Space-Age Risk Capitalist

LAURANCE ROCKEFELLER

AMONG the celebrated breed of risk capitalists who push out the frontiers of U.S. industry, probably the most daring and successful in the

space age is Laurance Spelman Rockefeller, 49, third (after John D. Ill and Nelson) of the five famed Rockefeller brothers. A blue-eyed, trim (180 Ibs.) six-footer, Laurance Rockefeller hardly needs more money; he is worth about $200 million. But he believes that wealthy men have a social responsibility to risk their riches, invest in inventive young companies. Says he: "I like doing constructive things with my money, rather than just trying to make more." The "constructive thing" was to put $5,000,000 into some two dozen long-shot companies since World War II. In doing so, he also made much more. The value of his stocks in the companies is now $33 million, not counting millions that he sold or gave to charity.

ROCKEFELLER bankrolls blue-sky companies few other capitalists would touch. But he selects his risks carefully. He likes to back young men whose chief assets are ideas ("That is business democracy"), favors brainy companies that may contribute to national defense. A World War II Navy lieutenant commander, he says: "I never demobilized." That was one reason why he bet heavily on aircraft and missile stocks long before they boomed.

Rockefeller got blooded in venture capital by helping round up $3,500,000 to refinance young Eastern Air Lines in 1938. He saved the day for one of his boyhood heroes, President Eddie Rickenbacker, who almost lost control to a bump-Rickenbacker group. Rockefeller took 24,400 shares of Eastern at $9; each is now worth $155 on a pre-split basis, and Rockefeller, with $3,970,000 worth, is Eastern's biggest stockholder. In 1939 an unknown plane designer, J. S. McDonnell, came to him with some paper plans for an advanced type of fighter. Rockefeller put up $10,000 and McDonnell Aircraft Corp. became one of the top plane companies. When Rockefeller's holdings were worth $400,000, he sold out--as he usually does when a company "matures"--to invest in newer companies.

Just after World War II, Navy brass urged Rockefeller to bail out a sputtering rocket pioneer, Reaction Motors. Against his financial aide's advice, Rockefeller put up $500,000. After a tough decade, Reaction grew strong enough to merge with Thiokol Chemical Corp. last year, and Rockefeller got Thiokol stock that is now worth $4,200,000. In 1950, Rockefeller put $202,000 into low-flying Marquardt Aircraft Co., a pioneer in ramjet propulsion; his interest zoomed to $5,200,000 after Marquardt started making ram-jets for the Bomarc missile. But the fastest rise of all was in Itek. Two years ago Rockefeller, a camera bug, invested $279,000 in Itek Corp., which had plans for computer-like photo machines to handle information. He got some Itek shares as low as $2. They soared as high as $315, and Rockefeller's paper profit is now above $10 million.

He has other millions in just-beginning companies--Geophysics Corp., Nuclear Development Corp., etc.--that explore everything from spaceship design to missile defenses. He is also moving into a new investment area that combines his lifelong interests in travel, conservation, development of backward areas. In the Virgin Islands. Rockefeller set up the 600-acre Cancel Bay Plantation resort, donated another 5,000-acre plot that became the U.S.'s 29th national park. In Puerto Rico he built the lavish $9,000,000 Dorado Beach Hotel. While Rockefeller thinks that the Caribbean will become a winter Riviera for the Western world, he expects to lose money there, "for the foreseeable present." Usually, Rockefeller invests for the long pull; he expects investments to take ten years, or even 20, to pay off. Some never do. He has lost heavily on a company to build steel prefab houses (buyers did not buy) and another to tin tuna in Samoa (the fish did not bite).

WHEN Rockefeller turns a profit, he gives most of it to some 200 charities. But he likes to live well. He collects paintings (about 100 by Gainsborough, Bonnard, Vlaminck, etc.), houses (a Fifth Avenue duplex, an estate on the Hudson, a 15-room summer home on Fishers Island--a millionaire's retreat 135 miles from New York), cars (a Bentley, a Cadillac, four others). He loves speed, often commutes in his fast 65-ft. aluminum P-T boat to his office in the RCA Building at Rockefeller Center (of which he is chairman). He enjoys muscle-straining outdoor exercise, chops wood regularly. And he does not worry about his investments. Last week's plunge of space-age stocks left him unconcerned. Says he: "It looks like a long overdue technical correction. The current basic trend of the market is up."

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