Bending a silver spoon

This story has been modified to include that Jeffrey Hollender‘s wife Sheila was part of the family team that started Sustain Natural.

On a Saturday morning In late October 2010, Jeffrey Hollender answered the phone in his Charlotte home. The caller was the lawyer for Seventh Generation, the Vermont-based company Hollender started 22 years before and for which he served as CEO. You’ve been fired, the lawyer informed him. We will collect your belongings and ship them to your home. You cannot enter the Burlington office.

The shock hit Hollender before he’d put down the receiver.

Imagine Bill Gates being shown the door at Microsoft, or Jeff Bezos no longer in his Prime. Hollender and a friend createdSeventh Generation in 1988 as an environmentally-conscious domestic products company. The name derived from a Native American philosophy that any decision must be taken with consideration of the impact “on the next seven generations.” The company creed was do no harm to Mother Nature.

Perhaps this seems matter-of-fact now, but in its time, it was borderline radical. Hollender made earth-friendly products cool and turned “sustainability” into a household word. Best of all, at least to shareholders, he’d spun green into gold; the company had reached $150 million in annual revenues.

It wasn’t enough. As self-styled “Chief Inspired Protagonist,” Hollender gave his board of directors agita. For one, he was a board member of Greenpeace, the agents provocateur of environmental activists. Hollender believed this advocacy in perfect harmony with his company’s mission; the board thought him tone deaf. In 2007, a Greenpeace protest at the U.S. State Department resulted in more than 50 arrests, among them Hollender. He admitted the board had said more than once that it was “inappropriate” for a CEO to get arrested.

The firing knocked Hollender for a loop, friends said, but as he learned as a beginning surfer, you fall off, you get back on the board. New Yorker by birth, Vermonter by choice, Hollender is resiliency itself — self-made, self-taught, self-assured — and the knockout punch turned into a glancing blow.

“The episode was just very painful,” said Marc Vahanian, a lifelong friend. “But he hung in there and has found a way to not only reinvent himself, but continue to recommit with that same curiosity.”

Seventh Generation’s history is the main part of a new book Hollender is writing. The remainder is “a bit of a memoir,” he said, possibly the closest he’ll get to an autobiography.

“He’s always had this curiosity about making the world a better place and doing things differently,” Vahanian said, “and not following the beaten path.“

Hollender’s path was gilded — if he chose to follow it. Raised in a luxe apartment on Manhattan’s Park Avenue to an actress mother and an advertising executive father, Hollender often compares his life to the “Mad Men” TV show. There was a beach house in the Hamptons of Long Island, where he learned to surf. Yet the material riches hardly filled the emotional void; his parents were often apart and absent leading to “a not particularly happy home life,” as Hollender put it. His parents divorced when Jeff turned 18.

Restless and rootless, Hollender hopscotched through cameo appearances at four different high schools before graduating from the James Baldwin School in Manhattan, which exists to “provide a haven for students who have previously experienced school as unresponsive to their needs as individuals.”

The charms of higher education also eluded the young Hollender. He packed it in at Hampshire College after three semesters, leaving father Alfred “devastated,” Hollender recalled.

“You’re gonna go for a job interview and they’re gonna ask you where you went to college,” the elder Hollender warned. “And you’re gonna be so embarrassed that you have to say you dropped out.”

Hollender cooly replied. “I never plan on going on a job interview. Because I don’t plan on working for anybody else.”

Hollender pretty much made good on that pledge. He began his entrepreneurial journey by developing the educational Skills Exchange program in Toronto, which failed because Hollender neglected to get a Canadian work permit. The educational space appealed to Hollender, who then created a non-traditional online school called Network for Learning. He sold that company in 1985 to Warner Communications for $2 million. Two years later, Hollender partnered with Vermonter Alan Newman to buy a mail-order catalog that sold eco-friendly products. In 1988, the mail-order business became Seventh Generation.

The new company, based in Burlington, quickly became the archetype for a wave of green companies and the sustainability movement. Hollender had no college degree but a small fortune in his bank account. He was 34 years old.

Yoram Samets, a friend and early investor in Seventh Generation, said Hollender has bested his entrepreneur peers at having an impact “beyond the bottom line.” He’s made mistakes “but we all become better human beings through mistakes.”

Hollender has been redefining the CEO role and expanding corporate responsibility his whole career. There’s the old joke about the rich kid who is born on third base and thinks he’s hit a triple. Hollender is the opposite. He’s taken that silver spoon and bent it to his will.

“Jeff always had a hunger and determination,” Vahanian told me. His friend also showed that a life in business didn’t mean that business was his life. To mark his 50th birthday, Hollender took a gaggle of friends to Barbados. One day he drove to the other side of the island from their hotel to check out a popular surf break called the Soup Bowl. It was challenging, Hollender said, and only three other riders were out besides him. One of them was Kelly Slater, perhaps the best professional surfer of all time. When they hit the beach, Hollender introduced himself and asked Slater to sign his T-shirt. “I still have it,” he laughed.

Hollender and his wife Sheila have three grown children. With his wife and his oldest child, Meika, he started Sustain Natural, which sold eco-conscious condoms for women and other sexual wellness products. The company was not a huge success and later was sold. Hollender makes a point of being present for his kids.

“I didn’t experience the kinds of things that I tried to give my kids, like, unconditional love,” he explained. “My dad’s love was always very conditioned upon how well I was performing.”

Meika, who now works at a startup that sells organic baby formula, described her father as “always very available emotionally [and] non-judgmental. He was very easy to talk to and supportive of us making our own decisions.” When crises erupted at their joint venture, “My dad was a rock.”

Samets, who knows the family well and lives nearby, said Hollender treated his kids “in total opposition to the way he was brought up … if you were in a meeting with Jeff and one of his children called, that meeting stopped so he could talk to them.”

In 2016, after Unilever had bought Seventh Generation, the new owners invited Hollender to rejoin the board of directors.

Hollender has maintained a significant profile in corporate responsibility, social equity and climate and population issues. He co-founded the American Sustainable Business Council, a coalition of business leaders promoting responsible business practices and serves on the board of Vermont Businesses for Social Responsibility.

Much of his time is spent teaching at New York University’s Stern Business School in its Business & Society program. The focus: Instructing students on how to build socially responsible businesses. The indifferent, unfulfilled student has become “an incredibly effective teacher,” said program director Batia Weisenfeld, who cited Hollender’s “willingness to meet with students and offer coaching and support outside the classroom.”

Hollender took time out from his endeavors to speak to The Charlotte News at his home. Here are some excerpts from two conversations. They have been edited for clarity and brevity.

TCN: Did your father ever recognize your success?

JH: Yes, when we sold the audio publishing company to Warner’s. He had invested in that audio publishing company and he got a nice big check. And that was the turning point in my relationship with him. He all of a sudden had to respect the fact that gee, this guy has been more successful than I was at his age and he didn’t go to college.

TCN: Other than your Greenpeace activism, why did you get fired?

JH: We had hired a new CEO to run the business on a day-to-day basis, specifically so I could do more speaking and writing than I was doing and not be as tied up with the day-to-day operations. I concluded after about six months that we hired the wrong person, and I was encouraging the board to let him go and find someone else. They didn’t see eye to eye with me on that. And they were much more comfortable with the new person who was much more traditional business guy than than I was. The second issue was a disagreement over employee ownership. I was trying to get employee ownership up to 30 percent. The board felt that we had already given too much stock to the employees and wanted to cut back their level of ownership.

TCN: Those sound like pretty fundamental differences.

JH: I mistakenly thought of the company as my company. And it wasn’t. It was controlled and owned by the board and the shareholders, and I didn’t have a majority interest. So, I was an employee, like every other employee. Luckily, I had a good employment contract. It was one of the most painful experiences of my life.

TCN: Do you consider yourself a capitalist?

JH: I am a believer in capitalism, although not the way in which we practice capitalism today. In the 1930s and 40s, capitalism was much more broadly beneficial to the public than what we have today, where a small number of people end up with most of the value that’s created. And that’s, you know, that’s not good for the economy. Our comedy economy would be better off if wealth was much more evenly divided than it is today. Because rich people don’t spend most of the money they have. That’s why they’re rich.

Q. As an educator yourself now, do you have any insights into your resistance to schooling?

JH: It just wasn’t as fulfilling as I had hoped it would be. I always thought this idea that you would work like crazy to write a paper that one person would read and grade to be sort of pointless. If you want to work hard on something then more people should read it. Otherwise, what’s the point in writing it?

TCN: What’s your approach to teaching at Stern?

JH: I’m teaching them sort of standard things from a different perspective that I learned about leadership. Things that are less often taught in business school about how to build corporate culture. And it’s an unusual class at the business school because it is directly in opposition to the notion of shareholder economics. I reject the notion that business should be in business to make money solely for its shareholders. We need stakeholder economics rather than shareholder economics, so that business is in business to benefit a broader group of people and especially the employees.

TCN: Are students receptive to your ideas?

JH: The single thing that makes me the most optimistic is a change in attitude and outlook amongst the students that I teach and the development of a commitment to do more than just make as much money as they can possibly make. And to use their career in their business as a way of addressing social and economic problems.

TCN: As an entrepreneur, how well does Vermont support startups?

JH: As a state, we have not created the support for entrepreneurs that we could. And that’s changing. Look at what’s happening at Hula. They have brought a tremendous amount of capital to support startups and they have been a magnet to attract talent to the state. I mean, if you look statistically at the value that has been created by entrepreneurs in Vermont, it’s extraordinary for the size of the state that we have. But that’s really a very recent development over the past five years.

TCN: Have we reached a turning point on the public’s understanding of climate change?

JH: Greenpeace spent years trying to figure out how to motivate people to care about climate change. And what they realized was, something has to happen like the rain this summer, in people’s own environment, that they can’t explain for other reasons for people to start caring. So, you know, they were very successful with hunters and fishermen. When all of a sudden, the fish that you’re so used to catching were no longer in the stream that you were catching them in, because the temperature had changed and they couldn’t survive in that temperature anymore. So, when you have that personal visceral experience with climate change, I think that begins to be a motivator. But sadly, for everything that I know, I don’t believe that we’re anywhere close to doing what we need to do on climate change. We’re going to see much, much worse.