The Gospel According To Fatjo

Tweet

He took up jogging, an activity he could do either at home or on the road. In 1973, he participated in a race at Dallas's Aerobics Center, and found that most of the other runners were business executives. He was impressed by their energy and sense of well-being, and noticed that his own health and business performance had improved. The time he had spent on physical fitness hadn't taken away from his business; if anything, it had improved it. He thought he saw a connection between physical fitness and business efficiency.

Browning-Ferris continued to grow. By 1975 it was operating in 110 cities, and had 6,000 employees and annual revenues of $250 million. Tom Fatjo had built his national company.

Mission 3. In 1975, Fatjo stepped down as head of BFI. "The company was running well," he explains. "It had strong management, was being operated on a regional basis by good people, and wasn't going through a strong growth period. There was no big need for me."

His $500 investment in a garbage truck had mushroomed into 160,000 shares of BFI stock worth more than $5 million. He had an option on 40,000 more shares.

But now Fatjo set his sights on a new goal, one that would meet both his personal and his professional needs. "I wanted to create a center that would have a positive impact on the lives of busy people, that would help them to be productive for a long period of time -- both personally and professionally. I wanted it to be a place where people could attend conventions, learn something about fitness, enjoy some exercise -- a place that would bring balance back into their lives."

But planning, building, staffing, and operating a resort and health club is a far cry from collecting garbage. "I've got to be honest with you," he confides. "From July of 1980 to about February of 1981, I can't really say that I enjoyed it -- it was a lot more difficult than trash. I'd been involved in one or two start-ups before, but never six or seven at the same time. We were in the restaurant business, the hotel business, the fitness business, the membership business. For a while I found myself out of my element, but the mission was so important that I never thought twice about whether or not we'd continue pursuing it."

The financial gamble alone was significant. The Criterion Capital Corp., which had been set up by Fatjo and several partners, became a general partner in the development of the $39-million project. "Virtually all of my business assets are tied up in Criterion, "Fatjo says. "I own about 40% of the firm."

Fatjo's new venture, dubbed The Houstonian, opened its doors in January 1980. Set in a heavily wooded area, once a private estate, in the southwest section of the city, it includes a 300-room hotel and conference center with three restaurants, 24-hour room service, and 29 meeting rooms. It also has a health and fitness center with 66,000 square feet of athletic facilities, including five tennis courts, eight racquetball courts, an Olympicsized pool, a gym, an indoor track with computerized timing lights, and a one-mile outdoor track carpeted with Astro-Turf. The Houstonian's Preventive Medicine Center has a staff of several doctors who put members through a comprehensive physical exam and prescribe programs of diet and exercise. It has given more than 7,000 complete examinations since it opened. Finally, there's The Phoenix, a luxurious women's spa run by Judy Fatjo, Tom's second wife.

"It's what God would have done if he'd been rich," goes the local joke. The initiation fee for Houstonian members began at $2,500 but has since shot to $12,500 because of demand.There are currently 2,300 members.

In its first year, The Houstonian lost more than $3 million, but Fatjo says the slow start was the result of a conservative attitude toward building the center's reputation. "Most major hotels would have come into a market a year ahead of time and done some heavy advertising," he explains. "We did virtually none; I wanted to build our reputation slowly." Occupancy of the hotel climbed from 50% in 1980 to 70% in 1981, and The Houstonian showed a $1-million profit. "Our reservations for 1982 are much stronger," Fatjo observes.

Today, The Houstonian is a vehicle for many of Fatjo's personal beliefs. He was one of the founders of the American Productivity Center, a business think tank located on The Houstonian's grounds. And 300 to 400 people have attended inspirational "Weekends for Personal Renewal" at The Houstonian, featuring religious as well as medical and business speakers. The emphasis on religion and its role in personal well-being reflects Fatjo's own thinking. "I've just always believed strongly that God was my partner," he says. "Many times, I haven't done the right thing, and I've made mistakes in business, but I've never felt that He was anything but a partner and supportive of me."

Fatjo continues to run every morning, and turned in a time of three hours and 36 minutes in the 1981 Boston Marathon. He takes a break from business to go hunting with his son, and he reads the Bible daily. Though he runs the poshest of resorts, he drives a 1971 Chevy. He seems to have found the balance between his business and his personal life that he was seeking when he turned from garbage collecting to physical fitness.

At 41, Fatjo clearly has time for more missions. He is chairman of the executive committee of Fannin Bank, the largest independent bank in Texas. He is personally involved in many of the projects of Criterion Capital, which is currently building The Houstonian Estates, a 155-unit high-rise condominium whose top-priced unit will go for $1.2 million. Criterion also has money invested in Criterion Management Co., a money management firm with interests in real estate ventures, an automobile agency, as well as Browning-Ferris Industries. For the moment, however, The Houstonian is Tom Fatjo's mission.

 PREV  1 | 2 | 3