We are 22 floors above Park Avenue, surrounded by memorabilia that Langone collected on the way to becoming — well — Ken Langone, billionaire, the co-founder of Home Depot and the philanthropist whose latest $100 million splurge will make New York University Medical School forever tuition-free.
The rangy financier wears a blue shirt with white collar and cuffs and a green print tie. “KGL” is embroidered across the pocketless breast of the shirt.
In an adjacent room, the Invemed money squad — his privately held investment vehicle — is busily making the Langone fortune bigger.
“I read your book,” I say, grasping Langone’s outstretched hand.
“Did you like it?”
“Don’t bull[bleep] me,” he says. “I am very insecure.”
This from the bulldog who has bearhugged or spit in the eye of every notable New Yawker, from cardinals to mayors to governors to hedge fund guys. He has served on the boards of General Electric, the New York Stock Exchange, Yum Brands and Home Depot.
He has beaten the New York state attorney general’s office in court. And he turned down a last-ditch ask for $500 million from con man Bernie Madoff.
“He is a go-to guy in New York, not just for me but for anybody,” said Cardinal Timothy Dolan, the Catholic archbishop of New York. “The word is out if you need truth, a helping hand, need a guy to level with you and a guy who has come through for a project, a tough one, then you go to Ken.”
Langone, 82, is a devout Catholic, so he’s heard about the virtues of the meek and the poor. He’s just not one of them.
This is the man, after all, who penned the autobiography/paean to success aptly titled “I Love Capitalism!”
Capitalism seems to love Langone, too.
We are splitting a $20 corned-beef sandwich and slurping chicken soup from the 2nd Ave Deli. Langone takes his half of the sandwich. He removes the meat and carefully rebuilds it into a full sandwich with the extra rye bread supplied by his 26-years-and-counting chief troubleshooter and executive assistant, Pam Goldman.
He takes mustard. I like Russian.
A line of model planes — representing the history of Langone’s personal air fleet, with the spacious, long-range Bombardier Global Express jet in the point position — fills the top shelf of a cabinet.
“You know one of the reasons I’m very successful? Because I’m supersensitive. Very, very sensitive,” he says, fingering the corned beef as if he were gluing together one of those model planes.
“No, no, no, no. Not sensitive in that sense,” he says. “You couldn’t hurt my feelings.”
He arcs his thumb and forefinger as if showing you the size of the bone-in rib-eye steak he prefers at Gallaghers, his favorite New York steakhouse. “My skin’s that thick.”
He made billions selling home improvement to the masses and has four grand homes, from Palm Beach to Long Island’s North Shore, but he seems to have some ambivalence about the riches.
“I’ve got all this [bleep] wealth. I watch the [bleep] money accumulate,” the former construction worker says.
“I know somebody out there’s hurting,” he says, his voice dropping as if telling a secret.“What kind of a person am I? What I’m saying is that, to me, not to feel hurt or somebody else’s pain, that’s bad.”
The Langone conference room, in the iconic Seagram Building, is a world away from his childhood in Roslyn Heights, on Long Island.
“There was never much money,” he writes in his book. “My father was an excellent plumber, though not a financially successful one; we lived from paycheck to paycheck. But I didn’t realized that I was poor, and I had a wonderful childhood.”
What keeps him up at night now?: “My deals. Losing money. My family, friends. Home Depot. You know what worries me the most? Staying humble. I worry about losing touch.”
He keeps others humble, too.
Stanley Druckenmiller, a billionaire investor, has been friends with Langone for 42 years. He recalls getting bawled out by Langone after a blueberry pancake breakfast one morning at Druckenmiller’s Florida home.
“We get done with breakfast, and he yells at me, really yells, because I have put the dishes in the sink,” Druckenmiller says.
“His mother taught him to clean up after yourself. It’s nobody else’s responsibility, and he didn’t give a [bleep] who I thought I was. This was two years ago, not when we were poor.”
A real New Yorker
“By the way, I’m spiritual,” Langone says, as if to sweep away the expletives. “I went to Mass this morning, 7 a.m. at St. Patrick’s.”
Langone is high-flying in his tastes and lifestyle. This is a guy who buys wine in six-figure shipments and is a regular at popular New York watering holes — Rao’s, Fresco by Scotto, Sistina, San Pietro and Primola. Yet he says he tries to stay grounded.
He took 21 Home Depot managers to dinner recently to thank them. He drove to his favorite Long Island Chinese restaurant to hand-deliver an inscribed copy of his book to the owner. He treated a man who works at his Long Island estate and the man’s son to a Yankees game. The seats were right behind the Bronx Bombers dugout.
“He has a moral compass like no one I ever met,” Druckenmiller says. “He gets emotional about people. He has a certain regard for human dignity. I bet he knows every nurse and every custodian at NYU Hospital by name. Not just the doctors.”
“He absolutely is the quintessential New Yorker,” Druckenmiller says. “He has the accent, the can-do.”
The city gets its share of the bounty. His name is on a hospital (NYU Langone Medical Center) and on a business school program (Langone Part-time MBA at NYU). A chapel is dedicated to Langone and his wife, Elaine, at St. Patrick’s Cathedral; he was a chief benefactor for the cathedral’s restoration.
Dick Grasso, former chairman of the New York Stock Exchange, recalls getting a call in the middle of the night when he was asleep at NYSE headquarters in the days after 9/11.
“I pick the phone up and say, ‘Hello.’ I don’t hear, ‘Hello.’ I don’t hear, ‘Dick.’ I hear, ‘I can’t get my [bleep] trucks down to Ground Zero,’ ” Grasso says.
“Ken had ordered Home Depot stores to empty their shelves of anything the responders could use — water, shovels, masks, gloves — and he was upset because the trucks couldn’t get past the police line. He is New York right to the bone.”
Pitching to Ross Perot
Langone tells this story about when he went to work on Wall Street: “When I got my job, a guy on Wall Street said, ‘You’re going to be a big success.’ And I said, ‘Why?’
“He said, ‘Because you know when to back off. You’re sensitive.’ I know when to go in for the kill. I know when to back away.”
Like when he pitched Texas mogul Ross Perot on taking Perot’s company, Electronic Data Systems, public back in the 1960s. It’s the deal that made him a player. He would eventually parlay his newfound stature into creating Home Depot.
Langone was told two things before he met with Perot: Whatever else happens, leave exactly after 30 minutes. And don’t use profanity. Perot hates profanity.
The diminutive Texan talked for 29½ minutes without Langone getting a word in.
At the end, Langone had his chance: “Even though I was told not to swear . . . when Perot gave me this 29 and one-half minutes of bull[bleep], and said, ‘What do you think?’ I said, ‘This is the biggest pile of horse[bleep] I ever heard in my life.’ ”
Then Langone looks at me and shouts, “I knew that was going to get his attention!”
The book project started, in a roundabout way, four years ago at the Allen & Co. conference in Sun Valley, Idaho, where an A+++ list of business, philanthropic, sports, media, cultural and political figures gather to exchange ideas and make deals.
“A guy comes up to me,” Langone says. It was Michael Ovitz, former Hollywood superagent, a founder of Creative Artists Agency and a former executive at Walt Disney Co. “He says, ‘You ought to write a book.’
“I said, ‘I’m not going to write a book.’ I was adamant.”
But in January 2016, “I’m watching TV. I’m watching Bernie Sanders, and here’s all these kids around Bernie Sanders,” the U.S. senator from Vermont and self-described democratic socialist who was running for president.
“I said: ‘Oh, my God. These are kids listening to this [bleep]. This is scary. If these kids are giving up on what made this country great before they start, we don’t have a future.’ ”
Langone had found his inspiration.
“I said, ‘If we can put together a book that, in part, embraces my fervent belief in capitalism — and you want to put some stories in to make it fun — that’s fine. I want kids to know you don’t need to be born with a silver spoon in your mouth to win.’ ”
Millennials came of age in the aftermath of the 2008 financial crisis, which nearly took down the world economy. “Their memory of capitalism is not pretty,” Langone says.
Should social goals play a role in investing? It’s an ideal promoted by money manager Larry Fink, the chief executive of BlackRock, the $6.3 trillion asset manager.
“Society is demanding that companies, both public and private, serve a social purpose,” Fink wrote in his annual letter to CEOs.
“Larry is a nice man, and I like him,” Langone says. “But what do you tell the state pension manager who needs to make 5 percent returns, that you made 3 percent because you didn’t want to buy shares of certain companies because of social concerns?”
He adds: “I make no apologies for capitalism. Look at all the [bleep] money I made.”
“I don’t know. I don’t count. I know I’m worth a [bleep] lot of money. I’m not [bleep] counting because it’s bad luck. Every [bleep] time I sat down and played [bleep] poker as a kid, and I counted my money [he claps his hands], I lost.”
It’s $3.6 billion, according to Forbes.
Is the United States still the best place for entrepreneurs?
“Absolutely,” he says. “[Bleep] yes. Start me all over again at 82. I’ll do it again.”
Langone did it pretty big the first time.
Early on, Langone built little businesses around Christmas wreaths and selling cardboard boxes for scrap. He made cash selling ties as a student at Bucknell University.
“On Sunday nights, we’d stop at a store on Forty-Second Street called Tie City. Everybody at Bucknell had to wear a tie and jacket at dinner,” he wrote in the book. “I used to buy a box of a hundred ties, all different colors, bring them back to Bucknell, then on Monday hit the freshman dorms and sell them for a buck-fifty, buck-seventy-five apiece.”
When he landed on Wall Street, he persuaded big insurance companies, banks and pension funds to make stock purchases through his firm, R.W. Pressprich.
A big “get” was a bond sale for Kenner Products, a small Cincinnati toy company whose commercials were a fixture of Saturday morning television cartoon marathons in the early 1960s.
The kid from Roslyn Heights was pulling down $100,000 a year in the 1960s. When he sold a medical equipment company to global pharmaceutical giant Eli Lilly in 1976, the plumber’s son became a millionaire.
Langone still has the Lilly shares. “You know what the average holding period is of Langone-owned shares?” he says. “Forty years.”
Home Depot was launched by Bernie Marcus and Arthur Blank with help from Langone and retail genius Pat Farrah in the late 1970s. The company started selling stock to the public in 1981.
“I walked into the board room of the stock exchange on the morning of the Home Depot listing,” Grasso says. “And there’s Ken with Arthur and Bernie, with Kenny doing push-ups. That kind of defines him. He is at the capital of capital, the biggest day in his life, and he wasn’t taking himself too seriously.”
Home Depot shares add tens of millions of dollars a year on the Langone family fortune.
“I don’t think he sells anything,” Druckenmiller says.
Focus on management
Langone sums up his investment theory with two words. “The manager.”
“I invest in managers when I invest in a company. I look for people are who objective, kind, smart, humble, direct.”
His all-star team includes the Home Depot trio and Perot. Then there’s Jack Welch, former CEO of General Electric; Lawrence Bossidy and David Cote, two former CEOs of Honeywell; Frank Blake, a former CEO of Home Depot; and Jamie Dimon, the current CEO of JPMorgan Chase.
His emphasis on management is seen as both a strength and weakness.
“He just has judgments about people,” Druckenmiller says. “Who would have picked Bernie Marcus, who had been fired by Handy Dan [another home-improvement chain], to run Home Depot? Come on.”
On the other hand, Druckenmiller says, “he can be too optimistic and too trusting. And that’s what leads to a lot of the hiccups. But he goes in and fixes it. The reason he has fixed so many things is he can be too optimistic.”
One big fix was the restoration of St. Patrick’s Cathedral on Fifth Avenue.
“I inherited the renovation of our beloved St. Patrick’s Cathedral from our predecessor,” Cardinal Dolan says. “We had made tiny progress. I was frustrated. A lot of people said, ‘You’ve got to go to Ken Langone. He is your man.’ And I did.
“He turned it around,” Dolan says of Langone, adding that Langone and his wife are among the cathedral’s major benefactors. “He can call in a bunch of chits. He rallied people and got the job done.”
So when Pope Francis arrived at the steps of St. Patrick’s in September 2015, “Who met him at the entrance? Ken and Elaine Langone. That’s the way I wanted it. Thanks be to God that I went to him.”