IRIS MAN: TILMAN FERTITTA
Interview by Marc Sifuentes | Photography by Jhane Hoang | Art Direction by Louis Liu
Tilman Fertitta photographed at the construction site of Landry’s new corporate office and Tilman’s mixed-use Houston tower – The Post Oak in Houston, TX.
Since childhood, Tilman Fertitta had dreams of becoming a business owner, an odd desire for a young boy; however, it was foreshadowing what his future would become. By age twelve, he was working for his father in the family restaurant, trying to send the patriarch home regularly with aspirations of running the place himself. Born in Galveston Texas, Fertitta spent his formative years working, and that passion for hard work has not died down and continues to become increasingly fiery. Work became such an integral aspect for Tilman’s life that it overshadowed his pursuit of higher education, but he viewed traditional education as a tiresome obstacle to his path towards success. Fertitta has enriched his community and given opportunity to thousands of people through his entrepreneurial and charitable endeavors. However, it is not without merit for he is a man whose natural intuition and savvy could produce corporate mergers, brilliant investments, and millions of dollars in his bank account before age thirty. Now Tilman Fertitta is the sole owner, chairman and CEO of Fertitta Entertainment, Inc., the mother company to both the restaurant empire Landry’s and the Golden Nugget Casinos. Now Tilman Fertitta has taken time to sit down with Iris and discuss his meteoric rise and estimated $3.2 billion fortune.
Let’s talk about how you started in the world of business, and what was the first venture you started on your own? How did you fund it?
It’s kind of funny because I did three scenes today for my show, and while I was having a conversation with one of the contestants, I told her you have to go get a line of credit. You know I remember in 1979 going to a bank, scared to death, to borrow $6,000. That’s how I started. A $6,000 loan, no guarantee, just me. The first business I was ever in was a women’s clothing store. I had a cousin who was in the women’s ready-to-wear business in Dallas. I would go and hang out with him, and one day I asked him what he did with all of these samples. He said we just get rid of them at the end of market, so I offered to buy them from him and start my own store. It was called the Sample Factory and it was my first store, my first business really.
How did it develop from there?
Well, my next business was with these people in the Shaklee Vitamin industry, and I met them and opened the Shaklee Vitamin Stores all over Houston. By the time I was twenty-one, I had won a free cadillac selling Shaklee Vitamins. Then I got into the building business, home building and then developing shopping centers, and by the time I was twenty-six I had built a hotel in Dallas. I did that for a few years then I was an investor in a restaurant and bought all of my partners out in 1986, and then I just started building restaurants. In the development business the world fell apart in Texas in 1985 because of the economic recession. From 1986 to 1993 we just built Landry Seafood restaurants in Houston, Corpus Christi, Dallas, Louisiana and a few other cities. I went public in August of 1993, and by the next morning I was worth one-hundred-million dollars. It was a crazy stock market, and the rest is history. The hardest thing to do is make the first one-hundred-million, I know it sounds easy but it isn’t! (laughs)
Sounds like you took a risk with the economy tanking in 1985, would you say that a lot of your success is based on risk taking?
Absolutely! You cannot be scared. If you want to be an entrepreneur and make big money you cannot be scared. It is a different world today, so many young people are working in tech and happen to work at the right companies at the right time, and they’re worth hundreds of millions of dollars, but to do it by sticks and bricks…you can’t have any fear.
Well, going back again to your childhood, your father owned a restaurant and you used to work there as a child, did you ever feel like you didn’t want to get into the restaurant business because of that?
I never really thought about it. I was always working there, I even tried to send him home so I could run it. I was twelve. (laughs) I have always loved working. I remember growing up in Galveston in my early years, working at my dad’s restaurant and then working at the pier as a lifeguard, which I now own and renamed Pleasure Pier. I have always worked. I had done every job that there was to do in Galveston by the time I graduated high school. It didn’t bother me to work. People ask me, why are you always working, and I say, “What else am I going to do? Sit on an island?”
You have four children, will any of them be taking over the family business?
I’ve got one whose last day of college is today, and he will be here tomorrow. All four of my kids love the business, it’s all they’ve ever known. They grew up with it. 48 Hours did a piece on the family about thirteen to fourteen years ago about how the kids had an influence on the business. They all want to be involved in the company.
We want to talk about the show you are now hosting and starring in, Billion Dollar Buyer, how did that start?
I had always guest hosted on CNBC, and they started a primetime a few years ago and asked if I would be interested in having a show but I just never thought it was the right time. But when CNBC contacted me about this and told me it would be a business type show and I could have some fun and be myself and it would be educational for people I felt that it was the right time for me to get into it. It is really amazing, you know, I was having dinner last night and this waiter came up to me and he was talking to me about his business and he told me “I learned so much from your show.” That’s what I wanted it to be, fun but educational.
Have you learned anything yourself from doing the show?
You know what’s good about it? I just got back from shooting in New York and I did three boardroom scenes, and you just have to always be on, so mentally you’re just whipped at the end. The world is changing and I have to stay up with it. We have to keep up with all of these young companies, and the show is keeping me on the cusp of what is really going on in the entrepreneurial world. For me, it’s about seeing all of these small companies, and seeing what is next and what is cutting edge.
You seem to have had a very fast rise in the entrepreneurial world. When your company started taking off, were you ever overwhelmed by the seemingly “overnight” success?
No. I never thought it was growing too fast. Have there been ups and downs? Absolutely. We’ve just been lucky enough to have more ups than downs (laughs), and the ups were big ups and the downs were little downs. I was very fortunate with my business decisions and it panned out very well for me. I never try to bite off more than I can chew.
As a busy entrepreneur, with a new TV show, buildings always going up, and the daunting task of managing all of these properties, you still manage to add more and more to your plate. What new and exciting concepts can we expect from you in the future?
Well, I am building a bunch of new concepts out here in Houston, and it will be just unbelievable. Downtown we’re building a new Grotto, and it will be nothing like the current one. It’s a real popular restaurant, but I am doing it with a twist and want to cater to the younger people. I am always building. I am building a couple of other unique restaurants inside of the hotel properties. I am always very excited about what is new and cutting edge, and it is really my mission to bring those ideas to Houston.
How does your team come up with a concept and how do you know that that’s the direction you want to take?
Everything usually comes out of my head, and I have a wonderful team that’s been with me forever. Like the Aquarium restaurant downtown, that used to be a fire station. When the city said that they wanted to get rid of it, I walked in there and I knew I wanted to do a big public aquarium on the ground floor, and a huge restaurant with a large tank on the second floor which would help draw people in, third floor I’d do a private dining room, and the fourth would be support. Outside I’d build a few amusements and make it fun. Then they said we also have this old waterworks building and that I couldn’t tear it down, but that I could do something in it. That’s when I came up with the idea to put a giant shark tank inside and have a train that goes through it. I am very fortunate that I have a wild imagination. (laughs)
What would you say is the most important characteristic a business person should have?
Well, we’re all business people. What has made me successful is my drive, and number two I understand the operational side of the business, but yet I know how to create. I can build from my imagination, and then I can operate it. Usually a developer is a developer, and they get tenants to maintain the property. Nowhere else in America is someone able to maintain the restaurants, hotels, entertainment, etc. in one property development.
You’re a contributor to several charities, do you have any that you hold close?
Number one right now for me, I am Chairman of Houston Children’s Charity and have been for many years. I love it because we are a children’s charity that does not operate in a silo, only focusing on one thing. We do multiple things for the community, like buying vans for people who are mentally or physically handicapped so their family can drive them to services that they need. I love being Chairman of the Houston Police Foundation. Yesterday I approved the purchase of four hundred specialized vests for officers, so they could operate more safely. Of course, the University of Houston is also very special to me and I am Chairman of that board as well. I just gave twenty million dollars for them to build a new basketball arena. I love doing stuff for the police, children, the university.
How do you think the industry has changed over the years?
Well, the whole industry has changed everywhere. Texas is very diverse, you have to cater to a lot of different people, and the industry is always changing, but it is very easy to do business here. I love Texas, I love the uniqueness of Texas, and I love being from Texas. No matter where you go, if you say you’re from Texas it makes people raise their eyebrows.
What’s the best advice anyone has ever given you?
I’ve never had that one mentor, but I have really tried to listen to a lot of other people. There is not one singular thing or piece of advice that has really struck me, but I try to learn every day. I want to wake up every morning trying to be a little smarter than the day before. A lot of young people today, who are very smart, don’t appreciate history. When you have done something a lot of times, you are just better at it.
What is your personal definition of success?
Anybody who does what they are passionate about very well, and who exceeds expectations, is successful to me. I have said this many times in speeches, “money is not a definition of success.” You can be a great artist, a great musician, you can take the engine of a car apart and put it back together –that is pretty damn talented to me. I can’t even change the oil to my car! (laughs) A lot of people make money accidentally, but I believe that it is what you do and how you do it, not what you get in return that makes you successful.
If not business, what other career paths would you have taken?
None. (laughs) I’m not good at anything else! I think we are all born with a certain amount of talent and everyone just needs to find what they do very well. I was born to work in business, and I was blessed enough to find that out at a very early age and go with my gut to pursue it.
What advice would you give to a young entrepreneur who wants to open a business?
If you get a partner, don’t get one that knows what you know. If you’re strong in operations get someone who knows sales, and vice versa. Whatever you think it is going to cost to stay in business, you better have a lot more capital. People usually fail because they are under capitalized. It is important to understand your flaws and weaknesses so you can compensate for them. I find the most successful entrepreneurs are people who do not believe that they can do it all.
