Take Off Your Shoes

by Ben Feder

  Take Off Your Shoes

  Take Off Your Shoes

  One Man’s Journey from the Boardroom to Bali and Back

  Ben Feder

  Radius Book Group

  New York

  Distributed by Radius Book Group

  A Division of Diversion Publishing Corp.

  443 Park Avenue South, Suite 1004

  New York, NY 10016

  www.RadiusBookGroup.com

  Copyright © 2018 by Ben Feder

  All rights reserved, including the right to reproduce this book or portions thereof in any form whatsoever. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording, or any other information storage and retrieval, without the written permission of the author.

  First edition: April 2018

  Hardcover ISBN: 978-1-63576-367-6

  Trade Paperback ISBN: 978-1-63576-495-6

  eBook ISBN: 978-1-63576-368-3

  Quote from David Whyte, printed with permission from Many Rivers Press, www.davidwhyte.com. David Whyte, “Fire in the Earth,” Fire in the Earth, together with ©Many Rivers Press, Langley, WA USA.

  A portion of the proceeds from the sale of this book will be donated to Save a Child’s Heart. The results of their work are a testament to the power of compassion.

  To Victoria, Live, Love, Laugh

  and

  To my late father, whose boundless legacy needs no words

  And we know, when Moses was told,

  in the way he was told,

  “Take off your shoes!” He grew pale from that simple

  reminder of fire in the dusty earth.

  He never recovered

  his complicated way of loving again

  and was free to love in the same way

  he felt the fire licking at his heels loved him.

  —David Whyte, “Fire in the Earth”

  contents

  Introduction

  Chapter 1

  Chapter 2

  Chapter 3

  Chapter 4

  Chapter 5

  Chapter 6

  Chapter 7

  Chapter 8

  Chapter 9

  Chapter 10

  Chapter 11

  Chapter 12

  Chapter 13

  Chapter 14

  Chapter 15

  Chapter 16

  Chapter 17

  Chapter 18

  Chapter 19

  Chapter 20

  Chapter 21

  Chapter 22

  Chapter 23

  Chapter 24

  Acknowledgments

  introduction

  I wrote this book for my children. I wanted them to understand my motivations for walking away from a lucrative and engaging career and all but burning my bridges. I wanted to leave them a memento that went beyond the photo album or the family blog we kept during the break. They may not understand or have an interest in it now, but when they are in their twenties and thirties, when many men and women start asking questions about their parents, I believe the book will be helpful to them. If my children find it enlightening, it will have achieved its aim. If others learn something from it, that is also good.

  The other reason I wrote this book is that many of the people I met who inquired about the trip asked me to write it. They thought it was an important story to tell. For some, the story stoked fantasies about what it would be like to take time off. For others, it enabled them to live vicariously through our experiences. Still others thought about making concrete plans. But everybody wanted to know about it.

  One of the things that led me to take a sabbatical was my increasing curiosity about brain plasticity and our ability to deliberately cultivate a sense of well-being. I read extensively on the subject and did my own research. In this book, I have tried to weave in what I learned through the academic and popular writing about our ability to change our lives by changing our minds. I applied that learning to my own actions and experiences. I have also tried to sprinkle in some of what I have learned about leadership along the way.

  Trying something new and creative, without regard to success or failure, was another reason to write the book and in a way is what it’s about. When I started to write it, I had a preconceived notion of what the exercise would be. I imagined banging away at my keyboard, the words flowing through my mind faster than my fingers could type them. In fact, the process was much slower and more methodical. Sometimes the words did not come at all. I persevered, and this is the result.

  One of my friends from Bali, Renee Martyna, researched the cohort of professionals that I had inadvertently joined and whom she called knowmads: knowledge professionals like me who had stepped off the career track to pursue an unexplained need to be a vagabond. Taken together, she thought, they told a universal narrative even though each individual story was highly personal. She found that the one factor that separated those who could adjust back to regular life after sabbatical and those who could not was their ability to tell their own story.

  I tend to be skeptical of authors who claim they write for the benefit of others. But it was my son Oliver, pushing me to write, who said in his preteenage years, “I think other people can really learn from what you did.”

  one |

  On a cool spring Wednesday morning, in the Meatpacking District of Lower Manhattan, black Cadillac Escalades ferrying executives from across town pulled up to the entrance of the W Hotel. Abundant clouds dampened the light but posed no threat. A news van parked outside raised its antenna to full height. Inside the hotel lobby, a CNBC reporting team was ensconced. Two floors down, in a windowless basement meeting room, management and shareholders of Take-Two Interactive, a multinational video game publisher, assembled for an unusual gathering. Regulators required the company to hold the meeting annually, but it had been eighteen months since the previous one—so late that Take-Two was in danger of losing its listing on the NASDAQ stock exchange.

  Shareholders arriving at this meeting were deeply unhappy with the state of the company. Take-Two had been under investigation by the Securities and Exchange Commission (SEC), the Federal Trade Commission, and the Manhattan District Attorney’s Office. There were financial irregularities, and the company’s auditors had not certified its annual report. A former CEO was ultimately indicted and pled guilty to falsifying business records, and the board of directors was fractious.

  Not only had many investors shied away from buying the company’s stock, but it was one of the most shorted stocks on the NASDAQ. Short sellers, who sell stock first and buy it later, gambled on the company’s stock price declining even further. Some investors bet that Take-Two would continue to circle the drain; others bet on a rosier outlook, hoping that a larger competitor might gobble it up. One way or another, in the eyes of many, the demise of the company’s independence was imminent.

  Ordinarily, shareholder meetings like this were perfunctory, and unless something controversial was on the agenda, votes were cast by the shareholders well in advance of the meeting, usually in support of the resolutions proposed by management. This time was different. Shareholders representing most of the votes were present to voice and act on their displeasure. They had no intention of voting for the management’s resolutions.

  They were there because my partners and I had arranged for them to be there. We were betting that the company would succeed. We thought it owned strong assets, especially the monster hit video game Grand Theft Auto. Take-Two was also about to release a promising new game, BioShock, and had a leading NBA basketball game franchise.

  Back in high school, I was an entrepreneurial kid, scheming up ways to make extra cash while my friends were playing ball. As I matur
ed, I meandered through a liberal arts education, searching for a professional calling. I had been a research analyst after college and attended business school because commerce seemed to be in my blood.

  But it wasn’t until my first real job working in business development at Rupert Murdoch’s News Corporation that I developed an ambition to become the kind of businessman that he was, to cleverly build new businesses or buy existing ones. I had founded and grown a start-up that I was proud of. I sold it but still harbored ambitions of leading a much larger enterprise. When I found like-minded partners, we started a firm with the ambition to build a diversified media company through acquisitions. Since we had no money, we were forced to fight our way into tough situations. We were entrepreneurial because we had to be. We were hungry, ambitious, and aggressive.

  Partnering with private equity investors, we took on highly troubled situations that we could fix and turn around. Using that model, we had successfully gained control of a number of small- and medium-sized companies. And we delivered good results. But nothing was as large or creative as Take-Two. Nothing exhibited its enormous potential, which, because its games were so highly regarded, projected a market presence that was vastly larger than its actual size.

  The situation was unusual for us because the company was publicly traded. Since no single shareholder owned enough company stock to control the organization, there was no single owner with whom we could work. If one shareholder sought to coordinate with another, they needed to abide by a complex set of regulations stipulated by the SEC and corporate case law in Delaware, where the company was incorporated. If we were to be successful in effecting change, we needed to be clever and creative. And we needed to be careful to stay strictly within the regulations. Inadvertently tripping over a regulatory wire, even a small one, would be fatal to our plans and our careers.

  My partners were initially skeptical. Take-Two was in deep trouble. Putting my credibility on the line and convinced that the company’s unresolved legal issues were old news, I took a contrarian view. Any investor who cared already knew about the problems, and if the company was not inclined to fix them itself, the government agencies that had been investigating would force the issue. It seemed unlikely that there were any horrors still to be discovered—the bad news was in the past. In the argot of Wall Street, it was all “priced in”—the current valuation already took all the rot into account. To Strauss, the senior partner at the firm I cofounded, I likened the company to an open, pus-oozing wound: it looked disgusting, but pus is a sign of a healing infection. My other partners reluctantly came on board. We needed to win.

  For about six months, my team and I had worked with the best lawyers in the business to garner support for our plan to change the composition of the board and senior management of Take-Two. We worked with some of the smartest fund managers and some of the largest pools of money in the investment community to navigate a path through the labyrinth of legal obstacles despite periodically running down legal blind alleys.

  When the company announced a snap shareholder meeting to be held almost immediately, we sprang. We coordinated a group of shareholders to file with the SEC and disclosed our intention: the shareholders would attend the meeting—in person—and would nominate a slate of directors to the board as a direct challenge to the one proposed by the company. If that board was successfully elected, the shareholders intended to oust the CEO and, potentially, the CFO.

  A vote of this sort from the floor of a shareholder meeting was rare in the extreme. Effecting a management change in precisely this form, we were told, had never before occurred in American corporate history. Ordinarily, a change of this sort would involve a proxy fight, in which nominees to the board are announced well ahead of time by activist shareholders, and a campaign to garner voting proxies would ensue. Proxy fights over one or two directors are often the source of a bitter contest between the company’s management and its shareholders. In this case, we proposed to change out not just a few directors but five out of seven. That would leave only two incumbent directors, resulting in a wholesale change in the ranks of senior management. Although we carefully designed the action to minimize disruption, there was no mistaking our intent. It was a hostile take-over.

  The meeting room at the hotel was packed. Two concrete floors separated the basement from ground level and obstructed connections to wireless networks. The professionals in the room were cut off from their advisers, partners, and in my case, my wife, Victoria, who was waiting anxiously for news. Once our opponents and we descended into that chamber, there was no communication with the outside world until the battle was over.

  Strauss and I took seats in the front row. I twisted around to look behind me. The room was packed with white men in ties speaking in hushed tones. I swung back to face the front. A tall man paced near the dais. He had his white hair slicked back and wore a three-piece, pinstriped Italian suit, starched white shirt, and red tie. I leaned toward Strauss. “This guy is obviously paid too much.” I was thinking about the potential cost-cutting exercise ahead of us and blithely assumed that Daddy Warbucks worked for the company. Strauss smiled calmly.

  The success or failure of our efforts would come down to a simple raise of hands. Normally, with shareholders casting votes in advance, tumbleweed could roll through the empty rooms of annual meetings populated often by retirees who owned a few shares or shareholders who wished to push a pet cause. This time, shareholders needed to be physically present in order to nominate a board in the manner that we were proposing—from the floor. Representatives from major hedge funds and mutual funds who had arrived specifically to support our bid for change gathered in the narrow room. A portfolio manager from one firm flew in from Italy for the sole purpose of casting his vote.

  Officers of the company sat at a dais facing a long column of narrow rows of seats. An empty podium stood lonely to the side. At the start of the meeting, the general counsel of the company rose to the podium to open the proceedings. The room fell silent. He introduced the company’s nominees for the board of directors. “Are there any other nominations for the board of directors?” he asked the shareholders sitting in the audience.

  Emmanuel Ferreira, representing the largest shareholder, rose to his feet. He cleared his throat and stated his name and the number of shares he represented. “I’d like to nominate the following directors.” He then listed a full slate of directors to the board, only two of whom were not new. I was nominated along with Strauss and three other independent directors.

  Months of planning had led to this showdown. Fueled by adrenaline and a deep competitive drive, we had fought and clawed. Now, although we knew that any outcome was possible, we were confident.

  After Ferreira read his list of nominees, a vote was called. I looked around the room to see hands shoot in the air in favor of our slate. Auditors walked around the room to collect forms. It took them more than an hour to count and authenticate the votes. The general counsel pulled us aside. “It looks like you’re the clear winners.” I felt the surge of victory well up inside me, that familiar sense of hard-fought achievement that I craved like an addict. “Congratulations,” he said. “I’ll see you in the office in the morning.”

  In that brief moment, the company turned over its management. It had a brand-new set of directors and a new management team. Strauss became chairman, and my colleague Karl became an executive vice president. I became CEO.

  I imagined for a moment what the next day in the office would be like. We had just fired the CEO, and others in the company surely expected more dismissals would follow. I felt a twinge of discomfort. My mother was a psychotherapist, and I grew up with an appreciation of and curiosity about the inner lives of others. I felt both power and empathy, and in that flash, also confusion. Success was rarely unbridled. I willed away any sentimentality. If you have a hammer, use it.

  I was at the helm of a two-thousand-person organization about whose inner workings I knew precious little. What I did know was how
to successfully reengineer a company’s internal operations in order to grow and create greater profits. And I knew how to position a company within its industry.

  My firm’s explicit intention was for me to serve for a short period while we launched a search for a full-time leader. I expected to head the company for six months, but the board asked me to stay. The gig lasted nearly four years.

  two |

  I arrived home late for dinner one night. Oliver and Rita, our two middle children, ran down the hall in a race to be the first to hug me, but before they reached me, Oliver checked Rita into the wall. She was unhurt but started to scream. Their combative relationship was starting to grate on me. Dinner was already under way, and as I walked toward the table, Victoria shot me a glance that I recognized all too well. Our son Sam, the oldest of our four children, was staring at his plate, his hands over his ears to block out the noise of his siblings. I joined the mostly raucous dinner, the conversation half-comprehensible as children vied for attention, the food half-eaten, Sam half-present.

  After dinner, in one of our increasingly heated behind-the-bedroom-door discussions, Victoria lost patience. “I never signed up for this!” My tenure at Take-Two had gone from being short term to permanent. My schedule had filled with dinners, breakfasts, and travel, and the rising tension between us was aggravated by Victoria’s own growing commitments. She managed not only our four children’s overscheduled lives but also a thriving community center and preschool that she had founded and in which she had been deeply engaged for seven years.

  Our conversations were becoming increasingly transactional, dealing with the logistics of our lives but sharing little of each other’s inner selves. I simply was not engaged in our family. Even when I was physically present, I was distracted. A constant flow of emails from multiple time zones competed intensely for my attention. She felt abandoned, we were growing apart, and I felt helpless to stop it or reverse the trend.