Known for its Stanley Cup-winning hockey team, booming development scene and rise of tech companies, Tampa’s current success is largely due to the success of business mogul Jeff Vinik.
Vinik, best known as the owner of the Tampa Bay Lightning and engine behind Water Street Tampa, spoke Wednesday at the Startup of the Year Summit in Tampa, an event that spotlights growing tech startups in the region.
Vinik, who previously managed the Fidelity Magellan Fund, took a significant gamble when he purchased the ice hockey team in 2010, and made other momentous investments in the city.
He has spearheaded more than $3.5 billion in real estate development, and since buying the Tampa Bay Lightning, the team has won the 2020 and 2021 Stanley Cups.
“If you would’ve told me 12 years ago when I was living up in Boston working at a hedge fund equity that I’d be living in Tampa, my family would’ve moved here, I’d own a hockey team that won two Stanley Cups, working on a real estate development worth $4 billion with Bill Gates, sitting inside an innovation hub …” Vinik said in disbelief.
In an interview with Frank Gruber, co-founder of Established and a venture partner at NextGen VP, Vinik gave viewers a look behind the curtain – how he has climbed the corporate ladder to becoming a most prolific investor.
The humble beginnings
“I was 50 [years old] and was looking to reinvent myself. I loved hockey, the business of sports and I did a lot of research and ended up buying the Tampa Bay Lightning. A lot of real estate was available around the arena,” Vinik said, explaining the motive.
“The next thing you know, we own 50-60 acres of real estate and are doing a big development,” he said, stating how he was stunned that downtown waterfront real estate surrounding an arena was available, and priced at 40 to 50 cents on the dollar.
“We didn’t know what to do with it. Originally I said the worst-case is it goes up in value over time. Best case, we figure it out,” Vinik said.
Vinik read the works of renowned urban planner Jeff Speck on how to develop a walkable city.
“He [Speck] was the key to understanding this structure how we wanted Water Street Tampa to look,” Vinik said.
The vision for Water Street Tampa blossomed into a reality when Vinik connected with Cascade Investment, which is controlled by Bill Gates and managed by Michael Larson.
Vinik explained that the former CEO of the Tampa Bay Lightning Tod Leiweke introduced Vinik to Larson.
“It was quite the endorsement that Michael saw the potential in Tampa Bay that I saw and others saw,” Vinik said.
Fast forward to today. Strategic Property Partners (SPP), which was created through the partnership between Vinik and Cascade, has completed the first $2 billion phase on Water Street Tampa.
Water Street Tampa is an urban community that consists of residential buildings, an office tower, hotel developments and many other elements embracing walkability that are meant to create a connected live-work destination in downtown Tampa.
To date, the Water Street Tampa development is Cascade’s largest real estate investment.
Vinik mentioned he has met with Gates several times and that Cascade is going to have its annual meeting in Tampa soon.
Building a team on and beyond the ice
“The hockey team that [the ownership] was for fun, making a difference in the community … it was never about investment,” Vinik said, explaining he enjoys playing the stock market.
When asked about how he taps the right talent to lead his endeavors, “Hard work would be the common denominator, which means spending a lot of time with that person in different conditions,” he said. “With someone senior, I like to go to a restaurant and see how they treat the waiter. If you’re not nice to the waiter, I have a zero-tolerance policy.”
He added how the individual has to tick a lot of boxes such as having high integrity, sharing the same values and plan.
“When I hired Steve Yzerman, (former) general manager of the Lightning when I started, he was clear to me and I agreed, we aren’t winning overnight here, it’s going to take a number of years to do things the right way – draft players, be patient with them in the minor leagues – to develop them, that takes years,” he said.
(According to Vinik, goalie Andrei Andreyevich Vasilevskiy, who was drafted in 2012, took years to enter his prime.)
The new general manager, Julien BriseBois, shares the same philosophies, Vinik said.
Setting a new bar for innovation
His next mission was accelerating the startup community here.
Vinik and Jim O’Connell, president of the Vinik Family Office, spent two years traveling the country, reading books and researching how to create a successful startup hub.
“I love learning new things … I didn’t know anything about commercial real estate. I knew enough, as they say, to be dangerous but I also knew I had to hire experts because I’m not going to be an expert, I’m not going to be the CEO of Embarc Collective,” Vinik said.
The first industry leader the duo connected with was Lakshmi Shenoy, who at the time was the Vice President of Strategy and Business Development at 1871, Chicago’s tech entrepreneurship hub.
Tampa was on a growth track, he pitched, but needed an accelerator for the startups.
Vinik, who is well versed in equity markets, from public offerings to private equity, said through the process of creating a hub and working alongside Shenoy, he learned more about the uphill battle ventures endure.
“What I didn’t realize when I started is venture is not that business. The biggest lesson I learned in the beginning, in the public markets, most stocks go up over time because they are established companies that already got through the rigors and are successful. In the venture world, it’s the opposite,” Vinik said.
“It’s so hard to succeed in a venture – [you have a ] great idea, great people and a little luck probably take that among other things – [but] most ventures, 80 to 90%, fail.”
“It excites me to see a high-quality leader with passion, doing whatever it takes, working around the clock. It’s tough. Hats off to every startup leader and employee out there. What you guys do in our society is so critical,” he said.
In addition to being a business mogul, Vinik is also known for his philanthropy.
“If you are fortunate to have made a lot of money, it’s kind of easy to give back because you still have a lot of money,” he said.
“I think rich people who don’t give back, shame on them. But rich people who do give back, that’s what they should do. I’ve been very fortunate, very lucky, a lot of things have gone the right way and my wife would agree with that completely. Both of our parents instilled philanthropy and giving back. It’s a great thing to do to be able to help organizations that are really helping people.”