Harvey's Way

By staff April 1, 2003

Last October, Harvey Vengroff was the keynote speaker at a Sarasota Chamber of Commerce Committee of Economic Development breakfast. The event, packed with men and women in business suits, was held at Michael's on East. Vengroff ambled in wearing his trademark corporate uniform-a T-shirt and shorts.

"I saw him walking in the back door wearing cutoffs and sailing shoes and told someone next to me, 'Maybe we should tell that man he's in the wrong place,'" remembers Peggy Barney, who had just been promoted to business development director of the Chamber's Committee for Economic Development. "Then they told me, 'That's our speaker.'"

Barney wasn't the only one who looked askance at the casually dressed Vengroff. Many in the audience seemed puzzled as he walked to the podium. They sat up, however, when Vengroff, fit and tan at 61, began to talk about his company, Vengroff, Williams and Associates (VWA) and the unconventional style that has propelled it into a billion-dollar business.

Vengroff started VWA in 1963 in California when he was selling janitorial supplies and couldn't get people who owed him money to pay up. He hired a collection agency to no avail. So he decided to take matters into his own hands. He walked his Great Dane in through the front door of companies that owed him money-and usually walked back out with a check. A light bulb went off in his head. "Hmmm, I could make a living doing this," Vengroff remembers thinking.

He was right. Today, VWA is the world's largest commercial collections agency, handling $32 billion in volume a year. It also handles all sorts of billing needs-anything to do with accounts receivable management. Its client roster is a Who's Who list of major companies, including Microsoft, IBM, Sun Microsystems, Cisco and the American Stock Exchange. The company employs about 1,100 people in offices in Florida, California, New York, Singapore, Amsterdam and Dublin and brings in revenues of more than $3 billion.

Sarasota is the headquarters of Vengroff's Florida division. Vengroff didn't plan on starting a company when he retired here 13 years ago. The initial idea was to relax and sail on his 54-foot ketch with his wife Carol and son Travis, now 16. And, in fact, they did do some sailing, spending a year or so cruising to different ports and home-schooling their son on board, But then, like many restless captains of industry, Vengroff just couldn't sit still. He ended up starting a division of VWA in a cramped office on Longboat Key with about 10 people, a number that has grown to 325 in the last 10 years.

And he's making his mark on Sarasota in other ways-although most Sarasotans would never know it, since he's rarely in the news, hates any kind of meeting and avoids social events and the black-tie circuit. (His wife is well known in Sarasota as a cheerful and tireless public school volunteer.) A major real estate investor, he owns two motels and the old Brenton Reef restaurant building on North Tamiami Trail, a number of apartment and commercial buildings, and renovated a building on Central Avenue for the Sarasota School of Arts and Sciences.

And now he's building-for free, since his wife Carol loves the arts and asked him to do her a favor-a new home for Theatre Works on an eight-acre property off Fruitville Road, the former site of Stottlemeyer Lumber. The complex will also include offices for his expanding workforce, film and sound studios, a 450-seat restaurant and a Vegas-style nightclub with a center stage that rises from the floor and can convert into a boxing ring on weekend nights and a church on Sundays.

Crazy, you say? Not for Vengroff, whose office is a cluttered corner booth in the old Brenton Reef. His employees are squeezed in there, too, and Vengroff has paid no attention to remodeling. The place looks virtually the same as when waitresses were serving shrimp cocktails. Some workers actually sit at computer stations behind the bar.

His business associate Rodney Schansman, an Atlanta Internet executive, laughs at the description. "He doesn't spend a lot on overhead," he says, adding, "No one can ever prepare you for Harvey Vengroff."

That's an understatement. After all, how can you categorize a man whose accomplishments range from building three nuclear power plants to selling toilet bowl cleaner to teaching himself to sail by navigating the Caribbean with only a compass and some candy bars as companions?

You know you're not dealing with the usual businessman as soon as he hands you his card. The card lists his cell number along with the phone numbers of the President of the United States, the party chairman of China, the prime minister of England and the secretary-general of the United Nations. A line at the bottom asks, "Guess which one is going to call you back?" Vengroff, obviously.

"It's easy to get in front of him the first time," says SouthTrust vice president Bill Casper, who cold-called him one day and was immediately told to head to Vengroff's boat for a meeting. "If you don't make a good impression, my hunch is it's probably not so easy to get in the second."

"He's a nut," says Schansman, "but if you want to get something done, call Harvey." (His wife Carol says with a laugh that Vengroff is so quick-acting that he's actually left her on the dock when she was late for a sailing trip. You either learn to be on time or figure out that missing the boat isn't that important, she says.)

Vengroff doesn't consider himself a nut. He just thinks people should be "the CEOs of their own lives." He's puzzled that people want to play it safe and by the rules. "It's not hard to be a millionaire," he asserts.

Vengroff grew up in New York with a self-employed dad who started a janitorial business every year just so he could take a two-week vacation in the summer. "He was the most optimistic person I've ever met," he says. They moved constantly. "I never went to the same school twice," he says. Vengroff loves to say he graduated "first in his class.first on the bottom, that is." He was named least likely to succeed.

Undaunted by such predictions or his grades, Vengroff applied to schools such as Harvard and MIT. He says, not without a certain pride, that he was rejected by both. Finally, Long Island University accepted him. Then they asked him to pay the tuition. "I didn't know it cost money," he says. He told the bursar that in lieu of a check for tuition, his cleaning company would clean the campus. Needless to say, the 17-year-old Vengroff had no cleaning company, but he quickly created one, tacking "Help Wanted" flyers up around campus, soliciting students for part-time cleaning work. And it worked. Vengroff says not only did he cover his tuition, he also won the cleaning contracts for LaGuardia Airport and the Chrysler Building in Manhattan and was driving a Jaguar by the time he was 18.

From there, Vengroff jumped from one college to another and one business to another, always landing on his feet. He owned several franchises, including the Jerry Lewis Theaters, by the time he was 20 or 21. He sold insurance. Somewhere along the way, he got a master's in education and taught high school science for a total of two days. He tried law school at San Diego School of Law.

While at law school, he saw an ad about a home study course in computer programming at Penn State. The application cost $26. Unbeknownst to Penn State, Vengroff created something he billed as "a screening test" for applicants and advertised that, for $253, he would administer the two-hour test to potential candidates to see if they qualified. If they passed, Vengroff told applicants, he would send their application in. While the candidates took the exam, Vengroff would work on his law school studies. At some point, Vengroff had rooms full of people taking the exam, each one of them paying him $253 while he did his homework. Eventually, one applicant discovered that the exam served absolutely no function and he could send the application in himself. There was "a big article in the newspaper about me," Vengroff says, which effectively ended the part-time business.

His propensity to make up his own rules has occasionally landed him in trouble with the law, he says, but he's never been convicted-although he has been arrested a couple of times, once for obstruction when he kicked shut an open file drawer and broke the fingers of the police officer who was rifling through his papers. (Vengroff says he warned the officer and asked for a subpoena first.) He still bears a scar on his lip from trying to repossess a car back in those days.

These days, however, Vengroff is less a scrapper than a sharp entrepreneur, according to those who do business with him. His drive to do things his way has made him an innovator. He realized early on that the use of sophisticated, flexible computer technology was key to a business that needed to handle all sorts of companies and billing needs. And he branched off into unknown territory with an attitude of always finding a solution-case in point, winning the bid of electrical contractor for three nuclear power plants when he knew nothing about nuclear power plants and the facilities they needed. Today, the plants are still up and operating in Fort Bragg, Fort Campbell and at the University of Virginia Medical Center.

Schansman says he met Vengroff about four years ago when he was searching for a company that could help him with collections. "My IT [information technology] guy was saying we can't do it. Harvey said, 'Don't worry about it. I'll take care of it.' He did. He got everything done."

Vengroff also hires people who adhere to his philosophy and drive. He's not impressed with Ivy League business school resumes or even high school diplomas. K.C. Cudney, who says her income jumped "five to eight times" since she began working for Vengroff 10 years ago, says the most important part of working for Vengroff is drive. "You have to have goals if you're going to work for him," she says. "He'll ask you, 'Have you written them down? Can I read them? What do you want to be when you grow up?' He's never happy with underachievers."

SouthTrust's Casper, who handles some of Vengroff's real estate transactions, says Vengroff's "a bit like Columbo, dumb as a fox." He says he's watched Vengroff figure out financing in his head. "He never took a pen out of his pocket," according to Casper.

Among his associates, Vengroff has a reputation for generosity. In addition to building a home for the Sarasota School of Arts and Sciences and his plans for the Theatre Works complex, he's provided a free home to the Sarasota Boxing Club and rents space at bargain rates in his North Trail motels to non-profits like Take Stock in Children and the Coalition for Affordable Housing. He's also known for lending a hand to deserving tenants in his rental properties for low-income people. Vengroff says such arrangements are "win-win" situations. Good tenants help clean up an area and make his properties more valuable, he explains. And, as a self-made millionaire, Vengroff is known for giving money to people-rarely charities-he believes in. "I'll help somebody, but there's got to be a plan and then they have to promise to help somebody else if they do make it," he says.

Once again, Vengroff insists he's retiring. He's in the middle of selling VWA to his employees. Cudney, who in her 10 years with the company had risen to division president before stepping down to spend more time at home, says she doesn't believe Vengroff will ever retire. "He needs the stimulation. He likes to stir the pot." She tells this story:

"Once when he, Carol and Travis went somewhere on vacation and we needed his office space, we reorganized. He's always been able to see everyone from where he sat, but I moved him into a corner with no windows. He was so mad when he came back and saw what I had done that he punched a hole in the wall and said, 'There, now I can see.'" And-as you'd expect from a wildly successful entrepreneur who hates wearing socks and runs his company from an old restaurant booth-he never has fixed that hole.

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