There he goes again. A. Malachi Mixon III is taking a risk. An intelligent risk, mind you, but a risk nevertheless. So what else is new?
The man who, some 30 years ago, staked his $10,000 in personal savings on a wheelchair company no one else seemed to want — then proceeded to grow it from $19 million in annual sales to $1.8 billion — is now poised to buy a bank.
For Mal Mixon, it is simply business as usual: “Somebody said, ‘Gee, Mal, what do you know about running a bank?’ Well, what did I know about making a vacuum cleaner or making a wheelchair or making a sterilization system?”
The “vacuum cleaner” would be the product of Royal Appliance Manufacturing Co., maker of the Dirt Devil. The “wheelchair,” of course, is the staple of Invacare, manufacturer and distributor of home health care products. And the “sterilization system” refers to the product line of Steris Corp., leader in infection-protection and contamination-control products and services.
At various times, Mixon has been instrumental in the acquisition and growth of each of these industry giants — each based in Northeast Ohio and each with tentacles that reach around the globe. Along the way he also has been involved in numerous other companies, large and small, that are among America’s finest case studies of success.
Not bad for a kid from Spiro, Okla., who found himself in a career rut as a marketing executive at the age of 39. That’s when he engineered the purchase of Invacare, which he continues to lead as chairman and CEO.
Mixon, 70, has no intention of retiring from that job, which he says still fascinates and energizes him, anytime soon. But that has not stopped him from seeking other challenges. His latest is the bank — specifically, National Bank of Southwest Florida, which in turn is set to purchase four branches of Houston-based Encore Bank in Southwest Florida.
He credits his son, Ki Mixon, principal of Resilience Capital Partners, for putting together the deal along with Resilience managing partners Bassen Mansour and Steve Rosen. He hopes the venture, which has $200 million in deposits, will be operating under its new ownership by the third quarter of this year.
Although he will function as chairman, the senior Mixon says he won’t be active in the company. But “active” is a relative term, and he surely has plenty of ideas about how the bank’s lending officers should approach their work.
“I think a lot of banks right now are treating small business in ways they will never forget,” he says. “I view this as a major problem in our country, and if we don’t get banks willing to support business needs, we’re not going to grow.”
Although he understands and appreciates the chilling impact of regulatory restraints put in place in the wake of the nationwide mortgage crisis, he believes bankers have been overly timid. “We’re going to concentrate on good judgment about people and intelligent risk taking,” he says.
Ah, there’s that phrase: “intelligent risk taking.” It has been a guiding force in Mixon’s professional life. The Harvard Business School MBA certainly knows the value of due diligence — he speaks, in fact, of “immersing” himself in the pros of cons of businesses he explores — but he also trusts his gut.
“We have to have some risk taking,” he says. “Because how else does an entrepreneur ever get going? I started Invacare with a $4.5 million loan. I never could have built this company if I would not have had the raw material called ‘cash’ from the banks.”
Moreover, he feels that banks have a social responsibility to the communities they serve. “I’m not going to chase big real estate loans,” he says. “I am not trying to compete with Bank of America. We’re going to try to be very responsive to doctors, lawyers, small-business people, community needs.”
If community needs are met, he believes, the rewards will come. “Entrepreneurs tend to be pretty loyal to the people who helped them when they needed the help,” he says. “They don’t go changing bankers and lawyers and advisers very easily.”
Make no mistake, however. The venture is not just pie in the sky. “The exciting part about it is that we’ve been able to pass the bad loans and write down the existing loans, so we have a clean balance sheet, which most banks don’t have,” Mixon says. “Our projections are that we’ll actually make money in the first year.”
And who knows? Cleveland might cash in on the enterprise one day, too. “We are a national bank, and if we want to open a branch in Cleveland or anywhere else, we can do that,” he says. “There are a lot of Clevelanders down there. If we are responsive to people, then having a small branch here might be a good thing to do.
“I don’t think you need an Eiffel Tower to have a bank,” he adds. “You can have an office where people can come in and be serviced.”
The bank is merely the latest in a long series of initiatives undertaken by Mixon — civic, philanthropic and corporate — that stand as testimony to the complementary relationship between business and community life. The story of Mixon and, especially, Invacare — chapter 14, incidentally, in the newly published book, The Risk Takers, by Renee and Don Martin — has always been a tale of imagination and intelligent risk taking for the greater good.
Life Lessons
Anytime you’re involved in a new business experience, you learn things. In my experience at Royal Appliance, I learned about plastics. We got the company that made the Dirt Devil involved in making components for some of our wheelchairs and made them look more like Harleys.
I’m smart enough to know what I’m not good at. A lot of entrepreneurs think they’re good at everything, and they’ve got to make every decision. As their business gets more complicated, they don’t have the level of information they need to make the right decisions.
I don’t try to act like the smartest guy in the room. I don’t always sit at the head of the table.
I learned a lot more about leadership in the Marine Corps than I learned at Harvard Business School. In the Marine Corps, your individualism is basically removed, and you’re taught that you’re a member of the team.
I say to my people at Invacare: “If I promote you to a position of management, you’re a manager. But you’ve got to prove to me you’re a leader.”
Some lessons are pretty simple ones: The first one that comes to mind is that you set the example. If I’m unwilling to approach the tough problems or go visit the tough accounts or take the red eye, people look at me and say, “Does Mal face the real challenges?” A lot of managers want to push the real problems aside.
I think good leaders have to show confidence under stress and under pressure. If the boss is nervous, it makes everybody else nervous. I’ve often said, “I got through cancer, and I got through Vietnam before the age of 40, and I’m still here, so there’s not a lot you can do to really stress me.”
We have a lot of innovation in the company. We’re going to be introducing a new power chair this year that we’ve been working on now for a couple of years. It’s going to knock your socks off when people see it. They’re going to say, “Wow, this is different.”
Whatever the values of this company are, they’re my values because I created this with this team over 30 years. If the product isn’t right, take it back and fix it. Give the customer his money back. We don’t lie or cheat, we don’t steal, we don’t misrepresent.
My dad taught me that the Mixon handshake is your word. Just because something may change or it’s a little more stressful, it doesn’t mean you back out.
Next to my father, I think my high school coach had tremendous impact on me. He was a man of real principle. He liked to win, but he liked to win by the rules.
I don’t give up very easily. I am pretty resolute. A lot of people give up the first time they get their nose bloodied. If you’ve ever played a sport, you know that you get back up and hit the line.
Instincts are very important. Sometimes you feel it in the pit of your stomach. Should I do this or that? It’s different from hip shooting.
All the bright kids at Harvard, they went into research. They were going to solve all the problems in the world. Guys like me, I was in the middle of the class. I said, “Gee, I’ve got to get a job, put a roof over my head.”
Is what I do work? I can hardly wait to get up in the morning. My mind’s racing, and there are a lot of different things going on, and I stick my nose in them. It’s kind of like getting up for a ballgame or something. I get excited about things.
The company was a lot tougher to run when I was by myself and couldn’t afford the kind of talent I have now. I don’t worry a bit today about whether my 30 factories are running or whether the quality’s good or whether we’re shipping on time. In the early days, I had to worry about that every day.
You can use your money to make things happen that are important to you. My wife just informed me that we were paying for a new playground at Hathaway Brown. She went to school there, my daughter went there, our grandkids are there. It’s more important to her than Wellesley.
I grew up studying a lot of classical music. A lot of people don’t know that about me. I gave the senior piano recital when I was a high school. So I got attracted to the Cleveland Institute of Music and ended up funding Mixon Hall, which I’m told has the best acoustics of any performance hall anywhere in the world.
I have a Mixon scholar in every Harvard class. I couldn’t have gone to Harvard without a scholarship. So that will be in perpetuity. I set it up so they have to be from Oklahoma, where I’m from, or Northeast Ohio.
One of the things I’m proudest of is that I started MWV, Minorities With Vision. It all stems from my view that to solve Cleveland’s problems in the inner city, they’re going to be solved by minorities, not by whites. What we need is some black wealth. That’s really what we need.
I do like to make money, but it’s more a measure of the success of your thinking than it is that I need the extra million dollars or something.
I don’t collect art. I’m not into those kinds of expensive hobbies and so forth. I would like to leave as little as possible to the government, though, and leave it to my family and charity.
In trying to understand the purpose of life, I became very attracted to Kierkegaard and existentialism. The teachings of that are: It’s not about you. It’s about advancing the ball for mankind.
I don’t go around asking for accolades, but there are a lot of people whose lives I’ve touched in Cleveland that people don’t know about. They’ll probably come to my funeral.