It’s referred to by come as “the gateway to both Americas” and for many alumni in and around Miami, the city is indeed “the place to be if you want to do business in Latin America.” Miami’s proximity to Latin American cities, its convenience, its bi- and tri-lingual population, and the entrepreneurial opportunities it offers for those who can navigate the changing global markets are noted by alumni in this article. In addition, tourism has rebounded and a new performing arts center is under construction. The city is on a roll. Miami was also the meeting place for the Wharton Family Business Program’s “Next Generation” seminar in December, which focused on leadership training for the successor generation in Latin-American family-owned corporations. For those of you who want to check out Miami for yourselves, or happen to be visiting one of the 350 alumni in the Miami area, we include a list of recommended restaurants and hotels.
Strategically speaking, Carlos M. de la Cruz has the ability to look into the future and determine how the forces of competition will shape his business and career.
For example, in the early 1980s as a banker in Miami, de la Cruz looked around him and realized that however much he loved the city, “it was not a headquarters town for large bank holding companies. To stay in banking would have meant moving, most likely to Charlotte or New York City.
“Also, I didn’t see that the industry would permit a small bank to survive. When I got into banking 30 years ago, there were about 15,000 banks in the U.S. How many are there now? Local banks had a role to play in the old economy. Since then, Eurodollars, the globalization of the economy, the lowering of tariff barriers and the interchange of data have altered the whole financial picture.”
In 1984, de la Cruz saw an opportunity to change careers and still use his expertise in sales and finance. He bought Eagle Brands, Inc., the Anheuser-Busch beer wholesale distributorship for Dade County. Two years later he acquired the adjoining distributorship [from Michael Cameron, WG’76], more than doubling the company’s size. Today Eagle Brands has sales of $100 million. In addition, de la Cruz has three car dealerships — Miami Honda, Central Hyundai and Sunshine Ford — with combined sales of approximately $200 million. And last month he purchased Coca-Cola’s Puerto Rican bottling operations.
A strategic issue that every company should always consider, de la Cruz notes, is “what kind of value your service will have in the future from the point of view of the economy. For example, as retailers get larger and the Walmarts of this world start selling more and more of your products, does that alter the role of the wholesaler vis a vis the market?”
While de la Cruz is well-known in the Miami business community, he is probably equally well-known among the city’s civic organizations, many of which have benefited from his philanthropy. Although de la Cruz recently cut back on his volunteer activities — choosing to focus primarily on the United Way of Dade County and the University of Miami where he earned a law degree in 1968 — he has been involved over the years with Mercy Hospital, the Greater Miami Visitors and Convention Bureau, Miami Partners for Progress, Georgetown University and Florida International University (serving there as founding co-chairman of the Black Educational Scholarship Trust), among others.
Civic responsibility is part of a family tradition. In Havana, Cuba, where de la Cruz and his wife Rosa were born, the de la Cruz family founded La Liga Contra el Cancer, Cuba’s largest charity, in 1926. “My grandmother was president of the volunteer organization for years and I remember visiting it as a child. Basically I have always thought that if you have the ability and time to get involved, you should. It was always expected of me.”
After graduating from Phillips Academy, Andover, in 1959 and Wharton, de la Cruz worked for Citibank in New York, then moved to Spain and ran a mutual fund for the Rockefeller family. In 1970 he joined a merchant bank company and headed its portfolio management department. He moved back to the U.S. in 1975 and continued his career in banking. From 1982 to 1984 he was president of the Spanish-owned Miami National Bank.
De la Cruz and his wife have five children and six grandchildren and live in Key Biscayne. Throughout their home is an extensive contemporary Latin American art collection which, de la Cruz says, has been tended to primarily by his wife. “Her agenda dovetails with mine in the sense that we only collect works by artists of Latin American origin,” says de la Cruz. “We are trying to give them access to museum shows and help them be seen and considered. Rosa and I work closely with Patrick Murphy, director of the Institute for Contemporary Art [at Penn], and he has shown several of the artists in our collection.”
If you want to start your own company, says Jose Antonio Baltodano, work for one or two years for another company so that you learn the systems, and don’t try to save money on people: Hire the best available.
Baltodano, who started Mercon, the second largest coffee importer in the U.S. with sales today of about $280 million, followed half his advice. The quality of Mercon’s 35-person workforce is “better than average,” Baltodano notes, adding that he makes a point of compensating employees well and working hard to create an entrepreneurial environment in his 14-year-old firm. As for the other suggestion, “the first four years were difficult. I worked very long hours developing new systems — control systems, accounting systems, and so forth. I think it is probably better to learn existing systems and improve them so that you don’t have to start out designing everything on your own.”
But that was back in the ‘80s. Today, Mercon imports coffee from all parts of the world, including the Far East, Vietnam, Indonesia, Thailand, Africa and all Latin American-producing countries, and sells it to roasters in the U.S., Canada and Japan. Its 11 percent market share is second only to Cargill’s. Company headquarters and traders are in New York, while Baltodano operates out of the company’s management office in Miami.
Baltodano was born in Managua, Nicaragua, but left to come to Wharton for two reasons: The reputation of the undergraduate program and his family connections to Penn. His father and two brothers went to Wharton and his grandfather went to Penn’s medical school in the late 1800s. In 1973, Baltodano returned to Nicaragua and worked for the family cotton and coffee business until most of their property was confiscated by the Sandinistas. “Business conditions were such that the best option was to emigrate,” says Baltodano.
He returned to the U.S., graduated from Harvard Business School in 1982 and then started Mercon in New York. The company is private, with 60 percent of the shares owned by the family.
Baltodano and his wife, an architect, live in Coconut Grove and have two daughters, 13 and 9.
“Coffee consumption in the U.S. dropped about seven percent during the last 12 months due to the high prices of coffee,” says Baltodano. “What has gone up has been sales of specialty/gourmet brands. Coffee shops have basically increased their share of the U.S. market, which means that consumers drink a better coffee today than they used to drink five years ago.”
Being successful, Jaime Alvarez has found out, means that you have to work more, not less. At least that’s been his experience as director of A&M International, a global cargo/transportation company started in 1992 by Alvarez and a friend from high school days.
Today, A&M has 18 employees and $7 million in sales. It ships vehicles, containers, heavy equipment, whole industrial and asphalt plants and other loads from sellers in the United States to buyers throughout South America. Among A&M’s biggest clients are IBM, Hewlett-Packard and Caterpillar.
“We’re getting into the major leagues,” says Alvarez. “It used to be that we competed with small companies, but now it’s the bigger companies, who are very professional and have years of experience and good reputations. We have to make sure our service is better than theirs, which is a very big challenge. But I think we are succeeding little by little.”
Alvarez was born in Lima and earned a degree in industrial engineering from the University of Lima. After graduating from Wharton he returned home and worked first for Goodyear Co. and then for an insurance brokerage. He subsequently spent five years as finance manager at Pan Americana, the largest television network in Peru.
While still at Pan Americana, he helped his friend and now partner start up A&M International. In 1993 it became a fulltime job. Alvarez, who lives in Miami Beach, works about 12 hours a day, and travels about 50 percent of the time to visit clients.
“We first started in Peru, then expanded to Ecuador, then Chile, Argentina, Brazil and Bolivia, and now we are moving into Colombia and Venezuela. There is the potential for the whole South American market.”
As a member of Ryder System’s law department, one of Yasmine Zyne’s areas of expertise is employment law. She reviews the company’s human resource policies, monitors employee legal issues, researches changes in employment law and does what she can to ensure that “employees like working here,” says Zyne.
If her own work history serves as an example, she must be doing something right. Zyne first joined the Miami headquarters of Ryder— a $4.7 billion transportation and business services company with 43,000 employees scattered around the U.S., Canada, Western Europe, Mexico and recently, South America—as a summer employee during high school in Coral Gables. After graduating from Wharton, she went to Georgetown Law School, where she worked summers as a law clerk for Ryder. In 1980, she was hired fulltime in the general counsel’s office.
In addition to employment law, Zyne, who is one of five assistant general counsels in a 21-lawyer department, supervises the environmental lawyers to ensure compliance with environmental laws and to negotiate contracts with environmental vendors. She also oversees lawyers involved in the purchase, sale and leasing of real estate.
Ryder System, says Zyne, is considered both an innovative and civic-minded employer. It recently built a daycare center that offers subsidized care and preferential placement to Ryder employees, and a year ago contributed money to establish the Ryder Trauma Center at Jackson Memorial Hospital. For her part, Zyne recently served on the board of directors of the Young Leaders Group of the American Red Cross. She and her husband and their two daughters, ages 8 and 10, live in Boca Raton, 55 miles north of Miami.
“As a city, Miami has a lot to offer,” says Zyne. “A new performing arts center is being built that will bring a lot of new talent. And tourism is starting to rebound.”
Bernardo Loredo’s life is an interesting mix of portfolio management and Cuban sandwiches.
He has spent the last two years in Miami managing high net worth individuals for First Capital Advisors, a minority-owned investment boutique whose main business is merchant banking. The majority of the firm’s members are Hispanic or African-American.
At the same time, he and a partner, Rinaldo Cartaya, WG’79, opened their first Cuban sandwich restaurant—Bocatidos—a year ago in Coral Gables, and a second one in November.
“It’s a brand new fast food concept,” says Loredo, noting that Cubans have a reputation for making the best sandwiches in Latin America. Bocatidos offers a varied menu, but its main attraction is a ham, swiss cheese, pickles and pork sandwich that has been popular enough with consumers to allow the Coral Gables restaurant to break even within six months. “The idea is to go public, but we need to open six restaurants and raise more money before we can consider this,” says Loredo, who already has the backing of one major investor and several smaller ones.
Loredo was born in Cuba and moved with his family to Philadelphia when he was eight. He graduated from Villanova in 1973, then spent four years at Ernst & Young before entering Wharton. In 1979 he worked at Booz Allen & Hamilton for one year, then at Citibank for five years, where he was an investment advisor to wealthy Latin American clients, primarily from Mexico.
He moved from Citibank to become president of Ladenburg Thalmann & Co. and start their asset management business. After four years he left to join First Capital Advisors. Loredo is married, has a three-year-old son, and lives in Key Biscayne. “Miami is the perfect place for me at this juncture in my life and career,” says Loredo. “All the Latin American countries are pursuing free market policies. It started in Chile and Mexico and is now moving to Argentina. At some point Brazil will get its act together too. Eventually these markets will be integrated with the American market, which for me means being exposed to a lot more entrepreneurial opportunities.”
Although he has been out of Wharton less than four years, Kevin May already feels like he has experienced a major career shift, or as he puts it, a “major detour” from where he started.
In 1992 he joined McKinsey & Co. in Caracas, where he worked on a Latin American entry strategy for a U.S. consumer goods company, domestic and international growth strategies for a Colombian apparel producer, and turnaround strategies for a Venezuelan poultry producer and plastics manufacturer, among other projects.
Two years later he moved to the private client services area of Goldman Sachs, where he spent seven months in their training program in New York and London before settling down in Miami last March. May, who speaks Spanish and Portuguese, manages portfolios for wealthy individuals throughout Latin America, primarily in Venezeula, Peru and Brazil.
It’s significantly different from what he was doing at McKinsey. “Both McKinsey and Goldman Sachs are very relationship-driven, but here it is much more portfolio management-oriented rather than project-oriented. I really enjoy being in the markets day in and day out. I am managing investments as opposed to helping organizations …
“In a way, I am in business for myself in that I have to build my own portfolio of clients. I have to be a self-starter every single day, although I also work with a team in Miami and have contact with people in New York and London and throughout the rest of the firm.”
May, whose father was an Air Force pilot, was born in Sacramento, graduated from high school in Rogers, Ark., and went to Washington University in St. Louis, where he met his wife who is Venezuelan. They live in Coral Gables. “Miami is a great city,” he says. “It is the port of entry to Latin America for the U.S. and vice versa.”
“If you are going to do business in Latin America, Miami is the place to be,” says Ted Miller, senior vice president/manager for Atlantic Security Bank. “The staff one can assemble here is bi- or tri-lingual, and they are familiar with the markets. I can be at the airport in 20 minutes on board a non-stop flight to any major city in Latin America. It’s enormously convenient.”
Miller should know, since he travels constantly around the U.S., Latin America and Europe in his position as head of lending for Atlantic Security Bank, which he describes as a “very profitable, small merchant trade finance bank” with about $650 million in assets and net worth of $250 million. The bank, whose president is Carlos Munoz, WG’74, is owned by a Bermuda holding corporation called Credicorp Ltd., which also owns the largest private bank and largest private insurance company in Peru. The bank, Banco de Credito Del Peru, is run by Raimundo Morales, WG’70.
“Also, one of Atlantic’s directors, Fernando Montero, WG’69, is a Wharton graduate,” adds Miller. “Credicorp has one of the largest contingents of Wharton graduates in Latin America, eight to ten at any one time, maybe more. There are five in Atlantic Security alone.”
As head of lending for the bank, Miller is responsible for trade transactions that have their origin or destination in Latin America. “For example, we have financed shipments of wheat from Argentina to Belgium, the importation of hops from Australia to Colombia and phone systems from Canada to Peru. We are generally short-term lenders,” says Miller, who speaks Spanish, Portuguese and understands French.
Miller was born in Syracuse, N.Y., grew up in Whittier, Calif., and attended the University of Southern California. He flew in the Air Force for six years, serving in both Vietnam and then in Panama, where he met his wife. They have two children, a son, 13, and a daughter, 12, and live in South Coral Gables.
After Wharton, Miller worked for United California Bank first in Los Angeles and then in Rio de Janeiro. In 1978 he moved to Panama as a credit manager for First National Bank of Boston. In 1981 he joined Groupo Harari, managing their real estate properties in Panama and the U.S. until 1987, when he joined Banco Disa as acting general manager. He moved to Atlantic Security in 1990.
When Oscar Ramirez and his father were looking to start a new company, they contacted friends, studied the market, and decided on Bolivar Trading. That was in 1986, and today, the $6 million Miami-based company sells petroleum equipment, including tanks, underground pipe, leak detection systems, lube equipment, carwashes and gasoline stations, to major oil companies— Shell, Texaco and Exxon, among others —throughout Central America, the Caribbean and South America.
The company has 10 employees in Miami and another 30 employees in seven offices in Central America.
Ramirez was born and raised in Nicaragua and educated in the U.S. at Georgia Tech and Wharton. In 1976 he went to work for his father’s bank in Panama, and seven years later became vice president of another family business, Colaco International, a debt collection company. Today, in addition to his responsibilities as president of Bolivar Trading, he is president of both Colaco and Bolivar International, a holding company in Panama.
His wife, whom he met at Georgia Tech, is American. They and their two children, ages 17 and 18, live in Fort Lauderdale.
His business, Ramirez says, “is changing all the time. There are always new technologies being implemented, especially now that gas stations are being built that are environmentally safe. So every year, the equipment is constantly being upgraded.
“The other challenge is finding good people, primarily engineers, who have contacts in different countries and know how to use and install the new technology.”