Classifieds king finds riches in charity
From Thursday's Globe and Mail
John McCall MacBain worked tirelessly for two decades to become the King of Classifieds, accumulating a net worth of at least $1.1-billion through the acquisition of buy-and-sell magazines around the world.
Now the Canadian entrepreneur is selling his company and looking forward to his next big project: Donating $1-billion to aid projects in sub-Saharan Africa.
When Trader Classified Media NV winds up later this year, Mr. McCall MacBain and his wife, Marcy, plan to use at least 80 per cent of their net worth to set up a charitable foundation tasked with improving the health and education of the world's most needy, especially African children.
"Your goals change as the roof gets higher," Mr. McCall MacBain, 48, said yesterday.
"At the beginning you say, I'd like to put my family through school and get a nice house, but when you've passed that, you say, the marginal utility of money is zero in the end. You can't eat it. You can only sleep in one bed. We don't have that extravagant needs. We're far past the stage where we can live quite comfortably so we want to give the balance away."
The charitable foundation, which will likely be based in Europe, will be one of the largest involving a Canadian. The largest is the Lucie and André Chagnon Foundation, which has $1.3-billion in assets. It was set up in 2001 when the Chagnons sold Vidéotron to Quebecor Inc.
A key step in the divestiture plans came last week.
Montreal-based Yellow Pages Group Co. announced that it was buying Trader's North American assets for $760-million. The deal is expected to close in June. The Dutch-based company, in which Mr. McCall MacBain owns a 70-per-cent stake, is planning to sell the rest of its operations in Europe, China and South America by the fall.
Mr. McCall MacBain has always been an entrepreneur. Growing up in Niagara Falls, Ont., he was hired to work as a swimming instructor for the city. But when he missed the first week of work to participate in a Spanish-language contest, he was told he was out of a job.
So he took matters into his own hands, asking neighbours whether he could use their swimming pools for a for-profit swimming school. He took out a $1-million insurance policy to cover liabilities and had 25 pools running by the end of the summer.
After attending Oxford University as a Rhodes Scholar and the Harvard Business School, Mr. McCall MacBain went to work as director of marketing for Power Financial Corp. in 1984.
Three years later, he left Power and with his then-wife, Louise Blouin MacBain, bought Auto Hebdo, a classified advertising magazine for people buying and selling cars in Quebec. Within a few years, they owned several similar publications in Canada and Europe that helped individuals and companies sell cars, boats and real estate.
Eventually, Mr. McCall MacBain bought out his former wife's stake. Louise Blouin MacBain used her money to start up a fine arts publishing business. She has garnered a much higher profile than her ex-husband, including reports in the British tabloids that she was romantically linked to Britain's Prince Andrew.
Mr. McCall MacBain, meanwhile, kept adding to his empire, focusing on countries such as Russia and China, where he could buy large stakes in classified publications at a discount because of the perceived political risk. At one time, Trader was the largest media company in Russia.
Then last year, the company conducted a strategic review and concluded that the future of the business was no longer in buying new assets, but helping the existing publications to continue to transition into the Internet. Meanwhile, Trader was being circled by various strategic investors eager to snap up pieces of the company at attractive prices.
Selling the company also allowed Mr. McCall MacBain and his wife to realize their goals of making the world a better place. Ms. McCall MacBain recently completed studies at the London School of Economics specializing in health policy and has interned with the World Health Organization.
The couple have also retained an undisclosed but high-profile adviser who will make recommendations on how to spend the money. The proceeds will be transferred into the foundation over several years, he said.
A resident of Geneva and collector of sports cars, Mr. McCall MacBain said he will "spend a few per cent" of his proceeds on himself and his family.
Mr. McCall MacBain, whose late father Allister MacBain was a Liberal member of Parliament, won't rule out returning to Canada to run for the Liberals, but said it's not in his short-term plans.
Mr. McCall MacBain, who has four children aged 15, 16, 18 and 10 months, said he's happy that his children won't feel compelled to take over the family business.
"I don't want them to have the burden of this. They have to make their own way in life as I did. I started from nothing and made my own way in life and it's been succeed or fail and I want them to have that same benefit. They've been told that 80 to 90 per cent of our money is going to children in Africa and they're happy with that," he said.
World's largest givers
Bill & Melinda Gates Found. 28.8
The Wellcome Trust 18.82
The Ford Foundation 10.69
J. Paul Getty Trust 9.64
Robert Wood Johnson Found. 8.98
Lilly Endowment 8.59
Found. Cariplo 8.27
Found. Monte dei Paschi di Siena 7.13
W.K. Kellogg Found. 6.80
William & Flora Hewlett Found. 6.49
*financial years ended 2004
SOURCES: THE FOUNDATION CENTRE, FOUNDATION REPORTS/THE ECONOMIST