Banking on KC – Barnett Helzberg
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Kelly Scanlon:
Welcome to Banking on KC. I'm your host Kelly Scanlon. Thank you for joining us. With us on this episode is Barnett Helzberg Jr. The former chair of Helzberg Diamonds and the founder of the Helzberg Entrepreneurial Mentoring Program. Better known as HEMP. Welcome, Barnett.
Barnett Helzberg:
Thank you, thrilled to be here.
Kelly Scanlon:
We're very excited to talk with you today and just to hear more about your story and to get your take on what's going on in Kansas City and what the future holds. So let's start that by talking first about HEMP. What was your inspiration for founding that mentoring program?
Barnett Helzberg:
You know, I would meet with Mr. Kauffman from time to time. And when I thanked him one time, he said, that's okay, you'll help somebody someday. So I know that planted the seed to do this.
Kelly Scanlon:
So you knew that someday as repayment for all the mentoring sessions that you had with Mr. Kauffman, that you would return that favor?
Barnett Helzberg:
I didn't know it right away. I went around town for about two years bothering people or whatever they call it with this idea. And most of them patted me on the head and said it was fine. It was great. A couple of them told me you couldn't do it because, I wasn't going to get all these big shots to do this stuff and no money, and also the chemistry and well, of course, that's, as you know, as you're an entrepreneur when the more people tell you that the more you enjoy doing it and they'll probably make up your mind to do it. So finally, I actually had lunch with Bill Eddy, Bill French and Rich Davis. They wanted me to run a gala and I said, you may have picked the worst person in the whole world to run a gala.
Barnett Helzberg:
Ask my wife, I'm an idea guy, I'm not an executor. And so then Bill Eddy turns to me and says, well, maybe you could start a mentoring program. Well, I've been talking about it, take it about for two years so I'll go home and the next morning I looked in the mirror and I say, put up or shut up, quit bothering these people. Either do it, or don't. It's time to make a decision so that we had a very nice meeting with a group of prospective mentors, and it turned out to be pretty emotional and it was run beautifully by a psychologist to Mr. Kaufman. It introduced me to Harvey Thomas, and then what really broke the ice, are going around the room. But one of the first to talk was Bernie car bank. You expect just a normal, well, success and this and that, it was great real estate. He got very personal and told how he has a kid with polio and trying to keep up and six years old. Anyway, everybody opened up, it was magic.
Kelly Scanlon:
26 years later. Here we are. The program is thriving. What made you decide with all the different kinds of resource programs and models that are out there for entrepreneurs? What made you decide mentoring needed to be at the core of the program you were going to start?
Barnett Helzberg:
Number one, I'm a mentee. I'm not a mentor. Actually, I had to fire myself being a mentor a few years ago, but anyway, I don't know that we did much research like we should have. I think we just moved forward and learned and learned and learned. And we use the old saying, you don't put both feet in the water to find the depth. So, we're testing all that time, and none of it was risking the farm.
Kelly Scanlon:
Tell us a little bit about how the HEMP program works, because I know that there are entrepreneurs who listened to this.
Barnett Helzberg:
Here's how it works. We promote to get candidates. They fill out an application, very detailed. We go through the applications and decide, well, here's the good prospects. You've got 20 is 15 to go visit. These applicants, not only go through the application, which is kind of long, and we put them through a lot of torture with a psychological test and references, looking at financials. And we think we know who they are and that's how we decide where does this and where it fits. People say it's like an MBA and it's so much fun. You're visiting entrepreneurs all day long. And from one business to another, it's just fascinating. And the many ways people make a profit, make a living.
Kelly Scanlon:
It's amazing, isn't it?
Barnett Helzberg:
And the ingenuity. And you know what? I really was scared when this COVID started. I said, oh no, that's our group or small businesses. And I asked Christina who runs it for the last 17 years, she said, we've hardly had problems. We had two people. Maybe they got bought out or something, but no disasters like you would expect.
Kelly Scanlon:
I would suspect it's because of that mentoring and the support network that you have within HEMP, that there was a group that these companies could turn to as they were trying to deal with the fallout of COVID. And that probably helped them immensely.
Barnett Helzberg:
I will tell you that I got a lot of compliments of the way our team informed them and handled them and all that. So I think we did help them because I heard that from a number of people.
Kelly Scanlon:
I have no doubt that that network was a real lifeline to many of your mentees. So it's a three-year program, and then they graduate.
Barnett Helzberg:
Yeah. They graduate. And then we find out they don't want to leave us. So we start the alumni group, we call them fellows and they kick in dollars to belong to fellows. And according to the last, I'd say three years, maybe before, every graduate joined fellows and it's over a thousand dollars a year, it's expensive.
Kelly Scanlon:
But what a compliment, they don't want to leave and they'll actually pay money to stay. I mean, that's a testament to how strong this program is.
Barnett Helzberg:
Bernie car bank accused me that it was a cult. We deny that. But I can't explain, there's a lot of closeness and warmth going on. It's not just, you get a mentor, we call it a resource guide, it's a list of everybody in the program, but it's also their areas of expertise, their phone number. So you've got 200 people you can call on. It's not just your mentor.
Kelly Scanlon:
And, let's talk about you a little bit Barnett. You're an entrepreneur. You came from a family of entrepreneurs and you work with them every single day. So what do you think, and only your observation of this, what do you think it takes fundamentally to be a successful entrepreneur today?
Barnett Helzberg:
To me, it's a singular focus, basically approaching it. I believe very simple. Somebody asked me, they quoted it years later, they said, well, what do you want to do? I said, well, three things, sell diamonds, sell diamonds, sell diamonds. So, I'm not a renaissance man by any stretch, but I've had so much fun and these people are fun, and that's what I loved about the business, the people.
Kelly Scanlon:
One of the things that I, in working with entrepreneurs myself is when to let go? When is it time to sell? To hire a CEO and put yourself in some other part of the business, but to let go of those reins... I know you had to experience that with Helzberg Diamonds too. So what is your advice for that?
Barnett Helzberg:
Well, I don't know if I have any advice. I can tell you what happened to me. Number one, the business outgrew me. I couldn't have the personal contact with all the managers I liked. Number two, I was about 60 and I was getting lazy, I wasn't working as hard as I had, and all these factors came together. And of course, with my usual luck, I run into Warren Buffett on the streets of New York and gets us started. We interviewed different, those brokerage firms and so on. So anyway, that's kind of how it happened.
Kelly Scanlon:
I remember though if I remember the story correctly, you didn't call him back right away. You hesitated a little because you couldn't quite believe he was interested in talking with you.
Barnett Helzberg:
Well, it's so weird. I didn't follow up very fast and I didn't move when he said to move. I messed around for a few months. It was Christmas. I don't want to upset everybody, blah, blah, blah. Dumbest thing I've ever heard, because he had changed his mind, and finally mailed him or figures and said he was interested and so on and come to Omaha. Finally, maybe in January after the Christmas season, I called him and we went up there and it was really weird because I said, well, now you want to non-compete, don't you? He says, no don't ever do anything to hurt this company. So he got a lifetime deal instead of a five-year deal. It was amazing.
Barnett Helzberg:
And the stories are true about him that he's very Midwestern, nice to deal with. At that point we had said, oh, we want to look at other alternatives. We talked to those wall street people, all these people were interested in. One said you can keep control and blah, blah, blah. We wanted someone who would not take it public, would not sell it, treat the people right with the criteria. And I said, okay, what about due diligence? He says I can smell these things, this one smells good. And that was a diligence.
Kelly Scanlon:
What are some of the greatest lessons that you've learned about business, that you strive to pass along to the mentees in the HEMP program?
Barnett Helzberg:
I don't think I've learned this very well because I still jump off the deep end. The lesson I haven't learned is, do your diligence, think things out. I remember this spring buyer and he couldn't get the right price, and the rig was a great seller. Well, he couldn't get the right price so he wouldn't buy it. Well, okay. So it's a little high, buy it and sell it. You don't pass up the opportunities. You get paralyzed. You can overdo the analyzation.
Kelly Scanlon:
You've seen a lot of changes in the business community. I mean, just in the last 10 years, the entrepreneurial community has changed so much. So what do you think is the biggest change in entrepreneurship, in Kansas City since you and your family-owned Helzberg diamonds, up through and working with the entrepreneurs in Kansas City for the last 26 years?
Barnett Helzberg:
I'll just quote, some of our members said... literally the whole world says that the word entrepreneur was hardly known when we started. And there's so many wonderful programs and focuses on it, at universities all around Kansas City and it's been a wonderful change. And also the many women and boys, some of these women have been sensationally successful. And look at, I mean, people want to help. We got incredible people and somebody said something about charging. I said, charge? Nobody could afford it.
Kelly Scanlon:
Yeah. How do you put a price tag on all of those years of experience? It's just it's impossible.
Barnett Helzberg:
You can imagine, for me, it's been magic. And it's funny because people said, well, you're generous. I said, no, no, no, no. I'm selfish. I'm getting more out of this than anybody. I could be talking to by contemporaries about their hips and their knees, or I could be meeting all these people I've never met, learning about all these businesses I'd never known anything about. I said it was a tough choice, but I decided I want to be with these people.
Kelly Scanlon:
It keeps you young, doesn't it? Barnett, when you think back, what is the single most important choice that you've made in your life?
Barnett Helzberg:
Well, undoubtedly, my wife. She's very... Way smarter than me. And she's one of these people that, when she gives you advice, probably pretty good. When you don't follow it, you might regret it. As you know, she's run a whole bunch of enterprises in the city, not-for-profits. So a lot of wisdom and beauty and a very good mother to two nice young men.
Kelly Scanlon:
What do you think the future for Kansas City looks like, especially when it comes to entrepreneurship?
Barnett Helzberg:
Well, I get very optimistic because you read about conditions. Isn't this good and this and that? I drive around town. There's all this construction. Of course, I see these aggressive group members working in their business so seriously, and as opposed to my nature, I mean, some of them have two and three businesses. And I think we have a Midwest advantage and not to be snobby, but I would have two brilliant friends from New York and they would come in and they'd be resources in our group, loved them. So repeatedly. And Shirley and I were driving them from the session over to a hotel for the dinner. And one of them said, this couldn't happen in New York, which gave me goosebumps. But the people here, part of it is their nature, generosity. You know, I've never seen any jealousy and some of our people have been incredibly successful, but I've never seen any jealousy within HEMP.
Kelly Scanlon:
That comradery and that willingness to help and to see each other succeed is what it really takes for a community to move forward without all the different territoriality that can divide up a lot of places.
Barnett Helzberg:
Right. Exactly.
Kelly Scanlon:
Any final thoughts that you'd like to...
Barnett Helzberg:
Yeah. There's one area that I didn't talk about and it's the most important area. That's the people. You've got to have loyalty. Brains is fine, but the loyalty, the passion, the excitement, and that's what's made HEMP because as I told you, I'm not an organizer, but we've had such passion from different people. And I don't know if you knew Ray Pittman. He was a great example. He was the inventor of the cherry picker and he fought the Pacific War and he adopted seven kids and loved his wife to death. He was so passionate.
Barnett Helzberg:
Well now, we have a president, Tracy Lockton, if you know her. She is so passionate about the thing, she'd been there about seven, eight years. And this young lady who's been there 17 years, Christina, it's... I'm doing a book on the history and I think I put it in there that we want your soul. That's what we tell them when we go out and interview them, we want your soul. We want you to be part of this and believe in it and love these people and help them, just want them to do better. Anyway, obviously the people. That is the key to everything because you can't stop good people.
Kelly Scanlon:
No, and passion and energy and enthusiasm is so contagious. And it's unstoppable once it gets started.
Barnett Helzberg:
Exactly. Makes it a lot of fun
Kelly Scanlon:
Barnett, thanks for being with us on this episode of Banking on KC. And most importantly, thank you so much for all of the things that you have done over the last many years for Kansas City, for so many entrepreneurs. I mean, I will probably never be able to measure the impact it has as we go forward. So thank you for all of that.
Barnett Helzberg:
Thank you.
Joe Close:
This is Joe Close, President of Country Club Bank. Thank you to Barnett Helzberg for being our guest on this episode of Banking on KC. Barnett often tells a story of how he'd benefited throughout his long business career, from the wisdom shared by his mentors, including the late Ewing Kauffman. After selling Helzberg diamonds and recognizing that many early-stage entrepreneurs are diamonds in the rough, Barnett founded the Helzberg Entrepreneurial Mentoring Program, better known as HEMP. To use the power of mentoring, to polish these entrepreneurs, and to high-quality community and business jewels. The program has helped numerous Kansas City entrepreneurs grow their businesses, and as they've grown, they've positively contributed to Kansas City's economic vitality, employment opportunities and philanthropic efforts.
Joe Close:
And the best part, after completing the program themselves, many of these business owners continue as mentors, paying the benefits of mentoring forward and empowering new generations of entrepreneurs. Country Club Bank itself was founded decades ago from a strong entrepreneurial vision that shines through today. We share Barnett Helzberg passion for helping entrepreneurs unleash their potential and supporting their dreams. Thanks for tuning in this week, we're banking on you, Kansas City. Country Club Bank, number FTIC.