It's hard to think of Peter Munk as a failure. This is, after all, the man who built Barrick, the world's largest gold miner, as well as a property empire, a philanthropic legacy and a reputation as a shoot-from-the-hip tycoon. Yet in the 1960s, he was tarred with the collapse of Clairtone, a Canadian manufacturer of cutting-edge stereo equipment and colour televisions that he had co-founded. Now approaching his 80th birthday, he considers the strange alchemy of failure and success, and how entrepreneurs are formed.
Why are you so eager these days to talk about entrepreneurship.
Anything we can do to encourage and foster the entrepreneurial spirit can't do much harm. We could do with some, after what happened to the mining industry.
What happened to the mining industry?
It got wiped out. What happened to Alcan? What happened to Falconbridge? What happened to Noranda and Inco? Think of the guys who bought them - out of Switzerland and Brazil. These companies were run by entrepreneurs, while here in Canada the companies were run by managers.
But don't entrepreneurs eventually sell out too?
Did you see me sell out Barrick? I think you could shoot Ted Rogers before he sold out. It's the difference between company builders and investors: Investors sell out.
But in the end, won't you just die and your holdings will go on the market anyway?
That is, I'm afraid, true. But even then, if a board can have vision, it can move into the top chair a man who not only has leadership qualities but also entrepreneurial ambitions. Then a company can do like what happened to [Australian mining giant]BHP Billiton when it hired Chip Goodyear [its recently retired CEO]
Is the problem that we don't have people with big dreams?
The question is how to encourage more Canadians to have the guts to risk everything to realize their dreams. If enough people try, some will succeed ... My personal experience is I didn't inherit my money, I created it and I created thousands of jobs in the process and made many people quite rich.
Or maybe we don't accord enough respect to people who fail, as you did in the 1960s.
I learned more from that failure than all the Harvard business graduates could have learned in five years at Harvard.
Anybody who fails can come up again. They have the wisdom of what they learned from failure and the self-confidence of having got there in the first place.
Is that what happened to you?
It happened to me with Clairtone. They were tough times, colour TVs were a tough thing, but you learn from your failure and you bounce back. You don't allow the conditions of your failure to intimidate you.
Did you ever think of giving up and going to work for someone else?
I'm a lousy employee. I'm much better as a leader, getting people committed to a common dream and working toward a common goal. I'm good at that. I'm good at motivating people, and I like to lead from the trenches.
I've been able to do that at Barrick and I was able to do that at Clairtone. Clairtone wouldn't have been such a failure if it hadn't been such a major success.
What do you mean?
You can't have a big-time failure if you never got high enough to fail. If Clairtone had been a little one-man shop, and I would have failed, you wouldn't have known about it 30 years later.
Clairtone was an impossible dream in the 1950s - to start up in a high-tech product area and to sell enough to become No. 1 in the market - in a country that traditionally bought its consumer products from the States and Germany. We must have done something right. Then I made a very major mistake, and we paid for it.
What was that?
We went to Nova Scotia and hired 3,000 people who were more interested in lobster fishing and drawing their unemployment insurance, and we got screwed up. We got caught up, of course, in the wrong timing, the supply of Japanese colour TVs, and a whole bunch of things.
You must bear some responsibility for that.
I had all the responsibility. I was the boss. I got wiped out, I got fired.
Does Canada tear down its venturesome people?
People say that about Conrad [Black]but I don't think it's the Canadian thing. I think when you're high up and you start making mistakes ... well, being high up means you're in the public eye. When you treat somebody wrong and you start failing, that's a better story than carrying on being successful.
You love to speak your mind.
I am uncommonly outspoken, and my family hates me for it. Every time I go to annual meetings, they say 'Don't tell them all the truth, or the way you see the truth.' But that's the way I am, and I am old enough to keep it that way.
This is a volatile time. Did you get caught up in the troubles of asset-backed commercial paper? [As a company, Barrick has reported $65-million of exposure to these illiquid notes.]/b>
That's out of my field, thank God. I'm not a banker and I'm not involved in those things. But what do you expect in an economy that has been booming now for a decade? There are never totally smooth, upward curves. The whole world is doing well now.
Look at the number of people who have come out of poverty in Latin America, China, and Southeast Asia. Look at India. This was a spectacular, spectacular run.
Is it over?
No, but nothing lasts forever.
What is your advice to someone caught in the middle of this volatility?
It's the same advice given by many people - don't sell when there is a panic button out there. Just do nothing, sit back and enjoy it.
I think you sell when people feel good about things. Look at when we sold [property company]Trizec - a year ago.
There is an old saying of my grandfather's: 'There is room for bears and room for bulls but there is no room for the pigs.' So if you try to buy at the lowest point and sell at the very highest, you're never going to make it. Don't look for the last penny.
Peter Munk
Title: Chairman, Barrick Gold Corp., Toronto
Born: Nov. 8, 1927 in Hungary
Education: Bachelor's in electrical engineering, University of Toronto, 1952
Career highlights:
June, 1958: Founded Clairtone with partner David Gilmour.
1964-1965: Shifted production to Stellarton, N.S.
August, 1968: Fired by Clairtone, which went out of business.
1970s: Invested in properties in South Pacific, Australia and Egypt, with mixed results.
1983: Made move into gold mining through Barrick.
March, 2006: Barrick became No. 1 gold producer with takeover of Placer Dome.
October, 2006: His real estate company, Trizec, sold for $4.8-billion.