Carl Beaumont entered the large conference room; a majestic oval table dominated the center. He found the other executives already sitting there.
“Good morning, chairman!” one called out.
Carl smiled. “Good morning, Drew.” He swept his arm across the room. “I’m glad to see you all arrived early!”
“It may have had something to do with your meeting notice,” Drew replied acidly. “The one alluding to a crisis? And how the meeting would start exactly on time?”
Carl chuckled. “I admit, I was pretty stressed when I wrote that. Hopefully you all had a good night’s sleep in spite of it.” He looked around the room and smiled sympathetically. “I need you all at your best.” He grabbed the remote-control clicker from the table and pressed a button. The television on the wall stopped displaying the property-management firm’s logo, and in its place was a handful of sedate bar charts.
Carl sighed. “As you all know, the company is at a crossroads. We’ve had decent success adapting to the new trend of private government ownership. We own our fair share of gated communities and small towns. But expansion has stalled; there are other national property-management companies doing the same thing. Finding a town to take over is becoming more difficult, since a lot of prime targets are snatched up by others before we can close the deal.”
Carl clicked the button, and the slide was replaced with a riot of colored graphs. “We could continue to bid on small towns, but prices are rising on the most desirable ones, and the overall effort is too small to make much of a difference in our bottom line. To make matters worse, profit from them has ceased to grow. Very little followed the initial windfall that came from reforming governance.”
Carl clicked again; the next slide showed a pareto chart of possibilities. “We need larger profit centers, if this venture is ever going to be worth the effort. The types of large-scale industry that can be enticed to set up shop in a small town are pretty limited. The plethora of small businesses to be found there are nice, and one of them might become a big business some day, but it hasn’t happened yet. We’re already investing in some of these smaller concerns, but it’s not clear if we should ramp that up. We’re unsure of the odds of seeing a return on such a diversified portfolio; this isn’t really our area of expertise. To be blunt, the next step is not clear.”
Carl clicked a button on the remote control, and the screen resumed showing the company’s logo. He turned to face the table. “I don’t need to tell you how the rest of our business is doing. Home prices are high, and tenants are milking the seemingly endless eviction moratoria for all they can, to stay in houses they can’t afford. This stops us from selling the houses and reaping a pretty good profit.”
Carl grimaced. “I’m afraid the only sure way to make money in the current environment is to assume things will continue to slide downhill, and to somehow find a way to profit on that decline.”
Carl rested his hands on the table, supporting himself. “To put it mildly…we’ve plateaued. Without some big ideas, this venture may have hit a dead end.” He looked across the room, which greeted him only with nervous silence. “So…does anyone here have any big ideas?”
The room became deathly still. “Oh, come on, people,” Carl anguished. “I’ve worked with some of you for years! We’ve always made it through the tough times. Granted, we never had to deal with such insane levels of unbridled chaos. But we’ve gotten to where we are because we always managed to pull a rabbit out of the hat. Is that over? Has the well truly run dry?”
Carl stood still for a moment. On the other side of the table, he could see someone with a shock of red hair look to his left, then to his right, then stare directly at Carl. As a smile washed over his face, he raised his hand.
Carl nodded and gestured towards the gentleman. “Why don’t we hear from one of our junior executives? What’s your name, son?”
“Eric Thompson, sir,” came the confident reply.
“Pleased to meet you, son,” Carl proclaimed. “Of course, that’s just a nice way of saying I don’t know you from Adam.” A smattering of polite chuckles flitted through the room. “Why don’t you tell us a little about yourself?”
“I’d be happy to,” Eric declared as he stood up. “As you pointed out, I’m a junior executive…but not for this firm. I work for a hedge fund, one of your largest partners. I was embedded here, not only to keep an eye on their investment, but to learn this business.”
“Well, I wish you could have joined us back in our better days,” Carl lamented. “This can’t be a very prestigious assignment for you.”
“Oh, I assure you, sir, quite the contrary!” came the enthusiastic reply. The board members shook with a start.
“Really?” Carl snorted. “You enjoy being part of our slow-motion crash?”
“I don’t see it that way at all, sir,” Eric assured. “I’m utterly fascinated by what I’ve learned in my time here. I’ve seen this firm expand from owning homes, to owning gated communities, to owning entire towns. I never would have believed I’d see anything like this, and yet here I am, in the thick of it! I find it far more interesting and motivating than just counting beans…I’m awed by the possibilities here! And what you see as a crisis, I see as a great opportunity.” He paused for a moment to behold Carl, who seemed dumbfounded. Eric continued. “Would you allow me to explain?”
“Of course, son,” Carl asserted.
“Yeah,” one board member chortled, as he turned to a colleague. “I can’t wait to hear this one.” A few scattered snickers erupted.
“To me, our next step forward is clear,” Eric declared. “I propose taking over an entire city…the one we’re in.”
The board erupted in guffawing laughter. The chairman covered his mouth, but finally couldn’t stop himself from letting out a disrespectful giggle. Eric stood stoically, unmoved, and continued to scan the room slowly with his eyes. Finally, the clamor died down.
“I’m sorry, son,” Carl explained. “I should have been clearer…I wanted a realistic idea.”
“The way to make money in real estate is to buy a depressed asset, one whose value isn’t appreciated by others, and refurbish it,” Eric interjected. “Wouldn’t you agree?”
“Well…of course it is,” Carl stammered. “That’s true for most investments. But how is that relevant here?”
“I’m glad you asked!” Eric crowed loudly, causing a few to wince. “May I show my presentation?” He motioned towards the television screen mounted on the wall.
Carl shook his head and chuckled softly. “Sure, son. Knock yourself out. Here you go.” He put the clicker down and, with a flick of his arm, slid it along the table. The clicker sailed over the smooth surface, spinning gently. Abruptly, it hit some barely visible imperfection on the surface, causing it to pirouette into the air, loudly tumbling end over end, before coming to a graceless stop, somewhere near the middle, in front of a young lady.
Eric gestured to her. “Ma’am? Little help?”
She beheld Eric for a moment. Then, with a smirk, the young lady grabbed the clicker and flung it down the table with great force. It slid noisily, and as the board members watched it, the clicker collided with a wire strung across its path, sending it into the air, bouncing and cartwheeling clumsily. As it threatened to sail over the edge of the table, Eric nimbly snatched it out of the air, the slapping sound it made with his palm echoing faintly through the room. “Thank you, ma’am,” Eric chirped as he saluted politely. “Excellent assist!” She returned a warm, beaming smile.
Eric pressed a button on the clicker; in the company logo’s place was a montage of riots, spirited street protests, and clouds of smoke billowing from fires. The members of the board reared at the abrupt transition. “I don’t need to remind you of the current state of affairs,” he quipped. “But I did anyway.”
He clicked a button, and the next slide showed before/after pictures of apartment complexes and small-town business districts, depicting how each had been cleaned up and refurbished. “Of course, there’s some good news. People at the grass-roots level are self-organizing against the macro-trend of decay; the ownership of gated communities and small towns is just the beginning. The recent stories of apartment complexes coming up with social-media inspired ‘terms and conditions’ for their residents are a new phase of the same movement.” He panned his eyes over the room. “Unfortunately, this isn’t the story of our city.”
The next slide showed an aerial photo of the metropolis at dusk, looking dingy and dilapidated. Overlaying the image was a depressing collage of sobering statistics. “Foot traffic is down a stunning eighty percent in the city center. Consumers and tourists simply don’t feel safe in an area beset by riots and criminal violence. Our police departments have been defunded; gun violence has skyrocketed. Our firm has had to hire private security to make up the difference, and although we’re safe for the time being, that cost comes straight out of our bottom line.”
Eric surveyed the room; everyone remained dead silent. He continued. “Businesses less blessed than ours are losing fortunes to looters, and are pulling out. Citizens are fleeing the soaring crime and high taxes. Ever since the city council decriminalized property crimes involving less than a thousand dollars, shoplifting has risen to epidemic levels. Insurance for retail businesses has become unaffordable, and many won’t pay for damages unless their client relocates to a less crime-ridden area. The collapsing business and tax base have left the city unable to pay its bills.”
Eric clicked a button; the slide showed the state capital complex. “The state government isn’t much better off. They can’t afford to bail out the city, because their finances are also hanging by a thread. Without a dramatic reversal of fortune, we can expect to lose everything we’ve worked so hard to build.”
The room was silent for a moment, then Carl spoke up. “We don’t debate any of this. But what do you propose to actually do about it?”
“We need leverage over the city,” Eric explained. “The real-estate-rental business is relatively low-margin, especially factoring in rent moratoria, depreciation from unruly tenants, and the ongoing civil unrest. On the other hand, home prices are near all-time highs, and inventory is very low; this is the time for us to sell our holdings. We need to change the law so that we can evict non-paying tenants, but trying to get a bill through the city council, with all the corruption and vested interests, simply isn’t feasible. But I ask, why bother owning the houses when you can own the infrastructure itself? I propose we replace the city code with the same sort of social-media-inspired terms and conditions that so many of our gated communities, and small towns, have utilized to such great effect.”
“And what leverage do you suggest we use?” Carl challenged.
“The oldest leverage there is,” Eric trilled. “Creditors!” He clicked the button; the next slide revealed a pareto chart. “It turns out that five firms own eighty-five percent of the city’s outstanding debts. All of them are quite aware the city can never afford to pay it off. That gives the debtholders great leeway in demanding major concessions. And the biggest one they can demand…is assuming total ownership and control of the city. We follow that by replacing city law with our well-vetted set of terms and conditions. That gives us the foundation we need to turn around the decline.”
“You know,” Drew began, “one reason we were able to purchase gated communities and small towns, is because the money came from our own funds; we didn’t have to get anyone else’s buy-in. What makes you think these debtholders will go along with your plan?”
“Because I’ve already discussed it with them,” Eric revealed. “And they’ve agreed to go along with it.”
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“They have?” Drew asked incredulously.
“Well, tentatively,” Eric admitted. “Providing I can make good on the other parts of my plan.”
“And what might those be?” Carl demurred.
“I’m glad you asked!” Eric answered brightly. Carl put his hand to his face and winced as Eric continued with his spirited presentation.
“I will need this firm’s permission to deal with our delinquent tenants,” Eric explained. “I’m confident I can get them evicted, allowing us to sell the houses. I’ve already made all the connections I need to make it work, from beginning to end. I just need money to put it into play.”
One board member raised a single eyebrow. “How much will that be?”
“It can vary,” Eric offered. “But the more you commit to, up front, the more broadly I can operate. And I’m happy to tell you that the hedge fund I work for has already committed to matching the funds that you pledge. Keep in mind, the amounts I’m talking about are large, but relatively minor for a company like yours. Plus, I already have informal commitments from all the people, and companies, that I need; as soon as I can get it funded, we can move forward almost immediately.”
“Just how informal are these commitments?” Carl countered.
Eric’s face became serious. “Sir, I wouldn’t waste the board’s time with a plan unless I had done all of the legwork to put it together; everything about the plan is in place, except for the funding.” Carl didn’t speak; Eric continued. “I project that the money made from selling houses currently rented to delinquent tenants will pay back the seed money in relatively short order, at which point the company can decide to take their profits, or plow them back in to make an even bigger profit.”
“And once you’ve sold the houses?” one board member piped up. “What then? The city is still in terrible shape.”
“And it must be refurbished,” Eric agreed. “I’ve identified a corporate takeover target that would be of great use to us.” He clicked a button on the remote, bringing up a video of gyrating robots. “No one will ever forget this synchronized dance routine! The rest of their product line is just as eerily sophisticated. But they’ve been bought and sold a few times since then. Sadly, their prospects have been kneecapped by widespread opposition from the workers that their robots would replace. Their parent company is regretting the investment, and has begun making noises about unloading it, but with uncertain future prospects, the odds are low that anyone wants it.” Eric smiled as he beheld the room. “I propose we buy them. Given the bleak consensus on their future, it’d be an incredible bargain. I have a different opinion of their worth. I believe they’re just what we need to reclaim our infrastructure!”
“I’m afraid I must disagree, Mr. Thompson,” a board member chimed. Eric turned to look at the elegantly dressed middle-aged lady. “My husband works for an investment firm that lost the bid to take over that company. He’s seen their internal documents. While their robots make for a good viral video, it takes a lot of programming and preparation to even make a canned demo work. Their sophistication is simply not up to the level of autonomous intelligence you need.”
“Intelligence,” Eric quietly said to himself, his eyes staring off into space.
“And without that, you’ll need a skilled labor force capable of wielding them. Their manufacturer doesn’t have enough people to do that, not even if every last one of them decided to uproot their lives and move here, and work solely on your tasks. And without autonomy, this part of your plan won’t work.”
The chairman smiled. “Thank you, Mrs. Verhage. I’m grateful you were able to inject some sanity into this far-out plan.” He turned to Eric. “I’m sorry, son, but your ideas are simply too fantastic. We can’t go forward with this.”
Eric continued staring into space. Carl frowned. “Mr. Thompson? Can you hear me?”
Eric suddenly turned his head, staring intently at the chairman. “My apologies, sir. I was thrown a curve ball; I had to come up quickly with a backup plan. I believe I’ve done so.” He gestured to Mrs. Verhage. “Your objections are noted, and gratefully received.”
“That’s hardly good enough,” Carl grumbled. “Frankly, your plan sounds like a house of cards. Magic robots aside, you must concede that one reason acquiring gated communities, and small towns, has worked so well is because the people that live there are largely law-abiding and self-sufficient. Large cities attract people that need public services in order to survive, and as we’ve learned recently, far too many are irresponsible and criminally oriented. You can’t scale up from small towns to a big city; the situations aren’t comparable.”
“With all due respect, sir, I disagree,” Eric countered. “I truly believe that most people are decent. Scaling up to a big city involves hiring the decent people, so that they can unleash their potential, and, inspired by what social media and other technology firms get away with all the time, impose terms and conditions that effectively banish the wrongdoers. One big advantage we have here is the widespread public surveillance network, already installed by the city. We’re not lacking for information on the bad guys, the city simply has no ability to do anything about it. Once the law is changed, the ne’er-do-wells can be imprisoned or deported.”
Carl paused for a moment, and then sighed. “OK, I can see how that would work. But I still believe your project is too risky to do under our banner. We have a nationwide reputation that could be tarnished irreparably.”
“Completely understandable, sir,” Eric concurred. “I suggest forming a separate corporation for it, of which this company, and its financial backers, would be the early funders and primary shareholders.” Eric smiled as his eyes glowed with revelation. “And I’ll give it the name I’ve always wanted to use.”
“Which is?” Mrs. Verhage asked, raising one eyebrow.
Eric raised his head and looked into the distance. “Unlimited Partners.”
Carl snorted. “Sounds pretty generic.”
“I disagree,” piped up a voice. The room turned to look at the young lady, seated near the center of the table, the one that assisted Eric with retrieving the remote clicker. “I think it has the perfect combination of sensible and messianic.” At this, the room burst into laughter.
“Son,” Carl challenged as the noise died down, “give me one good reason I should approve of your insane plan.”
“Because it’ll work,” Eric replied confidently. “Because it captures the spirit of the times. And…because it’s the only idea anyone’s offered you.”
Carl looked around the room. “Please, someone present a competing idea.” Several tense moments passed. “Anyone?” The board members just looked uncomfortably at each other.
Carl’s shoulders slumped. “Fine, kid. So how much are you asking for?”
Eric smiled. “A lot, but not compared to what you can afford.” He clicked a button on the remote, leading to a spreadsheet that broke down the up-front costs. At the bottom loomed a rather large figure. The board members collectively gasped.
Eric pounced. “That noise you all made, right then, tells me why this company is in so much trouble.” He turned to Carl. “You said you wanted big ideas.”
“Not quite that big,” Carl countered. “I might approve about half that.”
“I’m sorry to hear that you continue to think small,” Eric grimaced.
“Fine,” Carl glowered. “Half your figure, but your project gets approved.”
“Deal!” Eric shouted, grinning ear to ear.
The chairman looked around uncertainly. “Did I just get scammed?” He turned to Eric. “How can you agree to that, when you acknowledge it’s not enough?”
“I’ll accept the additional challenge, if it means I get to put my lifelong vision into action.”
“You were expecting the collapse of civil order?” one board member mocked.
Eric turned towards him. “Our country has been in a slow-motion crash for decades. Are you saying you hadn’t noticed? When was the last time we even won a war? Or didn’t abandon our allies at the end?” The board member glumly looked down.
“You really don’t know your place, do you,” Carl growled. “Just a loose cannon. You don’t sound like any businessman I’ve ever run into.”
“You’re right, I don’t,” Eric countered. “And that makes me sad, because I think I make a lot of sense.”
“I’m still making up my mind about that,” Carl declared. “So, while this might be your project, and your idea, you won’t be in charge. You will be the senior vice president, responsible for the overall direction and the day-to-day activities, but you’ll have your own bosses, and board of directors, to answer to. A board staffed with more sober minds, that I approve of. Catch my drift?”
Eric swallowed. “I can work with that.”
The room was still for a moment. Then Mrs. Verhage spoke up. “Congratulations, you have your funding. Now, how exactly do you intend to make your plan work?”
“I’ll put together a team to do it,” Eric explained. “After all, if I can’t put together an effective team, I have no business sitting at this table.”
The chairman shuddered. “Well, we now have our one big idea…God help us all. Unless someone wants to propose another one, this meeting is over.” The silence in the room revealed the faint murmur of the city outside. The chairman threw his hands in the air and wordlessly turned to leave. Most of the rest of the board followed, throwing reproachful looks at Eric on the way out.
Eric sighed happily, pulled his phone out of his pocket, and began to dial. He became aware that someone had walked up to him. Looking up, he saw the young lady that had previously been sitting at the center of the table.
“Hi, I’m Danielle,” she opened.
“Pleased to meet you!” he beamed. “Thanks for the assist back there. I literally couldn’t have done it without you.”
Danielle smiled. “That was the most stunningly visionary idea I’ve ever heard in my life. It has a rare combination of solid foundations, force multiplication, and optimism.”
“I’m glad you even understood it!” Eric laughed. “I’m not sure anyone else in the room grasped it beyond the up-front cost.”
“I heard somewhere you were putting together a team,” she ribbed. “I’d love to be part of this project.”
Before Eric could reply, a shout stopped him cold. “Danielle! Stop dawdling and get back to work!” Eric caught a glimpse of the interrupter’s name badge; he was Ted Danbury, vice-president of something illegible.
Danielle turned towards Ted, incensed, and looked him right in the eye. “I need a few more minutes.”
Ted’s eyes shot open in surprise, but an expression of anger quickly washed over his face. “Two more minutes! Then you’d better be back at your desk!” He turned around and stormed away.
Eric watched him leave, then turned to Danielle. “It takes all kinds, doesn’t it,” he deadpanned.
“No it doesn’t,” she shot back. “He’s just a bully.” She looked up with a deflated expression in her eyes. “I’m not just a secretary, you know. I have my business degree, and got very high marks in college. But all Ted cares about is that it wasn’t one of the ‘top 20’ schools. I can only find work as a glorified file clerk; no one will take me seriously!” She stared at him fiercely. “I’m dying for a chance to show what I’m capable of!”
Eric faced his palms forward in a pleading motion. “If you’re applying for a job on my team, you just got it.” A beaming smile flooded across her face. Eric continued. “Now, I’m not going to bully you…but I will ask you to put up with a completely different kind of pain.”
“I accept the challenge,” she replied stoically. “When do I start?”
Eric typed something on his phone, then touched his phone to hers; Danielle’s phone chimed. “Go pack up your desk. Here’s the location of your new office. I’ll see you soon. But now…I have to make a call.” He stared into the distance wistfully. “One I’ve wanted to make for years.”
Ted appeared at the door to the conference room. “Danielle! What are you still doing here? I said move it!”
Danielle strode confidently towards the door, pushing past Ted, who just gaped at her. She gestured to her rear. “You’re no longer my boss; I work for him now.” Eric slipped past Ted, smirking as he went by.
“How dare you!” Ted exploded. “I’ll fire you for this!”
Eric continued to walk away, turning to look at Ted. “She’s not yours to fire any longer.”
Ted gaped speechlessly for a moment. “Uh…you can’t just leave! You have to give notice!”
Danielle stopped walking and turned to face Ted, arms akimbo. “But my employment is at-will…as you’re so fond of reminding me whenever I ‘get out of line’.”
Ted marched right up to her, but stopped short; the fierce look on his face melted into uncertainty. “You…you need to hand off your job to someone else.”
“You only gave me menial secretarial work,” she retorted. “That hardly needs to be handed off.”
Ted’s face fell; his eyes filled with sorrow. “OK, I admit it…I can’t do this without you.”
Danielle looked incredulous. “What?! If that were true, why did you treat me so poorly?”
Ted didn’t respond; tears slowly welled in his eyes. “I’m sorry…I’m so sorry. I promise never to do it again.”
“You’re darn right you won’t,” Eric interjected as he stepped between them, throwing a steely look at Ted, holding it for a few seconds. Danielle strode away without saying another word.
“So, I see you finally decided to do the right thing,” Eric told Ted, “after exhausting every other possibility.”
Ted burned with rage. “I’ll get you for this. I’ll get you if it’s the last thing I do.”
Eric shook his head sadly. “So you really have nothing better to do with your time.” Ted didn’t respond; Eric continued. “Maybe I can find something worthwhile for you to do. Your combative nature could be really helpful, in the right setting.”
He then turned to walk away, leaving Ted standing there, speechless.