94

Artist Eric Waugh

started a design firm
at 18 and taught
himself to paint at 23.
He’s now one of the
world’s most famous
“live” painters—his
football-field-size
painting Hero, which
depicts an adult
embracing a child,
made the Guinness
Book of World
Records—and he put
those skills to work
for our 30 Under 30
feature. PAGE 68

PHOTOGRAPH BY JAMEL TOPPIN

JANUARY 24, 2017 FORBES | 67

 Music
Jason Aron, 28; Desiigner, 19 Logic, 26
Anthony Li, 28 Musician Musician
Managers, Halsey Derek Dolin, 28 Julia Michaels, 23
Sophie Ash, 28 Senior manager, Musician
Project manager, Three Six Zero Jeffrey Ponchick, 29
Parkwood Josh Dun, 28; Cofounder, Repost
Entertainment Tyler Joseph, 28 Network
Kelsea Ballerini, 23 Musicians, Twenty One Charlie Puth, 25
Musician Pilots Musician
Bibi Bourelly, 22 Taylor Dye, 21; Troye Sivan, 21
Musician Maddie Marlow, 21 Musician
Emma Burgess-Olson, Musicians, Maddie & Tae
Justine Skye, 21
28; Frankie Decaiza G-Eazy, 27 Musician
Hutchinson, 29; Musician
Christine McCharren- Drew Taggart, 27
Gallant, 25 Musician, the
Tran, 28 Musician
Cofounders, Discwoman Chainsmokers
Michael George, 27 La Mar Taylor, 26
Alessia Cara, 20 Artist manager, SB
Musician Creative director, the
Projects Weeknd
Patrick Corcoran, 26 Micah Hendler, 27
Manager, Chance the Bryson Tiller, 23
Founder, YMCA Musician
Rapper Jerusalem Youth Chorus
Daesung, 27; Lil Yachty, 19
Jeremih, 29 Musician
G-Dragon, 28; Musician
Seungri, 26;
Taeyang, 28; T.O.P., 29 Joe Kay, 27 JUDGES
Musicians, Bigbang Cofounder, Soulection
Jason Derulo—musician
Daya, 18 Tory Lanez, 24 Halsey—musician
Musician Musician Anthony Saleh—cofounder,
QueensBridge Venture
Partners

Gallant, 25
MUSI CI A N

“When I hear his voice, I just lose it.” That’s what Elton John had to say
about Gallant shortly before they performed the young singer’s breakout
hit, “Weight in Gold,” together in London last September. Born Christopher
Gallant III, he graduated from New York University in 2012 and moved to
Los Angeles to build his own, unique sound, blending elements of R&B,
alternative rock, soul and electronic music. His 2016 debut, Ology, is
up for a Grammy for Best Urban Contemporary Album, and he
averages 1.2 million listeners per month on Spotify alone. In 2016
he took his act on the road, doing 77 shows in eight countries.
That’s just the beginning, as far as he’s concerned: “I honestly
don’t think that I’ve necessarily had my big break yet.”
CREDIT TK

1941 WILD LILY WINDBREAKER BY COACH ($495); COTTON TROUSERS BY PT PANTALONI TORINO ($425);
CLYDE SNEAKERS IN CORDOVAN PATENT LEATHER BY PUMA ($110).

68 | FORBES JANUARY 24, 2017

 30 UNDER 30
Meet the Class of 2017. These 600 young
innovators—30 game changers in 20 industries—are
challenging the conventional wisdom and rewriting
the rules for the next generation of entrepreneurs,
educators and entertainers. Their individual
passions have been interpreted by artist Eric Waugh,
who created whimsical paintings of their claims to
fame in less than ten minutes during photo sessions
in New York and San Francisco. The result is a
picture-perfect marriage of art and commerce.
EDITED BY Caroline Howard with Natalie Sportelli
ART & STYLE: Susan Adams, Keren Blankfeld, Michael Solomon, Glenda Toma. EDUCATION: Caroline Howard, Justin Conklin. ENERGY: Christopher Helman, Aaron Tilley.
FINANCE: Nathan Vardi, Antoine Gara, Corinne Jurney. FOOD & DRINK: Maggie McGrath, Natalie Sportelli, Abram Brown. GAMES: David Ewalt, Matt Perez. HEALTH CARE:
Sarah Hedgecock, Matthew Herper. HOLLYWOOD: Natalie Robehmed, Madeline Berg, Hayley Cuccinello. LAW & POLICY: Kathryn Dill, Christopher Denhart, Daniel Fisher,
Avik Roy. MANUFACTURING & INDUSTRY: Amy Feldman, Joann Muller, Alex Knapp. MARKETING & ADVERTISING: Jennifer Rooney, Lilly Knoepp. MEDIA: Emily Inverso, Kate
Vinton, Madeline Berg. MUSIC: Zack O’Malley Greenburg, Natalie Robehmed. RETAIL & E-COMMERCE: Clare O’Connor, Vicky Valet. SCIENCE: Alex Knapp, Matt Perez, Sarah
Hedgecock. SOCIAL ENTREPRENEURS: Michela Tindera, Alexandra Wilson, Parul Guliani. SPORTS: Dan Kleinman, Jordan Lebeau, Chris Smith. TECH/CONSUMER: Ryan Mac,
Brian Solomon. TECH/ENTERPRISE: Kathleen Chaykowski, James Plafke. VENTURE CAPITAL: Alex Konrad, Jordan Lebeau.

PHOTOGRAPHY: Jamel Toppin for FORBES.

CREATIVE STYLE DIRECTOR: Joseph DeAcetis. STYLE ASSOCIATE: Juan Benson.
HAIR & MAKEUP EAST: Suzannah Hallili. HAIR & MAKEUP WEST: Mary Reid. PRODUCTION ASSISTANCE: Janet Baus.

JANUARY 24, 2017 FORBES | 69

Food & Drink
Lizzi Ackerman, 29
Cofounder, Birch Benders Micro-Pancakery
Drew Anderson, 29
Cofounder, Cleveland Kraut
Tatiana Birgisson, 27
Founder, Mati Energy
Matt Bodnar, 29
Partner, Fresh Hospitality 30 UNDER 30
Ross Burack, 27
Cofounder, Choza Taqueria
Andrew Chmielewski, 29
Jeremy
Founder, Dave’s Sweet Tooth
Chloe Coscarelli, 29
Fiance, 25
Founder, By Chloe MANAGING PA RTNER,
T HE HOUSE FUN D
Simon Davies, 27
Chef de cuisine, Alinea This UC Berkeley grad is de-
Jake Dell, 29 livering the message of
Owner, Katz’s Delicatessen
school spirit, entrepreneur-
Zachary Engel, 28
Chef de cuisine, Shaya ship and experiential edu-
Miguel Garza, 29 cation. His platform is the
Cofounder, Siete Family Foods House Fund, which launched
Jorge Gaviria, 29 in April 2016, a $6 million
Founder, Masienda
pre-seed and seed-stage
Andrew Gonzalez, 25
Founder, Night Owl Cookie venture fund dedicated to
Joey Grassia, 29 entrepreneurs with Berkeley
Founder, Kutoa Health ties: students, faculty, univer-
Amir Hosseini, 29 sity employees and its half a
Cofounder, Curry Up Now million alumni.
Kate Kavanaugh, 28 To date the House Fund
CEO, Western Daughters Butcher Shop
has funded more than 20
Michael Kennedy, 29
Founder, Component Wine Company companies, spanning robot-
Michael Steven Levine, 25 ics, education and AI, with an
CEO, Global Food Solutions average investment between
Jen Martin, 28 $50,000 and $250,000.
Cofounder, Pipsnacks “Having seen thousands of
Kwame Onwuachi, 27 companies come
Chef/owner, the Shaw Bijou
out of this commu-
Ian Purkayastha, 24
Founder, Regalis Foods nity, we have a good
Maxim Razmakhin, 28 sense of the big
Cofounder, Thirstie ideas when we see
Jourdan Samel, 28; Ari Sherman, 29 them. We have a sense
Cofounders, Hemp Health
of the passion and fire
Michael Shoretz, 29 in an entrepreneur when
CEO, Enlightened
they really want to bring
Katlin Smith, 28
Founder, Simple Mills this company to life,” says
Daniela Soto-Innes, 26 Fiance, who was previ-
Chef de cuisine, Cosme ously a managing partner at
Dominik Stein, 29 Dorm Room Fund SF, a ven-
Cofounder, Verts Mediterranean Grill
ture fund run by students for
Keeley Tillotson, 24; Erika Welsh, 25
Cofounders, Wild Friends Foods student startups. “I have [Cal]
Tiffany Yam, 29 shirts, hats, posters. I bleed
Partner, Salt Partners blue and gold.”
Molly Yeh, 27
Creator, My Name Is Yeh
JUDGES
Alex Guarnaschelli—chef/
restaurateur, Butter
Paul Ross—president and CEO,
Edrington Americas
Marcus Samuelsson—chef/
restaurateur, Red Rooster Harlem
Lee Schrager—founder, South Beach
and New York Wine & Food Festivals

Miguel Garza, 29
COFOUNDER, SIETE FAMILY FOODS
For years, when Miguel Garza sat down at the family dinner table in Laredo,
Texas, the Mexican-American spread was missing a very key component: flour
tortillas. His older sister Veronica had an autoimmune disease that forced her to
remove all grain from her diet, and for moral support the entire Garza clan also
made do without, using lettuce leaves for their tacos. In 2014, Veronica start-
ed making tortillas from almond flour. It was grain-free and, more importantly,
abuela approved. When the choosy family matriarch gave the tortilla her bless-
ing, Miguel knew the family was onto something. He began pitching the tortillas
70 | FORBES JANUARY 24, 2017
to local grocery stores and co-ops; lines of cassava-and-coconut (or chia) torti-
llas quickly followed.
Today, the family dinner workaround has blossomed into Siete Family
Foods, which is among the just 2% of Latino-owned businesses doing north of
$1 million in revenue each year. “The customer wants clean labels, simple in-
gredients, real food. Grain-free, by proxy, stands for that,” says Miguel, who is
Siete’s CEO.
Next up for the company: a line of grain-free tortilla chips, which will roll out
in Whole Foods nationwide in January. “We see ourselves as a healthy Mexican
food company,” he says. “You know Annie’s Homegrown, which does organic
traditional American cuisine? We see ourselves as that, but for Mexican food.”
MIGUEL GARZA: WALLACE & BARNES SELVEDGE DENIM SHIRT BY J. CREW ($148); BYRON
JEANS BY HUDSON JEANS ($189); NEW BALANCE 420 SNEAKERS BY NEW BALANCE($70).
JEREMY FIANCE: BOMBER JACKET BY ZANONE ($975); COURAGE JEANS BY 34 HERITAGE
($190); SUEDE SNEAKER BY SUPRA ($80).
Education Hollywood & Entertainment
Jacob Allen, 28; Marie Dandie, 27 Denée Benton, 25 Laura Gordon, 29 Justice Smith, 21
Cofounders, pilotED Schools Actor Television literary agent, Actor
Louise Baigelman, 29 Quinta Brunson, 27 ICM Partners Lakeith Stanfield, 25
Cofounder, Story Shares Development partner, Lucas Hedges, 20 Actor
Blair Brettschneider, 27 BuzzFeed Motion Pictures Actor Melissa Villaseñor, 29
Founder, GirlForward Jessica Chou, 26 Ryan Higa, 26 Comedian
Gregory Brown, 28; Mitchell Moffit, 28 Producer Digital star Mia Wasikowska, 27
Creators, AsapSCIENCE Kiersey Clemons, 23 Jacquie Katz, 29 Actor
Nicole Cardoza, 27 Actor Television literary agent, Samira Wiley, 29
Founder, Yoga Foster Emory Cohen, 26 Creative Artists Agency Actor
Hardy Farrow, 26 Actor Tyler Oakley, 27 Krysty Wilson-Cairns, 29
Executive director, Let’s Innovate Through Tanya Cohen, 28 Digital star Writer
Education Motion picture literary and Lele Pons, 20 Evan Rachel Wood, 29
Jeremy Fiance, 25 talent agent, WME-IMG Digital star Actor
Founder, the House Fund RJ Cyler, 21 Trevante Rhodes, 26
Jason Field, 27 Actor Actor JUDGES
Founder, BrainStation Cameron Dallas, 22 Margot Robbie, 26 David Linde—CEO,
Jonathan Gottfried, 26; Mike Swift, 27 Digital star Actor Participant Media
Cofounders, Major League Hacking Hilary Duff, 29 Charles Rogers, 29 Issa Rae—actor/writer/
Mendell Grinter, 25 Actor Director/producer/writer producer, Issa Rae
Founder, Campaign for School Equity Presents
Alden Ehrenreich, 27 Oren Rosenbaum, 27 Jill Soloway—writer/
Luke Heine, 22; Cole Scanlon, 20 Actor Digital media agent, director, Topple
Codirectors, Fair Opportunity Project Elle Fanning, 18 United Talent Agency
Productions
Ryan Hoch, 29 Actor Ashton Sanders, 21
Cofounder, Overgrad Elliot Fletcher, 20 Actor
Connie Hu, 27; Joseph Schlesinger, 27 Actor
Cofounders, ArcBotics
Sieva Kozinsky, 26
Cofounder, StudySoup
Jenna Leahy, 28
Co-CEO, CASA Academy
Jordan Levy, 24; Andrew Pohle, 27;
Jake Schaufeld, 24
Cofounders, Real Time Cases
Denisse Rojas Marquez, 27;
Jirayut New Latthivongskorn, 27
Cofounders, Pre-Health Dreamers
Jeffrey Martín, 25;
Dylan Stone-Miller, 26
Cofounders, honorCode
Elijah Mayfield, 27
Vice president of new technologies,
Turnitin
Sophia Parsa, 25;
Tyler Oakley, 27
Shakib Zabihian, 25 DI GI TA L STA R
Cofounders, toot
Jacobi Petrucciani, 22; Prahasith “YouTube provides a microphone for
Veluvolu, 21; Colton Voege, 21 marginalized voices,” says comedi-
Cofounders, Mimir an and LGBT activist Tyler Oak-
Evin Floyd Robinson, 26; ley. The platform has amplified
Jessica Santana, 27
Cofounders, New York on Tech his voice to reach nearly 8.1 mil-
Rachel Romer Carlson, 28; lion subscribers, who tune in to
Brittany Stich, 28 watch his talk-show-like vid-
Cofounders, Guild Education
eos, in which he muses on top-
Shanyn Ronis, 29
Founder, Education Global Access ics both light (celebrity crush-
Program es and viral videos) and heavy
Jeff Sorensen, 27 (politics and sexuality).
Founder, optiMize “When I was younger and
Leandra Tejedor, 25 still in the closet, I couldn’t just
Cofounder, Vidcode
Google ‘coming-out story’ to
Joe Vasquez, 27
Codirector, Runway Incubator help me articulate what I was
Cliff Weitzman, 22 going through,” he says.
Founder, Speechify With spiky bleached hair
Alec Whitters, 29 and signature geek-chic glasses,
CEO, Higher Learning Technologies
Tyler counts Michelle Obama, Kerry
Tamara Wilkerson, 26 Washington and Ricky Martin among
Executive director, African American
Teaching Fellows his fans, but his biggest proponent is Ellen DeGen-
eres, with whom he has a production deal. A 2015
JUDGES
book of personal essays, Binge, became a New York
Stacey Childress—CEO, NewSchools Venture Times bestseller, and he has raised over $1 million for
Fund
Arne Duncan—managing partner, Emerson the suicide hotline the Trevor Project. “YouTube is a
Collective place for people from all over the world to feel less
Wendy Kopp—cofounder, Teach for All
Marcus Noel—founder, Heart of Man Ventures alone,” Oakley says.

JANUARY 24, 2017 FORBES | 71

 Marketing &
Advertising
Daniel Altmann, 29; Eric Posen, 28
Cofounders, Naritiv
Andy Bossley, 28
Senior manager of global
marketing campaigns, IBM
Vincent Cacace, 26
Founder, Vertebrae
Eva Chan, 27; Daniel Rodic, 26;
Elena Sahakyan, 29
Cofounders, Exact Media
Eden Chen, 29
Founder, Fishermen Labs
Tony Chen, 26
CEO, Channel Factory
Marina Cockenberg, 29
Director of digital, The Tonight
Show Starring Jimmy Fallon, NBC
Gregory Constantine, 27
Global music strategy and cultural
partnerships lead, Smirnoff, Diageo
Alex Dahan, 24; Eric Dahan, 26;
Felix LaHaye, 28
Cofounders, InstaBrand
Bobak Emamian, 29
30 UNDER 30 Cofounder, Prolific Interactive
Andrew Fabbri, 29;
Shaun Sheikh, 25
James Heller, 29 Cofounders, Jump 450 Media
Jared Feldman, 28
COFOUNDER, WRAPIFY Founder, Canvs
As a kid, James Heller would beg his fa- Laura Foti, 26
Head of paid media and
ther to take him to the Porsche dealer- analytics, GE Digital
ship to sit in the cars. “I was completely Lauren Gallo, 29
obsessed with German sports cars,” Senior digital marketing and
said Heller, who bought his own communications lead,
Apple Retail, Apple
Porsche when he was 26. Two
Devon Galloway, 29
years later he sold that car— Cofounder, Vidyard
and cashed out his 401(k) and Daniel George, 25
savings—to launch Wrapify, a Founder, Limitless Creative
startup with $2.9 million in fund- Julieanna Goddard, 26
Founder, YesJulz
ing that pays everyday people an aver-
James Heller, 29
age of $350 a month to wrap their cars in Cofounder, Wrapify
advertisements and simply drive around. Leyda Hernandez, 28
Sure, advertising on cars isn’t new, but Director of marketing, iSpot.tv
Wrapify adds a digital twist. Its app au- Mansi Jayakumar, 29
tomatically alerts drivers to new ad cam- Global director of innovation, Y&R
paigns and provides brands with a dash- Salone Kapur, 27
Head of city marketing,
board that tracks how many people are Google Fiber, Google
seeing the ads in real time. Wrapify has Jan-Niklas Kokott, 29
35,000 drivers in 27 cities and counts An- Head of product and customer
insight, Glossier
heuser-Busch, Petco and eBay as clients.
In the next year Heller is looking to triple Jennifer Lo Chan, 26
Marketing campaign
his current $3 million in sales. “I don’t manager, Nvidia
take no for an answer. I just don’t.” Shaun McBride, 29
Founder, Shonduras
Eliana Murillo, 28
Head of multicultural
marketing, Google
Sean O’Brien, 27; Evan Wray, 27
Cofounders, Swyft Media
Aniq Rahman, 29
President, Moat
Justin Rezvani, 28
Founder, theAmplify
James Shani, 28
Founder, Madison+Vine
Kevin Yamazaki, 29
Founder, Sidebench

JUDGES
Linda Boff—CMO, GE
Bonin Bough—host of Cleveland
Hustles, CNBC
Rachel Tipograph—founder, MikMak
Abby Wambach—2015 FIFA Women’s
COTTON SUIT BY RAVAZZOLO ($3,300); COTTON SHIRT ($50) AND TIE ($45) BY VAN HEUSEN; World Cup champion
SILK POCKET SQUARE BY CHARLES TYRWHITT ($20); LEATHER AND ELKSKIN SHOES BY SANTONI ($920).

72 | FORBES JANUARY 24, 2017

Retail &
E-commerce
Alex Adelman, 27
Founder, Cosmic
Ben Aneesh, 26; Natalie Gray, 29
Cofounders, Cover
Andrew Brooks, 29
Founder, Vianel
Allen Brouwer, 28
Cofounder, BestSelf
Chloe Burch, 25; Neely Burch, 26
Cofounders, Neely & Chloe
Jennifer Chong, 28
Cofounder, Linjer
Nell Diamond, 28; Katherine
Kapnick, 26
Cofounders, Hill House Home
Ellie Dinh, 29
Cofounder, Girlfriend Collective
Matt Dronkers, 27; Andrew
Nilon, 27
Cofounders, Electric Family
Laura Dweck, 27; Michael
Dweck, 29
Cofounders, Basic Outfitters
Muhga Eltigani, 25; Sam
Roberts, 26
Cofounders, NaturAll Club
Alex Fenkell, 27; Jordan
Katzman, 27
Cofounders, SmileDirectClub
Yakir Gola, 23; Rafael Ilishayev,
23
Cofounders, goPuff
Molly Hayward, 28
Founder, Cora
Meika Hollender, 29
Cofounder, Sustain
Steven Izen, 26
Founder, Lokai
Marta Jamrozik, 26; Misha
Laskin, 26
Cofounders, Claire
Kylie Jenner, 19
Founder, Kylie Cosmetics
Erika Jensen, 27
Cofounder, the Flex Co.
Lauren Kassan, 29
Cofounder, the Wing
Furqan Khan, 28
Founder, Kixify
Michelle Lin, 24; Wayne Lin, 28
Cofounders, Live Love Polish
Emily Motayed, 28
Cofounder, Havenly
Nicole Najafi, 29
Founder, Industry Standard
Steven Ng, 24
Founder, Elliot Havok
Brett Podolsky, 28; Jonathan
Regev, 29
Cofounders, the Farmer’s Dog
Jon Richards, 29
Cofounder, Nomatic
Cynthia Salim, 29
Founder, Citizen’s Mark
Justin Schneider, 28
Founder, Wolf & Shepherd
Amber Venz Box, 29
Cofounder, LikeToKnowIt

JUDGES
Tyler Haney—founder, Outdoor
Voices
Jennifer Hyman—cofounder, Rent
the Runway
Toni Ko—founder, NYX Cosmetics
Alli Webb—founder, Drybar
Emily Motayed, 28
CO FOUNDER, HAVENLY
When she cofounded Havenly with her older sister Lee Mayer in
2013, Emily Motayed didn’t know much about interior design—
other than that she couldn’t afford it. After moving into her first
“big-girl” apartment in New York, she discovered that tradition-
al interior designers weren’t interested in working within her mod-
est budget. “Everyone deserves to have a beautiful home, whether
you have a $1,000 or a $50,000 budget,” she says.
Working with a roster of more than 200 freelance interi-
or designers, Havenly charges a flat fee of either $79 or $199
per room. Every interaction, from agreeing on a budget to as-
sembling a shopping list, takes place online. The Denver-based
company also sells furniture, allowing shoppers to buy a whole,
Instagram-ready look. In three years Motayed and Mayer have
increased Havenly’s team from 2 to 60 and raised $13.3 mil-
lion in funding.

ANAA-JUXTAPOSE ROSE SLEEVELESS FIT AND FLARE MIDI DRESS BY TED BAKER ($369);
LEATHER GODIVA PUMP BY SERGIO ROSSI ($630). PICTURE FRAMES COURTESY GILL & LAGODICH
JANUARY 24, 2017 FORBES | 73
Media 30 UNDER 30
Matt Humphrey, 29
COFOUNDER, LENDINGHOME
Libby Brittain, 27
Partner strategy lead, news, Daniel Houghton, 28 Buying a home may be part of the American dream, but
Facebook CEO, LONELY PLANET
Kristina Budelis, 28 mortgages can be a nightmare. Matt Humphrey wants to
Cofounder, KitSplit In 2013, three years after graduating from Western change that. His three-year-old startup has raised more than
Rhonesha Byng, 27 Kentucky University, Daniel Houghton took the helm $100 million and originated over $1 billion in loans. The plat-
Founder, Her Agenda of the now 44-year-old travel brand Lonely Planet. form cuts out banks by connecting borrowers directly with
Emma Cline, 27 One of his first tasks? Laying off 75 people, one-fifth investors. The approach opens up credit to unconventional
Author
of the company’s employees, many of whom worked buyers like self-employed entrepreneurs, who often hit walls
Leslye Davis, 26
Photo and video journalist, on LP’s free-spirited print guidebooks. Industrywide, with traditional lenders.
New York Times guidebook sales plummeted 40% from “The mortgage world today is mired by complexity, a
Anna Therese Day, 28 2007 through 2012, so Houghton de- lack of technology and inefficiency,” Humphrey says. “Not
Journalist
cided LP had to focus on digital to only can we beat the banks at their own game doing the
Brian Donohue, 27
CEO, Instapaper survive. One year after he took over, standard products better, faster and cheaper, but we can ex-
Clay Dumas, 28
digital accounted for 30% of LP’s pand access to credit.”
Chief of staff and senior revenue, and print sales also re- Humphrey, who started college when he was 13, has been
advisor, Office of Digital bounded, up 27% since 2013. an entrepreneur since 2005. His first big exit came when he
Strategy, the White House
After college Houghton start- sold a Groupon-like daily-deal site called HomeRun for over
Brandon Feldman, 29
News & politics manager, ed his own production company, $100 million in 2011. This year LendingHome established an
YouTube Houghton Multimedia, which got institutional channel, bundling $126 million in loans into trad-
Ashley Ford, 29 the attention of tobacco bil- able securities, fueling a near tripling of revenues.
Development executive, Web
series and video, Matter Studios lionaire Brad Kelley. The
Taylor Freeman, 26;
two created NC2 Media,
Will Mason, 26 through which Kel-
Cofounders, Upload ley acquired LP for $77
Vinny Green, 25 million. “You have to
Director, business
development, Snopes be respectful of [the]
Yaa Gyasi, 27 past while trying to
Author plow into the future,”
Isabelia Herrera, 25 Houghton says. That
Music editor, Remezcla
future is filled with
John Herrman, 29 a flagship Guides
David Carr Fellow,
New York Times app (nearly a million
Daniel Houghton, 28 downloads in the
CEO, Lonely Planet past year) and part-
Greg Howard, 28 nerships with com-
David Carr Fellow,
New York Times Magazine panies like Samsung.
Sarah Jeong, 28 LP is the largest
Contributing editor, guidebook player,
Motherboard, Vice Media according to Nielsen,
Alexander Klokus, 25; owning 25% of the
Jordan Lejuwaan, 26
Cofounders, Futurism nearly $90 million
Amy Levin, 29 guidebook market.
Founder, CollegeFashionista
Wesley Lowery, 26
National reporter, Washington Post
Adam Marshall, 28
Knight Foundation litigation
attorney, Reporters Committee
for Freedom of the Press
Ashley McCollum, 29
General manager, Tasty, BuzzFeed
Griffin McElroy, 29
Founding editor, Polygon
John Meyer, 21
Founder, Fresco News
Evan Puschak, 28
Creator, The Nerdwriter
Hayden Rockwell, 26
Lead senior story editor, Snapchat
Alex Schmider, 27
Senior strategist,
Transgender Media, GLAAD
Molly Swenson, 29
CMO, RYOT
Jia Tolentino, 28
Contributing writer,
NewYorker.com

JUDGES
Jim Bankoff—CEO, Vox Media
Pete Cashmore—founder, Mashable
Kate Lee—head of content
development, Medium
Shane Smith—cofounder, Vice
Media

DANIEL HOUGHTON: 1905 WOOL SUIT ($598), 1905 COTTON SHIRT ($80) AND 1905 SILK TIE ($60) BY JOS. A. BANK; CALFSKIN WINGTIP BY BY JOHNSTON & MURPHY ($198).
MATTHEW HUMPHREY: COTTON SHIRT BY CHARLES TYRWHITT ($69); BYRON JEANS BY HUDSON JEANS ($210); SUEDE AND LAMBSKIN SHOES BY ESQUIVEL ($875).
74 | FORBES JANUARY 24, 2017
Finance
Anish Abuwala, 29
Portfolio manager, Caxton
Associates
Raja Bobbili, 29
Analyst, Abrams Capital
Michael Buckley, 29
Analyst, Duquesne Capital
Management
Francis Chung, 29
Quantitative developer,
IEX Group
Kerri Cohen Saperstein, 29
Vice president, Goldman Sachs
Richard Craib, 29
CEO, Numerai
Ben Friedman, 29
Portfolio manager, CQS
Akshay Goyal, 28
Vice president, Starwood Capital
Zach Hamed, 23
Product manager, Goldman Sachs
Matt Humphrey, 29
Cofounder, LendingHome
Rachel Hunter, 27
Associate, Apollo Global
Management
David Knopf, 28
Partner, 3G Capital
Dhruv Maheshwari, 28
Research analyst,
Point72 Asset Management
Eugene Marinelli, 29
Chief technology officer, Blend
Anthony Massaro, 29
Partner, Pershing Square
Capital Management
Ann Mathews, 28
Vice president, Goldman Sachs
Alissa Merar, 29
Vice president, Bank of America
Alex Nomitch, 29
Portfolio manager,
Viking Global Investors
Guillaume Rabate, 28
Vice president, Morgan Stanley
Daniel Rasmussen, 29
Founder, Verdad Fund Advisers
Niraj Shah, 29
Senior associate,
RedBird Capital Partners
David Smalling, 29
Director, BlackRock
Ben Solarz, 29
Principal, SPO Partners
Andy Stafman, 29
Partner, Sachem Head
Capital Management
Colter Van Domelen, 29
Partner, Tiger
Global Management
Kelly Wannop, 29
Associate, Blackstone Group
Brandon Watkins, 28
Vice president, Goldman Sachs
Benjamin Wu, 28
Partner, Huntsman
Family Investments
Franklin Zhao, 29
Global macro trader,
Commonwealth
Opportunity Capital
Katy Zhao, 29
Vice president, Morgan Stanley
JUDGES
Jennifer Fan—portfolio manager,
Millennium Management
Thomas H. Lee—founder, Lee
Equity Partners
Sonia Gardner—cofounder,
Avenue Capital Group
Science Alice Zhang, 28
Michelle Atallah, 26 COFOUNDER, VERGE GENOMICS
Ph.D. candidate, Stanford University
While pursuing an M.D./Ph.D. at UCLA, Alice Zhang was shocked to learn a fact every
Michael Barron, 27
Senior scientist, AeroFarms drug researcher knows all too well: 90% of medicines that start human trials fail. “It’s
Brandon Carpenter, 25 still largely a guessing game,” she says. Her startup, Verge Genomics, is the latest in
Cofounder, Feynman Nano a long line of biotechs that think merging the latest in computer science with new
Xi Chen, 29 technologies for decoding the human genetic code can provide a solution.
Assistant professor, New York University What’s special: Verge has the guts to target Alzheimer’s and Parkinson’s,
Huanyu Cheng, 28
areas most drug companies have abandoned as hopeless. The seven-person start-
Assistant professor,
Pennsylvania State University up raised $4 million from such firms as IA Ventures and Draper Associates, and as-
Timothy Downing, 29 sembled multiple advisors, including Alzheimer’s research luminary Paul Aisen,
Assistant professor, University of Harvard biotech guru George Church and the chief medical officer of the bio-
California, Irvine
tech firm Alkermes. Using machine-learning algorithms to understand networks of
Davina Durgana, 28
Senior statistician, Walk Free Foundation genes is an exploding scientific field. Maybe this time it will work as a business.
Melissa Gymrek, 28
Assistant professor, University
of California, San Diego
Karan Jani, 28
Ph.D. candidate, Georgia Institute of
Technology
Michael Johnson, 27
Cofounder, Visikol
Michelle Kunimoto, 23
Master’s candidate, University of British
Columbia
Matthew Lovett-Barron, 29
Postdoctoral fellow,
Stanford University
Luther McDonald, 28
Assistant professor,
University of Utah
Stefanie Mueller, 29
Assistant professor,
Massachusetts
Institute of Technology
Jeff Nivala, 29
Postdoctoral fellow, Harvard
Medical School
Olivier Noel, 28
Cofounder, DNAsimple
Korin Reid, 29
Senior data scientist, McKesson
Daisy Robinton, 29
Postdoctoral fellow, Harvard University
Monica Rosenberg, 28
Ph.D. candidate, Yale University
Jacob Rubens, 29
Associate, Flagship Pioneering
Phiala Shanahan, 26
Postdoctoral fellow, Massachusetts
Institute of Technology
Arun Sharma, 26
Postdoctoral fellow, Harvard Medical
School
Mark Smith, 29
Cofounder, OpenBiome
Kenneth Smith, 27
Structural dynamics engineer, NASA
Langley Research Center
Justin Solomon, 29
Assistant professor, Massachusetts
Institute of Technology
Daniel Szafir, 28
Assistant professor, University of
Colorado, Boulder
John Urschel, 25
Ph.D. candidate, Massachusetts
Institute of Technology
Katharina Volz, 29
Founder, Razor
Diane Wu, 29
Cofounder, Trace Genomics
Alice Zhang, 28
Cofounder, Verge Genomics
JUDGES
Cigall Kadoch—assistant
professor, Dana-Farber Cancer
Institute
Robert Langer—institute
professor, MIT
John Scalzi—science fiction author
LEATHER JACKET($798) AND BLACK AND PRINTED DRESS ($398) BY POLO RALPH LAUREN;
LEATHER AND SUEDE GRACE GRAND SANDAL BY COLE HAAN ($270) BY COLE HAAN.
JANUARY 24, 2017 FORBES | 75
Venture Capital
Steve Anastos, 27
Principal,
Bain Capital Ventures
Lisa Barnett, 27
Partner, Sherpa Foundry
Logan Bartlett, 29
Vice president,
Battery Ventures
Phil Brady, 23;
Clancey Stahr, 23
Managing partners,
GoAhead Ventures
Mackey Craven, 28
Partner, OpenView Partners
Jason Duboe, 28
Principal, Chicago Ventures
Jerrod Engelberg, 28
Head of venture ops and data
science, FundersClub
Miles Grimshaw, 25
Investor, Thrive Capital
TJ Hennessy, 27
Principal, Arena Ventures
Mohammad Islam, 27
Senior associate, DFJ
Nimi Katragadda, 28
Principal, BoxGroup
Abie Katz, 26
Principal, August Capital
Jocelyn Kinsey, 26
Senior associate, DFJ
Alex Lim, 28
Senior associate, Institutional
Venture Partners
Michael Ma, 29
General partner,
Liquid 2 Ventures
Jake Medwell, 28;
Drew Oetting, 26
Founding partners, 8VC
Nimay Mehta, 28
Partner, Lead Edge Capital
John Melas-Kyriazi, 27
Senior associate,
Spark Capital
Ryan Melohn, 28
Cofounder,
Expansion Venture Capital
Harley Miller, 27
Vice president, Insight
Venture Partners
76 | FORBES JANUARY 24, 2017
Bucky Moore, 29
Principal, Costanoa Ventures
Joshua Nussbaum, 26
Principal, Compound
Andrew Reed, 26 30 UNDER 30
Partner, Sequoia Capital
Caitlin Strandberg, 28
Vice president, FirstMark
Adam Struck, 29 Lu Zhang, 28
Managing partner and FOUNDING PA RTNER, NEWGEN CAPITAL
founder, Struck Capital
Phil Toronto, 29 As a materials science and engineering grad student at
Partner, Vayner/RSE
Stanford, Lu Zhang applied her work with nanothin bio-
Anargha Vardhana, 28 sensors to building a new medical device that tests for
Senior associate, Maveron
Type 2 diabetes—part of an on-campus entrepreneurship
Joanne Yuan, 28
Associate partner, class. She eventually sold her resulting company, Acetone,
Cowboy Ventures
to a private medical device company, which later sold it to
Lu Zhang, 28 a public one for more than $10 million.
Founding partner, NewGen
Capital Looking to refresh, Zhang spent two years as
Toby Zhang, 28
a venture partner at Fenox Venture Capital. As a
Partner, CRCM Ventures female VC from China, she was unusual in Sil-
icon Valley and quickly became established
JUDGES
as an expert on U.S. tech that could do well
Alfred Lin—partner, Sequoia
back home. In 2014 she decided to open
Capital
Rebecca Lynn—partner, her own shop.
Canvas Ventures NewGen specializes in early-stage
Megan Quinn—general
partner, Spark Capital tech investments and has raised a
Naval Ravikant—cofounder, $17 million first fund and a $75 million
AngelList second one. The firm has made 38 in-
vestments so far, including ones in
Chat Sports (sports content and
news that are personalized using AI
algorithms), Grubmarket (an online
farmers’ market) and Stratifyd (data-
driven sentiment-analysis tools). “My
personality is I wish for the best, I pre-
pare for the worst,” Zhang says. “I may
look like a petite Asian girl, but I don’t want
anyone to tell me that I can’t do it.”
POLYESTER CREPE DRESS BY BCBG MAXAZRIA ($298) AND METALLIC PYTHON-STAMPED SANDAL BY GIUSEPPE ZANOTTI DESIGN ($845).
 Social
Entrepreneurs
Aditya Agarwalla, 23
Cofounder, Kisan Network
Noam Angrist, 25
Cofounder, Young 1ove
Ricky Ashenfelter, 29
Cofounder, Spoiler Alert
Robert Bergquist, 24;
Brittany Bergquist, 26
Cofounders, Cell Phones for Soldiers
Sixto Cancel, 24
CEO, Think of Us
Corinne Clinch, 23; Uriel Eisen, 24
Cofounders, Rorus
Emily Cunningham 26;
Kwami Williams, 25
Cofounders, MoringaConnect
Tsechu Dolma, 24
Founder, Mountain Resiliency Project
Brit Gilmore, 29
President, The Giving Keys
Jason Green, 27; Matt LaRosa, 23
Cofounders, Edenworks
Sam Greenberg, 24;
Sarah Rosenkrantz, 24
Cofounders, Y2Y
Kristof Grina, 26; Kathleen O’Keefe,
26; Jeff Prost-Greene, 26
Cofounders, Up Top Acres
Afzal Habib, 28;
Sabrina-Natasha Habib, 28
Cofounders, Kidogo
Tina Hovsepian, 29
Founder, Cardborigami
John Lewandowski, 26
Founder, Disease Diagnostic Group
Quardean Lewis-Allen, 29
Founder, Made in Brownsville
Evan Lutz, 24
Cofounder, Hungry Harvest
Sara Minkara, 27
Founder, Empowerment Through
Integration
Genevieve Nielsen, 24
Cofounder, mRelief
Daquan Oliver, 24
Founder, WeThrive
Liz Powers, 28
Cofounder, ArtLifting
Sam Pressler, 24
Founder, Armed Services Arts Partnership
Teju Ravilochan, 29
Teju Ravilochan, 29 Cofounder, Unreasonable Institute
Liana Rosenman, 25; Kristina Saffran, 24
COFOUNDER, UNREASONABLE INSTITUTE Cofounders, Project HEAL
Ryan Ross, 28
It’s unreasonable: Fresh out of college and without ever founding Program director, Halcyon Incubator
a company himself, Teju Ravilochan built an accelerator for social Michael Roytman, 28
entrepreneurs tackling the world’s unsolved problems from pov- Cofounder, Dharma Platform
erty to clean-water access. The company draws its name from a Annie Ryu, 26
George Bernard Shaw quote that claims “All progress depends on Founder, The Jackfruit Co.
the unreasonable man.” For the Unreasonable Institute that means Mario Jovan Shaw, 27; Jason Terrell, 26
Cofounders, Profound Gentlemen
finding entrepreneurs who are willing to tackle complex problems at
Rachel Sumekh, 25
scale, even if on paper they’re unqualified. Founder, Swipe Out Hunger
To make up for their inexperience, Ravilochan and his cofound- Galen Welsch, 29
ers created a massive network of mentors, such as pioneering social Cofounder, Jibu
entrepreneur Paul Polak and Google X cofounder Tom Chi, and cap-
JUDGES
ital partners, including the Rockefeller Foundation. To date the insti-
Jean Case—cofounder, Case Foundation
tute has graduated 148 startups who have raised over $155 million. Cheryl Dorsey—president, Echoing Green
“We admitted that we did not know what it took to solve these prob- Randall Lane—editor, Forbes magazine
lems,” says Ravilochan. “We were our own customers.” Kiah Williams—cofounder, SIRUM

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JANUARY 24, 2017 FORBES | 77

Enterprise 30 UNDER 30

Technology
Jobert Abma, 26; Michiel Prins, 26
Mitchell Hashimoto, 27
Cofounders, HackerOne CO FOUNDER, HASHICORP
Raphael Arar, 29
Designer and researcher, IBM When Mitchell Hashimoto worked for a consulting firm while an undergrad at the University of
Leore Avidar, 28; Harry Zhang, 27 Washington in 2010, he was frustrated by how much time he spent priming clients’ computers
Cofounders, Lob.com with the right software setup. As a fix, Hashimoto wrote code automating the process, cutting
Payam Banazadeh, 25; down setup time from about 15 hours to 15 minutes. He made his software, called Vagrant, open
William Woods, 28
Cofounders, Capella Space source, and within a few years millions of developers and IT professionals were die-hard users.
Shane Scranton, 26;
HashiCorp now offers seven open-source tools that automatically install and configure
Nate Beatty, 25 software in computers, servers and databases. The 60-person startup has raised $34.7 million
Cofounders, IrisVR in venture funding and has a roster of blue-chip customers includ-
Laura Behrens Wu, 25; ing eBay, Disney, PayPal, Stripe, Pinterest, Home Depot and near-
Simon Kreuz, 27
Cofounders, Shippo ly every U.S. bank.
Max Bennett, 26 “Every company is realizing the traditional way of doing IT
Cofounder, Bluecore isn’t going to scale,” Hashimoto says. “Tractor companies or in-
Scott Britton, 28 surance companies want to focus on their business, not on
Cofounder, Troops.ai building the delivery mechanism for their software.”
Mackenzie Burnett, 23;
Dan Gillespie, 23
Cofounders, Redspread
Nick Candito, 29
Cofounder, Progressly
Mathilde Collin, 27
Cofounder, Front
Brad Cordova, 27
Cofounder, TrueMotion
Ryan Disraeli, 29
Cofounder, TeleSign
Andrew First, 27
Cofounder, Leanplum
Wade Foster, 29; Mike Knoop, 27
Cofounders, Zapier
Larry Gadea, 29
Founder, Envoy
Mitchell Hashimoto, 27;
Armon Dadgar, 25
Cofounders, HashiCorp
Steven Hong, 28
Cofounder, Kumu Networks
Peter Johnston, 28
Founder, Lystable
Charlotte Kiang, 25
Mission integration engineer, SpaceX
Curtis Liu, 28; Spenser Skates, 28
Sean
Cofounders, Amplitude
Beyang Liu, 27; Quinn Slack, 28
Petterson,
Cofounders, Sourcegraph
Andrew Maas, 29
26
Cofounder, Roam Analytics COFOUNDER,
ST R ON GA R M
Chris Maddern, 28
Cofounder, Button T ECHN OLOGI ES
Jessica McKellar, 29 Safety is a major problem
Director of engineering, Dropbox
for blue-collar workers: More
Kylan Nieh, 24
Senior product manager, LinkedIn than 3% of manufacturing work-
Samantha Radocchia, 28
ers suffered a workplace injury in
Cofounder, Chronicled 2015, according to the Bureau of
Hany Rashwan, 26 Labor Statistics. Brooklyn-based
Founder, Payout.com StrongArm Technologies makes
Cecilia Stallsmith, 27 wearable protective technol-
Senior manager, platform and
partner marketing, Slack ogy to help industrial workers
Dmitriy Zaporozhets, 29 avoid injury. Its exoskeletons,
Cofounder, GitLab which retail for $275 to $630,
align the body to reduce arm
JUDGES
fatigue, avoid muscle strains and
Jeff Lawson—cofounder, Twilio
Douglas Leone—managing partner, sprains, and prevent back injuries. Sean
Sequoia Capital Petterson, whose father was a construction worker,
Maran Nelson—cofounder, Clara Labs studied product design at the Rochester Institute of
Technology, where he came up with the idea for the
company. StrongArm has raised $4.5 million from in-
vestors, including 3M, which helps with distribution,
and customers include Con Edison and military ship-
MITCHELL HASHIMOTO: WOOL AND SILK SPORT JACKET BY CANALI ($1,750); COTTON AND LINEN SHIRT BY builder Huntington Ingalls Industries. Revenue should
TED BAKER ($165); LEATHER GRANDPRØ TENNIS SNEAKERS BY COLE HAAN ($130).
SEAN PETTERSON; LEATHER BOMBER BY BRUNELLO CUCINELLI ($5,225); MERINO WOOL SHIRT ($164) AND MOTOR
approach $8 million in 2017. Says Petterson: “I really
CITY PANTS ($348) BY JOHN VARVATOS; LEATHER AND FELT SNEAKERS BY GIUSEPPE ZANOTTI DESIGN ($695). wanted to create products that would bring people
like my family members home a little bit safer.”

78 | FORBES JANUARY 24, 2017

 Manufacturing
& Industry
Rhae Adams, 26
Director of energy and mining markets,
Planetary Resources
Will Ahmed, 27; John Capodilupo, 25;
Aurelian Nicolae, 28
Cofounders, Whoop Candice Galek, 29
Chad Amonn, 29 FOUNDER, BIKINI LUXE
Cofounder, Inova Drone
Justin Barozie, 28 In March 2016 former fashion model Candice Galek decided to promote Bikini
Associate manager of manufacturing Luxe, her three-year-old online swimsuit retailer, on an unconventional plat-
engineering, battery, Tesla Motors
form: professional networking site LinkedIn. The series of sexy photos of models
Jeremy Blum, 26
Head of electrical engineering, Shaper Tools wearing her flesh-baring products stirred a backlash from users who blasted her
Zack Bomsta, 28; Jordan Monroe, 27;
for treating the buttoned-up site like an Instagram feed.
Kurt Workman, 27 “It was very suit-and-tie, and here I was posting these beautiful women,
Cofounders, Owlet Baby Care sprawled out on a beach in Tahiti,” says Galek. Instead of backing down, she
Kasey Catt, 28; Noah Snyder, 28 upped the ante with an ultrasexy shot of a neon green and lavender Montce bikini
Cofounders, Interphase Materials
that exposed the mostly bare derriere of Miss Universe contestant Natalie Roser.
Gaurab Chakrabarti, 28; Sean Hunt, 27
Cofounders, Solugen In her caption Galek wrote, “Is this appropriate for LinkedIn?” The post soon had
Ben Cogan, 26; Jesse Horwitz, 28 50,000 views and 500 comments.
Cofounders, Hubble Contacts The controversy boosted Bikini Luxe’s sales by 20%. In 2017 Galek is aiming
Tyler Collins, 28; Mike Radenbaugh, 27; to hit $5 million in revenue and produce her own house brand. The University of
Marimar White-Espin, 27 Miami grad says that her 18-hour workdays are worth the gratification she gets
Cofounders, Rad Power Bikes
from running her own business, which she far prefers to life in front of the cam-
Marine Couteau, 26; Ladislas de Toldi, 28
Cofounders, Leka era: “I’ve never been that great at having someone else tell me what to do.”
Chase Feiger, 28
Cofounder, Parsable
Anurag Garg, 29
Cofounder, Dattus
Caroline Guenther, 29
Integrated business planning manager,
Cisco Systems
Neha Gupta, 28
Business operations, Daqri
Cody James, 21
Robotics programmer, self-employed
Coby Kabili, 28; Braydon Moreno, 29
Cofounders, Robo 3D
Jake Kassan, 25; Kramer LaPlante, 25
Cofounders, MVMT
Lane Konkel, 26
Lean leader, General Electric
Angela Luna, 22
Curren Krasnoff, 24
Cofounder, Cortex Composites
Art & Style Fashion designer, Adiff
Sarah Meyohas, 25
Hasier Larrea, 28 Danielle Bernstein, 24 Artist
Founder, Ori Blogger, WeWoreWhat
Jane Moseley, 29
Marco Mascorro, 29 James Charles, 17 Artist/model
Cofounder, Fellow Robots Makeup artist
Bethany Mota, 21
Alex Mathews, 22; Param Shah, 21 Petra Collins, 24 YouTube personality
Cofounders, Fusiform Artist
Willa Nasatir, 26
Kayla McDonell, 26 Morgan Curtis, 29 Artist
Exterior lighting design release engineer, Lingerie designer, Morgan Lane
General Motors Jake Rosenberg, 29
Pablo Delcan, 27 Cofounder, Coveteur
Cam Murphy, 29 Graphic designer, Delcan &
Managing director, FEAM Aero Company Rachel Rossin, 29
Artist
Sean Petterson, 26 Peche Di, 27
Cofounder, StrongArm Technologies Model/founder, Trans Models Tschabalala Self, 26
Artist
Patrick Pittaluga, 25; Sean Warner, 25 Candice Galek, 29
Cofounders, Grubbly Farms Founder, Bikini Luxe Amy Shepsman, 29
Jewelry designer, Flaca Jewelry
Jonathan Saperstein, 29 Chloe Gordon, 29;
CEO, Tree Town USA Parris Gordon, 26 Marieclaire St. John, 29
Fashion designers, Beaufille Fashion designer, Dresshirt
Drew Tolly, 26
Data scientist, Caterpillar Arun Gupta, 28; Vanessa Stofenmacher, 29
Julian Connor, 27 Founder, Vrai & Oro
Justin Wenning, 24 Cofounders, Grailed
Welding engineer, Fabrisonic Katie Stout, 27
Skyler Grey, 16 Furniture designer/artist
Artist Paige Dellavalle Walker, 29
JUDGES
Michael Xufu Huang, 22 Jewelry designer, Stella Valle
Jewel Burks—cofounder, Partpic Collector/museum founder,
Jenny Lawton—COO, Techstars John Wise, 29
M Woods Cofounder, Lovepop
John Spirk—cofounder, Nottingham Spirk
Misha Kahn, 27 Jamie Wolfond, 25
Artist Industrial designer, Good Thing
Tahir Carl Karmali, 29 JUDGES
Artist
Carter Cleveland—founder, Artsy
Julia Gudish Krieger, 28
Founder, VillageLuxe Michelle Phan—founder, ipsy
Christian Siriano—fashion designer
CREDIT TK

Claudia Li, 28
Fashion designer, Claudia Li
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JANUARY 24, 2017 FORBES | 79

 Consumer
Technology
Ben Anderson, 28
Cofounder, Amino Apps
Matthew Bailey, 27; Aaron Grant, 27;
Stephen Lake, 27
Cofounders, Thalmic Labs
Colin Beighley, 28; Fergus Noble, 29
Cofounders, Swift Navigation
Joseph Bernstein, 28;
Kayvon Beykpour, 28
Cofounders, Periscope
Christina Bognet, 29
Cofounder, PlateJoy
Michael Brandt, 28;
Geoffrey Woo, 28
Cofounders, Nootrobox
Skinner Cheng, 29;
Pieter Doevendans, 26;
Thibault Duchemin, 25
Cofounders, Ava
Ben Christensen, 24; Garrett Lord, 27;
Scott Ringwelski, 24
Cofounders, Handshake
Joshua Dziabiak, 29; Adam Lyons, 29
Cofounders, The Zebra
Steve El-Hage, 27
Cofounder, Massdrop
Mattieu Gamache-Asselin, 26;
Jamie Karraker, 27
Cofounders, Scriptdash
Sergey Gonchar, 24;
Eugene Nevgen, 24
Cofounders of MSQRD, Facebook
Yunha Kim, 27
Founder, Simple Habit
Kai Kloepfer, 19
Founder, Biofire Technologies
Lexie Komisar, 29
Senior lead, IBM Digital
Innovation Lab
Noah Kraft, 29
Cofounder, Doppler Labs
Jeremie Lasnier, 27;
Andre Lorenceau, 27;
Saswat Panda, 28
Cofounders, LiveLike VR
Joseph Lau, 27;
Nikil Viswanathan, 29
Cofounders, Down to Lunch
Cory Levy, 25
Cofounder, One Inc.
Alexey Moiseenkov, 26
30 UNDER 30 Cofounder, Prisma Labs
Keller Rinaudo, 29

Noah Kraft, 29 Cofounder, Zipline

Jonathan Rodriguez, 27
COFOUNDER, DOPPLER LABS Spectacles architect, Snapchat
JD Ross, 26
Noah Kraft is a rookie in the world of hard- Cofounder, OpenDoor
ware, but he’s building one of the most am- David Rust, 27
bitious audio products in years. In June 2016 Director of operations strategy, Lyft
Kraft and his San Francisco team unveiled Brian Tolkin, 26
Senior product manager,
the Here One wireless earbuds, which, like Shared Rides, Uber
all headphones, let you listen to music and Evan Wallace, 27
take phone calls but also filter out specif- Cofounder, Figma
ic noises from the outside world. Unlike nor- Justin Wetherill, 29
mal noise-canceling headphones, which cre- Cofounder, uBreakiFix
ate a Cone of Silence effect, the Here One Whitney Wolfe, 27
Founder, Bumble
has multiple directional microphones that let
Ajay Yadav, 29
you control which sounds—a baby crying or Founder, Roomi
your boss’ voice—you can still hear. “Every- Alexandra Zatarain, 27
one’s talking about wearables. But most of Cofounder, Eight
the focus is on the eyes and the wrist. And
JUDGES
we made a bet early on that the ears were
Steve Anderson—founder, Baseline
actually a more elegant place.” Ventures
The company has raised $50 million, has John Collison—cofounder, Stripe
more than 65 employees and will start ship- Aileen Lee—founder, Cowboy Ventures
ping Here One to consumers in early 2017.
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($680); SEAMASTER DIVER 300M CO-AXIAL 41 WATCH BY OMEGA ($4,400).

80 | FORBES JANUARY 24, 2017

 Games
Lishan AZ, 26
Game designer, University of
Southern California
Eric Barone, 29
Game developer, ConcernedApe
Zaqueri Black, 24
Professional League of Legends
player, Counter Logic Gaming
Joe Brammer, 24
Senior producer, Bulkhead
Interactive
Kitty Calis, 26
Freelancer, Kitty Calis
Fabiano Caruana, 24
Chess grandmaster, Fabiano
Caruana
James Earl Cox III, 26
Cofounder, Seemingly Pointless
Juan DeBiedma, 23
Professional Super Smash Bros.
Melee player, Team Liquid
Andy Dinh, 24
Founder, Team SoloMid
Natalie Gravier, 25
Visual designer, USC Institute for
Creative Technologies
Lisy Kane, 29
Producer, League of Geeks
Gennadiy Korol, 29
Project manager, Moon Game
Studios
Jasmine Lawrence, 25
Program manager II, Microsoft
Auguste Massonnat, 28
CEO, Room on Fire
Daniel Mullins, 24
Indie game designer, Daniel Mullins
Games
Jenny Qian, 29
Director of business operations,
Twitch
Rachel Quirico, 28
eSports host, Cyber Solutions
Agency
Khaled Abdel Rahman, 25
Product manager, Google
Matt Salsamendi, 19
Cofounder, Beam
Alex Schwartz, 29
CEO, Owlchemy Labs
Yuting Su, 28
Founder, Thinker-Tinker
CREDIT TK
Tomber Su, 25
Managing director, High School
Starleague
Max Temkin, 29
Cofounder, Cards Against Humanity
Gabriel Toledo, 25
Professional Counter-Strike: Global
Offensive player, SK Gaming
Josh Watson, 29
eSports operation manager, Psyonix
Noah Whinston, 22
CEO, Immortals
Zach Wigal, 27
Founder, Gamers Outreach
Liam Wong, 29
Graphic design director, Ubisoft
Entertainment S.A.
Andrey Yanyuk, 24
Founder, Tempo Storm
Olga Zinoveva, 26
Producer, 343 Industries
JUDGES
Brandon Beck—cofounder, Riot
Games
Jade Raymond—founder, Motive
Studios Andy Dinh, 24
Bonnie Ross—corporate vice FOUNDER, TEAM SOLOMID
president, Microsoft
In the world of competitive
videogaming, Andy Dinh may
be the next Michael Jordan or
Nolan Ryan—a professional play-
er turned team owner and sports
icon. His Team SoloMid is North
America’s top squad in the Ten-
cent-owned game League of
Legends, a hugely popular
eSport that attracts 100 million
players monthly, selling out
arenas like Madison Square
Garden for live competitions.
“As I just competed more
and more, eSports was taken a
lot more seriously,” Dinh says.
“[Now] you’re seeing billion-
aires buy teams in eSports.”
After failing to persuade
existing eSports organizations to
pick up his team, Dinh formed TSM
in 2009. He ran the organization while
still serving as captain of the five-man team
before stepping down in 2013 to focus sole-
ly on management. TSM’s YouTube channel
has more than a half-million subscribers, and
its star player, Søren “Bjergsen” Bjerg, boasts
1.2 million followers on Twitch. Dinh has been
aggressive about monetizing the business,
bringing in sponsors like Geico, HTC,
Red Bull and Axe.
JANUARY 24, 2017 FORBES | 81
 David Freed, 28
PR OJECT MA N AGER ,
N ET POW ER DEMON ST RAT I ON PLA N T

30 UNDER 30 David Freed oversees a $140 million program to build

a first-of-its-kind power plant near Houston that will
Health Care burn natural gas. The 50-megawatt plant is designed
to emit no carbon dioxide or other pollutants. The trick
Ankur Aggarwal, 27; Hareesh is in the plant’s revolutionary design, using something
Ganesan, 25; Rahul Jain, 26; called the Allam Cycle, which captures carbon diox-
Nick Valilis, 27
Cofounders, TowerView Health ide so that it can be injected and sequestered in old oil-
Elizabeth Asai, 25; Elliot Swart, 25 fields rather than released into the atmosphere. Exelon
Cofounders, 3Derm and Toshiba back the project. “I believe climate change
Adam Behrens, 28 is the challenge of our generation,” says Freed. “There’s
Postdoctoral fellow, MIT
a lot of really great things [being done] in renewables
Archit Bhise, 25; Vinayak Ramesh, 26
Cofounders, Wellframe and solar and wind, but in order to limit the worst im-
Carrie Cowardin, 28
pacts of climate change, carbon capture has to be part
Postdoctoral fellow, Washington of the solution.
University “My best day will be when this technology actual-
Matthew De Silva, 29 ly works and we know that we can make an impact on
Founder, Notable Labs
the energy world.”
Prarthna Desai, 27
Operations, Zipline
Riley Ennis, 23; Gabriel Otte, 28
Cofounders, Freenome
Jiang He, 28
Postdoctoral fellow, MIT
David Hysong, 29
Founder, Shepherd Therapeutics
Emilia Javorsky, 28
Cofounder, Arctic Fox
Lydia Kisley, 28
Postdoctoral fellow, University of
Illinois, Urbana-Champaign
Vivek Kopparthi, 27
Cofounder, NeoLight
Michael Martin, 29
Cofounder, RapidSOS
Nicole Moskowitz, 26;
Jessica Traver, 25
Cofounders, IntuiTap Medical
Alaa Murabit, 27
High-level commissioner, UN
Sudhakar Nuti, 25
M.D. candidate, Yale University
Kevin O’Rourke, 29
M.D./Ph.D. student, Weill Cornell
Medical College
Shaun Patel, 28
Orthopedic surgery chief resident,
Harvard Medical School
Ashwin Pushpala, 28
Founder, Sano
Srilakshmi Raj, 29
Postdoctoral fellow, Cornell University
Matthew Sacchet, 29
Postdoctoral fellow, Stanford University
Emily Schlichting, 27
Chief of staff, Office of the Assistant
Secretary for Legislation, Department
of Health and Human Services
Tyler Shultz, 26
Visiting researcher, Stanford University
Niko Skievaski, 29
Cofounder, Redox
Rohan Suri, 17
Founder, Averia Health Solutions
Gloria Tavera, 29
President of the board, Universities
Allied for Essential Medicines
Austin Walker, 28
Cofounder, Innovein
Tim Wang, 28
Cofounder, KSQ Therapeutics Michael Martin, 29 “Despite all the ways that technology has transformed our
lives, [911] calls are still going through a 1960s infrastruc-
Arsani William, 27 CO FOUNDER, RAPIDSOS
Investment professional, Farallon ture,” says the company’s cofounder/CEO, Michael Martin.
Capital Management Last year more than 10,000 people died when they could RapidSOS has raised $14 million and can now handle
not relay fast and accurate information after calling 911. 911 calls nationwide. The service is being used just 25,000
JUDGES
People in danger don’t always have the presence of mind times a month, about 0.1% of all 911 calls, so there is plen-
Ann Lamont—managing partner, Oak
Investment Partners to press the right numbers and explain where they are. But ty of room to grow. “This technology will be preinstalled
Nat Turner—cofounder, Flatiron Health what if your smartphone could do that for you? That’s the across your life, whether it’s on your wearable, already in
Anne Wojcicki—cofounder, 23andMe
idea behind RapidSOS’ smartphone app, Haven. With a sin- your car, on your smartphone. So that whenever you need
gle touch, it sends the 911 dispatcher your exact location. it, it is there for you.”
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TED BAKER ($39); SILK POCKET SQUARE BY CHARLES TYRWHITT ($20); LEATHER GRANDPRØ SNEAKERS BY COLE HAAN ($130).
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82 | FORBES JANUARY 24, 2017 BY RALPH LAUREN; BYRON JEANS BY HUDSON JEANS ($189); JACOB MONKSTRAP BOOTS BY JOHN VARVATOS ($448).
Energy
Michael Alfaro, 28
Head of exploration and
production investing, Zimmer
Partners
Elizabeth Barno, 26
Community manager,
Greentown Labs
Kevin Barry, 23;
Thaddeus Tarkington, 24
Cofounders, FilterEasy
Charles Cai, 29
Cofounder, MG Fuels
Keiana Cave, 18
Founder, Mare
Anthony Diamond, 29;
Amrit Robbins, 27
Cofounders, Axiom Exergy
James Ellsmoor, 24
Director, Solar Head of State
Giles Eperon, 29
Research fellow, University of
Washington
David Freed, 28;
Mike McGroddy, 29
Project manager/principal,
Net Power Demonstration Plant
Nishant Garg, 29;
Jimit Shah, 28
Cofounders, Flow Labs
Thomas Healy, 24
CEO, Hyliion
Christopher Hopper, 29
Cofounder, Aurora Solar
Samir Ibrahim, 28
CEO, SunCulture
Christina Karapataki, 29
Principal, Schlumberger
Paige Kassalen, 23
Engineer, Solar Impulse
Ravi Kurani, 29
Cofounder, Sutro
Ann Makosinski, 19
Founder, Makotronics
Enterprises
Maanasa Mendu, 14
Student, Mason High School
Gabriel Mesa, 15
Founder, Mesa Foundry
Sam Slaughter, 29
Cofounder, PowerGen
Renewable Energy
Arthur Souritzidis, 28
CEO, Momentum Solar
Travis Thompson, 29
Research fellow, University of
Michigan
Colin Touhey, 29
CEO, Pvilion
Charlie Upshaw, 28
Cofounder, IdeaSmiths
Augusta Uwamanzu, 18
Student, Harvard University
Richard Walsh, 29
Program lead of clean energy
solutions, WGL Energy
Richard Wang, 27
CEO, Cuberg
Raymond Weitekamp, 28
CEO, polySpectra
Kendrick Worrell, 28
Cofounder, Accelerate Resources
Sam (Yinglin) Xu, 29
Head of oil and gas investment
banking, CohnReznick Capital
Markets Securities
JUDGES
Matt Owens—cofounder,
Extraction Oil & Gas
T. Boone Pickens—founder, BP
Capital
Allison Lami Sawyer—cofounder,
Rebellion Photonics
Law & Policy
Kate Aitken, 29 Elizabeth Kelly, 29
Chief of staff for federal policy and federal Director of policy, United Income
affairs, Airbnb Sarah McBride, 26
Jessica Anderson, 29 National press secretary, Human Rights
Grassroots director, Heritage Action for Campaign
America Svante Myrick, 29
Adina Appelbaum, 29 Mayor, City of Ithaca
Equal Justice Works Fellow, Capital Area Amanda Nguyen, 25
Immigrants’ Rights Coalition Founder, Rise
Andrew M.J. Arruda, 27; Pargles Dall`Oglio, Steven Olikara, 26
27; Jimoh Ovbiagele, 23 Founder, Millennial Action Project
Cofounders, ROSS Intelligence
Sonya Passi, 28
Ryan Burke, 29 Founder, FreeFrom
Special assistant to the president for economic
policy, the White House Jonathan Perichon, 26; Daniel Yanisse, 28
Cofounders, Checkr
Jamira Burley, 28
National deputy millennial vote director, Andrew Rausa, 29
Hillary for America Advertising and privacy counsel, Facebook
Elizabeth Clark-Polner, 29 Jordan Roberts, 29
Associate research scholar in law, Yale Associate, Fenwick & West
University Varun Sivaram, 27
Matthew Denhart, 29 Acting director for energy security and climate
Executive director, Calvin Coolidge change, Council on Foreign Relations
Presidential Foundation Xiyin Tang, 29
Johnetta Elzie, 27; Samuel Sinyangwe, 26 Attorney, Mayer Brown
Cofounders, Campaign Zero Kendall Hope Tucker, 24
Aaron Ginn, 28 Founder, Polis
Cofounder, the Lincoln Network Ryan Walsh, 29
Greg Glod, 29 Chief deputy solicitor general, Wisconsin
Manager of state initiatives and senior policy Department of Justice
analyst, Texas Public Policy Foundation Matt Watters, 28
Alex Harris, 28 Team lead, McKinsey & Company
Law clerk to Justice Anthony Kennedy, the
Supreme Court of the United States JUDGES
Chelsea Harrison, 29 Arthur C. Brooks—president, American
Senior policy communications manager, Lyft Enterprise Institute
Jon Hartley, 27 William Eskridge Jr.—John A. Garver Professor
Cofounder, Real Time Macroeconomics of Jurisprudence, Yale Law School
Nate Levine—cofounder, OpenGov
Hope Hicks, 28 Anne-Marie Slaughter—president, New
Press secretary, Donald J. Trump for President America
Joshua House, 28
Attorney, Institute for Justice
Hope Hicks, 28 says, “he’s magnetic. People are drawn to him.”
She launched her PR career at New York City’s Hiltzik
P R E SS S EC R E TA RY, Strategies, whose clients included the Trump Organization,
DONALD J. TRUMP FOR PRESIDENT
and then quit to work directly for the family’s business. In
Hope Hicks rocketed to prominence last year as a one-wom- Washington she’s continuing to fend off the fourth estate for
an press team for a candidate known for eschewing talking her “dream client,” and she hopes to parlay that into “even
points and press conferences in favor of hurling curveballs via a small role” in the Trump Administration. The 24/7 life of
Twitter. She has reputation for being tight-lipped, but when a Beltway operative is a new experience for this Connecti-
your boss is Donald Trump, that’s hardly a problem. cut native, who used to go to bed at 9:30 p.m. “I don’t sleep
“Whether it’s Twitter or an arena or a TV show,” Hicks much, but when I do, I sleep well.”
JANUARY 24, 2017 FORBES | 83
 Sports
Alessandro Babini, 25
Cofounder, Humon
Andrew Barge, 29
Content development manager,
Twitter
Odell Beckham Jr., 24
Wide receiver, New York Giants
Martellus Bennett, 29
Tight end, New England Patriots
Mookie Betts, 24
Right fielder, Boston Red Sox
Simone Biles, 19
Gymnast, Team USA
Elena Delle Donne, 27
Shooting guard, Chicago Sky
Draymond Green, 26
Forward, Golden State Warriors
Javier Hernandez, 28
Forward, Bayer Leverkusen
Kyrie Irving, 24
Point guard, Cleveland Cavaliers
Patrick Kane, 28
Right wing, Chicago Blackhawks
Akshay Khanna, 29
Vice president of strategy,
Philadelphia 76ers
Chloe Kim, 16
Snowboarder
Julia Landauer, 25
Stock car driver, Nascar
Sydney Leroux, 26
Forward, FC Kansas City
Tatyana McFadden, 27
Wheelchair marathon athlete,
Team USA
Collin Meador, 29
Investment associate,
San Francisco 49ers
Von Miller, 27,
Linebacker, Denver Broncos
Katie Nolan, 29
TV host, Fox Sports
Grant Norris-Jones, 27
Director of integrated
partnerships, FanDuel
Nneka Ogwumike, 26
30 UNDER 30 Forward, Los Angeles Sparks
Kate Pratt, 28

Von Miller, 27 Director of marketing

partnerships and team sales,
Madison Square Garden Co.
LINEBACKER, DENVER BRONCOS
Carey Price, 29
Since being selected second overall in the 2011 Goalie, Montreal Canadiens
NFL Draft, Von Miller has snagged Defensive Milos Raonic, 26
Tennis player
Rookie of the Year, Pro Bowl and Super Bowl 50
Chris Sale, 27
MVP honors. The All-Pro linebacker leveraged his Pitcher, Boston Red Sox
on-field performances into a six-year, $114.5 million Evan Shugerman, 27
contract with the Broncos, making him the high- Sports partnerships manager,
Facebook
est-paid defensive player in the history of the NFL.
Shakur Stevenson, 19
That contract isn’t the only thing beefing up Boxer, Team USA
his bank account. While it’s normally superstar Jake Stone, 26
QBs who are Madison Avenue favorites, Miller has Director of business development,
endorsement deals with EA Sports, Old Spice, Omnigon
Adidas and Microsoft. He is also an investor, with Nigel Sylvester, 29
BMX rider
a stake in Twitter-backed headphone compa-
Justin Zayat, 24
ny Muzik and a chunk of Chef’s Cut Real Jerky. Vice president, Zayat Stables
The former Texas A&M poultry-science major
also runs his own chicken farm in his hometown, JUDGES
Desoto, Texas. “The person I am on the football James Harden—shooting guard,
Houston Rockets
field, that’s the person that you’ll get when I’m Phil Knight—chairman emeritus,
with my family. I try not to live double lives.” Nike
Casey Wasserman—chairman,
Wasserman Media Group

84 | FORBES JANUARY 24, 2017

Last year, Ben was too sick to dream.
He has Primary Immunodeficiency or PI.
Thanks to the Jeffrey Modell Foundation,
he has been properly diagnosed and treated.
Now he can search for the cure.

helping children reach for their dreams

info4pi.org
 30 UNDER 30

The
Black Sheep
At 25, James Proud has a quarter-billion riding on
reinventing how you sleep. And this original Thiel
Fellow is determined to do it his way—or fail trying.
BY BRIAN SOLOMON

CREDIT PINES
ETHAN TK FOR FORBES

86 | FORBES JANUARY 24, 2017

JANUARY 24, 2017 FORBES | 87
 30 UNDER 30 James Proud

I
t’s only six blocks from
James Proud’s office, a brick-
walled converted bakery
in San Francisco’s Mission
District, to Central Kitchen, a
hip restaurant owned by fel-
low FORBES 30 Under 30
alum Thomas McNaughton,
but that’s plenty of time for
the 25-year-old to take on
more or less all of Silicon
Valley. People who complain
about finding good talent just don’t know how
to recruit. Traditional venture capital firms? Un-
necessary. By the time we reach the host stand,
he’s deriding the entire tech community for their
“airy-fairy bullsh-t about changing the world.”
This absolutism feels all the more jarring the godfather himself, Thiel. It’s his first person-
given that his short, bulldog frame and pudgy al investment in one of his fellows. “James stood
baby face make him look like the high school out from the start as extremely tenacious and de-
computer-lab nerd he once was, a persona but- termined,” Thiel says.
tressed by his wardrobe (a sweatshirt and sweat- And now he’s rich, too. Proud still owns about
pants almost all the time, a black T-shirt if he’s half of Hello, pushing him well into centimillion-
feeling dressy) and diet (no vegetables, no fish). aire territory.
The latest in the 21st-century cavalcade of cocky Proud’s chosen market is right up there with
prodigies in the mold of Sean Parker, Mark Zuck- death and taxes in terms of universality: sleep,
erberg and Evan Spiegel, Proud was born thumb- which has suddenly become a bit more sexy and
ing his nose at other people. “No one can make a bit less sleepy than it has been for the past few
me do what I don’t want to do,” he says. He’s been millennia. “You’re starting to see a shift in con-
professionally bred this way, too. versation around sleep that happened in the ’80s
James Proud was in the first class of Thiel Fel- around exercise and in the ’90s and 2000s with
lows, the upstarts—122 and counting—who for organic and healthy eating,” Proud says. Arianna
the past seven years have taken $100,000 each Huffington has raised $7 million for Thrive Glob-
from billionaire contrarian Peter Thiel on the al, which offers a suite of products and services
condition they skip college. And he’s also the driven by the idea that more sleep translates to a
most successful. Over the past four years he’s better life, and Casper, the mattress-will-change-
ETHAN PINES FOR FORBES

raised roughly $40 million for his startup, Hello, your-life startup, has raised $70 million.
mostly at a $250 million valuation. He’s recently Proud’s focus is on hardware, specifically an
been raising bridge financing, at an even higher orb the size of a tennis ball that sits on your bed-
valuation, including a direct $2 million ante from side table and uses a variety of hidden sensors to

88 | FORBES JANUARY 24, 2017

track your movements and the surrounding nighttime
atmosphere. The $149 gadget, called Sense, grades your
sleep on a scale from 0 to 100—and tries to help you im-
prove that score over time. Proud claims that the Sense
holiday rollout at Target is the biggest the retailer has
ever done for a new electronics product (Target says
that’s incorrect).
Big orders won’t guarantee big success, at least not
immediately. A source close to the company says the in-
ternal sales projection for 2017 is 250,000 Sense units,
implying net revenues in the ballpark of $20 million.
Tiny compared even to a flagging competitor like Fit-
bit, which likely finished 2016 with sales of more than
$2.3 billion—and even at that size, it’s barely profitable.
Meanwhile, a triad of monoliths—Amazon, Apple and
Google—stand determined to put connected devices
on every conceivable surface of your body and in every
space in your home.
What does Proud think of his trillion-dollar compet-
itors? Looking up from his lamb ribs and roast pork, he
lifts both hands in a double-middle-finger salute.
It’s the kind of brashness that a Peter Thiel could
love. That tack surely worked for Zuckerberg and Spie-
gel. But youthful hubris goes back to Icarus, and that tale
didn’t end with an IPO. Given his complicated market,
dotted with pitfalls and entrenched enemies, Proud will
ultimately demonstrate whether unswerving self-confi-
dence is a necessary entrepreneurial attribute or a po-
tentially fatal flaw. At the FORBES
Under 30 Summit in Boston last Oc-
tober, Proud was asked backstage
whether he’d ever met Richard Bran-
son, whom he would soon join on a
panel. “The real question,” Proud re-
sponded, “is whether Branson has
ever met me.”
PROUD GREW UP less than an hour
away from Branson’s childhood
home south of London. His father
worked for the British civil service,
and his mother was a secretary who
later stocked grocery-store shelves
at night. Proud preferred haunting
the computer lab to making friends
on the playground. His first Internet
payday came at the age of 12, when
he built a website for a scammer he
had met through an online forum
(he spent the money on a Sony Erics-
son mobile phone and Creative Labs
MP3 player). As a hired hand for Web
projects, he began making hundreds
of dollars per job. At one point his
PayPal account was frozen because
he was underage, so cash arrived in
the mail, prompting questions from
his parents.
At 17 Proud started GigLocator,
a website that aggregated concert-
ticket information, and persuad-
ed his parents to let him take a gap
year to work on it. He fed himself by
faking hole punches on loyalty cards
from a British chicken chain, Nan-
do’s, or else schmoozing venture cap-
italists and other European techies
JANUARY 24, 2017 FORBES | 89
30 UNDER 30 James Proud
over lunch, always letting them pick up the check. “Al-
ready back then, James had this laser-sharp focus about
what he was going to do for the next ten years,” says Spo-
tify founder Daniel Ek, who met Proud playing Ping-
Pong during that period. “It was incredibly rare to see
that from someone who should have been more focused
on girls and school.”
Proud would have been the first in his family to at-
tend college, but when the day came to enroll, he re-
fused to go, despite his parents’ pleas. Then, on a Sep-
tember day in 2010, Proud found his savior at 1 a.m. while
watching a live stream of the TechCrunch Disrupt con-
ference. There Thiel announced his eponymous fellow-
ship: a $100,000 grant to each of 20 teenagers who want-
ed to skip college to pursue another dream. Proud decid-
ed to apply on the spot.
When Thiel flew the finalists out to hobnob in San
Francisco, Proud was surrounded by preppy American
kids with acceptances to Harvard they wanted to turn
down. He returned to London, sure he wouldn’t make
the cut. “I wished I didn’t even come,” Proud says. “I
What does Proud think
of his trillion-dollar
competitors? Looking
up from his lamb ribs
and roast pork, he lifts
both hands in a double-
middle-finger salute.
was going to have to go back and hate my life because I’d
seen that this would be so much better.” But in April 2011
Thiel’s organization called to give him the good news.
They also told him to sit tight until July. Proud, of course,
was in a hurry—and not listening to anyone who would
stop him. He quickly emptied his savings to buy a plane
ticket and then demanded the first Thiel check be sent
early, lest he end up sleeping on the street. They caved.
The fellowship changed Proud’s life, turning him
from an unknown programmer living with his parents to
a member of an inaugural class of wunderkinds. While
crashing on air mattresses and couches for most of the
next year, he took advantage of every door the Thiel brand
opened across Silicon Valley. For a time Proud worked
out of PayPal cofounder Max Levchin’s incubator, and in
June 2012 he offloaded GigLocator to the concert promot-
er Peter Shapiro, earning himself a cool six-figure payday.
90 | FORBES JANUARY 24, 2017
(“That’s one young, smart motherf—ker,” says Shapiro.)
Soon after, Proud began raising money for a new
stealth startup that would become Hello. “I said, ‘I’m in
for whatever amount you’ll let me in for,’” says Shakil
Khan, an early Spotify investor that Proud befriended in
London. “He said, ‘I still haven’t finalized what it’s going
to be.’ And I said, ‘That’s irrelevant.’”
The original idea for Hello was to build a better ver-
sion of the activity-tracker wristband pioneered by Fitbit
and Jawbone. Proud recruited a handful of young hard-
ware engineers and spent 18 months developing a proto-
type, which included a magnetic strap similar to one that
would later appear on the Apple Watch. But over time
Proud quietly soured on its potential. He noticed that
no one on his team wore any existing product on his or
her wrist for more than a few weeks. Consumer surveys
show similar results, with estimates that about a third
of wearables owners give up on their devices within the
first six months. Plus, competition was fierce. Google
would announce Android Wear in March 2014, and the
Apple Watch debuted in September. Proud was already
late to a category in which he no longer believed.
“So what do you do? Do you give the money back to
investors and send everyone home?” he asked.
The epiphany came when Proud flew out to New
York City to attend a birthday party in March 2014.
Distracted by his dilemma, he brainstormed about
products that wouldn’t need to be worn at all times
and suddenly arrived at sleep tracking. People en-
joyed the feature on wristbands but hated wear-
ing them overnight. He brought the team togeth-
er when he returned and told them they would be
scrapping a year and a half of work to start over.
“I wore the wristband prototypes for a good two
weeks after, holding on to the work we had done,”
says Hello’s first industrial designer, Rob Shook.
Proud also had to sell his decision to an angry group of
investors who had supported a $7 million Series A only
months earlier. To placate them, he granted addition-
al shares to everyone who participated in the round, in-
cluding Khan, then-PayPal president David Marcus and
Xiaomi vice president Hugo Barra. “Had the decision to
pivot come three months later, I don’t think the compa-
ny would have survived,” says Dan Rose, Facebook’s vice
president of partnerships and Hello’s only board mem-
ber other than Proud.
PROUD’S MOVE AWAY FROM wearable devices took Hello
out of a crowded but expanding market—an estimated 67
million smart watches will be sold this year—and made
it the pioneer of a completely new one. “If it can work,
it can end up being a consumer device on par with the
iPod,” Thiel says. A huge if. Searching for scientific back-
 Scorecard: How Have the Thiel Fellows Fared?
In 2011 Peter Thiel embarked on an audacious plan: He’d give a group of teenagers $100,000 each to forgo
college—and build their own startups from scratch. It quickly generated immense buzz as applications poured in.
In the end, 24 young entrepreneurs became the first Thiel Fellows. Over the next five years that freshman class
followed a number of different paths. Some stuck with their initial idea, while others changed course completely.
And only a handful completed a key Silicon Valley rite of passage: raising money for their startup. —Matt Drange

Raised Money Stuck With Their Went to School

Only four fellows, or about
First Plan There’s no rule
16% of the original Thiel Roughly half have kept that Thiel Fel-
class, have raised more than going on their original proj- lows can’t
$1 million since taking Thiel up on his offer. ects. Dale Stephens, for ex- eventually at-
Paul Gu, cofounder of Upstart, leads the ample, has stayed at the tend college.
pack, having raised $53 million for the on- startup he founded, Un- At least five fellows have done
line-lending marketplace. Andrew Hsu, College, which puts together gap-year so, including David Luan, who
meanwhile, was the first to programs, while Laura graduated from Yale and has
get funding, scoring $1.5 mil- Deming remains at her a new machine learning com-
lion for his Airy Labs, a maker biotech-focused venture pany, Dextro.
of educational games for kids. capital firm, the Longevity
Fund.

Changed
Directions
Intertwining Ties to Thiel
A dozen or so fellows have
At least three fellows besides James Proud have continued to stay connected moved on from their initial
in some way to Thiel: Eden Full Goh, who started a solar company before leav- concepts. For his part, Sujay
ing for Palantir, the data-mining firm Thiel cofounded; Tom Currier, who joined Tyle worked on founding
Thiel’s Founders Fund as an entrepreneur-in-residence after starting Black Swan Hired, a job-search website,
Solar; and Daniel Friedman, who received funding from FF Angel, one of Thiel’s VC firms, for then left to join one of Hired’s
Thinkful, his startup that offers online coding classes. investors, Sherpa Ventures.

ing, Proud hired Matthew Walker, director of the Sleep
& Neuroimaging Laboratory at the University of Califor-
nia, Berkeley, as Hello’s chief scientist. Walker believes
that lack of sleep is an “epidemic” in First World coun-
tries and that Sense can help fix that. After one year of
use, 71% of Sense users slept longer on average than they
had before, and 57% had more regular wake-up times,
the company claims. Hello hopes to do even better as it
tests more personalized sleep techniques.
ILLUSTRATIONS BY PATRICK WELSH FOR FORBES
lus Rift’s crowdfunding haul. That summer proved an in-
toxicating high, but there was so much to do to make the
marketing pitch a reality that four bottles of celebratory
champagne sat in the office refrigerator unopened until
this past Thanksgiving.
Hello promised delivery by November 2014 but de-
layed the first shipments until February as production
challenges mounted. Sense is a two-part system that in-
cludes a bedside device—an amalgam of LEDs, circuits

Proud proved there was a market for sleep-centered
products, at least among early adopters, with a success-
ful Kickstarter campaign in July 2014. After racing to
build a basic hardware prototype and marketable soft-
ware façade, Hello launched its campaign with a slick
video and a goal of $100,000. It blew past the finish line,
scoring $1 million in the first four days and $2.4 million
after one month, just a hair shy of VR phenomenon Ocu-
and sensors to detect light, sound, temperature and air
quality, all stuffed into a small sphere—and an accompa-
nying battery-powered, Bluetooth-enabled “Sleep Pill,”
which clips to your pillow to track movement. The team
had to design many of the manufacturing tools them-
selves. That following June Hello brought in a $30 mil-
lion cash infusion at the $250 million valuation from the
likes of Temasek Holdings, a government-owned invest-

JANUARY 24, 2017 FORBES | 91

30 UNDER 30 James Proud
ment fund in Singapore, but the rest of the year was lost
to fixing bugs and rewriting core features. In 2016, as
Amazon rolled out the Echo and Google revealed Google
Home, both voice-enabled wireless speakers, Proud
pushed the team to add voice controls to the latest Sense,
which went on sale this past November.
“The big challenge is always: Can you lock in the mar-
ket enough before people develop copycats that are cheap-
er and roughly equivalent?” Thiel says. “This is always
something a little harder for hardware than software.”
Unfortunately, even the new version feels like an un-
finished product searching for a market. After trying it
for a week, I enjoyed Sense’s novelty as a smarter alarm
clock with limited voice commands and the ability to
turn off the alarm with a wave of your hand. But for my
$149, the core functionality is too
inconsistent. It’s supposed to de-
tect when you fall asleep and wake
up, and analyze your tossing and
turning to see how many hours
you’re in deep sleep. Yet the Sense
interprets data gathered from the
clip on my pillow rather than a
band on my wrist, so it frequently
fails to register when I get up from
bed and often confuses my fian-
cée’s movement for my own. Even
if it were accurate, neither the
sleep results nor other measure-
ments are groundbreaking. Every-
one already knows that blackout
The sleep doctor is in: For $149, the Sense is designed
curtains are good for beauty rest to track your sleep—and analyze how to make it better.
and a barking dog is bad.
Other warning signs abound. Proud boasts about the
new Hello displays in nearly 700 Target stores across
the country, but the only inventory in Oakland was one
Sense tucked in a side cabinet next to some Apple TVs
and Linksys wireless routers. A survey of Best Buys
around New York found only one with the product in
stock; other stores indicated you needed to order it. And
when I brought a Sense home, I nearly abandoned the
set-up process after an hour of trying and failing to plug
in the charging cable. Hello says a new manufacturer
had constructed the USB port a millimeter off target in
a few units.
WHILE PLENTY OF QUESTIONS REMAIN about Sense,
Proud now treats his risky pivot as a thesis statement.
He trashes devices that need to be worn (like the Apple
Watch) or require direct interaction (like the home assis-
tants from Amazon and Google). His goal is to cover the
entire 24 hours of your day with a few “nonengagement”
health-tracking devices like Sense. “It’s a tragedy that we
92 | FORBES JANUARY 24, 2017
can’t build and release them all right now,” Proud asserts.
He’ll need to diversify his product line soon to avoid
the fate of other hardware startups like fellow Kickstart-
er darling Pebble, which shut down in December, and
drone maker 3D Robotics, which crashed after burning
through $100 million in funding. Even public companies
like Fitbit (trading down 86% from its peak) and GoPro
(down 90%) have struggled. “On one hand, it’s easier
than ever to build a hardware product,” says Jan Daw-
son, analyst at Jackdaw Research. “But in some ways it’s
harder than ever to be competitive and build a sustain-
able business.”
In the meantime, Proud must mature as the leader of a
50-employee startup trying to go toe-to-toe with compa-
nies that outnumber and out-finance him. While friends
extol Proud as wise beyond his
years, former Hello staffers de-
scribe him as a smart but invet-
erate risk-taker who often unrav-
els in tense situations. “You could
see the pressure got to him, and
sometimes I would think it’s be-
cause he’s young,” a former Hello
engineer says. “He would sudden-
ly rush in saying, ‘We need to do X
because people are complaining
about it.’” Instead of patiently ad-
hering to a long-term plan, Proud
is prone to rash decisions. “The
ability to take risks and be aggres-
sive is the foundation of James’ de-
cision making, and it may eventu-
ally come back to bite him,” says
one ex-Hello employee who worked closely with Proud
for more than two years. “If that day never comes, he’s a
genius. If it does, the warning signs were there.”
Proud doesn’t deny he can be a capricious boss. In De-
cember 2014, on the morning an engineer was set to fly
to China to install the final firmware for the Sense’s first
manufacturing run, Proud decided to add one more fea-
ture. His CTO, Tim Bart, told him it was insane to change
anything in the code at such a late hour, but Proud was
suddenly convinced that Sense should light up and play
a sound when it was plugged in for the first time—like a
computer booting up.
After a bruising argument, Proud got his way. The en-
gineer finished coding the change on the cross-Pacif-
ic flight, and through skill and luck avoided introducing
new bugs into the final product.
Was that last minute intervention a Steve Jobs-like mo-
ment of product genius or the power trip of an enabled,
immature founder? Proud’s analysis of his behavior in
hindsight is simple and unapologetic: “Well, I was right.” F
 6

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 A
BOUNTIFUL
MIND
Forget the 30 Under 30. If there were
an 8 Over 80, it would include Phillip
Frost—doctor, investor, inventor—who
globalized the generic-medicine
business and continues to make
and give away billions with
Buffett-level efficiency.

BY MATT SCHIFRIN

F or most Floridians, palm trees assume the same status that

pigeons do in New York City. They are everywhere, but you barely notice them.
Not for Dr. Phillip Frost. As we drive to his office in his white 7 series BMW, Miami’s second-richest man and a 50-year
resident can’t help but lecture me on more than a dozen varieties of palms sprouting like weeds from the lapses in pavement.
“See the fruit on that one hanging? It’s yellow. That’s a lady palm. Beautiful, isn’t it? And that’s a date palm in front. This is a
Chinese fan palm—forms a fan like the elephant ear—and that is a sabal palm, flowering. Isn’t that pretty?” Then Frost decides
to test my retention. “And those crooked ones are what?” After a few seconds he answers his own question. “Coconut palms.
Remember I told you coconut palms grow crooked? Royals tend to grow up—these are royals.”
In this sweltering city of conspicuous consumption, where nearly everyone drives with windows rolled up and the air-con-
ditioning and radio blasting, Frost, with his botanical obsession and insatiable appetite for learning, is an anomaly. He is a busi-
nessman and an investor, but he is also a scholar, inventor and fervent patron of the arts and sciences. And anyone spending
time with the self-effacing octogenarian will readily testify that it is precisely his meticulous attention to seemingly mundane
details—like those many varieties of palm trees—that underlies his uncanny ability to spot and capitalize on opportunities.
SONYA REVELL FOR FORBES

Frost is a board-certified dermatologist and irrepressible entrepreneur who is also the chairman and CEO of Opko Health,
a midsize pharmaceutical and medical-diagnostics company with promising remedies in numerous areas, including chronic
kidney disease and prostate-cancer detection. Though his company has revenues of $1.2 billion and will lose about $50 million
in 2016, he insists Opko will mean more to medicine than any of his previous endeavors, including drug-industry pioneers like
Key Pharmaceuticals, Ivax and Teva Pharmaceuticals. It’s a bold statement from a man who played a major role in creating the

94 | FORBES JANUARY 24, 2017

Dr. Phillip Frost: a
Renaissance man
and billionaire with a
passion for palm trees
and profits.
FROST
THE FROST FOLIO
Through Opko Health, Frost is building a health-care-focused Berkshire Hathaway, but
like other great investors he finds values in a myriad of industries.
OPKO HEALTH Frost owns 34% of therapeutics and diag-
nostics company with $1.2 billion in sales.
TEVA PHARMACEUTICALS INDUSTRIES A $20 billion
(revenue) Israel-based big pharma, specializing in gener-
ics. Frost owns 1.5% of the stock.
VECTOR GROUP Founded by fellow Philadelphian
Bennett LeBow; owns tobacco company Liggett Group
and commercial realtor Douglas Elliman Realty. Frost is
largest shareholder, with 15%.
LADENBURG THALMANN Regional investment bank and
CASTLE BRANDS financial advisory; 4,000 advisors and $132 billion in as-
Goslings rum. sets. Frost owns 36.5% and Vector Group owns 8.23%.
CASTLE BRANDS Maker of premium liquor, including
Jefferson’s whiskey and Goslings rum. Frost owns 33.5% and Vector 8%.
COCONUT GROVE BANKSHARES Miami-Dade’s oldest bank; Frost owns 24%.
COGINT Formerly Tiger Media; a cloud-based data
and analytics company focused on marketing and
risk management. Frost owns 29%.
BIOCARDIA Formed by Frost’s Sorbonne room-
mate, Dr. Simon Stertzer. A clinical-stage company
using stem cells to repair cardiac muscle after a
heart attack. Frost owns 32.7%.
DRONE AVIATION Florida-based maker of drones
for law enforcement and military. Frost owns 14%.
DRONE AVIATION
ARNO THERAPEUTICS Developing antiprogestins
for breast, endometrial and prostate cancers. Opko The WATT drone has an
owns 9%. electric-tethered aerial
ZEBRA BIOLOGICS Attempting to make generic platform (ETAP).
versions of antibody drugs—like the bestselling
rheumatoid arthritis drug Humira—that could be
better than the original. Opko owns 29%.
OAO PHARMSYNTHEZ Russian developer and marketer of new drugs in Eastern Europe.
Opko owns a 17% equity interest.
RXI PHARMACEUTICALS Ladenburg took it public in December. Developing an RNA
interface to prevent skin scars. Opko has an 19% equity interest.
COCRYSTAL PHARMA New antivirals (hepatitis C, flu,
Norovirus); Frost and Opko own 23%.
SEVION THERAPEUTICS Developing antibodies against
difficult targets; treating cancer and immunological
diseases. Frost and Opko own 20%.
NEOVASC Canadian maker of specialized cardiology
devices. Frost owns 22%.
CHROMADEX Maker of ingredients for nutritional
NEOVASC supplements. Frost owns 14.6%.
The Tiara is a VBI VACCINES Developing a technology platform to
design vaccines for hepatitis B, Zika and brain tumors.
minimally invasive Opko has a 25% equity interest.
treatment for a MABVAX THERAPEUTICS Clinical-stage cancer immuno-
common form therapy. Frost and Opko have an estimated 5% interest.
of mitral-valve MUSCLEPHARM Nutritional supplements. Frost owns
disease. less than 5%.
modern generic-pharmaceutical business and—given that
shares in Opko are down 39% in the last 18 months—more
than a little self-interested.
“What we are building here is a company that will have
a half a dozen products, each capable of doing more than
a billion dollars in sales and some several billion,” he says,
pointing to a printout displaying overlapping circles that
highlight five core Opko markets: urology, nephrology,
genetics, bio-reference and aging/metabolic syndrome. “In
the case of human growth hormone, where we are part-
nered with Pfizer, that is a $3.5 billion market.”
Unlike most of his pharma peers, Frost has the mind-
set of a savvy value investor, only it’s enhanced by a deep
96 | FORBES JANUARY 24, 2017
understanding of molecular biology and a penchant for swift-
ly striking opportunistic deals. His office desk is stacked with
pitchbooks and proposals, as well as dual flat-panel Bloom-
berg screens, with dozens of stocks on his watch list blink-
ing green and red. “Phil has an incredible vision of where to
position himself within health care,” says Oracle Partners’
Larry Feinberg, a veteran hedge fund manager who has
owned shares in Frost companies since the 1990s. “He views
Opko as his holding company. It is his Berkshire Hathaway of
health care.”
Through Opko and other entities, Frost has strayed far from
health care. He has big stakes in dozens of public and private
companies, ranging from Vector Group, owner of tobacco
company Liggett and commercial real estate broker Douglas
Elliman, to Castle Brands premium spirits and investment
firm Ladenburg Thalmann & Co. He has invested in a slew of
promising startups, such as a data-fusion company, a drone
surveillance provider and BioCardia, a biotech developed by
his college roommate, renowned Stanford Medical School
cardiologist Simon Stertzer, which is trying to find a way to use
stem cells to rejuvenate hearts damaged by heart attack.
Tireless at age 80, Frost is working on his fifth billion
in net worth, but he is giving it away nearly as fast as he is
making it. The Frosts have no children, but he and his wife,
Patricia, through their hands-on approach to philanthropy
and hundreds of millions in funding, are on a mission to
transform Miami from a city best known for its beaches, golf
courses and trendy Latin-Caribbean cuisine into a mecca for
art and serious science.
F
rost’s Horatio Alger story contains a healthy dose of
serendipity. He was born in 1936, in the midst of the
Great Depression, the third son of a shoe-store owner
from South Philadelphia. A stellar student from the start, he
attended Philadelphia’s selective Central High School and
the University of Pennsylvania, majoring in French literature.
After his junior year in Paris studying at the Sorbonne, he had
a chance meeting with a former schoolmate at Penn’s cafete-
ria, alerting him to a scholarship that was being offered to a
new medical college in New York City called Albert Einstein
and available to graduates of his high school. Frost applied and
won a full scholarship. Einstein quickly established a reputa-
tion as one of the top med schools in the country.
His decision to specialize in dermatology also contained an
element of chance. As an undergrad he developed an unsightly
wart on his elbow that prompted him to go to a Penn faculty
member who happened to be doing research on cantharidin,
otherwise known as Spanish fly, for an application to remove
warts.
“I was interested in a specialty that would permit me the
time to reflect and do [other] work. I knew that surgery could
never be for me because you’re tied up in operating rooms
most of the time. And I needed the freedom to do things,”
Frost says. Fortuitously, the professor who cured his wart later
offered him a postgraduate residency in dermatology at the “I had heard that an important Czech pharmaceutical
University of Pennsylvania. company was being privatized by the government,” Frost says.
After his residency and two years as a lieutenant com- “One of my friends from Colombia, South America, had an
mander in the U.S. Public Health Service at the National Insti- apartment in Miami, and he had a Czech friend in Toronto.”
tutes of Health, Frost landed a spot on the faculty of the Uni- So Frost made some calls and found out that Novartis and
versity of Miami’s dermatology department in 1966. Seeing two other European companies were interested in bidding,
patients and teaching med school weren’t enough to satisfy his but Frost’s Miami-Toronto connection was able to arrange
insatiable curiosity, so at night he invented a disposable tool a last-minute meeting with Vaclav Havel, then the president
for taking skin biopsies (still used today). During negotiations of the Czech Republic. “I told him, ‘Look, if you do a deal
to sell his invention to Miles Laboratories in 1969, Frost met a with us, we’ll guarantee you’ll keep at least 900 of the 1,200
young lawyer with a silver tongue named Michael Jaharis. employees,’ ” says Frost, who shrewdly noticed that the politi-
Frost’s friendship with Jaharis blossomed into a business cian’s primary goal was saving jobs, not getting top dollar for
partnership after the lawyer decided to quit his corporate the assets. The Czech deal, which cost Ivax only $50 million,
job to help Frost build a business around a novel ultrasound included prime real estate, subsidiaries in all the former Soviet
device used to clean teeth that Frost had purchased. He had Republics and $20 million in the bank.
a thriving dermatology practice, with patients that included “Phil turned Ivax from a domestic drug company to a
Jackie Gleason, who once filled Frost’s mother’s hospital room global generics-pharmaceutical company,” Feinberg says. “It
with roses after he discovered they were convalescing in the wasn’t subject to just the vagaries of the U.S. [market]. It really
same hospital. By 1972 he had become the chairman of derma- had strong positions in both generic and proprietary pharma-
tology at Miami’s Mount Sinai Medical Center. ceuticals throughout the entire world. It became a very valu-
That same year, another chance meeting: At Miami’s air- able asset.”
port, while waiting to board a plane to New York, Frost ran In 2005 Israel’s Teva Pharmaceuticals paid $7.6 billion for
into a high school classmate who was a top executive at Key Ivax, making Frost a billionaire. For the first time.
Pharmaceuticals, then a struggling drugmaker focused on cold

C
remedies. “By the time we got to New York, we agreed to put ommand central for Frost’s empire is a shimmering
our little company, which had some cash and some inventions, 15-story glass-and-steel building he owns at 4400
together with Key, which was public,” Frost says in his apart- Biscayne Boulevard in downtown Miami. Lining the
ment in New York’s Pierre hotel, overlooking Central Park. walls of the 15th-floor executive suite, below an electronic
“They had great technology, but they didn’t have the people to ticker tracking Frost stocks, are beautifully framed photo-
recognize what they had. They had the first controlled-release graphs of Art Deco Miami Beach circa World War II from
technology for drugs.” negatives Frost rescued when the city’s Bayfront Park library
Key Pharmaceuticals was Frost and
Jaharis’ ticket to serious wealth. After
reformulating its main asthma drug, “Phil’s a face guy. He doesn’t do meetings over the phone.
which had initially been combined
with a cough suppressant, into an It’s part of his calculus to get a gut feeling about people.”
asthma-only remedy with a controlled
release, Key’s Theo-Dur became the
nation’s best seller. Key followed up with the first nitroglycer- was being demolished in the mid-1980s. Just outside Frost’s
in slow-release patch remedy (Nitro-Dur), used to treat heart office is a glass-enclosed “atrium,” where he lunches daily
disease, also a big hit. Ultimately Schering-Plough purchased with senior executives, including Dr. Jane Hsiao, a brilliant
Key Pharmaceuticals in 1986 for $836 million. By then Jaharis chemist with an M.B.A., whose late husband, Charles, co-
and Frost were on The Forbes 400. Frost, age 50, had a net founded Ivax with Frost. Hsiao is a vice chairman of Opko and
worth of at least $150 million ($330 million in current dollars) ranks 46th on the Forbes list of Self-Made Women, with a net
and was Schering’s largest individual shareholder. worth of $320 million. Another regular lunch mate is Steven
But instead of retiring to collect dividends, Frost blazed Rubin, a former mergers-and-acquisitions lawyer who joined
a trail in the nascent generic-drug business with another Frost in 1986 after Frost sold Key and started Ivax. Rubin is
company he formed, called Ivax. In the early 1990s, when the Frost’s deals guy, sitting on the boards of many of his com-
low-margin generic-drug business was getting bad press for panies. A newcomer to the inner circle is CFO Adam Logal,
products of questionable quality, Frost presciently bought up Opko’s accountant and Frost’s liaison to Wall Street. The con-
companies and expanded internationally. Again he used con- versation is almost always about deals, which flow into Frost
nections to get an edge. In 1994, for example, Frost bought one headquarters on a daily basis. Often company executives and
of the Czech Republic’s largest pharmaceutical companies, others are invited to make presentations.
known as Glaena. “Phil is a face guy,” Rubin says. “He doesn’t do [meetings]

JANUARY 24, 2017 FORBES | 97

FROST
over the phone. He’ll be like, ‘I just read you have an idea. Why
don’t you come down on Friday and see me?’ I think that’s part
of his calculus to get a gut feeling about people.”
One of Frost’s CEO’s is Richard Lampen, an ex-banker who
worked for Salomon Brothers in the go-go ’80s and now runs
regional broker Ladenburg Thalmann on the 12th floor.
In the aftermath of the dot-com bubble in 2001, Frost
bought into Ladenburg, then a tired 120-year-old investment
bank known mostly for risky small-cap IPOs and cold-calling
brokers. Frost has since financed its impressive recent growth.
In the last ten years revenues have climbed from $30 million to
$1.1 billion, and a series of regional brokerage acquisitions has
swelled the firm to 4,000 financial advisors with client assets
of $130 billion.
“Thanks to Phil, we punch way above our weight,” Lampen
says.
One executive who spends a lot of time at Frost’s staff lun-
cheons these days is Dr. Charles Bishop, the man in charge of
Rayaldee, a newly approved drug that boosts vitamin D, which
Opko is aiming squarely at a segment of the $12 billion market
for treating chronic kidney disease. Opko acquired Bishop’s
startup in 2013. Frost had heard about the promising remedy
during a casual lunch with a Toronto pharma exec. Hours later
Bishop had a voice mail from Frost.
“I returned the call immediately,” Bishop recalls. “He says
to me, in classic Phil fashion, ‘Can you get to Miami in three
hours?’ ”
Given that it was nearly Thanksgiving, Bishop persuaded
Frost to wait a few days. “We had prepared to give him a full
presentation. . . . I came with my slide deck. We got through
four slides and Phil says, ‘That’s enough of the slide presenta-
tion. Can we talk about a deal?’ ”
That sort of impatience is a Frost deal-making hallmark.
He had done his homework and had decided that kidney dis-
ease was going to be a big business for Opko. Chronic kidney
disease afflicts some 25 million people in the United States,
including 9 million or so in stages 3 and 4. Opko’s Rayaldee,
which analysts forecast could surpass $500 million in sales in
the U.S. alone, has the first product approved by the FDA to
correct vitamin-D insufficiency through a one-a-day capsule
with an extended-release formulation.
Not all of Frost’s deals have been warmly received on Wall
Street. In 2015 Frost announced he would pay $1.47 billion
for Bio-Reference Labs, one of the largest full-service clini-
cal laboratories in the U.S., known for its expertise in genom-
ics and genetic sequencing. Opko’s stock plummeted by more
than 50% within four months of the announcement and has
begun to recover, by about 20%, only in the last few months,
with Rayaldee’s launch.
One promising Opko diagnostic that will leverage Bio-Ref-
erences network and marketing is Opko’s new 4Kscore blood
test, which accurately assesses the risk of prostate cancer for
men with elevated PSA (prostate-specific antigen) readings.
Frost says, “If you have an elevated PSA, the tendency was to
98 | FORBES JANUARY 24, 2017
be biopsied, a painful procedure associated
with infection and bleeding. And of the biopsy
results, maybe 60% turn out to be to be nega-
tive.” He notes that there are an estimated 30
million PSA tests per year in U.S., and perhaps
25% of the results are elevated. Opko’s 4Kscore
test costs $1,900.
“I wasn’t a big fan of his purchase of Bio-
Reference labs,” money manager Feinberg
admits. “But people always doubt Phil because
they don’t understand what he is doing. They
short his stock, but eventually he makes it
work. He doesn’t give up. He has the tenacity
and capital.”
D
avid Gibbes Miller, 23, has never
met Phillip or Patricia Frost, but the
elderly couple have opened doors
for him that he never could have imagined a
few years ago. A Tallahassee native, Miller was
an Eagle Scout and straight-A student in high
school, but his family couldn’t afford to send
him to a prestigious private college without in-
curring significant debt, so he took the scholar-
ships he was offered to Florida State Universi-
ty, where he majored in religion with a premed
focus. At FSU Miller excelled, graduating
summa cum laude in 2015. During his senior
year he organized and hosted an undergradu-
ate conference on bioethics at Florida State.
Upon graduation Miller was awarded Frost’s version of
the Rhodes Scholarship. The program, called Frost Scholars,
sends ten public-university students from Florida and four
from Israel to Oxford each year to conduct research and earn a
master’s degree in a STEM discipline.
At Oxford Miller studied medical anthropology with
an interest in epidemiology and public health, completing
a dissertation in the process. Another Frost Scholar in his
cohort was Kaitlin Deutsch, 23, a Gainesville native and
graduate of the University of South Florida. Deutsch was
recently awarded an NSF Graduate Research Fellowship
and is at Cornell getting her Ph.D. in entomology, study-
ing native bees in an effort to boost their ability to polli-
nate plants. During her year at Oxford, where she earned
a master’s in biodiversity, conservation and management,
she made an important discovery soon to be submitted to
a science journal: The so-called deformed-wing virus, a
scourge decimating honey bee colonies, may have jumped
species to another pollinator insect, the hoverfly.
“The [Frost] scholarship set me up in a way that al-
lows me to shoot much higher,” says Miller, who is now a
predoctoral fellow at the NIH and will soon apply to top
medical schools.
Ultimately Miller and Deutsch both hope to return to
The Frosts are on a mission to make Miami a science mecca. Their new Museum of Science will feature a 500,000-gallon aquarium and a planetarium.
Florida. Nothing could make Dr. and Mrs. Frost happier.
“We are hoping that everyone is going to come back that
graduated from Florida,” says Patricia Frost, a former
teacher and current member of the board of governors of
Florida’s State University System.
“We want to make Miami more of a technological and
science center. When we came here, people thought of
Miami as anything but that,” Dr. Frost says, noting that
the couple’s recent $100 million gift to the University of
Miami was made with this in mind. “We feel that it begins
with education. We need to start at the top with the uni-
versities and even the graduate students. The fastest way
to achieve this is to attract a cadre of top-notch scientists,
starting with chemistry and molecular biology.”
According to Frost, part of that $100 million will go to-
ward developing an institute of chemistry and related sci-
ences. “There will be a new building and new professors,”
he says. “We hope all this will encourage new startups.”
The Frosts have signed Warren Buffett and Bill Gates’
Giving Pledge, but they are the opposite of so-called
“checkbook philanthropists.” In fact, they are so hands-on
that they have generally refused to hire consultants even
for their world-class art collection, which has included
American Abstract Expressionists, French Impressionists
and old masters like the Flemish painter Jean-Baptist de
Saive. The couple have endowed the University of Miami’s
School of Music and Florida International’s Art Museum,
and Mrs. Frost is regularly in touch with their directors,
even helping select architects for small remodeling jobs.
“We are involved to the nth degree at the new science
museum,” says Patricia, referring to the $45 million of the
Frost’s generosity that has gone into the construction of
Miami’s new 250,000-square-foot Patricia & Phillip Frost
Museum of Science. After significant delays, the new fa-
cility, which has a planetarium and a massive multilevel
marine aquarium, will open in March 2017.
In the elegant breakfast room of the Frosts’ grand Ve-
netian palazzo built on Miami’s exclusive Star Island using
imported Italian limestone, Mrs. Frost serves an assortment
of homegrown tropical fruits, such as mamey, dragon fruit,
papaya and longan, all freshly picked from their expansive
gardens and greenhouse, which include more than 150 vari-
eties of palms that Dr. Frost personally tends to. “The muse-
um will try to emphasize basic science as illustrated by what
is happening in this microclimate,” Frost says. “We want the
young people to have an experience so that when they walk
in they are awestruck. Then, as they spend more time there,
it inspires them to work in the sciences.” F
JANUARY 24, 2017 FORBES | 99
FORBES LIFE SPORTS

The Flip
Turn
By 30 he was the most
decorated Olympian of
all time. Now he seeks to
translate his prodigious
accomplishments into an
everlasting brand. Can
Michael Phelps be like
that other Mike?
BY MONTE BURKE

M
ichael Phelps is
sprawled on a
couch in a Lower
Manhattan hotel,
sporting a beard, a gray beanie
cap, a white T-shirt and Under
Armour sweatpants and sneakers,
an athlete in repose. He’s in New
York to accept yet another life-
time achievement award for his
triumphs in five Olympic Games,
another chance for him and others
to revel in his past glories. What
Phelps wants to talk about now,

however, is the future. “I’ve spent
decades staring at that black line
at the bottom of a pool,” he says.
“I’m ready to do something new.
I’m ready to channel my competi-
tiveness into something else.”
Phelps, 31, is four months removed from
what he swears was his last Olympics. The
second phase of his life has begun, he says,
and it has two main parts: He wants to cre-
ate a brand that burns brightly for decades
to come, but he also wants to become a
global champion for the causes that mean
the most to him—swimming and the well-
being of children.
On the brand side Phelps is, of course, well
established as a corporate pitchman. Under
PHOTOGRAPHY: JAMEL TOPPIN FOR FORBES. CREATIVE STYLE DIRECTOR: JOSEPH DE ACETIS. STYLE ASSOCIATE: JUAN BENSON
sorships he earned an estimated $7 million Making a splash: In
addition to his MP
a year. Many of the companies are longtime line, Phelps has a
partners and plan to stay that way. “We hope program to teach
he’s with us forever,” says Kevin Plank, CEO of children how to
swim. “The goal,” he
Under Armour, which signed Phelps in 2010. says, “is to get every
But Phelps is not content simply to be the kid in the world
face of someone else’s brand. In 2013 he left his water-safe.”
longtime sponsor Speedo, and the following COTTON POLO BY VERSACE
($275), 5-POCKET BLUE JEANS
year he started a swimwear line called MP. He BY PAL ZILERI ($295) AND
SEAMASTER AQUA TERRA 150M
found a partner in Aqua Sphere, a swimwear CO-AXIAL GMT CHRONOGRAPH
44MM ROSE GOLD TIMEPIECE BY
and swimming accessories company, which OMEGA ($46,300).

Armour, Omega, Intel, Activision and Beats now sells Phelps-branded suits that range from
by Dre are among his well-known sponsors. $40 to $475. “I’d like to someday have the big-
(Some of the lesser known: Master Spas, Krave gest and best brand in swimming,” he says.
and Sina Sports.) At the height of these spon- His business role model is, of course,

100 | FORBES JANUARY 24, 2017

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Michael Jordan, whose Nike Inc. Jordan
Brand sold $2.8 billion worth of shoes and
apparel last year.
Swimming obviously isn’t as merchandis-
able as basketball, but Plank says Phelps’ am-
bitions shouldn’t be dismissed: “Michael has
that special trait, the ability to be clutch and
win when it counts, which he demonstrated
over and over at the Olympics. I think he can
be the king of all things water.”
Phelps’ other main post-Olympics goal
involves his foundation, which he started in
2008 with the $1 million bonus he earned
from Speedo for his record-breaking eight
gold medals in Beijing. His biggest initia-
tive is the im program (“im” for “individual
medley,” one of his strongest events, and for
the affirmation “I am”). The program focuses
on making children “water-safe.” (Drowning
is the leading cause of injury-related deaths
for kids ages 1 to 14 in the U.S. and the third
leading cause worldwide.) Phelps’ mother
made him take a water-safety course when
he was a boy, and he says that’s the reason he
became a competitive swimmer.
The im program has 104 teams in all
50 U.S. states and another 176 in 33 other
countries, and through it 16,000 kids have
learned how to swim (for three-quarters
of them, the program was their first time
in a pool). “I’d like for that number to be
50,000 someday soon and then 100,000,”
Phelps says. “The goal is to get every kid in
the world water-safe.”
To accomplish these dreams, Phelps will
need to become a lasting global icon, no easy
task for even the most successful Olympians.
Jesse Owens, in the end, was more a power-
ful symbol than a brand. Muhammad Ali’s
boxing career spanned two full decades after
his Olympic gold in 1960. And Caitlyn Jenner
remains famous four decades after decathlon
heroics in Montreal but for reasons no one
could have foreseen in 1976.
Yet Phelps was no ordinary Olympian. He
began as a 15-year-old prodigy in the 2000
Games and provided a glimpse of the great-
ness to come in the 2004 Athens Games.
Then came the triumph in Beijing in 2008
and the weary wins in London in 2012, fol-
lowed by the drinking and depression and the
FINAL THOUGHT
“If your ship doesn’t come in, swim out to it.” —JONATHAN WINTERS
102 | FORBES JANUARY 24, 2017
SPORTS
stint in rehab. All of which culminated in the
redemption in Rio in 2016. In the end Phelps TRENDING
had won an Olympic record 28 medals, all WHAT THE 50 MILLION
but 5 of which were gold. FORBES.COM USERS
ARE TALKING ABOUT.
That level of longevity and excellence in FOR A DEEPER DIVE GO TO
the Olympics has given Phelps the kind of FORBESLIFE.COM
global profile most American athletes lack. PERSON
And with his longtime agent, Peter Carlisle, HEATHER NELSON
Phelps has been laying the groundwork for Single-malt fans
a global presence since the beginning of his take note: Nelson
will become the first
career. He started visiting China and making
woman in 200 years
deals there five years before the 2008 Games to open a whisky
(the Chinese call him the Flying Fish). distillery in Scotland
Phelps and Carlisle used the same playbook when Toulvaddie begins
for Rio—he made four pre-Olympics visits production next year.
Sláinte!
to Brazil and has since signed a deal with
the Brazilian media giant Grupo Globo. And COMPANY
he will soon embark on a tour of Vietnam, LOVE YOUR MELON
Ethiopia, South Africa and Latin America. The four-year-old
Phelps, of course, has been through this apparel startup—
founded by two
before, when he retired for the first time
collegiate Millennials—is
after the 2012 Games. “This time is different,” now donating 50%
he says. “Back then I just wanted to dig the of the profits from
deepest black hole and be left alone.” Now its products to fight
“life is so different and so much better. I have pediatric cancer.
Boomer [his 8-month-old son] and Nicole
[his wife]. I have other things to worry
about than just myself.”
Phelps says he travels three weeks out
of every month, and at meetings he doesn’t
just show up for the grip-and-grin but really
dives in. “I’m actually sitting at the table
now during the discussions, asking ques-
tions,” he says. “Some of this is self-reinforc-
ing. I want to be out there now. If I isolate
myself as I’ve done before, I know the road
I’ll go down, and I know it won’t be pretty.”
A question remains: Is he really done
competing? “Yes, definitely,” he says, while IDEA
admitting that he said the same thing in 2012. GROUP VIDEO CHAT
The 2020 Olympics is out of the question, Released in 2016,
but Carlisle has been floating an intriguing Houseparty, an app that
enables users to hold
scenario regarding the 2024 Games. “I think
group chats via video,
Michael is 100% sure he’s done right now,” he recently raised
says. “But what if the 2024 Games are award- $50 million.
ed to Los Angeles? And what if there was a
spot open on a relay team?” Carlisle leaves
the thought there, as any good agent would.
Phelps just smiles when this idea is
brought up. “I’m happy now,” he says. “And
I’m excited for what’s ahead of me.”
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THOUGHTS ON

Tomorrow
“THE PAST IS ALWAYS TENSE, “The
THE FUTURE PERFECT.” belief that
tomorrow is
—ZADIE SMITH
a different
place from
“We can only today is
see a short certainly
distance a unique
ahead, but hallmark of
we can see our species.”
plenty there —DOUGLAS
that needs COUPLAND
to be done.”
—ALAN TURING

“I’VE SEEN THE FUTURE,

AND IT’S MUCH LIKE THE
PRESENT—ONLY LONGER.”
—DAN QUISENBERRY

“EVERY AGE HAS A “Always remember that

KEYHOLE TO WHICH the future comes one day
ITS EYE IS PASTED.”
—MARY MCCARTHY
at a time.”
—DEAN ACHESON

“AFTER ALL, “Someday we will try /

To do as many things as are possible.”
TOMORROW IS —JOHN ASHBERY

ANOTHER DAY.”
—MARGARET MITCHELL “Often do the spirits /

CLOCKWISE FROM TOP LEFT: EAMONN MCCABE/GETTY IMAGES; HERITAGE IMAGE PARTNERSHIP/ALAMY; PASCAL SAEZ/SIPA
PRESS/NEWSCOM; FOCUS ON SPORT/GETTY IMAGES; BETTMANN/CORBIS/GETTY IMAGES; ULF ANDERSEN/GETTY IMAGES;
Of great events stride
“Ah! The clock is On before the events /

FINEART/ALAMY; SSPL/GETTY IMAGES; NYP HOLDINGS/GETTY IMAGES; JULIO DONOSO/SYGMA/GETTY IMAGES

“Yesterday is but today’s
memory, and tomorrow
is today’s dream.”
—KAHLIL GIBRAN
always slow. It is later And in today already
walks tomorrow.”
than you think.” —SAMUEL TAYLOR COLERIDGE
—ROBERT W. SERVICE
“I think it has
something to do with
tomorrow: that there
always is one, and that
FINAL
everything can change THOUGHT
“Let us look
when it comes.”
forward, and let
—AUGUSTEN BURROUGHS
us go forward
“THEREFORE DO NOT WORRY ABOUT TOMORROW, FOR with confident,
TOMORROW WILL WORRY ABOUT ITSELF.” unhesitating tread.”
—MATTHEW 6:34 —B.C. FORBES
SOURCES: SKETCHES FROM LIFE, BY DEAN ACHESON; DEATH OF WALLENSTEIN, BY SAMUEL COLERIDGE TAYLOR;
GONE WITH THE WIND, BY MARGARET MITCHELL; IT IS LATER THAN YOU THINK, BY ROBERT W. SERVICE; THE PROPHET,
BY KAHLIL GIBRAN; MICROSERFS, BY DOUGLAS COUPLAND; THE TIMES BOOK OF QUOTATIONS; SELF-PORTRAIT
IN A CONVEX MIRROR, BY JOHN ASHBERY; RUNNING WITH SCISSORS, BY AUGUSTEN BURROUGHS.

112 | FORBES JANUARY 24, 2017