Huizenga, H. Wayne

(1939-)
Huizenga Holdings

Overview

Harry Wayne Huizenga has a reputation in business like that of Midas, the king in Greek mythology who could turn objects into gold. In Huizenga's case, he was able to literally turn trash into money, and has built a number of successful businesses, starting with Waste Management in the 1970s. He followed this up with a struggling video chain called Blockbuster, which he turned into a conglomerate so huge that it is larger than the 99 smaller video chains put together. After selling Blockbuster to entertainment giant Viacom, Huizenga entered the rapidly growing automobile superstore market. Meanwhile he built an empire of sports franchises, including baseball's Florida Marlins; hockey's Florida Panthers; and football's Miami Dolphins, making him the only individual to own three professional sports teams.

Personal Life

Harry Wayne Huizenga was born at the Little Company of Mary Hospital in Evergreen Park, a suburb of Chicago, on December 29, 1939, the first child of Gerrit Harry Huizenga, a cabinetmaker, and Jean (Riddering) Huizenga. Huizenga's parents were strict Dutch Reformed Christians, and did not allow the future owner of Blockbuster Entertainment to read the comic pages of the local newspaper or to attend movies. Young Huizenga had to sneak out of the house whenever he wanted to attend a movie or a dance. In early 1953, the Huizenga family moved to Fort Lauderdale, Florida, where his father hoped to take advantage of the real estate boom occurring in southern Florida by working as a building contractor. In October of 1954, Huizenga's parents divorced and his mother was given custody of young Huizenga and his younger sister, Bonnie, but they reconciled and remarried in 1978.

Huizenga married Joyce VanderWagon, whom he had met while attending high school, on September 10, 1960 in Chicago, Illinois. They have two children, Wayne, Jr. and Scott, but the couple divorced in 1966. Huizenga then married Martha ("Marti") Jean Pike, a former secretary in his office, on April 17, 1972, and adopted her two children from a previous marriage, Pamela and Raymond. Huizenga is a member of the Republican political party and lives in south Florida. He enjoys golf and collecting antique cars, and is also involved in a number of charitable activities, including Easter Seals and the Juvenile Diabetes Foundation.

Huizenga's many awards include the Entrepreneur of the Year award for 1989 from the Wharton School at the University of Pennsylvania and the Silver Medallion Brotherhood Award from the Broward Region National Conference of Christians and Jews in 1990. In 1990, he was voted Man of the Year by the Juvenile Diabetes Foundation, and an endowed teaching chair in his name was established at Broward Community College.

Career Details

In 1953 Huizenga graduated from Pine Creek School, a private high school where he had played third base for the baseball team and linebacker and center for the football team. Soon afterward he began to call himself by his middle name, Wayne. After briefly driving bulldozers and three semesters at Calvin College in Grand Rapids, Michigan, in 1957 and 1958, Huizenga joined the Army for a short time. Huizenga then moved back to Florida, where he was given a job by one of his father's friends as a garbage truck driver in Pompano Beach, Florida.

Huizenga's uncles were all part of Huizenga and Sons, a Chicago garbage-hauling business established by Huizenga's grandfather. Huizenga worked for them for a few years between high school and college; then, heeding the advice of his father, who said: "You can't make any real money working for someone else," he decided to start his own garbage collection business.

On February 14, 1962, Huizenga incorporated Southern Sanitation Service and, with $5,000 he had borrowed from his father-in-law, purchased a single used garbage truck and 20 commercial accounts from Wilbur Porter of Porter's Rubbish Service in Broward County, Florida. The 25-year-old Huizenga would collect trash from 2:00 a.m. until 12:00 p.m., and then canvass the neighborhood soliciting new business. Huizenga had started his trash company at a time of rapid growth in southern Florida; using the combination of hard work, aggressiveness, and Florida's new right-to-work laws, he steadily increased his business. Under his stewardship, the small trash company called Southern Sanitation grew rapidly.

By 1968, Huizenga had transformed Southern Sanitation Service into Waste Management, Inc. (now known as WMX Technologies), which became the largest garbage collection company in the world. He accomplished this by merging with three garbage collection businesses in Chicago, including his uncles' business. The company went public in 1971, raising $3 million with its stock offering, and Huizenga as chief executive officer (CEO) built it into a vast enterprise. In 1972, Huizenga bought 90 competing trash collection companies in just nine months. This positioned Waste Management, Inc. as the leading trash collecting business in the world, with revenues in excess of $1 billion a year. Huizenga also negotiated contracts to collect trash in such distant places as Argentina and Saudi Arabia.

By 1983, Huizenga was ready to get out of the leadership role of Waste Management, Inc. He was tired of commuting between the company's headquarters in Oak Brook, Illinois, and his home in Fort Lauderdale, and he no longer wanted to be tied to a desk. In 1984 he resigned, taking with him 3.7 million shares of stock worth approximately $100 million. He retired for only a few weeks before starting on his next venture; he began buying hotels, office buildings, pest control businesses, warehouses, and lawn care services. By the end of 1986, Huizenga and his new company, Huizenga Holdings, had bought more than 100 businesses that generated $100 million in annual income.

In late 1987, Huizenga was persuaded by John J. Melk, an executive at Waste Management, Inc., to look into Blockbuster Video, a Dallas, Texas-based chain of eight video-rental stores and 11 franchises. In 1987, Huizenga and his partners bought a 43 percent interest in the business for about $18 million, and he began to build it at an astonishingly fast rate. Inspired by Ray Kroc of McDonald's and his pioneering franchising concepts, Huizenga set out to make Blockbuster the McDonald's of the video rental world. He would buy up competing video-rental stores in the same market and offer the customers large, well-lit stores offering at least 8,000 video titles to rent. Blockbuster advertised itself as "America's video store" and removed all NC-17 and X-rated titles. It even removed crude language from movie trailers it showed in its stores.

Chronology: H. Wayne Huizenga

1939: Born.

1953: Moved to Fort Lauderdale, Florida.

1962: Created Southern Sanitation Service.

1968: Renamed company Waste Management, Inc.

1972: Waste Management, Inc. became largest trash collecting business.

1984: Resigned from Waste Management, Inc.

1987: Purchased Blockbuster Video.

1991: Granted baseball expansion team Florida Marlins.

1992: Granted hockey expansion team Florida Panthers.

1993: Purchased Spelling Entertainment Group and Republic Pictures Corporation.

1994: Sold shares of Blockbuster Entertainment Corporation.

1994: Became sole owner of NFL's Miami Dolphins and Joe Robbie Stadium.

1997: Announced proposed sale of Florida Marlins.

Huizenga's strategy worked again and, by the end of 1991, Blockbuster had more than 2,000 stores and had surpassed its closest 99 competitors combined in annual revenue from video rentals. Blockbuster also had expanded worldwide, with stores in Canada, Austria, Mexico, Puerto Rico, Chile, Venezuela, Spain, the United Kingdom, Italy, Japan, Guam, Australia, and Japan. By 1994, when Huizenga sold his share of the newly named Blockbuster Entertainment Corporation to Viacom, Inc. (owners of MTV) for $8.4 billion, it had 3,700 stores.

Huizenga's next target was sports, which he pursued as diligently as he had his previous businesses. In 1989, he began purchasing various interests in major league sports, including 15 percent of the National Football League's (NFL) Miami Dolphins and, in 1990, 50 percent of Miami's Joe Robbie Stadium in Dade County, Florida. Four years later he purchased the remaining shares of both the team (for $138 million) and the stadium. In an effort to increase patronage at the stadium, Huizenga spent $10 million to improve the field and construct an adjoining picnic area. In 1991, armed with $25 million that he had raised by selling 10 percent of his Blockbuster stock, Huizenga successfully beat out 10 other cities to gain Major League Baseball's (MLB) newest franchise and the first professional baseball team in Florida history, the Florida Marlins. The Marlins, which eventually carried a price tag of $95 million, played their first game in 1993 at Joe Robbie Stadium and became World Series Champions in 1997. Several months before the championship games, however, on June 27, 1997, Huizenga had announced that he would sell the Marlins and take a $39 million loss, but would not sell them to anyone who would take them away from Miami. Realizing also that, southern Florida was home to millions of transplanted northeasterners and Canadians, Huizenga spent $50 million to win Miami a National Hockey League (NHL) expansion team, the Florida Panhers, in 1992.

In 1994, Huizenga paid $40 million for hundreds of acres between Miami and Fort Lauderdale on which to construct a sports and entertainment complex called Blockbuster Park. The locals christened it "Wayne's World," and many local residents and environmentalists were not in favor of its construction. Even though many saw it as the biggest competitor to the Walt Disney World complex located outside of Orlando, Florida, Huizenga scrapped his plans after the buyout of Blockbuster Entertainment Corporation by Viacom.

In 1993, Huizenga spent $140 million to purchase 54 percent of Spelling Entertainment Group, which holds the rights to such movies as Rambo and its sequels, as well as the Dynasty television program. Later that year, through Blockbuster, Huizenga gained 78 percent ownership of Spelling during its acquisition of Republic Pictures Corporation. He also secured a 49 percent interest in the chain of indoor playgrounds known as Discovery Zone. Huizenga's Republic Industries owns AutoNation USA, the leading auto superstore, and many other automotive-related businesses; its 1997 sales were estimated at more than $3 billion. On May 13, 1997, the Republic board announced that it was moving its stock trading from NASDAQ to the more prestigious New York Stock Exchange. In addition to Republic and his sports interests, Huizenga is also chairman of a rapidly emerging hotel chain, Extended Stay.

Social and Economic Impact

Huizenga has said of his start in the trash-hauling industry, "The garbage business is a real good business to cut your teeth on." Punctuality and maintaining a regular schedule may not be as important in other businesses, "but that garbage has to be picked up every Monday or every Thursday. You've got to be there. So I grew up in a business where there were no excuses." Huizenga has not been inclined to take or to give excuses; his upbringing in the Calvinist faith, which holds that personal success is a sign of divine favor, has made him a hard worker verging on workaholism.

He has always shown more enthusiasm for building a business than for managing it once it was built. In the early days of Waste Management, Inc., Huizenga would collect garbage all night and morning, return home and shower, and then go out to drum up new business. But, once Waste Management became a huge enterprise, he wanted out. After leaving Waste Management, he still could not sit still for long, even though he had planned to retire with his wife Marti to a vacation house in North Carolina. Huizenga had to keep moving, and soon he was involved in Blockbuster; but, after building that business, he quickly got out of it, and moved on to the next challenge, Republic and its automotive superstores.

Whether with Waste Management, Blockbuster, Republic or one of his many sports franchises, Huizenga's strategy has been the same: to build aggressively, chiefly through purchasing existing businesses and bringing them under the corporate imprint. This is particularly evident with Blockbuster, which seemingly overnight swallowed thousands of "mom and pop" video stores across the United States.

Huizenga is a strict adherent to the franchising concepts pioneered by such companies as McDonald's. A result: all Blockbusters look and feel the same, with bright colors, spacious aisles, and attractive displays. These stores were not necessarily as attentive to the needs of their customers as the old corner video stores had been; and dazzled customers did not always realize that they were paying higher rental fees. As Huizenga observed, "This is nothing like the trash business . . . . If someone rents a movie and doesn't like it, they blame Hollywood, not Blockbuster. There are very few problems with customers."

Critics have charged that, in his aggressive buyout strategy, Huizenga provides a formula for rapid growth that tapers off as soon as he quits buying up businesses. Usually this happens just before he gets out of the particular enterprise, as he did with Blockbuster. Whether this charge is true or not, it is clear that, as Huizenga said in an interview with the Miami Herald, "I like being a builder. I don't like being a manager."

Sources of Information

Contact at: Huizenga Holdings
450 E. Las Olas Blvd., Ste. 1500
Fort Lauderdale, FL 33301-2227

Bibliography

Connelly, Mary. "How Republic Became a Believer In Reincarnation." Advertising Age. 7 April 1997.

DeGeorge, Gail. The Making of a Blockbuster: How Wayne Huizenga Built a Sports and Entertainment Empire From Trash, Grit, and Videotape. New York: John Wiley, 1996.

Kerwin, Kathleen, et al. "Hurricane Huizenga." Business Week, 24 February 1997.

Picker, Ida. "Wayne Huizenga, Conglomerateur." Institutional Investor, April 1997.

Taylor, Alex III. "Car Wars: Wayne Huizenga vs. Everybody." Fortune, 9 June 1997.

The Wall Street Journal, 14 May 1997.

The Wall Street Journal, 27 June 1997.

Wernie, Bradford. "Huizenga Developing Primer In Selling and Renting Cars." Auto Marketing, 7 April 1997.

Who's Who In America 1997. New Providence, NJ: Marquis, 1996.