To really understand Dan Gilbert, the billionaire owner of Quicken Loans, the nation’s second-largest mortgage lender, it helps to know a little bit about his pumpkin-carving.At least that’s what he tells 1,000 of his newest hires to kick off his latest day-long orientation, which he hosts every six weeks or so.
Gilbert had never given much thought to his Jack-O’-Lantern style, he explains while pacing a balloon-rimmed stage in Downtown Detroit. Then, on his annual pilgrimage to a pumpkin patch with his wife and five children, a stranger offered advice that shook him to the core: “Carve your pumpkin from the bottom.”
The idea had never occurred to Gilbert, who, at 52, has amassed an empire worth $4.2 billion, including the NBA’s Cleveland Cavaliers, casinos in four US cities, 110 other loosely linked small companies—and bankrolling the revival of Detroit, the poster city for all that’s gone wrong in urban America. But once he thought about it, he realised slicing off the bottom of the pumpkin had enormous advantages: It’s easier to get stuff out, you can carry it by the handle, and it’s simpler to light because you just place the carved pumpkin over a candle.
“That really messed me up,” says Gilbert, a short (5’6”), solidly built force in dark slacks and a grey sports coat. “I was always trying to get people to fix things that are wrong. Now it was ‘How do I make things that are going good go better?’” That, in a nutshell, is No 5 on Gilbert’s list of 19 company rules, or “Isms”: “Obsessed with finding a better way.”
And that, pretty much, explains why he’s turned his not-insubstantial carving skills on an entire city. As you’ve likely heard, over the past four years, Gilbert has become one of Detroit’s single-largest commercial landowners, renovating the city with the energy and impact of a modern-day Robert Moses, albeit bankrolled with his own money. He’s purchased and updated more than 60 properties downtown, at a total cost of $1.3 billion. He moved his own employees into many of them—12,000 in all, including 6,500 new hires— and cajoled other companies such as Chrysler, Microsoft and Twitter to follow. He recruited 140 tenants, though most are tiny startups and other entrepreneurs his venture firm helped finance. Some 40 percent of his tenants are his own companies, including Quicken Loans, Title Source and Rock Gaming, which owns Detroit’s Greektown Casino. “He’s dramatically sped up the redevelopment of downtown,” says Mayor Mike Duggan. Adds Governor Rick Snyder: “Dan has a track record as a successful entrepreneur and innovator, and he’s doing it again in Detroit.”
But while Gilbert has attracted a fair amount of attention for his efforts, the most brilliant—and risky— part of the story is far less known. Yes, he’s saving Detroit because he loves the city, and yes, he sees an unprecedented opportunity to snap up real estate on the cheap (he is in the mortgage business, after all). But more than anything else, Dan Gilbert is saving Detroit to help his business.
If you think luring professional basketball player LeBron James back to Cleveland from Miami, which Gilbert did earlier this year, was an impressive piece of corporate headhunting, it is nothing compared with the HR challenge he faces every day. His empire rests on luring the kind of young, educated, technologically savvy employees that every employer in the nation craves. To get them, he must compete with the golden glow of places like Palo Alto and Manhattan. His genius is to see Detroit—the most dilapidated, forlorn urban environment in North America—not as a hindrance but rather as an opportunity to build the kind of place that Millennial workers crave: Authentic, inspiring, edgy and cheap.
And it’s working. “We turned down 21,000 kids who raised their hands and said, ‘I want to work in Downtown Detroit’,” says Gilbert, who got 22,000 résumés for 1,300 internships this summer. “They were from everywhere. Of all the metrics you’re looking at, that’s the one that makes me the most optimistic.”
Detroit has a long history of staking its future on the grandiose visions of wealthy would-be saviours. In the early 1970s, Henry Ford II aimed to revive the city’s economy with an enormous riverfront office complex billed as a city within a city. Even its name—the Detroit Renaissance Center—promised a new era. Instead, it became a fortress that did little to benefit the rest of downtown. In the late 1980s, Little Caesars co-founders Mike and Marian Ilitch bought and restored the historic Fox Theatre and moved their headquarters downtown from the suburbs, hoping to spur redevelopment. In the late 1990s, they and others built casinos to boost the economy. In the 2000s, both the Ford and Ilitch families built huge new sports stadiums in the centre of town. Compuware founder Peter Karmanos was another hero of the moment, moving his company from the suburbs to a neglected section of downtown, where he built the midrise office building that now houses Quicken Loans’s headquarters.
That’s where Detroit comes in handy. Earning just $43,000 in the Motor City puts you on the same level for earning power as someone raking in $100,000 in New York and $142,000 in San Francisco, thanks largely to housing costs (the former is some 1,200 percent more expensive, the latter twice that number). Everything—from food to utilities to health care—costs far less in Detroit.
(This story appears in the 28 November, 2014 issue of Forbes India. To visit our Archives, click here.)