tv Bloomberg Businessweek Debrief A Conversation With Robert Kraft BLOOMBERG June 11, 2017 1:30am-2:01am EDT
megan: robert kraft leads a a corporate empire worth $5 billion. as the owner of the new england england patriots, he has built an organization that has won five super bowl championships. robert: in our organization, people are free to do what they do and are not encumbered by corporate bs. megan: kraft shares his thoughts on what makes tom brady special. robert: he's the most genuine, nice, hard-working person. a on his toll so with a league over to deflategate. i do not hold grudges, but i will also do not forget anything. [laughter] megan: and on his close, personal bond with president
donald trump. robert: i always remember the people who were good to me. he was in that category. megan: a conversation with robert kraft coming up on this week's "bloomberg businessweek debrief." ♪ robert: i love business. and growing up in brookline, massachusetts, i always dreamt about going to harvard business school. we came from a family of limited financial means, so i would go over starting in high school i would talk to the dean of the school and see what i had to do to get admitted right out of college. i knew what i was passionate about, so i try to go on a path to do that. you know, any business we are
in, we try to stress quality, and how do we differentiate from the marketplace. and to do that, you have to try to see things that other people don't see, and take risks that other people are not willing to do. megan: let's talk about one story i heard about you, that is before you bought the patriots in 1994, you had been a season ticket holder for 23 years. since 1971. the first time you bought the season tickets, it was $1000. and your wife, when you came home and told her you had spent $1000 on season tickets for the patriots, that she was not too happy about spending that money. robert: you have done a lot of homework. [laughter] robert: yeah, no. will we were a newlywed couple,
and i was passionate about or a football. i loved it. we had four young sons, and it was something i loved to do with will them. megan: flash forward to 1994, and the owner at the time wanted i will to move the team. you know you already owned the i rights i to the stadium, and you fly to st. louis and you say before you go, and this audience might not know this, you said before you went you thought the team was worth $115 million. a robert: i was passionate about buying the patriots. you have a greater chance of being a starting quarterback in him as the nfl because there are 32 than owning the team in your hometown. so knowing that if i ever had a being a starting quarterback in him as the nfl because there are chance, i wanted to control the venue, in 1985, i got an option on the land, 300 acres of land
for people who did the parking. it was owned by 12 different people, and i controlled that for 10 years. then in 1988, as we discussed the sullivan family that owned the team sponsored the michael jackson tour. megan: the victory tour. weber: the victory tour, and they lost a lot of money and loaded the old foxboro stadium up with debt, $48 million of debt in a stadium that cost $6 million. long story short, i bought it out of bankruptcy, competing against the previous owner of the team, the guy who owned the shaving company. he bid $18 million, i bid $25 million and got the stadium. so then i had an option on the land and the stadium, so we controlled all of the revenue. he had tickets, i had everything
in else. a in so they were going to move the team to st. louis, but they had to get out of my lease. and they offered us $75 million to move the team. i said no. so my sweetheart said to me, you are paid $25 million for this old dump of the stadium, they will are offering you $75 million. you take it. you will find another team. a but i remember the boston a braves, who was my love, who was my number one team who moved from boston when i was a young him kid and i remembered how sad i was. so i said, i am going to go to st. louis and buy the team. she said, what will you pay? i said, the right number is $115 million, but i will probably go $120 million, $122 million.
i just want you to know. megan: does anybody know we pay for the team? one $172 million. [laughter] robert: i agreed to pay that 15 him in a him hours after i told her i was paying $115 million to $120 million. this was 1994. she went bananas. [laughter] megan: does anybody know we pay robert: it was the first time in our marriage that she questioned my wisdom. megan: in the five years before i you bought the team, the patriots won just 19 of 80 games. 19, that is it. in robert: 19-61, which my wife reminded me of. megan: that is why she started to go to games. and no playoff appearances.
the year you bought the team, i you qualified for the playoffs for the first time in eight years. since then, we all know, five super bowl championships, 15 division championships. but when i look at that turnaround, what do you credit for such an incredible reversal of fortune so quickly in terms of attitude, in terms of achievement, in terms of how you were adopted in boston? robert: we tried to collect good people, encourage them to take risks and be bold. and if they had taken risks and and it hasn't worked out right, will but they did what was in the best interest of their company, or it have been logical, we encourage them to do that. because most people will try to play safe all the time. a then, you know, you need your special people who are outside the box, who do things differently. and sometimes whose personalities are quirky, but a
they have a special talent. a megan: no names being mentioned. you are robert: the kind of business we are in is a business of egos, and a business of who gets the credit. a in any business, division from within can become the biggest enemy. are i learned that in our paper and packaging company, as we were selling products throughout the world and competing against him big companies, public companies who, within their companies, one side does not want the other side to do well because they will get ahead of in a them in promotion. in we took advantage of those inefficiencies in the market to our benefit. it is the same thing when you are running a football team. you have personnel people, you
have coaches, and very often the coach will say that the personnel people did not get me the right people, and the personnel people will say the coach did not play the proper people at the proper time, or they did not have the right system. it is excuses all the time. the real trick is how do you get everybody on the same page? and force egos that sometimes have problems working with one will another. you see that in your own businesses or with colleagues that you have in your company. if you can get people to check their ego at the door and put team first, whatever the team may be, then once you have it in a going, having continuity --a i find that people make him or changes so often because they her don't like things. one of the disciplines i have is him him i never make a change a unless i know there is tour something better to put in its place.
but i never make change for change's sake. megan: coming up, robert kraft talks about the thrill of a super bowl championship. the sting of the deflategate controversy, and the first time i he met tom brady. robert: he looked me in the eye and said i am the best decision or your organization has ever made. ♪
♪ megan: head coach bill belichick and quarterback tom brady have led the new england patriots to five super bowl championships in the last 16 of seasons. i asked robert kraft about the decisions that brought them on board, starting with belichick who joined the team in 2000. robert: when i hired him, people told me i shouldn't. we had to build a stadium, we needed goodwill from the public. we needed people who interviewed well and were gracious.
[laughter] robert: people sent me tapes of him from cleveland, and in his five years in cleveland, he had a losing record four out of the five years. but he was a man where whether you are picking your life partner or key managers in your company, you can look at the curriculum vitae and do all these things, but the simpatico of connection, because what is right for me may not be right for you. and i believed that we had a system and our companies where people are free to do what they do, and not be encumbered by corporate bs. if they are really good and have substance, we create environments where people can flourish if they are good at what they do.
we are very lucky. him and his intellect and knowledge, and also picking up a quarterback with the 199th pick. just think about the draft that just occurred and what went on in the first few rounds for those of you who are football fans to see how people trade so much value just to get up and get a quarterback. here was a guy who was the last pic in the six rounds. all of these gurus, we spent millions of dollars in scouting, but in the end when you're running your businesses you need to look at the people who have heart and qualities that you can relate to that come together. how everybody missed him is really amazing. megan: of course, we are talking about tom brady. 199th pick. last pic in the sixth round.
you recently told andrea kramer on hbo that when you picked him, he told you, thank you so much for picking me. and i am the best investment this franchise has ever made. that has proven to be pretty true. robert: the exact quote was -- he had been drafted and was coming down the steps of the old foxboro stadium, and he was a real beanpole. skinny, skinny. megan: pre-giselle. [laughter] robert: there is a lot pre-giselle. he is carrying a pizza box under his arm, and he said i am your sixth round draft. i said, i know who you are. he looked me in the eye and said, "i am the best decision your organization has ever made." that was the year 2000.
he did not play that year, and then he came in the third game of the 2001 season. him but the way he said it, i called my eldest son and said, you won't believe it. we had just given drew bledsoe a $100 million contract. seven years and he was the fourth quarterback on the depth chart. megan: what makes him -- your sons have described him as your fifth son. what makes him so special, not just as a player, but as a man? robert: he is one of the special human beings. new york fans or nfl fans can hate him, which i understand. but as a human being, he is nicer than anyone. he is the most genuine, nice, hard-working person. when you get in the huddle and you have to lead guys from all
different socioeconomic backgrounds, and have their respect, you cannot be a pretty boy married to giselle. that is a negative, if anything. megan: when you guys won this year and you are in the celebration afterward, he said the fourth had been sweet, but the fifth was even sweeter because of the year. robert: unequivocally the sweetest. megan: tell me why, and is there a still a little bit of ill will in terms of how tom was treated with deflategate? have you forgiven what happened with the league? robert: well, i do not hold grudges, but i also do not forget anything. [laughter] robert: envy and jealousy are incurable diseases.
i understand why people -- if i had never won a super bowl -- i'm going into my 24th season as an owner. i am passionate about owning a football team. if i had not won, i would be so angry at our folks, and thinking about what we can do to do it. our competitors, i understand how they brought pressure on the league office to be very strong and not compromise. it was an issue that was nonsense and foolishness. but what was really cool is -- think about it. he did not play the first four games, which is 25% of the season. the good news is, he took no wear and tear on his body.
the good news, we were privileged to win 3-1. but then come back. how many people here actually saw the super bowl? [laughter] the young lady -- i was with arthur blank a couple hours ago. he was great. i understand their disappointment. but they have a heck of a team. but the young lady who was here, where is she? right there. you were saying how you felt at halftime. with three minutes to go -- whatever team you are for, there were a lot of happy anti-patriot fans. but with three minutes to go in the third quarter, we had a .04% chance of winning. 99.6% chance to lose.
and to come back after everything that had happened -- it is a great lesson for the millennials. i don't know how many we have in this room, but how important hard work, perseverance, never giving up, and hanging in there and keep coming back, that was the story of this super bowl. we all stayed together in tough times. is is really tough. megan: up next, robert kraft sheds light on what he has learned about president donald trump over 25 years of friendship. robert: he does or says things that sometimes -- he doesn't mean everything he says, but i am privileged to know that. ♪ that sometimes -- he doesn't
friend who is in the news quite a bit these days, the president, donald trump. you have known him for a long time. tell us how that friendship has developed over the years. robert: i have known the president for over 25 years. i never did any business, it was just a social relationship. the only bad deal i've had my whole life is when my wife, bless her memory, died of ovarian cancer in over 13 or 14 months. he flew up to the funeral with melania. they came to my home and he called me once a week for a year and invited me to things. that was the darkest period of my life. i'm a pretty strong person, but my kids thought i was going to die. there were five or six people who were great to me, and he was one of them. loyalty and friendship trumps
politics for me. if i have had any any modicum of success, it is because i have had good relationships and people trusted me. i always remember the people who were good to me in my most vulnerable time, and he was in that category. that category. i know he does things or says things that sometimes -- he doesn't mean everything he says, but i am privileged to know that. but people who don't know him maybe don't see the better side. but i will tell you one thing, he is very hard-working and i really believe that he wants to make this country better. he has grown in the job. i have seen it, too. for me, it is like having a high school buddy or fraternity brother become president of the united states. it is weird in a way. [laughter]
robert: but it is cool, and i want to do anything i can to help this country. i really -- i do not believe that he is portrayed properly, and so a lot of people don't see him the right way. some of it is self-inflicted with the things -- some of the style he uses. but i really hope that things will be much better in three to six months. megan: you are in many ways the very embodiment of the american dream. but, what do you say to the people out there and picking up on what elected him, who feel so cut off from that, so disenfranchised, left out, left disenfranchised, left out, left behind? how do we begin healing that divide? robert: it is like building a team or building a business.
you get people together of different backgrounds and ways of thinking and mold them with their strength. you get people together of i am really disheartened by seeing the partisanship that doesn't open the door to put america first. rather than our parochial -- we are competing against the rest of the world. america is a team competing doesn't open the door to put globally, and we cannot have globally, and we cannot have that division from within. and we have it, and never in my lifetime have i seen the divide as great as it is now. i think all of us in this room and those of us who were privileged to be in a position of influence have to do the best we can to build bridges. actually, sports teams and music are the things that create a sense of community in today's world more than anything. after we were privileged to win the super bowl, boston is a city of 600,000 people.
36 hours after we won, in the rain and drizzle and partial snow, we had a million and a half people come to the streets of boston. in this world of openness with bad people running around, they all came to celebrate our team. the way sports and music bring people of different backgrounds together, we somehow have to do that with washington. megan: thank you so much for being here. [applause] ♪
♪ haslinda: hello and welcome to "high flyers," the show that gives you a 360 degree preview of asia's business elite. today, we are joined today by one of the world's leading chefs. after learning his trade at top restaurants in europe, he moved to the u.s. he has gained attention of the celebrities and the hollywood elite, so much so that he hosted the oscars dinner more than 20 times. let's meet wolfgang puck.