The Protégé Read online

  Clayton nodded. “Fine, I’ll take all the charity I can get,” he said, leaning down and lining up the cue ball with the top of the triangle at the far end of the table. Then he hesitated, smiling serenely and straightening up. Looking at the ceiling as if he were deep in thought. “You’ve never taken a match from me, have you?”

  They both knew Christian hadn’t. And they both knew that such a victory was Christian’s white whale. Reminding him of the streak was his father’s way of playing with his mind, but he wasn’t going to let himself be manipulated tonight. “This’ll be interesting, Dad. I played a lot last semester.”

  “Is that all you guys at Princeton do?” Clayton wanted to know, breaking up the balls with a loud crack. “Play pool?”

  “I’m keeping my grades up,” Christian said quickly, sizing up the way the balls had come to rest. None in for his father on the break. A good way to start. “I’m fine.”

  Clayton chuckled. “I know you are. Four A’s and a B plus in advanced calculus last semester. You’re still on track to graduate with honors this May.”

  Christian had been about to take his first shot, but he stopped. “How do you know?” The semester had just ended last week. Final grades hadn’t been released yet.

  “I called my friend John Gray. He’s one of the—”

  “One of the assistant deans,” Christian broke in, setting up for the shot again. “Yeah, I know.” He made it easily. “Checking up, huh?”

  “It’s what I do, son. Which reminds me. While you’re home I want you to have lunch with my friend Ted Stovall. He’s a Stanford trustee. He’ll be very helpful getting you into business school.”

  Stanford University had one of the nation’s elite business schools. “I’ll take care of that on my own, Dad,” Christian said. “I appreciate it, but I don’t need your help. Damn it!” He’d missed a shot he shouldn’t have because he’d been distracted by the conversation.

  “You mean you don’t want my help,” Clayton corrected, inhaling, then clenching the pipe between his teeth as he prepared to shoot. “Just have lunch with Ted,” he pushed gently. “Okay?”

  “Yes, sir.”

  “And when you graduate from Stanford, we’re going to get you that job at Goldman Sachs. Mergers and acquisitions. That’s the one you want, right?”

  It was exactly the job Christian wanted after business school. The only job he wanted. “Yes, sir,” he said, spying a large wooden box sitting on a table in front of the window. “Thanks.” He knew this den like the back of his hand, and the box hadn’t been there when he’d left for Princeton last September. “Is that a humidor?” he asked, pointing.

  Clayton glanced in the direction Christian was pointing. “Yes.”

  “When did you start smoking cigars? I thought you hated them.”

  “I do. It’s a gift from a friend in Cuba. I’m not supposed to keep those things, but, well, it was just so pretty.”

  Christian watched his father sink seven balls in a row, tapping the butt end of his cue on the floor faster and faster, harder and harder, until the eight disappeared, too. “Damn,” he muttered.

  Clayton rose up as the black ball dropped and smiled from behind the pipe. “One down, one to go. This is going to be easy.”

  But Christian won the second game, and the third was hard fought. Finally, there were just three balls left on the tan felt—the cue, the eight, and a stripe—Clayton’s. Christian smiled. His father was blocked. The striped ball lay directly on the opposite side of the eight from the cue, and his father couldn’t use the eight in a combination.

  Clayton grimaced. “Tough leave, huh? Nowhere for me to go.”

  Christian nodded, trying to mask the smile. His father had to do something, and the odds were good that once the cue ball came to rest, he’d have an easy next shot to win. The streak was almost over. He could feel it.

  But Clayton did the impossible. He made the cue ball jump the eight and into the stripe, knocking the stripe cleanly into a far pocket. The cue ball caromed off two sides of the table and came to rest near the eight. Clayton dropped it into a side pocket easily for the win.

  Christian just shook his head as Clayton replaced his cue stick in the rack on the wall and came around the table. He’d been so close.

  “I know how you hate to lose,” Clayton said, placing his hands on Christian’s shoulders. “You’re so much like me,” he murmured, smiling. “So much.”

  “Christian.”

  Gillette heard the voice but didn’t react. He was still far away, still in his father’s study, wishing he could have an evening like that just once more. After pool, they’d talked until two in the morning. But there’d never be another evening like that. Six months later, Clayton was gone.

  “Christian!”

  Gillette finally looked up. Faraday was standing in his office doorway. “What is it, Nigel?”

  “It’s time for the meeting,” Faraday replied, tapping his wristwatch. He cocked his head to one side. “You okay?”

  “LET’S GO,” Faraday snapped at the stragglers. “You’re four minutes late.”

  The two managing directors hustled to their seats at the far end of the conference room table.

  This was the Everest managers meeting: Gillette, four managing partners, eight managing directors, and Debbie; attendance required. The only exception—Gillette. If he needed to be elsewhere, Faraday was in charge.

  Gillette ran the meeting from the head of the table, while the other managers sat down the sides in descending order of seniority. Debbie sat at the far end of the table, taking minutes. Donovan had never allowed anyone but the partners into this meeting, but Gillette had a different management style. He believed in open communication—most of the time, anyway.

  “Everyone’s here, Christian,” Faraday reported. He sat immediately to Gillette’s right.

  Gillette had been reviewing a memo and glanced up into two rows of hungry eyes. They reminded him of a wolf pack. “A couple of updates,” he began. “Nigel finished raising Everest Eight this morning. We now have fifteen billion dollars of signed commitments.”

  Everyone rapped the table with their knuckles—the customary show of approval. The news about Everest Eight had spread like wildfire this morning, so the announcement was just a formality.

  “Nigel deserves more than that, people,” Gillette urged as the sounds of congratulation faded. “I said fifteen billion.”

  The room broke into raucous applause and loud whistles. Gillette usually wanted controlled responses to everything at this meeting, even big news, but when he gave permission to celebrate, people responded. And this was tear-the-roof-off stuff.

  Historically, Everest had achieved at least a three-to-one return, with the firm keeping twenty percent of the profits. So if the people around the table could turn fifteen billion into forty-five over the next few years, Gillette would have six billion—twenty percent of the thirty-billion-dollar profit—to spread around. It would be the biggest payout ever for a private equity firm. Some of the money would go to the Everest rank and file, but most of it would go to the people in this room.

  Gillette nodded approvingly at their reaction, watching the hungry looks turn ravenous. He could see people calculating their potential share of the ups—as they should. Money was their driver, their reward for the intense stress and sacrifice—eighty to ninety hours a week away from family and friends. If they didn’t get to enjoy the reward, they wouldn’t last.

  “That’s better,” Gillette said, motioning for quiet as he turned to Faraday, who was beaming. “Nigel, it’s a tremendous achievement. The largest private equity fund ever raised. Thank you.”

  “Thank you, Mr. Chairman.”

  People began to clap and whistle again, but Gillette shut them down with a flash of his piercing gray eyes. “It gets better,” he continued when the room was silent. “This morning, I met with representatives of the Wallace Family. They’re out of Chicago, for any of you who don’t know,” he said,
effectively telling anyone who didn’t that they better research the Wallaces right after the meeting. “They’re one of the wealthi-est families in the country.” He paused. “They’ve committed an additional five billion to Everest Eight, so it’s now a twenty-billion-dollar fund.”

  There were gasps.

  “And they’ve made their investment on the same terms and conditions as the other limited partners.”

  “They don’t want anything special?” Maggie Carpenter asked warily. Maggie was one of the managing partners. Six months ago, Gillette had hired her away from Kohlberg Kravis & Roberts, another high-profile private equity firm in Manhattan. Thirty-five, Maggie was thin with dark red hair, a pale, freckled complexion, and stark facial features. Besides Gillette, she was usually the first one to ask tough questions in this meeting. “That’s an awfully big commitment for them not to get some sizzle.”

  “They want one of their people on the ground here at Everest,” Gillette replied, catching the uneasy looks appearing on the faces around the table. “Allison Wallace will join us as a managing partner. That’s the only extra they want.”

  “The only extra?” asked Blair Johnson. Johnson was another of the four managing partners. He was African American and had grown up in an upper-middle-class Atlanta suburb. The son of a physician, he’d gone to the right schools: Harvard undergraduate and Columbia Business School. He’d been with Everest for seven years, and Gillette had promoted him to managing partner nine months ago. “That seems like a lot.”

  “Worried about the money?” Gillette asked.

  Johnson cased the room quickly, making certain he wasn’t the only one concerned about Allison Wallace. “Not the salary and bonus, really,” he answered hesitantly. “After all, it’s a twenty-billion-dollar fund. At one percent, we’ll make two hundred million a year in fees alone.”

  “So it’s the ups you’re worried about.”

  “Yeah, the ups.”

  “Well, here’s the deal, Blair,” Gillette said sharply. “Allison doesn’t want any money. No salary, no bonus, no ups. All she wants is a front row seat at the game so she can see how her money’s being used.”

  “What Allison Wallace wants,” Tom O’Brien said in a professorial tone, “is to see how we do it.” O’Brien was the fourth managing partner. He was forty-one but looked older. His hair was snow white, and he had a ruddy complexion. From Boston, he had a prickly New England accent. “She wants to go to school. She wants the keys to the castle.”

  “Of course she does,” Gillette agreed. “But so what? Nigel and I planned on adding two more managing partners anyway. We’ll need six of you to put twenty double-large to work in three years. At least six. This way we get one free, and we get an extra five billion to invest, plus the annual fee. It’s like she’s paying us fifty million a year to work here,” he reasoned, liking the way it sounded. “It’s a good deal, and it’s not like she’s going to be able to duplicate what we have when she goes back to her family office in Chicago.” Gillette could see that people were apprehensive. “Another update,” he said, switching subjects, not wanting to dwell on something that made people feel insecure. He’d made the decision about Allison Wallace, and it was final. “We got the Las Vegas NFL franchise.”

  “Hot damn!” yelled O’Brien, banging the table. He was a sports nut and had helped Gillette and Faraday during the bid process.

  “Next week I’m meeting with Kurt Landry, the NFL commissioner, to work out a few things,” Gillette continued, “but basically it’s a done deal.”

  “And we’re sure we’ve got the zoning to build the stadium?” Maggie wanted to know.

  “Absolutely.”

  “Wait a minute,” David Wright broke in. Typically, he was the only managing director that spoke without being asked a question by a managing partner first. “We’re building the stadium?”

  “I want to build it so we keep the extra revenue,” Gillette explained. “Concessions, advertising rights, naming it. This way we have total control of everything.”

  “How much did we offer for the franchise?” Maggie asked. “I can’t remember.”

  “Four hundred and fifty million.”

  “What’s the strategy with this?” she continued. “I don’t know much about sports teams, but four hundred fifty million seems like a lot, and you’ve got the cost of building the stadium. Which is what?”

  “Three hundred million.”

  “So we’re in for seven hundred and fifty million. Can we really get a decent return on that, Christian?”

  Maggie was suspicious that this was just a “boys gone wild” investment, Gillette could tell. An excuse to jet to Las Vegas every few weeks and hang out with movie stars, corporate bigwigs, sports figures, politicians, and friends in a plush skybox. “The stadium will be finished in a year and a half, and it’ll seat eighty thousand,” Gillette answered, giving a quick overview of the numbers. “We’ll charge an average of a hundred dollars a ticket. That’s eight million dollars for each of the eight home games, sixty-four million a season. And that doesn’t include a couple of preseason games we can probably get fifty bucks a ticket for. Plus, we get concessions, our share of the NFL TV contracts, and ad dollars. One of the big computer store chains already offered us ten million a year to put their name on the stadium. Nigel and Tom,” he said, “figure we can generate at least three hundred million a year in revenues. Based on where other major league sports teams sell, that would make the franchise worth somewhere between two and three billion. That would be a hell of a return.”

  “But can you really fill up eighty thousand seats at a hundred bucks a pop in that city?” Maggie pushed. “Vegas isn’t that big, it’s probably only got around a million permanent residents. I don’t think eight percent of the population is going to a football game eight times a year for that kind of money.”

  “The population is closer to a million five,” Gillette corrected, “but I hear what you’re saying. Which is why we’re already negotiating with a couple of the major airlines to add flights from Los Angeles to Vegas on game weekends. Remember, as crazy as it sounds, L.A. doesn’t have a football team, and we’ve got assurances from the NFL that it won’t get one in the next few years, until we’re established. I think L.A. will adopt the Vegas franchise. It’s a nothing flight for those people—you’re up, you’re down. We’re also working with the casinos on promotions, and we’re pretty far along with several of them. In fact—and what I’m about to tell you has to stay in this room,” he said, giving everyone a warning glare. “We’re looking at opening a casino ourselves. We’ve gotten to know the city officials very well over the last two years, and they’ve told us they can persuade the state gaming commission to give us a license.”

  “What about the Mafia?” Maggie asked bluntly.

  Gillette had figured someone would ask about that. “We’re checking, but I doubt the NFL would green-light the franchise if the Mafia was still a problem out there.” He had better information than that but didn’t want to alarm anyone. “I’ll keep everyone up-to-date on what we find,” he promised, looking around the room. It was time to end the cross-examination. Maggie was good, but she didn’t get it this time. “This could turn out to be one of our best investments ever. Not Laurel Energy, but close.”

  People rapped on the table hard, nodding their approval, understanding that Gillette had ended the discussion on this topic.

  “Another thing,” he continued, holding up his hand for quiet. “I’m going to retain Morgan Stanley to sell Laurel Energy.”

  “Why Morgan Stanley?” Maggie asked.

  “Why not?”

  “I thought Goldman Sachs had the best mergers and acquisitions group for the energy industry.”

  “Morgan Stanley will do a great job for us,” Gillette replied confidently.

  “Is this payback?” Maggie looked over at Wright, then back at Gillette.

  “For what?” Gillette demanded.

  “You know what.”

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sp; Gillette’s eyes narrowed. “No.” He stared at her for a few moments more, then resumed the meeting. “I want to get back to a point Blair made earlier. The fact that we’ll be making two hundred million a year in fees on Everest Eight. I’ve decided to commit ten million of the first-year fee to St. Christopher’s Hospital up on the West Side.” He paused. “I want all of you to make personal contributions to your local charities, too. In your towns, your neighborhoods, whatever. That’ll be something I’ll talk about with each of you during your annual reviews in January. Frankly, the more you donate the better. All of us are lucky when it comes to money. I know everyone works hard and makes a lot of sacrifices, particularly those of you who have spouses and children. You don’t see them much,” he said, his voice dropping. “But it isn’t like we dig ditches, either. While I’m chairman, this firm is going to be socially responsible, understood?”

  His words were met with nods.

  “Good.” Gillette checked his agenda, scratching out the NFL, Laurel Energy, and charitable contribution items. The next topic was the L.A. office. “Just so everyone’s clear, Nigel and I are looking into opening a Los Angeles office, but we haven’t made any final decisions yet. I don’t want rumors going around. When we do make a decision, we’ll let everyone know right away.” He grinned. “Anybody want to volunteer to go?”

  Wright raised his hand immediately. “Can I get promoted to managing partner if I do?”

  Gillette shot Faraday a quick look and shook his head, still grinning.

  Faraday rolled his eyes.

  “Always looking for a deal, aren’t you, David.” Gillette turned back to face Wright. “Stop by later and we’ll talk about it. We can talk more about that other thing, too.”

  “Stop by later” meant they’d talk about it during a game of pool in the room adjoining Gillette’s office.

  “I’d rather talk about Hush-Hush now,” Wright said, taking advantage of the fact that Gillette was speaking to him. “I don’t want to wait. It’s too hot.”

  To bring up a prospective investment in this meeting, a managing partner or managing director was supposed to run it by Faraday first, then send around a short memo on the company so the group had the basic facts—what the company did, how big it was, how profitable it was. Wright hadn’t talked to Faraday or sent around a memo.