Clay Mathile, the billionaire pet food pioneer who made Iams a household name by touting premium nutrition to top breeders and veterinarians, died on August 26. He was 82.
Mathile first debuted on the Forbes 400 list of Richest Americans back in 1991. He was 50, with an estimated $450 million net worth. Back then, Forbes wrote that Mathile made a fortune launching “the fast-growing $1 billion yuppie puppy food market.” Today, the U.S. premium pet chow industry does about $14 billion in sales a year.
Mathile, a former buyer for Campbell’s Soup, joined Iams founder Fred Iams as a general manager in 1970. By 1975, he was the top dog at Iams and bought out Iams in 1982. He grew annual sales from $13 million to some $800 million. In 1999, Mathile sold Iams to P&G for $2.3 billion. He shared the windfall, giving $100 million to employees and setting aside another $130 million for a charity. Mathile, an Ohio native, structured the sale so Iams jobs stayed in Dayton, OH.
Dayton would also become the site for his $100 million entrepreneur hub, Aileron. Mathile had earlier toyed with endowing an established university, but ever the brand builder, he struck out on his own, creating a campus that would teach MBA-level management strategies to small business folks grinding to survive and grow. “We’re dealing with day-to-day, gut-wrenching problems, and the universities aren’t really set up to deal with that,” Mathile told Forbes in 2010. He knew the type. When he joined Iams in 1970, the dog food company had five employees.
I met Mathile at the Aileron campus for a Forbes profile in 2010. With its massive, curved, chrome roofline, the 71,000 square-foot building looked like a UFO had landed in the fields outside Dayton. My taxi driver, steering down the serpentine road that wove to the futuristic structure, asked me if Mathile’s campus was some sort of secret lab. In many ways, it was.
Each year, Aileron hosts about 15,000 small business owners on its 114-acre campus for management retreats, business courses, and mentorship programs.
Curious about Mathile’s Aileron method? Below is the January 21, 2010, Forbes profile of Clay Mathile and his unique entrepreneur program in the fields of western Ohio.
Clayton L. Mathile is an entrepreneur who built a billion-dollar fortune in pet food. He sold the Iams Co. to Procter & Gamble in 1999 for $2.3 billion. Like many of his ilk, he turned his energies to teaching others the craft of entrepreneurship. For the $130 million he’s already spent on that goal, Mathile could have simply stuck his name on a new building at Harvard Business School or Wharton and called it a day. Instead, he started a new kind of school for the betterment of the small business owner.
Mathile’s project is called Aileron, which started in 1996 offering management classes at community colleges. Some 1,500 businesses have taken its seminars. In April 2008 Mathile cut the ribbon on its permanent home, an airy 70,000-square-foot building of glass, wood and stone on a bucolic campus outside Dayton, Ohio.
The “clients,” as the small business owners are called, are a different breed from what’s usually found wandering the halls of Ivy League business schools. These are owners of roofing, landscaping and metal-stamping firms too wrapped up in the grind to focus on internal controls and long-term strategy.
“We’re dealing with day-to-day, gut-wrenching problems, and the universities aren’t really set up to deal with that,” says Mathile, 69. He initially toyed with the idea of funding an entrepreneur school at a university, but after speaking to unhappy donors who had backed such programs, he decided to create Aileron with a chunk of his estimated $1.7 billion fortune.
Fewer than half of Aileron’s clients have formal business training. “There’s dirt under their fingernails, they probably don’t use the best English or have the best table manners, but they have 10 to 20 employees,” Mathile says. Aileron covers 95% of the costs; clients pay the rest so they have something invested in the courses. The Course for Presidents costs $800 for a two-day seminar. Similar offerings by the American Management Association run $2,450. The $800, moreover, includes a consultant, drawn from a pool of successful entrepreneurs and executives, for as long as you need one.
Mathile wanted a nontraditional setting for learning and got it. Architect Lee H. Skolnick, who designed several children’s museums, installed a floor-mounted video monitor in the building’s “Risk Corridor” so that visitors could walk over images of a raging fire. Down another hall a touchscreen lets clients interact with a digital Mathile. The real Mathile is around a lot, too. After a guest lecture 30 clients cornered Mathile to get him to sign copies of his book Dream No Little Dreams, to talk strategy and to offer thanks.
Wesley Gipe, chief of technology services firm Agil it, is using Aileron consultants to switch to performance-based pay and shed customers to focus on the healthcare market. The consultants, he says, “can be brutal, and that’s just what I need.”
Eric Rich II, an Aileron client who heads Rich Roofing in Troy, Ohio, implemented more clearly defined roles and performance reviews. He suffered a staff turnover of 90% but enjoyed a sales bump in 2009 of 14% to $3.5 million despite the recession. Rich’s quality of life improved, too: “I can take my family on vacation without spending the whole time on the phone.”
Mathile wants to take his Dayton experiment national and branch out using social networking and the Web. “If every business adopts effective management and is successful, then you won’t need this place,” Mathile says. “We’ll just rent it out as a bed-and-breakfast.”
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