Charles D. Martin
Mr. Martin (79) is the Chairman, CEO and Chief Investment Officer of Mont Pelerin Capital, an investment management firm that he founded in 2005. The firm manages long/short hedge funds in the public equities market.
With over 40 years of investment experience, he has been engaged actively in managing strategies across most asset classes, including public equities, international & domestic bonds, venture capital, leveraged buyouts, real estate and marketable alternatives (hedge funds). For almost 20 years he has served on, or led, investment committees for university endowments, in addition to being an active investor across multiple asset classes for his own account. Over the last 40 years Mr. Martin has served on the Board of Directors of 47 public and private companies.
Mr. Martin has served as a leading member of the Investment Advisory Committee for the University of California Regents for the last 12 years. This is a $100 billion global, multi-asset class investment program managing endowment and pension funds for the ten campuses of the UC System. It has a large, sophisticated professional staff. For about the same period, he has served on the Investment Committee for the UC Irvine Foundation. Earlier he served as Chairman of the Investment Committee for Chapman University for four years, during which time the endowment doubled from investment returns. He also counseled the Ohio State University in the formation of its investment office and assisted in the recruitment of their Chief Investment Officer.
In 1984, Mr. Martin founded the venture capital firm, Enterprise Partners, and served as its Managing Partner until his retirement in 1999. Enterprise Partners grew to become the largest venture capital firm based in Southern California, investing in over 100 emerging growth companies. During his term as the firm’s Managing Partner, Enterprise Partners consistently ranked as one of the top performing venture capital firms in America. Investors included the endowments of Harvard, Yale, Princeton, Dartmouth, the Ford Foundation, the Common Fund, AT&T, General Motors, Eastman Kodak, Bank of America and others. Over 80 CEO’s of California companies are also investors in these funds.
Private Equity/Leveraged Buyouts
Mr. Martin is also the cofounder, with George Argyros (formerly the U.S. ambassador to Spain), of Westar Capital, a private leveraged buyout/recap investment firm, and served as a general partner of that firm from its formation until 2000 when he retired as its partner emeritus. During his term of leadership in Westar Capital, it achieved returns that were extraordinary by any standard in the private equity industry. Currently, he serves as a Senior Advisor to the private equity firm of ClearLight Partners ($900 million under management), which is focused on the acquisition and development of middle market companies.
For 25 years, until its sale in 1999, Mr. Martin was a co-owner and served on the Board of Vedax Sciences Corporation, the parent company of TEC International (now known as Vistage), the largest proprietary membership organization in the world for the management development of company Presidents and CEOs. TEC International operates in 72 metropolitan markets in the United States, eight foreign countries and has 12,000 members. Mr. Martin sold the company to Knowledge Universe, a partnership between Michael Milken and Larry Ellison.
Mr. Martin is also a seasoned operating executive. Earlier in his career he served as CEO or V.P. Corporate Development of various think tank/contract research companies and companies in the computer systems & software business. For about ten years he operated a strategic advisory and merger & acquisition firm, Corporate Development Associates. He has completed over 90 merger & acquisitions and countless corporate financing transactions.
Philanthropy and Personal Information
Mr. Martin is a Trustee of University of California, Irvine (15 years) and Chapman University (28 years). For the five-year period from 2000 to 2005 he served as Chairman of the Board for the Graduate School of Management, University of California, Irvine (now known as the Merage School of Business) and was designated its first Chairman Emeritus. He created and sponsored an investment competition for MBAs at the school known as the Polaris Investment Competition between 2004 and 2014 awarding 115 scholarships in connection with it. He served as the founding Chairman of the Board of Trustees of the Orange County Museum of Art from 1996 to 2000 and continues as its Chairman Emeritus. Mr. Martin and his wife, Twyla, have established and operate the Martin Foundation and Charitable Trust, The Orange County Endowment for Intellectual Advancement, focused on higher education and the arts.
Mr. Martin is the author of five books and numerous editorial essays on various topics including investment strategy, global economics, public policy, education and the environment. He graduated from Ohio State University in 1960 with a degree in Engineering Physics and five majors (physics, mathematics, chemistry, electrical engineering and business). In 2007 he was awarded the distinguished alumni-of-the-year, Lamme Medal. In 2013 he was awarded the prestigious University of California, Irvine Medal.
Touch points of your Author on OC Companies
Your author has had significant involvement with many companies mentioned in this book. Arriving in Orange County in 1960, he was a young engineer at Hughes, the largest electronics defenses contractor at that time. He was the co-founder and became CEO of System Engineering Labs (1962-1966) and later served as the EVP of Mauchly-Wood Systems Corporation. He merged American National Housing into Barratt, Ltd, Britain’s largest home builder then led the takeover of a large public homebuilder for Barratt to make them a major player in the US market. Your author served as an advisor on the merger of Western Pacific Financial into Shearson. He also arranged the merger of Zee Medical into the large drug distribution company, McKesson. He served as the merger & acquisition advisor to Caremark for several years during its growth period. These transactions were in addition to many that were not OC companies.
He was an investor in Xenotech and Board member. He was the founder (1984) and managing partner of Enterprise Partners, Orange County’s most successful venture capital firm, which backed over 100 companies during his leadership period, while turning in top decile returns for investors. He was the founder of Westar Capital, a highly successful private Equity/Buyout firm backed by George Argyros. He was the lead first-round investor and Board member in Tokos Medical, a Wall Street darling for many years in the late 1980s. He was the co-lead investor in creating Apria Healthcare and served as its lead Board member for 10 years. He backed of Steri-Oss and served on its board until it was sold. His firm was the lead investor in the insurance software company, Risk Data. He was an investor in the buyout of McGaw Labs. More recently he served on the Board of Stearns lending.
These are just a few of the OC companies that your author has touched in some way.
Early Life/Early Career
I was born and grew up in a small Ohio town. My mom, dad and younger brother lived in a tiny one-bedroom house on the “wrong side of town” where the poor people, blacks and hobos lived. There was a large set of railroad tracks that ran less than 50 yards in front of our house. An abandoned house was on one side and a junk yard on the other. Although we were very poor, we were a happy loving family with strong working class, mid-west values.
Learning came easily to me and I did well in school. I was a bit of a strange kid and was not a hit with the girls. I was skinny with glasses and a droopy left eyelid, a defect that I was born with. I enjoyed sports, but never was very good at any of them.
Upon entering high school, I was required to take an IQ test. Upon learning the exceptional results, my dad took me aside and told me “No one likes a smart boy. Sit in the back of the classroom and don’t answer the teacher’s questions.” As an awkward teenager, anxious to fit in, I followed his guidance. To this day, I have not shared my score with anyone other than my wife, Twyla.
Family, circa 1945
No one in my family had ever gone to college, but my thirst for intellectual activity drove me. My parents had no money to help me. Fortunately, the cost of an education at The Ohio State University was so low that I could work and put myself through school. I generally worked 40 plus hours per week and carried a minimum 21-unit academic load. Since I had no time and no money, I went through my college days without a single date. However, I graduated with five majors: physics, mathematics, chemistry, electrical engineering and business, plus a full general education program.
First Job after College
Upon graduating, I was offered a job in Boston with Digital Equipment Corporation and one with Hughes in California. I figured that a small town boy from Ohio was not going to fit in in Boston, so I took the California job. I borrowed $300 from the town doctor and took a train to California, landing in Fullerton where Hughes had a huge defense electronics facility employing about 14,000 mostly high-powered engineering talent. In those years, big defense contractors traveled the country recruiting the best & brightest and relocated them to California.
At Hughes, I was hired into the Advanced Systems Group. The company was leading the development of phased array radars and the fire-control computers to guide missile weapon systems. I landed right in the middle of that, surrounded by exceptional engineering talent. Early on I advance quickly.
High Tech Start-up
Two plus years later, a fellow 5-6 levels my senior called me into his office and announced that he was leaving to start a new company. He said that it was based on some of the work that I was leading and asked me to join him. Although I didn’t even know what an entrepreneur was, it sounded like an adventuresome thing to do. I signed on and the two of us founded a start-up company. This was about 1963 and I was only 26. Two years in, the investor that had backed the company showed up unexpectedly, fired my CEO boss and put me in charge of our rapidly growing high tech company. I knew nothing about running a business, but had been very successful bringing in contracts with prestigious government agencies such as DARPA, the Defense Advanced Research Projects Agency. We were among the first companies developing computer-aided-design technologies. I continued to run that business for several years and eventually merged it into a public company based in Boston.
Management Career Advances
A couple of years later, I grew restless and left to join a software company named Mauchly-Wood Systems Corporation. The co-founder had been John Mauchly (the inventor of ENIAC, the first digital computer) who had teamed up with Schlumberger engineer Don Wood to develop the world’s first seismic data processing systems for oil exploration. These systems were sold to oil companies all over the world. In those years the company had also developed an expertise in the software for relational data base management systems, a technology that a decade later was to form the basis for Larry Ellison’s Oracle Corporation. This allowed our company to win important contracts with HUD, the Department of Urban Development, to develop model information systems for cities. This was pioneering work at that time.
My next career move was to Systems, Science and Software, a contract research, think tank firm in La Jolla that had been founded by lead scientists out of General Atomics. Many of them had worked on the Manhattan Project during WWII. This was a very interesting company where over 80 percent of its employees held PhDs. I joined the company as its Executive VP for Corporate Development with a mandate to grow the company into more commercial markets. The company had an interesting shareholder, the May Department Stores. So we persuaded May Company to underwrite the development of the first electronic cash register, a point-of-sale computer terminal. I also led the acquisition of a computer-aided-design company and built that business into an early success. With the company’s sophisticated computer simulation technology we developed applications in environmental studies and earthquake structural analysis.
My next move was to Systems Development Corporation, the software/systems business that had only recently split off from the Rand Corporation. Again my role was to head up the Corporate Development activities of the company (acquisitions, new ventures, sales & marketing). At that time, SDC was one of the two largest software systems companies in the world. It developed military applications, public safety applications (police & fire), criminal justice systems (for automation in the court systems), and commercial applications including the first key-word search engine (think Google, but three decades earlier). LEXIS for legal search was one of those applications developed. It was during those years that I led the company’s initiatives to develop business in Saudi Arabia and Iran which were nations spending heavily on modernization. I was operating at the Minister level, just under the King (Faisal) and the Shah (Pahlavi). I had the former British Attaché to Iran working for me which was helpful in understanding t’aarof, the business etiquette and negotiating style in that world. On one such marketing program there, I collaborated with the German rocket scientist, Werner von Braun, to put up a communications satellite.
In the mid-1970s I became involved with Vedax Sciences Corporation and ultimately became its co-owner with Dr. Fredrick B. Chaney. The company operated four business units over its life; (a) creating & running the Presidential MBA Program for Pepperdine University, (b) a productivity improvement division, (c) a for-profit business school and notably (d) TEC International the acclaimed membership program for company Presidents and CEOs. TEC became the dominant business of the company growing its membership base to 12,000 members in 72 US cities and 8 foreign countries. In 1998 I led the sale of TEC International to Michael Milken and Larry Ellison through their company, Knowledge Universe. TEC is now known as Vistage International.
Corporate Development Associates
From 1975 to 1984 I operated a strategic advisory, corporate finance and merger & acquisition firm focusing on mid-size companies. During that period, my firm completed a large number of notable transactions across many industry categories (bringing my career total to over 60 at that point).
All of this financial transaction, corporate strategy and management operating experience prepared me well for the prime time in my career which was to follow…in the venture capital and private equity/buyout business.