It has become fashionable to demonize ‘‘Bain’’ as some sort of monster of greed. Even the president and his followers would have us believe that Bain and its one-time leader, Mitt Romney, care only about profits, never people. We are told that Bain delights in seizing weak companies, firing their staffs, amassing amoral fortunes, and fleecing decent working folk.
That certainly doesn’t sound like a very compassionate business, much less the sort to produce someone we would want as our next president. But are these attacks true?
I began my business career at Bain & Company, the management consulting firm, in 1977, when the organization had one office in Boston and fewer than 30 employees. Mitt Romney joined us a few months later and I worked alongside him for two years. After business school, I was hired by a Michigan company where I served as assistant to the CEO responsible for corporate acquisitions.
Rough times lay ahead. Our company CEO was fired by his board for ignoring the economic downturn of 1981/82, and my own future looked bleak. Then Mitt called. He said, “I know you’re in a tricky spot, Bill, and wondered if you’d come back to Boston to join us here at your real home, Bain.” With a wife and two young kids to provide for, Mitt’s offer was a lifesaver. Later I worked with him as he developed Bain Capital, the private equity firm, which he founded with Bill Bain.
Fast forward to 1990. Bain & Company was fighting to survive. The firm had acquired debt and the interest payments would soon crush us unless we could sell the company or restructure. Bill Bain decided to sell and asked me to help. We tried, but the right offer was elusive. I finally had to inform him that we had run out of suitors. Bain asked me whether it made sense for Mitt Romney to return and step in as CEO. “If Mitt is willing to,” I said,“it is by far the best solution.”
Mitt took over without a penny of salary. He made all the right moves. He forced the Bain founding partners to put money into the firm and restructured the debt. He put confidence back into the hearts of the over 1,200 Bain employees, and all while he was running Bain Capital, quickly becoming the most successful firm in the private equity world. As I look back, two men can lay claim to the success of Bain: Bill Bain for starting it, and Mitt Romney for saving it.
For over 20 years now I’ve run my own management consulting firm, The Parthenon Group. We compete with Bain & Company for business; occasionally we work for Bain Capital as our client. I’ve always been proud of my Bain heritage. Folks around town on the charitable side of life know there are countless organizations who have received substantial support from Bain Capital, Bain & Company, and their partners: The Boys and Girls Club, the MSPCC, the Bright Horizons Children’s Foundation, City Year, Tenacity, and many others. Bain even started Bridgespan, a group that works for non-profits around the world at highly discounted rates. When you add in firms like mine, companies who owe their existence to the lessons we learned at Bain, the amount of “giving back” to Boston’s charitable organizations reaches into multi-millions every year.
The plain truth is that Bain is in the business of creating value for its clients, including shareowners, employees, customers, suppliers, and their communities. Over a long history, Bain & Company and Bain Capital have treated their constituencies extremely well. Companies like Staples, Burger King, and Dominos would not exist without the assistance of Bain Capital. Likewise, the successes of Bain & Company have propelled it to the ranks of the management consulting “Big Three,” beside McKinsey and the Boston Consulting Group. Bain would not belong to this eminent club if it were offering shoddy, self-serving and duplicitous advice.
So when people bash Bain as a way to undercut the respectability of Mitt Romney, they only look foolish. Bain is an American success story and Mitt is at the very heart of it.
Bill Achtmeyer is chairman and managing partner of The Parthenon Group in Boston.