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As founder of Capital One Financial Corp., Richard Fairbank revolutionized the credit card industry with teaser rates and zero-balance transfers. But in the beginning he recalls, he had “no money, no experience, and no ideas.”

STANFORD GRADUATE SCHOOL OF BUSINESS —As an MBA student at the Stanford Graduate School of Business, Richard D. Fairbank, MBA ’81, like many of his peers, knew he wanted to start a company. “But I had no money, no experience, and no ideas,” Fairbank recalled.

Several years later inspiration struck in the form of a consulting assignment with a bank. With new technology emerging, and the knowledge that the credit card industry was ripe for change, Fairbank started what is now Capital One Financial Corp. He made a return trip to his alma mater Oct. 16 to speak before a capacity crowd as part of the View from the Top speaker series.

As chairman and chief executive officer of Capital One, Fairbank sits atop a financial services conglomerate that, back in the early 1990s, revolutionized the credit card industry. With innovations such as teaser rates and zero-balance transfers, he helped transform credit cards. Two years ago Cap One moved into retail banking.

The McLean, Va., company is No. 130 on the Fortune 500 list of top corporations and the nation’s 10th-largest bank. It has $106.8 billion in deposits, 45 million customer accounts, and 25,800 employees. Its commercials featuring the tagline “What’s in your wallet?” are immediately recognizable.

Fairbank, 58, offered students some thoughts about business and careers. Among them is that Capital One is a people-centric company, and he’ll go to great lengths to find the best ones.

“I chased our CFO for 10 years,” he said. “I tell people I’m stalking them, and you’re on my short list.” Companies that spend 2% of their time recruiting and 75% of their time managing their recruiting mistakes don’t have the right people, he said.

And, he said he totally believes in the “people model” of a corporation. “It’s not about you; it’s about them,” he said of his leadership style. “So many spend so much energy showing how good you are, but it’s not about you. Worrying about yourself is a bankrupt leadership model.”

He also urged students not to worry about failure. He said he initially asked banking companies such as Wells Fargo and Citibank to invest in Capital One. Although they refused, he gained valuable insight into the industry.

“It’s not failure; it’s feedback,” he said. “Great forward progress comes from setback. Try to harness that energy, and turn it into something that otherwise might not be possible.”

Finally, Fairbank urged students to “dream instead of chasing the next step in a career.” He advised them to spend less time managing their resume and more time investigating opportunities as they come along. After business school he didn’t set out to become a consultant, but a consulting job exposed him to a variety of industries where he learned about structure, process, and management.

“The only way I got to run a very large public company was by not seeking to do it,” he said. “I see so many people losing sight that this is not life or death. Don’t sell your soul but do the best you can.”

Fairbank also received his BA from Stanford, class of 1972. He is part owner of the Washington Capitals hockey team.

— Joyce Routson

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  3. Social Enterprise Pioneer Scofield Created the World Bank for the Poor

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