That’s not to say they have always got it right. Like many bigger-than-life companies, as their share price rocketed towards $100, hubris inter-mixed with their usual good understanding of how to manage risk. This explained why its share price eventually went below $20 at the depths of the post-Crash plummet of global stock markets.
But it’s now making a comeback as confidence rebuilds worldwide. In fact, Nicholas Moore, the current CEO, once explained at a UNSW conference that Macquarie’s share price closely tracks the Morgan Stanley Capital International (MSCI) World index. This tracks the health of the global stock prices and as it has headed north again, so has Macquarie’s share price.
On why Macquarie has done so well, Moss explained to me a number of years ago that it has employed a small business-like model where small teams think entrepreneurially as opposed to what prevails in most big business banks. But unlike most small businesses they are given two things that all businesses need — capital and expertise support.
I know I doubted Mac Bank, as it was called then, when some years ago it bought Rome airport and on visiting the airport I saw a policeman smoking under a sign which read 'No Smoking'.
I thought at the time: “If these guys make money working with Italians then the sky is the limit.” Of course the share price headed that way until the Crash.
In my years of watching great business builders and great companies, I have learnt not to underestimate those who Malcolm Gladwell, the author of The Tipping Point fame calls “outliers”. In fact, his new book carries that name where he analyses and explains a myriad of success stories. In my opinion, Macquarie has gone long on outliers and their results, in the future, won’t surprise me.
Outside the square
One last point before I sign off. I have now interviewed Edward DeBono, the man who is famous for coining the terms — ‘lateral thinking’ and ‘thinking outside the square’. He says the very competitive in business and all walks of life are lateral thinkers. They assess their opposition and challenges, and they outthink their rivals and their obstacles. Macquarie’s old model might be dead, and that’s still debateable, but I will bet you these smartest guys and girls in the room will come up with a new model in the future.
As Rachel Hunter, the famous model and ex-wife of Rod Stewart once observed about the hair repair qualities of a certain shampoo: “It won’t happen overnight, but it will happen!”
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