Business • Red McCombs
His can-do approach to everything—from cars to football—pegs him as a winner.
(Page 2 of 2)
In 1953 he opened his own used-car business in Corpus and picked up extra money by selling auto insurance to customers. Soon Edsel awarded him his first new-car dealership. He was such a good salesman that he could even sell the industry’s most notorious flop: His franchise was one of the few in the nation to turn a profit. The next year, McCombs was feeling a little flush, so he spent $10,000 to buy his first sports team: the Corpus Christi Clippers of baseball’s Big State League. “When I bought the Vikings, I was asked how it felt to pay that much money for a team,” McCombs says today. “All I could think of was that it was no big deal compared to the risk I took with the Clippers.” The reason: $10,000 in 1954 was a much greater percentage of his total assets than $250 million was in July 1998.
Four years later, in January 1958, McCombs moved to San Antonio and went into partnership with Austin Hemphill, who owned a Ford dealership. During the next two decades, McCombs bought out Hemphill and started more than 25 new dealerships in the Southwest. He began branching out in almost every conceivable direction. A large investment in one bank, South Main in Houston, led to other investments in other banks. The purchase (with partner Lowry Mays) of San Antonio’s largest radio station, WOAI, led to the founding of Clear Channel Communications, which now owns or operates more than seven hundred stations around the world. Investments in hotels led to investments in restaurants (he is a part owner of the Old San Francisco Steak House chain), which led to underwriting movies, including The Verdict and Romancing the Stone. “My unbreakable rule is that I don’t buy into things I don’t feel a personal passion about,” says McCombs. “The trouble is I feel passionate about a great many things. I hurt when things go wrong, and I feel a great high—positive elation—when things go well.”
One thing McCombs has definitely felt passionate about is San Antonio itself. After HemisFair in 1968, he turned his attention to helping the city solidify its identity. Five years later, he and a business partner, Angelo Drossos, leased and later bought the Dallas Chaparrals of the old American Basketball Association and moved them to San Antonio, where they were rechristened the Spurs after the local newspapers held a name-the-team contest. Even today McCombs has strong ties to the Spurs, which he has owned twice (he sold his interest in 1982, bought the team again in 1988, and sold it again in 1993). From his front-row seat, he cheered wildly for the Spurs over the Minnesota Timberwolves in the first round of the 1999 NBA playoffs, even though he now has an allegiance to Minnesota.
The seventies were an important period in McCombs’ life for another reason: That was when he realized he had a problem with alcohol. He was never a falling-down drunk—he never even appeared to be tipsy. To this day, Charline does not believe that he is an alcoholic. “That’s how insidious this disease is,” McCombs says in response to his wife’s disbelief. He knew that he was an alcoholic because, he found, he couldn’t live without booze: At first he drank mainly beer, then mixed drinks, and finally graduated to vodka because it’s clear and odorless. At two in the morning on November 12, 1977, almost one month after he turned fifty, he awoke at his home and went into convulsions. He was taken by ambulance to a hospital and later transferred to a hospital in Houston. “My liver and kidneys just quit working,” recalls McCombs. On the sixth day he was conscious enough to start praying. “I had only one prayer: ‘Please, God, get this monkey off my back,’” he recalls. At some point the urge to drink left him; his will to live was stronger than his desire for alcohol. “God gave me a second life. I don’t know why, but I’m very sure of it,” says McCombs. “People ask me all the time if I’ll ever retire. Naturally, the answer is no. You don’t retire from a second chance.”
Soon after, McCombs found new, more profitable ways to channel what he describes as “my addictive personality.” During his recuperation, Charline took him on long drives through the Hill Country and urged him to “buy a little ranch so that we can relax.” They bought a five-thousand-acre spread about a mile north of the Pedernales River near Johnson City, and McCombs decided he would try to buy a small herd of cattle. He discovered that breeders did not sell their best Longhorns, which kept the price low—in 1978, about $700 a head. Once again McCombs saw a hook. He resolved to find a way to offer top-of-the-herd Longhorns to the general public.
That summer, he and Charline toured the South and Southwest in his airplanes, paying three times the going rate for the best cattle he could find. One of his stops was the King Ranch, which had never sold its Longhorns. He called Tio Kleberg, who ran the King Ranch’s cattle operations in Texas, and asked to buy from his herd. At first, Kleberg refused—traditionally, the ranch hasn’t sold its Longhorns—but eventually he relented, and McCombs picked out 26. When he inquired about the price, Kleberg told him, “Pay me what you think they’re worth.” McCombs took the top ten percent of the previous year’s sales of Longhorns, averaged them out, and came up with a figure. In 1980 the King Ranch’s Longhorns were part of the herd that McCombs sold for record prices at glitzy public auctions in the lobbies of the largest hotels in San Antonio and Houston: Breeding stock that once sold for $700 now sold for $3,000 and higher. In 1983 one of McCombs’ bulls, Redmac Beau Butler, sold at auction in Johnson City for $1 million. By the late eighties, the high-end market that McCombs helped create had run its course; today, Longhorn prices are half what they were at their peak.
In the years since, much of McCombs’ time and money has been expended on public causes. In 1989, for instance, he helped then-mayor Henry Cisneros sell San Antonio voters on building the Alamodome with a half-cent sales tax. But his greatest contribution has been his philanthropy. The foundation that he and Charline established in 1981 donates as much as $8 million a year to charities. In April 1997 they gave $6 million to Southwestern for the construction of a student center. The following month, after Jody Conradt, the director of women’s athletics at UT-Austin, told McCombs that women’s sports had no large benefactors, he wrote a check for $3 million. “I really felt bad that I hadn’t given money to women’s sports before,” he says. “I’m a guy, you know, and I gotta tell you: I’d never thought of it.” In 1997 he and Charline donated $1 million to complete the much-delayed renovation of the Empire Theatre, an architectural landmark in downtown San Antonio.
By that time, McCombs had restructured his business interests. In 1997 to focus more on commercial real estate and his new energy company, he made the decision to sell off most of his automobile franchises across the country, leaving only twelve in nine locations in San Antonio. “I’m drilling thirty new oil wells this year,” he says. “That may sound crazy, but I see a hook.” More recently, he’s been buying huge tracts of land in Colorado; he plans to divide them into ranches of various sizes, which, of course, he’ll sell.
AFTER JOSEPH’S BASEBALL GAME, MCCOMBS drove to one of his used-car lots to have lunch—a plate of barbecue—with Charles Hutchings, who had sold 22 used cars in a month’s time. A small crowd of salesmen, for whom football is a secular religion, greeted McCombs at the front door like a deity. He rewarded them with an anecdote about another godlike figure: Minnesota governor Jesse Ventura, the former pro wrestler. Like many people, McCombs was stunned by Ventura’s victory last November, and he was anxious to talk to him because the Vikings will soon be seeking taxpayer funds to build a new domed stadium.
The day after the election, McCombs recalled, he arranged to telephone Ventura during the latter’s popular radio talk show in Minneapolis. “How are the Vikings doing?” cooed Ventura, a loyal fan, when McCombs got on the line. He then teased McCombs about the fact that the 1999 season was such a sellout. “My family and I couldn’t even get nosebleed seats,” he said.
As he related the story, McCombs assumed the pose of a fisherman who was terrified the catch of his life might be slipping off his hook. “I told Jesse he would never again have to worry about getting tickets to a Vikings game,” McCombs told his sales crew. “The next Sunday, when the Vikings faced Green Bay, Jesse showed up with his two kids, and he took his seat right next to me on the fifty-yard line.” Inside the circle of salesmen, McCombs beamed, and you had the feeling that this easy camaraderie—being one with his team—was the big payoff.
Pages: 1 2
My Library
