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The business career of Mitt Romney began shortly after he finished graduate school in 1975. At that time, Romney entered the management consulting industry, and in 1977 secured a position at Bain & Company. Later serving as its chief executive officer, he helped bring the company out of financial crisis. In 1984, he co-founded and led the spin-off Bain Capital, a private equity investment firm that became highly profitable and one of the largest such firms in the nation. The fortune he earned from his business career is estimated at $190–250 million. Entry into management consulting at Boston Consulting Group: 1975–1977 After he received a joint Juris Doctor and Master of Business Administration from Harvard University in 1975, Mitt Romney was recruited by several firms and chose to remain in Massachusetts to work for Boston Consulting Group (BCG), reasoning that working as a management consultant to a variety of companies would better prepare him for a future position as a chief executive. He was part of a 1970s wave of top graduates who chose to go into consulting rather than join a major company directly. Romney had his pick of jobs at the nation's biggest and most prestigious consulting firms, and at that time BCG was neither. Its idiosyncratic founder, Bruce Henderson, was regarded as outside the mainstream of corporate consulting, and BCG was routinely disparaged by faculty and students at Harvard Business School. But BCG was a pioneering upstart that fostered camaraderie among its employees, who traveled around the country to advise clients, and that is where Mitt Romney chose to start his career. His legal and business education proved useful in his job while he applied BCG principles such as the growth-share matrix, which is a simple chart to assist large corporations in deciding how to allocate cash among their business units. He was viewed as having a bright future there. Romney worked nights and weekends, and traveled frequently in the U.S. and to Europe on business. Management consulting at Bain & Company: 1977–1984 In 1977, he was hired by Bain & Company, a management consulting firm in Boston that had been formed a few years earlier by Bill Bain and other former BCG employees. Bain would later say of the thirty-year-old Romney, "He had the appearance of confidence of a guy who was maybe ten years older." Unlike other consulting firms, which issued recommendations and then left, Bain & Company had a practice, that Romney learned, of immersing itself in a client's business and working with them until changes were implemented. Geoffrey Rehnert, who also worked at Bain & Company, recalls that those who gravitated to Bain were mostly not from wealthy backgrounds. The company operated as a results-oriented meritocracy, and Romney excelled there. He became a vice-president of the firm in 1978, and worked with clients such as the Monsanto Company, Outboard Marine Corporation, Burlington Industries, and Corning Incorporated. Within a few years, he was considered one of their best consultants and at times sought by clients over more senior partners. Romney aspired to start a new business, and in 1983, Bill Bain offered him the chance to head a new venture that would buy into companies, have them benefit from Bain consulting techniques, and allow the venture's partners to reap higher rewards than consulting fees. He initially refrained from accepting the offer, and Bain re-arranged the terms in a complicated partnership structure so that there was no financial or professional risk to Romney. Thus, in 1984, Romney left Bain & Company to co-found the spin-off private equity investment firm, Bain Capital. Private equity at Bain Capital: 1984–1990 Bain Capital was founded in 1984 by Bain & Company partners Mitt Romney, T. Coleman Andrews III, and Eric Kriss. In addition to the three founding partners, the early team included Geoffrey S. Rehnert and others from Bain & Company. Romney initially had the titles of president and managing general partner (or managing partner). He later was referred to as managing director or CEO as well. He was also the sole shareholder of the firm. At the beginning, the firm had fewer than ten employees. When new employees were hired, they were generally in their twenties and top-ranked graduates from Stanford University or Harvard University, both of which Romney had attended. In the face of skepticism from potential investors, Romney and his partners spent a year raising the $37 million in funds needed to start the new operation. Early investors also included members of elite Salvadoran families who fled the country's civil war. They and other wealthy Latin Americans invested $9 million primarily through offshore companies registered in Panama. While Bain Capital was founded by Bain executives, the firm was not an affiliate or a division of Bain & Company but rather a completely separate company. Initially, the two firms shared the same offices – in an office tower at Copley Place in Boston – and a similar approach to improving business operations. However, the two firms had put in place certain protections to avoid sharing information between the two companies and the Bain & Company executives had the ability to veto investments that posed potential conflicts of interest. Bain Capital also provided an investment opportunity for partners of Bain & Company. Bain Capital's original $37 million fund was raised entirely from private individuals in mid-1984. The firm initially gave a cut of its profits to Bain & Company, but Romney later persuaded Bill Bain to give that up. The Bain Capital team was initially reluctant to invest its capital. By 1985, things were going poorly enough that Romney considered closing the operation, returning investors' money back to them, and having the partners go back to their old positions. The partners saw weak spots in so many potential deals that by 1986, very few had been done. At first, Bain Capital focused on venture capital opportunities. One of Bain's earliest and most notable venture investments was in Staples, Inc., the office supply retailer. In 1986, Bain provided $4.5 million to two supermarket executives, Leo Kahn and Thomas G. Stemberg, to open an office supply supermarket in Brighton, Massachusetts. The fast-growing retail chain went public in 1989; by 1996, the company had grown to over 1,100 stores, and by 2008, over 2,000 stores. Bain Capital eventually reaped a nearly sevenfold return on its investment, and Romney sat on the Staples board of directors for over a decade. Another very successful investment occurred in 1986 when $1 million was invested in medical equipment maker Calumet Coach, which eventually returned $34 million. A few years later, Bain Capital made an investment in the technology research outfit the Gartner Group, which ended up returning a 16-fold gain. Bain invested the $37 million of capital .... Discover the Michael Kranish Scott Helman popular books. 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