(Article originally published in March/April 2017 edition)
TELL US ABOUT YOURSELF. WHERE DID YOU GROW UP?
I’m from Bay Ridge in Brooklyn, the youngest of six kids. I have four older sisters, one brother and 55 first cousins, so it was always family and it was great – in the kitchen and on the streets and at holidays and in friends’ houses. We all lived in the same neighborhood and you always knew you were part of something bigger and more important than yourself.
My father emigrated from Aleppo in 1920 with my Armenian grandfather, who had left Turkey in the late 1800s. They came through Ellis Island, landed in Paterson, New Jersey, then moved to Brooklyn where he worked as a shoemaker, butcher, shopkeeper and then started a factory with his brothers. The rest of my dad’s family went to Marseille and lived there for eight years until one by one they came to America.
My maternal grandparents arrived from Aleppo in 1908. My grandfather was a travelling salesman. My parents took a cruise in November of 1955 to Cuba and through the Panama Canal, so it’s perhaps destiny that I ended up in sales and supply in the shipping industry in Miami.
WHAT KIND OF STUDENT WERE YOU?
I was an environmental science major at the State University of New York at Plattsburgh and took an interest in economics and political science. My dream was to combine business with the environment. I was a big believer in solar energy and also had books on refuse-driven energy production. I worked a full summer internship for the Soil Conservation Service of the Department of Agriculture and realized that it was going to be a long road combining these two fields and the government wasn’t where I wanted to start my career.
So I rushed out of school in 1977 and got a job as a bunker broker. I was fortunate to get a really good grounding from a couple of guys who were mavericks but who really knew what they were doing. So that was a great foundation.
I left after five years and started up a bunkering business for the Gokal trading group, which wasn’t sustainable, but I learned a lot about the market, myself, human nature and character. It was a real-life revelation about your ethics, your reputation, your relationships. Those are the things that are golden.
WHEN DID YOU AND PAUL STEBBINS START TRANS-TEC, THE FORERUNNER TO WORLD FUELS?
That was in 1985. I had met Paul the year before, and we decided to start up a new business. It was four guys in a thousand- square-foot room with no windows, a desk, phones and a telex machine. We were young and starting from scratch, but we knew what we were doing and loved it. I mean we never had more fun. Because it was all for one and one for all, a “Knights of the Round Table” type of culture, and we’ve retained some of that to this day.
We grew fast. We set up London in September of 1987 and San Francisco in October of 1987 and then Singapore the next year. So we were now global with coverage in all the time zones. Then we built up four other locations and had eight altogether and by 1995 were the largest independent marine fuel services company in the world. It took us ten years, and we did it all organically.
None. We innovated. We brought in risk management and derivatives. We started embedding financial contracts into physical contracts with forward fixtures, and I’m pretty sure we were the first innovators there. We brought in technical experts and had full- time engineers on staff to help our clients understand fuel-quality issues. I don’t think very many independent companies were doing that back then.
AND THEN YOU SOLD TRANS-TEC TO INTERNATIONAL RECOVERY CORP. AND ESTABLISHED WORLD FUEL SERVICES?
Yes. We wanted to keep on growing but had already outgrown our balance sheet, and I had been tracking this company, International Recovery, for about two years because they were a public company and that was the only way we could get any sort of objective evaluation of our own company. And they were doing in aviation approximately what we were doing in marine. They were a mirror image of us.
The name International Recovery came from how the company started, which was in oil recycling. Then they acquired an aviation business and focused on that. So we packaged ourselves up and sold ourselves to International Recovery.
A year later, the company changed its name to World Fuel Services but kept the original ticker symbol (INT) because most investors were familiar with it and WF and WFS were already taken. Eventually Paul and I took over the management of the company, and we were a great partnership because our skills were complementary. There was no daylight between the two of us and it was definitely sort of a band of brothers that we built up. And he’s still involved with the company as a member of the Board of Directors.
HOW WOULD YOU DESCRIBE WORLD FUEL SERVICES?
We are an energy management, fulfillment, logistics and payment business. We help users manage their procurement of energy. Whether it’s a shipping company, an airline, a fleet of trucks, or a commercial, industrial or governmental entity, we help them use less of it, get the right fuel at the right time at the right place and the right price with the right logistics. We make sure the invoice is correct and manage all the related operational issues. It’s very difficult for them to do it. There are thousands of variables, and we help them navigate through them. We have 5,500 people that are focused just on that, laser-focused on it. It’s an absolute full- time job.
There really isn’t anybody in the market that does what we do. There’s lots of people doing pieces of what we’re doing, but there isn’t anybody that does what we do as broadly in terms of the marketing and geography and breadth of services.
WHO ARE YOUR SUPPLIERS? DO YOU BUY FROM THE MAJOR OIL COMPANIES?
We buy from everybody. We buy from major oil companies, national oil companies, independent refiners, regional refiners, merchant refiners. We buy from suppliers who are buying oil from global traders. We buy in bulk and sell in bulk and retail to end-users.
WHAT DOES THE SLOGAN “BEYOND FUEL” MEAN?
It means two things. First it means all of what I just mentioned in terms of products and services. It’s all the logistical support. It’s the payment. It’s the technical services. It’s the information analysis and the risk management and the billing logistics, the consolidation of all of that. It’s not just pitching prices. It’s a complete energy management solution.
We are basically sort of a supermarket of energy procurement. We’ll procure it in any number of different ways that make sense and we’ll sell it in any number of different ways that make sense and along the way we’ll provide all kinds of ancillary services.
Second is we’ve moved beyond fuel into energy and power and are zeroing in on natural gas and electricity as well as wind and solar because our customers’ energy diet is becoming more diverse. The name World Fuel Services to a certain extent doesn’t really describe correctly what our focus is because we are now in the natural gas, power and payments businesses.
In 2013 we bought a company called U.S. Energy Services, and we did it because our shipping and trucking clients were interested in LNG and other energy sources. It’s becoming more diverse. You’ve got ethanol, bio-diesel, renewable fuels, LNG and CNG. The whole world is changing, and whether or not you believe in global warming or sustainability is irrelevant because the market is going there anyway. You’re either going to be part of it or you’re not.
So we hired experts and put together six different energy management companies and launched the Kinect Energy Group. And that’s just the beginning.
WHAT’S YOUR BIGGEST CHALLENGE RIGHT NOW?
The whole world has changed with low oil and gas prices and the emergence of alternative fuels. Now it’s a new world order with low demand and too much supply and lots of energy choices. We need to adjust to this new environment and once again reinvent ourselves. We need to be a highly efficient operator and become more diverse because our customers are looking for more things and want omni-channel choices.
So we have to be Johnny-on-the-spot on price, value and service and you name it. You have to be where they want you to be. They want sustainability reporting and different products and different ways of fulfillment. And so we have to do all of that and at the same time be able to deliver predictable quarterly results to keep our shareholders happy. That’s not easy to do when you’re delivering something that has a longer time horizon and your investors are focused on quarterly and annual results.
HOW WOULD YOU DESCRIBE YOUR MANAGEMENT STYLE?
I’m pretty engaged. My primary interest is the management process itself. I try to make myself totally irrelevant and create the right routines and the right rhythm and culture for an organization so that we have a group of individuals who are really collabo- rating and working at a high level of achievement and professionalism. For me, the main thing I want to do is get this company on the next plane of operating.
There’s a concept called “cooperative antagonism,” and it’s something I picked up years ago and it’s stuck with me. It means everyone pushing each other to seek higher ground and do better. Everyone challenging each other with a high level of collaboration. That’s what I’m trying to achieve.
IS THERE A COMPANY CULTURE?
Oh yes. Part of it is what I just described, a kind of cooperative antagonism. The other part is we’re a melting pot. We’re an immigrant company. We’ve acquired lots of different companies over the years and lots of people coming from lots of places and different cultures. It’s the coolest thing, and one of the things I really enjoy is getting to know people from all over the world. It gives you a great global perspective.
We’re not just Korean or Japanese or Chinese or Greek or Norwegian. We’re basically part of this big global family, and it reminds me in some ways of my extended family back home in Brooklyn. It’s like a proxy for that.
WHAT DO YOU LIKE TO DO IN YOUR SPARE TIME?
I enjoy riding my three motorcycles and taking epic tours out west with a group of friends. We’ll ride 500 miles in a day and I tell you this country is gorgeous. Just three or four guys and we just ride all day – grab a quick bite along the way and then eat and have a drink at the end of the day and go to bed and do it all over again the next day.
And I love being with friends and family and having a party with good food and music and dancing. For me there’s nothing better than hanging out with people you love.