It was 2002, and Steve Pagliuca marveled as Mitt Romney, his friend and mentor at Bain Capital, marched into the opening ceremony of the Winter Olympics in Salt Lake City, serenaded by a regal fanfare. Eight years after his stinging loss in a Senate race to Edward M. Kennedy, Romney was being hailed for rescuing the Games from scandal.
“Mitt’s walking with kings,” Pagliuca mused.
Now, Pagliuca is hoping to become the next Bain Capital executive to rebound from a failed Senate run and save a faltering Olympic effort. On Thursday, he was named chairman of Boston’s bid committee, replacing John Fish, the founder and driving force behind the city’s effort to land the 2024 Games.
In taking over Boston’s embattled bid, Pagliuca must deliver a credible financial and venue plan and convince a skeptical public that the Games are in the city’s long-term interest and will not drain the public treasury.
Friends say he will draw on the financial savvy that earned him a fortune at Bain Capital, buying emerging or struggling businesses, improving their finances, and then selling them for a profit. As a co-owner of the Boston Celtics, he has also been credited with helping to assemble the front office team that brought the storied franchise its elusive 17th banner in 2008, after a 22-year drought.
But fixing the bid committee, Boston 2024, will require selling voters on the promise that they will not have to pay to build and run the world's largest sporting event. That task, many say, is more akin to a political campaign than a business deal, and Pagliuca’s one foray into politics was not a rousing success.
In 2009, riding high on the Celtics’ championship, he poured $8 million of his own money into the Democratic Senate primary and campaigned with the Celtics’ trophy, but finished fourth out of four candidates, with just 12 percent of the vote. He was guided in the race by Doug Rubin and Will Keyser, veteran political strategists who are now paid advisers to Boston 2024.
Despite the defeat, former colleagues say Pagliuca could help Boston’s bid by ruthlessly scrutinizing its finances, personnel, and operations as if he were a Bain Capital executive taking over a troubled company. The soft-spoken, rumpled former accountant is also expected to set a warmer tone as he replaces Fish, a hard-charging construction magnate who was sometimes testy with critics.
“I think Steve has the right set of skills for this challenge, starting with the fact that he’s extremely smart and very cordial,” said Marc B. Wolpow, a former managing director of Bain Capital. “He’s very good with people. He has a good strategic mind and a good political mind.”
Even so, Wolpow said he wonders if anyone can salvage the bid after its rocky start.
“It’s a daunting task,” he said. “I wouldn’t take it.”
Harry Strachan — who was Pagliuca’s boss at Bain and Co., the venerable consulting firm where Pagliuca worked before he joined the company’s investment arm — said his friend is well qualified to revive the bid since he is “very creative at structuring a deal” and has a “real nose for the gold.”
Strachan compared Pagliuca favorably to Romney, who left Bain to run the Salt Lake City organizing committee after an ethics scandal erupted with respect to lavish gifts that backers of the Games showered on IOC members in their efforts to lure the Olympics to Utah.
“Knowing Mitt Romney and looking at what he did out in Utah, I have a feeling Steve will be as effective here, although in many ways Boston is going to be tougher to try to get up to speed,” Strachan said. “It’s a difficult city to make things happen in.”
The son of a middle-school teacher and a salesman, Pagliuca, 60, grew up in Framingham and Basking Ridge, N.J. He played freshman basketball at Duke University, where, he has said, “I was the slowest, nonjumping guard” on the team.
In 1982, he graduated from Harvard Business School, where he had met his wife, Judy.
The couple have four children and live in Weston. After Harvard, Pagliuca joined Bain and Co., where he used his training as an accountant to analyze complex financial deals. In 1989, Romney hired him at Bain Capital, where he is currently a managing director.
In his two decades there, Pagliuca has earned hundreds of millions of dollars for himself and his colleagues, helping to broker deals such as a $2.6 billion buyout of Burger King and a $21 billion deal for Hospital Corp. of America.
Some of those deals resulted in job losses.
In 1994, for example, a $448 million buyout of Dade International, a struggling medical equipment manufacturer, led to multiple rounds of layoffs, a bankruptcy, and questions about Bain’s tactics. Pagliuca has said the job cuts were necessary to improve Dade’s performance. The deal was one of several that dogged Romney in his 2012 run for the presidency.
Pagliuca’s dream purchase came in 2002, when he and a friend, Wyc Grousbeck, along with Grousbeck’s father, H. Irving Grousbeck, bought the Celtics and set about restoring the franchise to its former glory. Pagliuca helped recruit Danny Ainge to rebuild the roster. That led to the acquisition of Kevin Garnett and Ray Allen, which in turn led to an NBA championship in 2008.
The following year, after Kennedy died from brain cancer, Pagliuca jumped into the race to fill his Senate seat. He had long been a major donor, mostly to Democrats, and an active philanthropist, serving as chairman of the Massachusetts Society for the Prevention of Cruelty to Children. But he had no experience in politics and did not even take a poll to see if he would be a viable candidate, according to Tad Devine, an adviser to Pagliuca on that race.
When an aide finally polled, after Pagliuca had launched his campaign, the results showed he had no shot, Devine said. Democratic voters overwhelmingly favored Martha Coakley, who went on to win the primary and then lose to Republican Scott Brown.
“The thing he said to me was, ‘I made this decision. I’m going to see it through, and I’m determined to run the best campaign I can,’ ” Devine said. “He’s somebody who, notwithstanding the odds, is going to give it his very best shot.”
During the race, rival Democrats attacked Pagliuca for supporting Republicans, including Romney in his 1994 Senate battle against Kennedy, William F. Weld in his 1996 Senate matchup against John F. Kerry, and George W. Bush over Al Gore in the 2000 presidential campaign.
“Once voters got that, they wouldn’t listen to anything else,” Devine said.
Pagliuca has avoided the political fray since his defeat, returning to private equity and his seat under the basket at Celtics games. But Wolpow said he would not be surprised if Pagliuca wants to run for office again, particularly if he can turn around the Olympics, as his mentor, Romney, did.
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