Philadelphia’s empire-builders we bid farewell to in 2019
Rest in peace, Jack Bogle, John Neff, Raymond Perelman, Pete Musser and Arnie Staloff.
It’s a privilege writing about new and growing enterprises around Philadelphia, as well as troubled ones. This year, I was called on to write goodbyes to successful businessmen who shaped the communities we have written about for many years. Hail and farewell:
John C. Bogle, who died at 89 on Jan. 15, persuaded millions of successful Americans and their bosses to trust his Vanguard Group with their old-age savings. His low fees saved customers piles of cash. He built one of Pennsylvania’s largest employers. He was frank and blunt. He liked retelling the boardroom-rebel story of his creation of Vanguard in the wreckage of the 1970s bear market.
I worked there as a teenaged temp. It wasn’t always a happy place. But the old Vanguard “crew” tend to remember him as an inspiring, loyal boss, and recall the camaraderie of those years as the good old days.
He saw opportunity everywhere, especially in America, the greatest country in the world, for a person willing to watch, work, plan, and persist. Jack’s message to savers is, in its cheerful wrapping, pessimistic: You can’t beat the market. Those pros can’t, either. The best you can do is capture broad market gains while minimizing your fees. It was a full life, a good and generous one.
Raymond G. Perelman, 101, who built a fortune buying and selling factories amid America’s industrial decline and gave more than $300 million to the University of Pennsylvania’s medical school and Philadelphia art and Jewish charities, died Jan. 14 in Philadelphia.
A son of Lithuanian immigrants, Perelman bought, grew, and sold dozens of companies — Esslinger’s beer, Belmont iron, Dicalite minerals, Champion auto parts, and Bobcat construction vehicles. He said, “It didn’t make any difference, they were in trouble and I turned them around, and they were making money.” Or he would freeze pension funds and liquidate assets to at least make a profit from the pieces.
He lived at the 1820 Rittenhouse Square apartment building he built. Perelman “saw opportunity where other people saw only risk,” said banker Betsy Zubrow Cohen. “He was a man of large appetites.”
Perelman liked his name on buildings. “He wanted his grandchildren and his great-grandchildren to have a legacy in Philadelphia,” said Laura Goldman, one of his early brokers. In Palm Beach, Perelman was a member of the Mar-a-Lago club owned by President Donald Trump; he preferred to breakfast in simpler places; he owned a pair of Rolls-Royces that he seldom used.
“He didn’t get to where he was because he was a sweetheart all the time,” said one of his lawyers, Clifford Haines. “He was a savvy and accomplished businessman. He did a lot of good things for the city of Philadelphia.”
John B. Neff, 87, a plainspoken Ohio native who beat the stock market for a generation, built Vanguard Group’s largest fund, and gave the University of Pennsylvania an Ivy League-sized endowment without pay in his spare time, died June 4.
Neff resisted suggestions by the Wharton School’s real estate, hedge fund, and private equity alumni to dump U.S. stocks and choose riskier investments.
At Wellington Management Co., he stood for thrifty Philadelphia-style value investing. In a business full of aggressive salesmen, Neff’s tone gave a bracing humility. As he told The Inquirer’s Andrew Cassel in 1995: “When you feel like bragging, it’s probably time to sell.”
Warren “Pete” Musser, who backed risk-takers for decades and rode the dot-com boom and bust, died Nov. 25. He was 92.
Musser was from 1953 to 2001 the head of Safeguard Scientifics, which invested in small industrial, telecommunications, electronics, internet, and other firms, and trained Philadelphia-area investment professionals. He encouraged QVC, CompuCom, and Novell. In 1963, Musser and his partners sold Philadelphia investor Ralph Roberts the first of the cable-TV systems that became Comcast Corp., the biggest company now based in the city.
“Safeguard was the first ‘incubator’” of small tech companies at its campus north of Wayne, which Musser called “the Orphanage,” said Dean Miller, executive director of the Philadelphia Alliance for Capital and Technologies.
Safeguard-backed stocks such as Internet Capital Group and VerticalNet, which were briefly worth billions and lost most of their value in the 2001 dot-com bust. Musser continued to invest in area companies and meet venture capitalists and aspiring tech bosses at the Radnor Hotel for morning breakfast meetings into his 90s.
Arnold Staloff, 74, of Cherry Hill, a leader among the innovative financial traders who challenged the world’s central banks in the 1980s and helped ensure the survival of Philadelphia as a financial center, died Dec. 6 at Jefferson Cherry Hill Hospital.
Working for the old Philadelphia Stock Exchange, Staloff invented the currency-trading option in 1982, challenging bank control of world exchange rates, Gregory Millman wrote in The Vandals’ Crown: How Rebel Currency Traders Overthrew the World’s Central Banks.
These were among the earliest of a wave of “derivative” securities that enabled investors to invest in economic benchmarks, such as stock indexes or interest rates. Derivatives vastly increased profit opportunities for traders and made risk harder to measure, leading to losses by the unwary. One of the businesses attracted to the exchange on Staloff’s watch, Susquehanna International Group, based in Bala Cynwyd and headed by Jeff Yass, has grown into a worldwide trading force, with 2,000 employees and a presence in world markets.
Staloff suffered strokes that changed his personality but kept working, his daughter Lindsay Staloff Peterson said. All his life, “he would pay attention. He would help people, or give them good advice, or refer them. He would shake the hand of a homeless person; he learned their names. For me, at age 16, that was very profound.”