Theodore Marshall Swartwood, investment banker (and competitive golfer) died on January 14, 2021. He was an only child born at the end of the depression to working class parents. When he was nine he lost his father in the Second World War. The next several years were a struggle. After public school Marshall enrolled in Harpur College, now SUNY, Binghamton, and joined the Reserve Officers Training Corp which offered financial assistance in exchange for future military service. He also joined the golf team. America was immersed in the Korean War. Upon graduation he was commissioned as a Marine Second Lieutenant. He served two years and entered Cornell University’s Johnson School of Business, supported in part by The GI Bill, where he earned his MBA. It was 1960. After graduation Marshall went to work as a salesman at Blythe & Co, an old line investment banking firm founded in 1914. The firm functioned as an underwriter and distributor of corporate securities. Ford Motor Co (in 1956) was one of the many companies underwritten and taken public by Blythe. It was there that Marshall met his future partner, Roger Faherty. In 1969 they left Blythe and formed Faherty & Swartwood, a small full service brokerage firm specializing in investment banking. The firm moved quickly. Instead of breaking businesses up they built them, arranging financing for dozens companies and ideas. It was capitalism in the service democracy. Ken Langone, a founder of Home Depot, met Marshall around the time of the RIBI deal said of Marshall that, “…he always had very creative suggestions for financing start-ups and small companies. He was a true entrepreneur…and lots of fun on the golf course where he was a much better than average player.“ Golf was an essential part of Marshall’s life. Affluent people played golf…“He always said you get someone’s guaranteed attention for 4 hours or so on a golf course and if you’re good at golf…even better!”, remarked his son Ted. Winners get listened to. Good salesmen were winners. The very essence of American exceptionalism.
By the early 70’s Faherty & Swartwood had attracted the likes of Henry Kravis and Ted Forstmann who worked at the firm and learned the business. After about a year Kravis and Forstmann had a meeting with Marshall to present their idea for starting a leveraged buyout business. It was the opposite of what Marshall was doing. Their idea was creative destruction. Marshall had no interest. He liked to build businesses. Over the years he raised money from small and large investors—billions of dollars in today’s money—arranging financing for dozens of businesses and venturesome ideas, creating employment for thousands. In 1992 he financed Hammer Plastic Recycling that made marine pilings, speed bumps and park benches out of plastic waste. Another: NMR of America which developed the first MRI machine(s). And one more: RIBI Immunochem Research, Inc. which did pioneering work developing chemistry platforms that enhanced the functioning of the immune system. It was while doing the RIBI deal that he had first met Ken Langone. Langone owned a trucking company then. One day while driving Marshall around in one of his eighteen-wheelers, Ken described what would become Home Depot. Marshall listened carefully. After a pause, he shook his head…“No way…there’s a goddamn hardware store on every f’n corner in America…it’ll never work!” What would happen to all those corner stores and the communities that formed around them, Marshall wondered. He was what might be called, a Community Capitalist, an investment banker who operated on a scale proportionate to his personal history. Enhancing a community was good business. Byron Roth, founder, Chairman and CEO of Roth Capital Partners—the largest investment bank in Orange County, California started out with Marshall. “He was always enthusiastic when he heard a good story but had great instincts to balance the risk with the reward in deciding what projects to pursue. He taught me that you had to be able to sell to be successful in our business or as he put it you had to be able to, ‘write a ticket’.” Marshall was a good listener and a good storyteller. He understood it was the story that counted. Two years ago the Nobel Prize winning economist, Robert Shiller, published, Narrative Economics, How Stories go Viral & Drive Major Economic Events. Marshall was way ahead of him. He was a Futurist. Marshall understood that, “you sold the moo, not the cow.”
I got to know Marshall at the end of the 90s. I met him at his penthouse on East 57th Street. Introduced by a mutual acquaintance with the idea that I might get a position with Marshall’s firm. He greeted me warmly and asked me about my background and what kind of Street experience I’d had. I told him I’d been in the business about ten years beginning as a broker at my father’s firm, a small member firm of the New York Stock Exchange. I had eventually become president of the enterprise with a substantial equity stake. Marshall asked me what I had done before joining my father’s firm. I told him that I’d been an artist and how I’d put my life in storage, moving to New York City to get to know my father. Over time things between my father and me turned south. We were unable to arbitrate our differences. Wanting no further contact with my father I threw the equity I had at him and walked out of his life.
Marshall took my story in and asked me what I wanted to do. I said: “Just about anything except writing tickets and doing commission business.” He replied: “Can you come downtown to my office in the morning?” The following day I arrived about an hour after the markets had opened. When he summoned me in, I asked to use the bathroom. He showed me where to find it and said that the sink wasn’t working. When I came back to his office he apologized for the sink. I told him not to worry, that I’d fixed it. He stared at me. After a short pause he pointed to an office next to his and told me that it was now my office.
Marshall Swartwood’s bona fides came natural to him. He was forthright, curious and creative—a good investment banker and a good citizen.