Hardly Strictly Business

Cal Alum Warren Hellman Plays His Own Tune in Investing, Philanthropy.

By Ronna Kelly


Warren Hellman, a San Francisco financier and power broker, loves telling stories. Here's one he shared with CalBusiness recently:

Earlier this year, Hellman, BA 55, met with two top New York Times editors in his Financial District office about the newspaper publishing articles written by The Bay Citizen, a news website that Hellman seeded with $5 million.


How do we know you won’t try to influence the editorial product?, the editors pointedly asked Hellman, who co-founded the private equity firm Hellman & Friedman 26 years ago.


With a sly grin, Hellman recounts his response to the editors: The only publication that ever wrote anything negative about the Hardly Strictly Bluegrass Festival, another Hellman cause, was San Francisco magazine—and Hellman was a significant shareholder at the time.


Indeed, Hellman says his success in private equity stems in part from his ability to choose companies with strong managers already in place, limiting his need to interfere.


"Part of making smart investments is to back great people who run the companies,” says Hellman. “Chances are they won’t be at Hellman & Friedman. In fact, it’s a relative certainty that they won’t be at Hellman & Friedman.”


But private equity is just one chapter in Hellman’s long career. Hellman, 76, has accomplished more than three people might only hope to achieve in business—first in investment banking, then venture capital, and most recently in private equity. Hellman’s success—stemming from strong management, finance, and entrepreneurial skills—has enabled him to become involved in a wide range of philanthropic activities, from The Bay Citizen to the bluegrass festival to giving back to UC.


The Haas School is honoring Hellman this year with its Lifetime Achievement Award to recognize his countless accomplishments in business and generous philanthropic efforts. The school will present the award to Hellman at its annual gala in San Francisco on Nov. 5.


“Warren Hellman is a man of great humility, despite his amazing track record in building successful companies and undertaking new ventures for the community,” says Dean Rich Lyons. “He is an archetype of the leader we aim to develop here at Berkeley Haas.”


Banking Roots
Born into a banking family, Hellman was destined for a career in business. His great-grandfather led Wells Fargo Bank in the late 1800s; his uncle was chairman of Lehman Brothers; and his father was an investment banker. Hellman triple-majored in economics, political science, and history while playing varsity water polo at Cal. “I never wanted to leave,” he recalls. “It was so damn much fun.”


After graduation, Hellman served in the Army and earned an MBA at his father’s alma mater, Harvard Business School. He says his family connections helped him get his first post-MBA job at Lehman Brothers. But he quickly proved himself and became the firm’s youngest partner at the age of 26. By 36, he was president.


Lehman was one of two Wall Street firms that invested its own capital as principal, rather than only helping others invest—which was Hellman’s favorite part of the job. What he didn’t like was the cut-throat culture. So, when capital requirements limited Lehman’s ability to continue investing its own principal, Hellman left.


“It was the most internally competitive, tough environment that you could ever imagine,” Hellman says of Lehman Brothers. “When people say, ‘How do you explain the success of Hellman & Friedman?’ I say, ‘Well, I just try to remember what we did at Lehman, and I do exactly the opposite.’”


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