How Scott Griffith, ’90, CEO of Zipcar, drove car sharing to the mainstream Opening New Routes The University of Chicago Booth School of Business Summer 2012 Critical Dialogues Dean Sunil Kumar gets the inside track on Zipcar from CEO Scott Griffith, ’90 20 Temptation’s Siren Song Research by Wilhelm Hofmann investigates desire, willpower, and self-control 10 Good Energy Experts discuss fueling the future at the 60th Annual Management Conference 26
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The University of ChicagoBooth School of Business
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Chicago, Illinois 60637
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P A I DPermit No. 4444
Twin Cities, MN
How Scott Griffith, ’90, CEO of Zipcar, drove car sharing to the mainstream
Opening New Routes
CH
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The University of Chicago Booth School of Business Summer 2012
Critical DialoguesDean Sunil Kumar gets the inside track on Zipcar from CEO Scott Griffith, ’90 20
Temptation’s Siren SongResearch by Wilhelm Hofmann investigates desire, willpower, and self-control 10
Good Energy Experts discuss fueling the future at the 60th Annual Management Conference 26
Accessorize with Booth: It all started when David Booth, ’71, suggested that the school
should have a signature tie. The student-led Dean’s Marketing Advisory Committee
offered to help run a design contest, which concluded in May, with a $300 check and
bragging rights for the best overall design going to fi rst-year Full-Time student Joseph Ryu.
Meenakshi Dash, ’08, won $100 for the most original design and Mark Zmijewski,
Leon Carroll Marshall Professor of Accounting, won $100 for scoring the most “likes”
on Facebook. The fi ve-judge panel evaluated the designs for originality, suitability for a
business setting, and ease of manufacturing. To view all 60 design submissions, visit the
Booth Community Facebook page at Facebook.com/ChicagoBoothBusiness.
From left to right: David Booth, Meenakshi
Dash, Joseph Ryu, and dean Sunil Kumar.
Not pictured: Mark Zmijewski.
Chicago Booth Magazine…
Get it now Download the new Chicago Booth app at ChicagoBooth.edu/Boothapp.
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1Summer 2012 Chicago Booth Magazine
F E A T U R E S
Faculty Digest 9
Balancing Desire and Self-Control in Everyday Life A new paper by Wilhelm Hofmann investigates the temptations we struggle with
the most—from indulging in food and sleep to compulsively checking email—and why we respond
to them in the ways that we do.
By Erin O’Neill
Capital Ideas: Consumption Strikes Back 16Research by John Heaton on the correlation between stock returns and expected future
consumption offers a measure of long-run risk that proves fundamentals can drive risk
premiums in the stock market.
By Vanessa Sumo
Cover Critical Dialogues 20Zipcar CEO Scott Griffi th, ’90, tells dean Sunil Kumar about his journey steering an idealistic
Boston-area start-up into an infl uential public company.
Edited by Judith Crown
Management Conference 2012 26Chicago Booth faculty and industry experts considered the future of alternative fuels and the
challenge of reducing greenhouse gas emissions. Breakout sessions discussed corporate tax policy
and how data is best used to understand consumer shopping habits.
“There is a level of engagement, hard work, and enthusiasm among the students that is absolutely infectious.”
—Anne Thomas,
W. Allen Wallis Distinguished Fellow
Chicago Booth attracts the best and brightest students.
The Annual Fund opens doors for many of them,
including students such as Anne Thomas. With your
continued support, there is no limit to what Chicago
Booth can achieve.
ChicagoBooth.edu/possibilities
5Summer 2012 Chicago Booth Magazine
Booth Receives $3.5 Million in Gifts
New Deputy Deans Appointed
Booth TV Studio Debuts
H E A R D A T C H I C A G O B O O T H
Consulting is a wonderful thing to do, but if you want to be the hero, it might not be the right thing for you.
Beth Rooney
Punit Renjen, chairman of the board, Deloitte LLP
Renjen sat down for a “fi reside chat” with dean Sunil Kumar
and 100 Booth students on a visit to Gleacher Center in
January. Renjen discussed how Deloitte has managed to grow
its consulting business by double digits in four of the past fi ve
years, despite a challenging economy. For complete coverage
of the event, go to ChicagoBooth.edu/ontheweb and enter the
keyword “Renjen.”
5
Chicago Booth Magazine Summer 20126
News Update
New Chief Information Officer Leads Information TechnologyKevin Boyd has joined Booth as senior director, information tech-
nology, and chief information offi cer. He has overall technical
responsibility for the school’s campuses in Chicago, London, and
Singapore, and manages a staff of 45 in operations, application
development, and project and service management. He replaced
Ligia Moreno, who retired after more than eight years at Booth.
For the past two years, Boyd was director of the project manage-
ment offi ce at the General Board of Pensions (Wespath) in Glenview, Illinois. Earlier in
his career, he held technical leadership positions at Tribune Company, CNA Financial
Corp., United Airlines, Bank One Corp, and W.W.Grainger, Inc.
Boyd taught e-commerce at Northwestern University as an adjunct faculty
member from 2003 to 2012. He has a master’s degree in communications
systems, strategy, and management from Northwestern and a bachelor’s degree
from Marquette University.—Chicago Booth Staff
H E A R D AT C H I C A G O B O O T H
As one of the world’s leading business schools in finance, Booth has the faculty capabilities, cutting-edge application, and research to thoroughly cover the CIMA curriculum and bring it to life.John Heaton, Joseph L. Gidwitz
Professor of Finance, on Booth’s
accreditation as a registered
education provider for Certifi ed
Investment Management Analyst
(CIMA) certifi cation. Heaton will
serve as faculty director for the new
program. Booth joins Wharton in
offering the educational component
for CIMA certifi cation, which is
designed for advanced investment
advisors and consultants.
Two Deans to Fill Leftwich’s ShoesDean Sunil Kumar named
two deputy deans for faculty
to replace Richard Leftwich,
who has held the post for the
past eight years and plans to
step down on July 31. The
second deputy dean is being
added as a result of the growth in faculty, Kumar said, and in order to accommodate
the expected future increase in demand.
Steven Davis, William H. Abbott Professor of International Business and Econom-
ics, began sharing responsibilities with Leftwich on April 1. John Heaton, Joseph L.
Gidwitz Professor of Finance, will succeed Leftwich on August 1.
Leftwich, Fuji Bank and Heller Professor of Accounting and Finance, joined Booth
in 1979 and will continue to serve as a member of the faculty. Under his leadership as
deputy dean, the number of tenure-track faculty grew from 113 to 130, with 12 new
hires for the 2012–13 school year. Overall, the number of teaching faculty grew from
169 to 197 during his tenure.
Davis, who joined the Booth faculty in 1985, is an applied economist with
research publications on employment and wage behavior, worker mobility, job loss,
and other topics. He is the former editor of the American Economic Journal: Macro-
economics, a research associate with the National Bureau of Economic Research, an
economic advisor to the US Congressional Budget Offi ce, and a visiting scholar at
the Federal Reserve Bank of Chicago.
Heaton studies asset pricing, portfolio allocation, and time-series economics. His
research in these areas has earned him numerous fellowships, including an Alfred P.
Sloan Research Fellowship, and a National Science Foundation Fellowship. Before join-
ing Booth in 2000, he was the Nathan S. and Mary P. Sharp Distinguished Professor of
Finance at the Northwestern University Kellogg School of Management. He is a former
editor of the Review of Financial Studies.—Chicago Booth Staff
A P P O I N T M E N T S
Bet
h R
oone
y
Steven Davis
Bet
h R
oone
y
Richard Leftwich
Dan
Dry
John Heaton
Cou
rtes
y of
Kev
in B
oyd
Kevin Boyd
7Summer 2012 Chicago Booth Magazine
P H I L A N T H R O P Y
Gifts Support Entrepreneurship,Energy Research Two contributions to Chicago Booth will enable the school to develop new initiatives
in the fi elds of entrepreneurship and energy. A $2 million gift from Edward L. Kaplan,
’71, will endow the New Venture Challenge (NVC), of which he has been the title
sponsor since its fi rst competition in 1996. A $1.5 million gift to the Energy Policy
Institute at Chicago from the Fuel Freedom Foundation will be used to explore eco-
nomic and policy questions surrounding transportation fuels.
The NVC endowment, once fully funded, will enable the competition to be self-
sustaining for years to come. Hosted by the Polsky Center for Entrepreneurship, the
NVC has helped launch scores of companies, including GrubHub, Inc., Braintree, and
BenchPrep, all based in Chicago. Kaplan is cofounder of Lincolnshire, Illinois–based
Zebra Technologies Corp., a pioneering company in barcode technology that went
public in 1991.
“Ed was an important catalyst for the New Venture Challenge and, more broadly,
for the Polsky Center,” said Steven Kaplan, Neubauer Family Distinguished Service
Professor of Entrepreneurship and Finance and faculty director of the Polsky Center.
“In the mid-1990s, he was one of a few alums who advocated that Booth should
develop a strong entrepreneurship program.”
The NVC’s infl uence has extended to the University of Chicago campus and
beyond. The more-than 75 alumni companies whose founders participated in the
competition have raised more than $242 million in equity capital collectively and have
created more than 1,000 jobs. This year, the NVC received a record 119 applications,
up from 89 entries in 2011.
“It is one of the country’s most successful venues for creating new business
ventures,” said Ellen Rudnick, clinical professor of entrepreneurship and executive
director of the Polsky Center.
“The endowment now being created by the Kaplan Foundation will insure the
long-term viability of the NVC and enable it to expand beyond its current limits,”
Rudnick said. “We are thrilled that Ed’s name will be forever linked to this capstone
program at Booth.”
Another fl ourishing discipline at Booth gained recognition with a gift from
the California-based Fuel Freedom Foundation to the Energy Policy Institute at
Chicago (EPIC).
Founded in 2011, EPIC is an interdisciplinary joint enterprise of Chicago Booth
and the Harris School of Public Policy that focuses on economic and social policy
questions related to energy. The gift will help launch the Initiative on the Future of
Transportation Fuels.
“This generous gift will help EPIC conduct the data-driven research that policy
makers and business leaders need to make sound, evidence-based energy policy
decisions,” said Robert Topel, codirector of the center and Isidore Brown and Gladys
J. Brown Distinguished Service Professor in Urban and Labor Economics.—Kate Fratar
To learn more about companies involved with the New Venture Challenge,
visit ChicagoBooth.edu/nvc.
News Update
B Y T H E N U M B E R S
Booth Faculty on the AirIn early March, Booth opened
the Harper Center TV studio.
Professors were soon inter-
viewed on topics ranging from
sports to the European debt
crisis and US monetary policy.
Number of faculty
appearances as
of late May
Number of networks:
Number of professors
interviewed:
John Cochrane
Austan Goolsbee
Randall Kroszner
Tobias Moskowitz
Raghuram Rajan
Luigi Zingales
Chicago Booth Magazine Summer 20128
FOR OVER 50 YEARS,
Find out more at www.crsp.ChicagoBooth.edu.
WE’RE NOT DONE YET.
CRSP HAS EMPOWERED
THE WORLD OF FINANCE.
9Summer 2012 Chicago Booth Magazine 9
IQ and Investing Prowess
Two Sides to Innovation
Why Brand Preferences Vary
Dan Dry
I N T H E H E A D L I N E S
It’s very clear that the outside world is rethinking the India story.Raghuram Rajan, Eric J. Gleacher Distinguished Service Professor of Finance and Charles M. Harper Faculty Fellow
India’s business boosters have been consistent in promoting
the potential of “brand India,” especially at prestigious venues
such as the World Economic Forum in Davos, Switzerland,
where Rajan, who is economic advisor to India’s prime minister,
spoke on the issue. But India’s country-with-great-potential
story is wearing thin among international business and political
leaders, according to Rajan and others, a view that was cited in
a February column in the Hindu Business Line.
To learn more about Rajan’s research, visit
ChicagoBooth.edu/magazine/facultylinks.
Chicago Booth Magazine Summer 201210
On average, participants enacted 42 percent of the media
desires they had actively attempted to resist.
Hofmann credited this fascinating soft spot to societal
norms and our general feelings about the cost-benefi t analysis
of these activities. “Modern life is a welter of assorted desires,
marked by frequent confl ict and resistance—the latter with
uneven success,” Hofmann explained. “With cigarettes and
alcohol, there are more costs—long-term, as well as mon-
etary—and the opportunity [to consume] may not always be
the right one. Desires for media may be comparatively harder
to resist because of their high levels of availability and also
because it feels like it does not ‘cost much’ to engage in these
activities, even though one wants to resist.”
But, as vices go, aren’t work and media-usage relatively
good ones to have? According to Hofmann, it depends on
your overall goals. The study warns of the potential for
media habits to develop into abuse and noted, “Whether
underregulation of media use causes serious problems for
Westerners is an intriguing issue.” So, while compulsively
checking email or spending time on Facebook offers a quick
fi x for boredom and one’s need for connectedness, doing so
comes with its own pitfalls. “Even though giving in to media
desires is certainly less consequential,” Hofmann said, “the
frequent media use may still ‘steal’ a lot of people’s time and
attention away from other things that matter.”—Erin O’Neill
Faculty Digest
t happens to the best of us. We vow to lose 10 pounds.
We swear that this vacation, we won’t check email. But
then, after a few weeks, or days—or even minutes—we
give in to temptation.
But why?
In his recent paper, “What People Desire, Feel Confl icted
About, and Try to Resist in Everyday Life,” published in
Psychological Science, Wilhelm Hofmann, assistant professor
of behavioral science—along with two colleagues—found
that some desires are harder to resist than others.
“Self-regulation is important for both theoretical and
practical reasons,” the authors wrote. “Yet, the majority of
research on self-regulation occurs in the laboratory.” In order
to better understand the interplay among desire, motiva-
tion, and self-control in everyday life, the researchers used
smartphone experience sampling to closely monitor desire
experiences in a sample of 205 adults over the period of a
week. Using this technique, the researchers collected infor-
mation on more than 7,000 desire episodes in people’s daily
lives, and thus were able to directly compare various human
desires in frequency, strength, confl ict, and controllability
with each other.
Not surprisingly, the single most frequently mentioned
desire was that for food. Desires for nonalcoholic drinks, sleep,
media, leisure, and social contact also made it to the top of the
list. In terms of desire strength, the most potent desires were for
sleep, sex, and social contact, among others. Surprisingly, desires
for substances long considered to be highly addictive—such
as tobacco and alcohol—were among the weakest in average
strength. In terms of confl icting desires, participants reported
having the highest levels of confl ict in regard to leisure activities
and sleep, followed by spending, media use, and tobacco.
Yet, despite the strength and frequency of many of their
urges, participants were generally able to exhibit impressive
rates of self-control in resisting those desires that were expe-
rienced as problematic. But when it came to media desires
(such as watching TV, checking emails, or surfi ng Facebook)
and desires for work—their willpower often faltered.
Professor Wilhelm Hofmann investigates the
temptations we struggle with most, and why
we respond to them in the ways that we do.
Balancing Desire and Self-Control in Everyday Life
Not surprisingly, the single
most frequently mentioned
desire was that for food.
11Summer 2012 Chicago Booth Magazine
The subsequent research showed
that high-IQ investors are less subject
to the disposition effect, the tendency
to sell winning investments but hold
on to assets that have dropped in
value. These investors are also “more
aggressive about tax-loss trading,
and more likely to supply liquidity
when stocks experience a one-month
high,” the research found. The study
also found that investors with higher
IQ scores “exhibit superior market
timing, stock-picking skill, and trade
execution.”
“It’s difficult to justify why someone
wouldn’t have invested in the stock
market, knowing what a good deal it
has been,” Linnainmaa wrote. “It’s not
just that it may be expensive to buy
stocks and mutual funds, but people
may not have enough knowledge about
them.”—Erin O’Neill
When Brand Loyalty Is Divided
Why does a Bud-
weiser-guzzling couch
potato suddenly
switch to Heineken
when he’s at a cocktail
party with friends?
That’s just what
Pradeep Chintagunta, Joseph T. and
Bernice S. Lewis Distinguished Service
Professor of Marketing, and his co-
author set out to answer in their paper,
“Investigating Brand Preferences Across
Social Groups and Consumption
Contexts, ” published in Quantitative
Marketing & Economics.
Drinkers choose different brands
depending on what they’re doing (for
example, either bowling or sitting on a
They stated, “insider selling is associ-
ated with litigation risk only when
contemporaneous disclosures are
unusually optimistic.”—Dan Kedmey
IQ and Investing ProwessAre smarter people
instinctively bet-
ter investors? For
decades, economists
have debated the root
of the “participation
puzzle,” in strug-
gling to understand why such a small
percentage of the population takes
advantage of stock investments—which
generally produce a higher rate of
return than traditional savings.
Juhani Linnainmaa, associate profes-
sor of finance, and two colleagues
tackled this question in two papers:
“IQ, Trading Behavior, and Performance,”
published in the May Journal of Finan-
cial Economics; and “IQ and Stock
Market Participation,” published in the
December 2011 issue of the Journal of
Finance. The studies found evidence of
a direct correlation between an inves-
tor’s IQ and decisions to invest in the
stock market.
In the first paper, the researchers
collected two decades–worth of scores
from a mandatory army intelligence
test administered to Finnish men who
are required to enlist for nine months
to a year. They analyzed this data along
with records regarding equity return,
trade, and limit-order book data. They
found that higher IQ scores increased
the likelihood of later stock ownership
by 21 percent, even after being con-
trolled for environmental factors such
as wealth, income, age, and profession.
How Word Choice Can Land a Company in Legal Hot Water When a company
discloses informa-
tion to shareholders,
it should watch its
language. An overly
optimistic tone can
expose it to lawsuits
from angry share-
holders, according
to a new paper by
Jonathan Rogers,
associate professor
of accounting, Sarah
Zechman, assistant
professor of accounting, and a colleague
at Ohio State University.
In their study, “Disclosure Tone
and Shareholder Litigation,” which
was published in the November 2011
issue of the Accounting Review, the
researchers used a dictionary-based
measure of optimism in order to
gauge the tone of company statements.
Sued companies used “measurably
more optimistic” language in their
disclosures as compared to peers who
weren’t sued. “These results indicate
a strong link between disclosure tone
and litigation,” the authors concluded.
Further, said the researchers, the
link between tone and litigation
became even stronger when manag-
ers engaged in insider selling that
contradicted the optimism of their
statements. Therefore, according to
Rogers and Zechman, in order to
mitigate legal risk, managers should
avoid overstating the company’s per-
formance, particularly when selling
off their own shares and assets.
Dan
Dry
Jonathan Rogers
Faculty DigestC
hris
Lak
e
Sarah Zechman
Bet
h R
oone
y
Juhani Linnainmaa
IN THE NEWS AND JOURNALS
Chr
is L
ake
Pradeep Chintagunta
Chicago Booth Magazine Summer 201212
couch) and whom they’re with (alone
or among friends). These shifts in
consumption could provide valuable
information to marketers, but the data
for many of these scenarios tends to
be scarce.
Chintagunta and his coauthor
worked around this scarcity by devel-
oping a more parsimonious model
of context-based consumption. The
model reveals that context plays a
powerful role in brand selection.
Smaller companies could increase
their market share by marketing to
a highly-targeted “context or social
group setting.” (Think the Corona-on-
the-beach ad campaign.) Ultimately,
the study suggests “marketers should”
indeed consider how consumers’ prefer-
ences can vary across social group and
consumption context scenarios when
designing their marketing programs.”
—Erin O’Neill and Dan Kedmey
The Consequences of Innovation
There are two sides
to innovation. The
bright side is that
innovative firms are
able to produce more,
which in turn raises
their output, con-
sumption, and wages. The dark side
is that less nimble competitors can be
forced to slash pay and lay off older
workers, who are less able to adapt to
the innovation of the firms. This dark
side, which is called “displacement
risk,” is the subject of a new study by
Stavros Panageas, assistant professor
of finance, and two colleagues.
In their paper, “Displacement Risk
and Asset Returns,” which is scheduled
to be published in the Journal of Finan-
Finding Combinations That Satisfy
In his paper, “The
Combinatorial
Assignment Prob-
lem: Approximate
Competitive Equi-
librium from Equal
Incomes,” published
in the Journal of Political Economy,
Eric Budish, assistant professor of
economics, tackled the problem of
how to design a market-like resource
allocation system in settings where
there are legal or moral restrictions
against using real money to figure
out who gets what. He devised a
new “Competitive Equilibrium from
Equal Incomes” (CEEI) mechanism
that could be applied, for instance, to
course allocation at educational insti-
tutions: which students get to take
the most popular professors’ courses
at Booth? It also could be applied to
shift allocation at companies: which
employees have to work Thanksgiving
or Christmas this year?
cial Economics, and which won the
Best-Paper Award at the Utah Winter
Finance Conference 2011, the authors
measure the magnitude of displacement
risk by looking at consumption data
across generations. The authors find
that, because “innovation benefits the
young at the expense of the old,” growth
firms—which derive a large part of
their value from future inventions—are
a good hedge against displacement risk,
as opposed to less-innovative “value
firms.” Finally, the authors “identify
innovation shocks through their effect
on the consumption of individual
cohorts and show that inter-generation-
al differences in consumption correlate
with the return differences between
value and growth stocks.”—Dan Kedmey
Faculty DigestD
an D
ry
Stavros Panageas
Dan
Dry
Eric BudishThe dark side is
that less nimble
competitors can be
forced to slash pay
and lay off older
workers, who are
less able to adapt
to the innovation of
the fi rms.
Previously proposed
systems for these
kinds of problems,
from both theory and
practice, have
fairness problems,
incentives problems,
or often both.
13Summer 2012 Chicago Booth Magazine
T The CEEI system works as follows.
First, the participants log their prefer-
ences to a computer program. For
example, taking a particular profes-
sor’s class is worth 100 “utils.” Second,
the program assigns each participant
an equal amount of an artificial cur-
rency—say, 10,000 points, plus a
small random amount extra. Third, a
computer finds a “competitive equi-
librium”—prices such that, when each
participant “purchases” the set of goods
she likes best at these prices, subject to
not spending more than her budget of
artificial currency, the market clears, so
that supply equals demand. The reason
for the random amount of extra budget
in step two is to ensure that competitive
equilibrium prices always exist in step
three. Budish teamed up with computer
scientists at Carnegie Mellon University
to develop a computational procedure
capable of finding these prices.
Budish showed that CEEI is attrac-
tive on three dimensions: efficiency,
fairness, and incentives. Here, effi-
ciency means that welfare-improving
trades aren’t left on the table. Fairness
means that the participants don’t envy
each others’ allocations, or, if they do,
their envy is small: I may envy you
if you get one of the top professors
and I don’t, but you won’t get two of
the top professors while I get neither.
Incentives mean that it is in each
participant’s interest to report prefer-
ences truthfully to the computer in
step one—that is, it is impossible to
“game the system.” Budish argued that
all other previously proposed systems
for these kinds of problems, from
both theory and practice, have fair-
ness problems, incentives problems,
or often both.—Kalliope Dimitrakopoulos
Faculty Digest
Rajan and Weber Appointed to G30
Raghuram Rajan,
Eric J. Gleacher Dis-
tinguished Service
Professor of Finance
and Charles M.
Harper Faculty Fel-
low, and Axel Weber,
visiting professor
of economics, have
been appointed to
the Group of Thirty
(G30), an interna-
tional body that
examines the impact
of financial and economic decisions
in the public and private sectors.
The group also includes Mario
Draghi, president of the European
Central Bank, Mervyn King, governor
of the Bank of England, and other
senior participants from public and
private sectors and academia.
“The effectiveness of the G30
depends fundamentally upon the qual-
ity and stature of the group’s mem-
bers, and our new colleagues bring a
wealth of experience and professional
accomplishment to the group,” said
Dan
Dry
Raghuram Rajan
Cou
rtes
y of
Axe
l W
eber
Axel Weber
“The appointment of
Raghuram Rajan
and Axel Weber to
the G30 is further
recognition of their
stature as leaders in
the fi eld.”
—Sunil Kumar
Jacob Frenkel, chairman of the G30
Board of Trustees. Frenkel is also chair-
man of JPMorgan Chase International.
“The appointment of Raghuram
Rajan and Axel Weber to the G30 is fur-
ther recognition of their stature as lead-
ers in the field,” said dean Sunil Kumar.
“It also shows that Booth’s faculty influ-
ence is growing even stronger in the
public debate over key issues affecting
the world economy.”—Allan Friedman
Cochrane Named Guggenheim Fellow
John Cochrane, AQR
Capital Management
Distinguished Service
Professor of Finance,
has been named a
2012 Guggenheim
Fellow by the John
Simon Guggenheim Memorial Foun-
dation of New York.
He is among 181 scholars, artists,
writers, and scientists who received
the honor this year. The winners were
selected from nearly 3,000 applicants
on the basis of prior achievement and
exceptional promise.
Cochrane’s monetary economics
publications include articles on the
relationship between deficits and
inflation, the effects of monetary
policy, and the fiscal theory of the
price level. The Guggenheim Fellow-
ship was awarded for his further work
on the fiscal theory.
Cochrane has served as an editor of
the Journal of Political Economy and asso-
ciate editor of several journals, including
the Journal of Monetary Economics, the
Journal of Business, and the Journal of
Economic Dynamics and Control. His
recent awards include the TIAA-CREF
Institute Paul A. Samuelson Award for
his book, Asset Pricing, the Chookazian
Dan
Dry
John Cochrane
A W A R D S A N D H O N O R S
Jacob Frenkel, chairman of the G30
(continued on page 15)
Chicago Booth Magazine Summer 201214
BOOTHGEAR
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In the photo, Lauren Polo Patnaude, ’11.
15Summer 2012 Chicago Booth Magazine
American Academy of Arts and Sciences,
one of the nation’s most prestigious
honorary societies and a leading center
for independent policy research.
They are among more than 200 lead-
ers in business, science, the humanities,
the arts, and other fields to be recog-
nized this year. “Election to the acad-
emy is both an honor for extraordinary
accomplishment and a call to serve,”
academy president Leslie Berlowitz
said. “We look forward to drawing on
the knowledge and expertise of these
distinguished men and women to
advance solutions to the pressing policy
challenges of the day.”—Allan Friedman
Gary Becker, University Professor of
Economics and Sociology
Douglas Diamond, Merton H. Miller
Distinguished Service Professor of Finance and
Richard N. Rosett Faculty Fellow
Eugene Fama, Robert R. McCormick
Distinguished Service Professor of Finance
Robert Fogel, Charles R. Walgreen
Distinguished Service Professor of
American Institutions
Reid Hastie, Robert S. Hamada Professor of
Behavioral Science
Kevin Murphy, George J. Stigler Distinguished
Service Professor of Economics
Raghuram Rajan, Eric J. Gleacher
Distinguished Service Professor of Finance and
Charles M. Harper Faculty Fellow
Richard Thaler, Ralph and Dorothy Keller
Distinguished Service Professor of Behavioral
Science and Economics
Robert Vishny, Myron S. Scholes Distinguished
Service Professor of Finance
Bertrand and Zingales elected to American Academy of Arts and Sciences
Marianne Bertrand, Chris P. Dialynas
Professor of Economics and Richard
N. Rosett Faculty Fellow, and Luigi
Zingales, Robert C. McCormack
Professor of Entrepreneurship and
Finance and David G. Booth Faculty
Fellow, have been elected fellows of the
Endowed Risk Management Prize, and
the Faculty Excellence Award for MBA
teaching.—Allan Friedman
Hofmann Wins Early Career Award
Wilhelm Hofmann,
assistant professor of
behavioral science,
received this year’s
2012 Social Cogni-
tion Early Career
Award, which rec-
ognizes contributions to the study of
social cognition by junior scientists. It
was presented to him by the Interna-
tional Social Cognition Network.
Hofmann has received several other
awards in his burgeoning career, includ-
ing the 2009 William Stern Award of
the German Psychological Society, and
the 2010 Distinguished Young Scientist
Award (Heinz-Maier-Leibnitz Award)
of the German Science Foundation.
His work has appeared in numerous
psychological journals, including Psy-
chological Science and the Journal of
Personality and Social Psychology. His
work has also been featured in Scientific
American Mind, Discovery News, the
New York Times, Financial Times, the
Guardian, the Telegraph, and Forbes, as
well as many broadcast outlets includ-
ing ABC, NBC, CBC, and Fox News.
Hofmann also serves on the editorial
boards of Social Psychological and Per-
sonality Science and the European Jour-
nal of Personality.—Kate Ancell
Faculty DigestD
an D
ry
Wilhelm Hofmann
Bet
h R
oone
yMarianne Bertrand
Chr
is L
ake
Luigi Zingales
Among Their PeersBertrand and Zingales join nine other Booth faculty who earlier were elected fellows of
the Academy of Arts and Sciences
(continued from page 15)
Chicago Booth Magazine Summer 201216
JOHN HEATON Joseph L. Gidwitz Professor of Finance
Award Winner
Hoover Institution National Fellow (1993–94)
Sloan Foundation Fellowship (1993–95)
National Science Fellowships (1993–98)
Specializes in
asset pricing, portfolio allocation, and time-
series economics
Teaches
investments, fi nancial instruments, and
topics in empirical fi nance
Previous Education
PhD in economics, University of Chicago
MA in economics, University of
Western Ontario
BA in commerce, University of Windsor
Feature Capital Ideas
17Summer 2012 Chicago Booth Magazine
This article was originally published in the May 2012 issue of Capital Ideas,
a publication highlighting faculty research at Chicago Booth. This issue
featured selected papers on investment management. For more information, visit
ChicagoBooth.edu/CapIdeas.
Mat
thew
Gils
on
By Vanessa Sumo
Fundamental economic variables regain importance in explaining risk premiums in stock markets
Consumption
Strikes Back
When investors think about the risk of investing
in the stock market, one of the things they pay
attention to is how stocks and the underlying
earnings of companies are affected by movements in the
economy. Stocks that closely follow the ups and downs
of business cycles are considered riskier, because these
stocks will typically fall at the fi rst hint of a downturn
and rise faster as the economy recovers. From the
investors’ perspective, then, stocks of companies whose
earnings are most affected by economic conditions
should promise a bigger return.
The high returns observed in the stock market would
therefore suggest that its performance is strongly related
to business cycles. Indeed, many people think that an
economic recession goes hand in hand with a bear market.
However, John Heaton, Joseph L. Gidwitz Professor of
Finance, says this often has not been true in the past.
“There have been a lot of settings where stocks have come
down but the economy has not moved,” says Heaton. Why,
then, would investors demand high risk premiums in the
stock market?
Perhaps equally baffl ing is why value stocks, which are
stocks with low market values relative to the fundamental
factors that determine their price, have had consistently
higher returns than growth stocks, which are stocks
whose earnings are expected to grow rapidly. This
difference in average returns arises even though the
returns on both types of portfolios are about equally
correlated with business cycles. It is unclear from simply
looking at the correlation between the returns of different
portfolios and the state of the economy why investors
would ask for a higher return for holding value stocks.
Chicago Booth Magazine Summer 201218
Feature Capital Ideas
These puzzling observations have overlooked the fact that
investors are concerned not only about the impact of short-
term fl uctuations in business cycles on stock prices, but also
about how an uncertain economic future might affect their
investments, according to a recent paper by Heaton, Lars Peter
Hansen, a professor in the Department of Economics at the
University of Chicago, and Nan Li, a professor at National
University of Singapore, titled “Consumption Strikes Back?
Measuring Long-Run Risk.” In particular, a decline in the
stock market today may refl ect an underlying shock to the
economy that will not dissipate quickly and will have an
impact over a long horizon.
“Maybe what’s really happening is that when the stock market
goes down today, investors think that this is telling them a lot
about the state of the economy in the future,” Heaton says. If
investors perceive that economic conditions will be worse in
the future, then investors will likely ask for a higher return on
stocks today to compensate them for that higher risk.
Measuring Long-Run Risk
Hansen, Heaton, and Li develop a theory that captures long-
run risk, or the risk that arises from the uncertainty about
the long-run growth of the economy. They show also how
to appropriately measure the relationship between current
stock market returns and future economic conditions—a
relationship that leads to differences in required returns.
Under this theory, stocks that have higher predicted required
returns should have lower prices to refl ect the additional
return needed to persuade investors to buy those stocks.
An economic downturn can raise uncertainty about the
pace of future economic growth in several ways. For instance,
a number of people who lose their jobs in a recession will not
fi nd work again and will leave the labor force, permanently
reducing the economy’s productive capacity. Other bad
shocks that investors may see as threats to future economic
growth include a widening government defi cit that raises the
prospect of higher taxes in the future or a recession that makes
politicians feel more protectionist in terms of international
trade. As a result, a recession today can make investors think
hard about the risk that the economy may no longer return to
its long-run growth path.
Hansen, Heaton, and Li use their theory to understand
whether an exposure to long-run risk can help explain the
difference in returns of value and growth portfolios. In
particular, if the cash fl ows generated by value stocks are more
highly correlated with future economic conditions compared
with those of growth stocks, then investors would demand a
higher return to hold a value portfolio that they perceive to
have a higher exposure to long-run risk.
Indeed, the study fi nds that the cash fl ows of value portfolios
are strongly correlated in the long run with macroeconomic
shocks, while growth portfolios show little correlation. The
results confi rm the authors’ argument that investors are
concerned not just about the short-term impact of business
fl uctuations, but also about how these disturbances will affect
economic prospects years from now. Investors see the long
run as an important source of risk, which they consider when
accepting a price for the assets they buy.
“When the stock market goes down today, investors think that this is telling them a lot about the state of the economy in the future.” —John Heaton
19Summer 2012 Chicago Booth Magazine
Consumption Makes a Comeback
Before Hansen, Heaton, and Li’s study, researchers had
somewhat abandoned the idea that stock prices largely refl ect
the relationship between the aggregate economy and the stock
market. The economic models that researchers typically use did
not adequately explain the consistently high equity premiums
observed in the data, leading academics toward behavioral
biases and transactions costs to account for this shortcoming.
But by fi guring out how to accurately measure long-run
risk, Hansen, Heaton, and Li have made it possible for
fundamental economic variables to once again play a key role
in determining asset prices. That’s the story behind the paper’s
title. “What we’re saying is that using fundamentals like
consumption to measure risk can actually work if you look at a
longer horizon,” says Heaton.
Consumption is the largest component of gross domestic
product and is an important indicator of economic well-
being. By looking at the correlation between stock returns and
expected future consumption, Hansen, Heaton, and Li were
able to come up with a measure of long-run risk that—when
linked to the economic shocks that investors see today—
proves that fundamentals can indeed drive risk premiums in
the stock market. ■
“Consumption Strikes Back? Measuring Long-Run Risk.” Lars Peter
Hansen, John Heaton, and Nan Li. Journal of Political Economy,
April 2008.
To watch a video of John Heaton explaining his research, visit ChicagoBooth.edu/CapIdeas.
“Using fundamentals like consumption to measure risk can actually work if you look at a longer horizon.” —John Heaton
Chicago Booth Magazine Summer 201220 Chicago B
Feature Critical DDiiaalogguuesis a series of conversations with members
of the Chicago Booth community who
play key roles in shaping business and
economic policy worldwide.
In early 2003, following the internet boom, Scott Griffi th, ’90, had the experience of running two start-ups
under his belt and was looking for his next endeavor. He was intrigued by Cambridge, Massachusetts–based
Zipcar, the young company that pioneered the big idea of car sharing. The concept was simple. In large
cities, where car ownership was costly, Zipcar members could rent a Honda Civic or a Volkswagen Beetle to
run errands or head for a weekend getaway, all for much less than the cost of a conventional car rental. And
the venture was irresistibly green. Reducing the number of vehicles downtown would lower pollution, parking
demand, and gridlock.
But the company was ineffi cient and losing money, so when Griffi th stepped in as chief executive, he applied
the kind of rigorous data-driven analysis he fi rst learned at Booth. He nurtured a performance-based culture,
launched hyper-local marketing campaigns, expanded the vehicle fl eet, and targeted new markets, growing
the company to 18 metropolitan areas and 250 college campuses. He also broadened the appeal of the brand
from utilitarian to fun.
Membership at Zipcar has grown to more than 700,000, and the company boasts a fl eet of more than
9,000 vehicles, not just Civics, but Mini Coopers, BMWs, Fords, and even hybrid and all-electric vehicles.
The company went public in April 2011 and its stock is traded on the NASDAQ under the symbol ZIP.
Griffi th recently discussed his Zipcar journey with dean Sunil Kumar in a Critical Dialogues conversation.
20 Chicago Booth Magazine Summer 2012
Edited by Judith Crown | Photos by Matthew Gilson
21Summer 2012 Chicago Booth Magazine 21Summer 2012 Chicago Booth Magazinegazine
Kumar: When you were fi rst recruited to join the team at Zipcar,
what attracted you to the company’s idea and business? What
were some of the things you considered in making the decision?
Griffi th: I like to think of Zipcar as my own personal sweet
spot because it brought together three of my passions:
innovation, transportation, and cities. I grew up in Pittsburgh
and saw the incredible impact that innovation and technology
had in turning that city around after the death of the steel
industry. I had moved back to Boston after running two
internet start-ups. I was a cancer survivor, and I wanted to do
something that made a difference. In 2002, I started watching
Zipcar and saw a huge idea. When I was offered the CEO role
in early 2003, I knew I was taking a tremendous risk, but I
loved the vision.
Kumar: What kinds of changes did you have to make to move
the company forward?
Griffi th: We’ve been able to build the brand by being very
specifi c and deliberate in our business model and the processes
for everything from fl eet management to hyper-local marketing.
For example, when I arrived, there was a move afoot to do a
major media buy to place ads on trains and in bus shelters.
It didn’t go well because you can’t explain what Zipcar is
about on a bus ad. But out of failure came a better idea—very
localized zone marketing. We created print materials that
we placed in card holders at dry cleaners and cafés. We put
grassroots marketers on the sidewalks with collateral. I even
rode through neighborhoods on a fl atbed semi with Zipcars on
it and used a bullhorn to explain what Zipcar was about.
Also, when I joined the company, we had 60 cars in New York
City, but they were spread out, so effi cient marketing was
diffi cult. We moved all the cars to the Chelsea area, a hip, young
neighborhood in lower midtown, where we were able to target
our message. At the time, we were growing at a 15-percent rate,
but when we focused on Chelsea with our concentrated fl eet and
hyper-local marketing approach, our membership tripled in a
month and a half. That was a goose-bump moment.
Kumar: Did you have to change the brand’s positioning?
Griffi th: At the start the image was too basic, too green. We
offered mostly white or silver Honda Civics and VW Beetles.
To reach a broader audience, we needed to offer more variety
and make the brand about lifestyle. In 2004, we started adding
colorful Mini Coopers, Mazdas, and BMWs, even SUVs. That
generated some good press and expanded the appeal to a much
broader audience of users.
Kumar: Why did you make the decision to go public last year?
Griffi th: Although we went public last year, the strategy was
set years earlier when we decided to be a global company. The
car-sharing business traditionally has been divided into two
camps: smaller local operators with a tight geographic focus,
“When we focused on Chelsea with our concentrated fl eet and hyper-local marketing approach, our membership tripled in a month and a half. That was a goose-bump moment.”—Scott Griffi th
Neal Cohen, AB ’82, MBA ’84, has been named executive vice
president and CFO of ATK
Aerospace Systems. Th e aero-
space and defense company is
headquartered in Arlington,
Virginia.
Brian Krelitz has joined
MGK as market manager for
professional products. Th e
insecticide company is based
in Minneapolis.
1985
Donald Seaton has been
appointed CFO of Integrated
Diagnostics. Headquartered in
Seattle, the biotech company
develops blood-based molecu-
lar diagnostic tests.
1986
Grant Gustafson has been
appointed to the board of
directors of Headwaters Inc.
Based in South Jordan, Utah,
the company makes light
building and heavy construc-
tion materials. Gustafson is a
private equity senior advisor
in the industrial products
market.
John Hamilton (see “CEO
Watch,” page 45)
1987
Michael Polsky (see “CEO
Watch,” opposite page)
Brian Posner has been named
to the board of directors of
BG Medicine, Inc. Based in
Waltham, Massachusetts, the
biotech company develops
tools and tests to aid in the
detection of heart disease.
Posner is president of Point
Rider Group, LLC.
Donna Zarcone (see “CEO
Watch,” opposite page)
1988
Steven Barnhart, AB ’84, MBA ’88, has been elected
lead independent direc-
tor of the board of USA
Technologies, Inc. First
appointed to the board in
October 2009, he will con-
tinue to chair the nominating
committee and to serve as a
member of the audit and com-
pensation committees. Based
in Malvern, Pennsylvania, the
company off ers wireless, cash-
less microtransactions, and
networking services for the
vending industry. Barnhart is
senior vice president and CFO
of Bally Total Fitness.
Patrick Doyle (see “CEO
Watch,” page 48)
47Summer 2012 Chicago Booth Magazine
Class Notes
1989
David Broecker has joined
Harlan Laboratories, Inc. as
president of research models
and services. Th e company
provides research for clients
in the pharmaceutical, biotech,
medical device, agrochemical,
and chemical industries,
as well as universities, gov-
ernment offi ces, and other
research organizations. It is
based in Indianapolis.
At Roche, Sophie Kornowski-Bonnet has been promoted to
head of Roche Partnering and
has joined the corporate exec-
utive committee. Previously,
she was general manager of
Roche Pharma in France. Th e
biotech company is headquar-
tered in Basel, Switzerland.
Richard Musgrove has joined
Hotel Asset Enhancement
Value, Inc. as executive
vice president. Based in
Providence, Rhode Island,
the company manages hotel
assets and consults on hotel
real estate.
Clifford Stocks (see “CEO
Watch,” page 48)
Th e economy’s
small business
sector is show-
ing signs of
picking up and
that’s good
news for job creation. “It looks
like we’re seeing small busi-
ness creation, which is really
critical for the long-term
sustainability of employment,”
said Diane Swonk, chief econo-
mist with Mesirow Financial,
in a December CNBC.com
article. An employment report
by payroll services company
ADP revealed that more than
half of the 206,000 private sec-
tor jobs created in November
2011 came from small busi-
nesses. “Usually, when you
have that kind of a pickup, it’s
indicative of small businesses
starting,” Swonk said. “Th e
ADP survey is a payroll
survey, and new small busi-
nesses are more likely to use
payroll services than an
established business.”
1990
Scott Griffi th (see “CEO
Watch,” page 48, and “Paving
the Road for the Urban
Traveler,” page 20)
M A K I N G H E A D L I N E S
Michael Polsky, ’87Founder, President, and CEOInvenergyAlternative energy company Invenergy is getting a boost from
GE, which has agreed to supply it with 23 megawatts of solar
equipment, according to a January Wall Street Journal article.
Th e equipment will be used at Invenergy’s Grand Ridge solar
site in LaSalle County, Illinois, which is on its way to becoming
the largest solar farm in the Midwest, the article said. “As we
look to continue the expansion of our clean energy portfolio,
advancements in technology have made solar a more com-
petitive solution,” Polsky told the Journal. “Having installed
over 1,500 of GE’s wind turbines at projects across the United
States, integrating GE’s solar technology is a natural fi t.”
Commonwealth Edison customers are expected to begin
using energy from the Grand Ridge site starting in July,
according to a January Chicago Tribune article. Th e solar farm
won a bid from the Illinois Power Agency to sell the energy
to ComEd, part of a strategy to help the state meet renewable
energy goals required under state law. “Renewable plants don’t
just happen,” Polsky told the Trib. “Th ere has to be a demand.”
In February, Polsky was appointed to the Argonne Board
of Governors. Argonne does research in the fi elds of energy,
environment, technology, and national security. Polsky also is
a member of the University of Chicago Board of Trustees.
T A K I N G T H E L E A D
Donna Zarcone, ’87 President and CEO Economic Club of ChicagoZarcone had been serving as interim president before being
named to the top spot. Th e club formulates public opinion on
business issues and works to identify young business leaders.
48 Chicago Booth Magazine Summer 2012
Alumni News
1991
Christopher Fanning has been
appointed president and chief
operating offi cer of Survey
Sampling International. Th e
company off ers data sampling,
collection, and analysis for sur-
vey research. It is headquar-
tered in Shelton, Connecticut.
Michael Howard has been
appointed vice president for
fi nance at the Massachusetts
Institute of Technology in
Cambridge, Massachusetts.
Patricia Kampling (see “CEO
Watch,” opposite page)
1992
YOU HAVE TO BE THERE.
OCTOBER 4–6
ChicagoBooth.edu/reunion12
2012
Claiborne Booker lives in
Alexandria, Virginia, and is
co-chair of the Booth Energy
Network’s DC Chapter. He
recently joined the board of
his undergraduate alma mater,
St. John’s College.
Bill Bruckner, Dave Fong, and
Amy McGowan (see “A Return
to the Slopes,” page 52)
Ari Chaney, Dan Hoskins, John Greener, and John McBane
(see “A Return to the Slopes”
and photo, page 52)
Kelley Drake, Nanci Meyer Fastre, Reid Funston, Mike Hajost, Dan Hoskins, John McBane, Ed Ryder, Kevin Smith, Jim Tuchler, and
Grant Van Voorst (see “A
Return to the Slopes” and
photo, page 52)
Daniel Damon is manag-
ing director in the sponsor
fi nance capital markets group
at GE Capital, where he has
worked for the past fi ve years.
Prior to joining GE, Damon
worked in the capital markets
group at Bank of New York,
most recently as head of the
structuring group. He lives in
Mount Kisco, New York, and
is married with three boys,
ages eight, 10, and 12. Damon
is serving as a volunteer for
the class of 1992 Reunion
committee and looks forward
to reconnecting with class-
mates in Chicago in October.
Maurice Holmes has joined
KPMG, LLP as managing
director of market develop-
ment for alternative invest-
ments. Th e New York–based
fi rm is the US member fi rm
of KPMG International
Cooperative, which is head-
quartered in Amstelveen,
Netherlands.
M A K I N G H E A D L I N E S
Patrick Doyle, ’88President and CEODomino’s PizzaRather than run his franchise autocratically, Doyle uses a
more democratic style, he told Blue Mau Mau, in a January
article. “I think the value of having built trust in the system
is that you can actually move far faster,” Doyle said. “I think
a lot of people look at it the other way. Th ey [autocratic lead-
ers of franchise chains] think that if they just make decisions,
announce them, and move forward, it’s more time effi cient.
But you tend to get far more resistance, which ends up ulti-
mately meaning that the system moves far more slowly. If the
relationship is there and the trust is there, I think it gives the
system the ability to move far faster.”
T A K I N G T H E L E A D
Clifford Stocks, ’89 CEO Theraclone Sciences, lnc.Th e biotech company discovers and develops antibodies. It
is based in Seattle. Stocks previously served as chief business
offi cer of Calistoga Pharmaceuticals.
M A K I N G H E A D L I N E S
Scott Griffi th, ’90 CEO ZipcarTh e car-sharing company recently turned its fi rst quarterly
profi t in a decade, according to a December 2011 article in
Cleantech. Griffi th was asked how it’s possible to get Americans
to switch from owning cars to car sharing. He told Cleantech:
“We see our greatest competition as personal car ownership
and the American dream of a car in every garage. Th is has been
inextricably tied to the American dream for almost 100 years.
“Based on member surveys, we know that Zipcar house-
holds spend only 6 percent of income on transportation,”
Griffi th said. “About half of Zipcar members sell a car or
choose not to buy a car as a result of their Zipcar membership.
Th at makes urban life more aff ordable for many, many people.
For our more than 650,000 members, the value proposition is
loud and clear.”
Th e next challenge to company growth, Griffi th said, is
expanding Zipcar’s global reach. (For more about Griffi th, see
“Paving the Road for the Urban Traveler,” page 20.)
49Summer 2012 Chicago Booth Magazine
Class Notes
T A K I N G T H E L E A D
Patricia Kampling, ’91CEO, President, and ChairAlliant EnergyKampling’s appointment at the Madison, Wisconsin, electric
and natural gas utility was eff ective April 1.
T A K I N G T H E L E A D
Andrew Ackerman, ’95 CEOLayercakeTh e new mobile app and website aims to make managing
digital memories quick and painless. Ackerman previously
spent eight years as COO of Bunk1, which provides photo
galleries to summer camps. “Th inking deeply about what par-
ents want from photos and other cherished memories,
Layercake was a next logical step for me,” Ackerman writes.
T A K I N G T H E L E A D
Urs Daniel Baumann, ’95CEOBellevue GroupTh e fi nancial services company is headquartered in Küsnacht,
Switzerland. A former CEO of Swisscard, Baumann took the
reins at Bellevue on March 1.
M A K I N G H E A D L I N E S
Dean Curnutt, ’96Founder and CEOMacro Risk AdvisorsMacro Risk Advisors has founded the Macro Risk Advisors
Scholarship Fund at Booth, a two-year scholarship of $25,000
per year rewarded to a Full-Time MBA Program student.
“Chicago Booth is one of the country’s foremost business
schools with a best-in-class student body,” Curnutt said in
a January article in Investment Weekly News. Curnutt had
received the Citibank Award for best performance in fi nance
as a student. “My two years at Booth provided an unmatched
foundation for my professional pursuits, generating the
insight and network to launch an independent risk advisory
fi rm,” he said.
John Nikolich has been
appointed executive vice
president of capital markets
and investor relations at
Banner Apartments, LLC.
Headquartered in Northbrook,
Illinois, the company invests
in real estate and manages
property.
Ed Ryder is chief invest-
ment offi cer for multifamily
investments at Pearlmark
Real Estate Partners, previ-
ously known as Transwestern
Investment Company. Ryder
lives in the Chicago area with
his wife, Julie, and their two
children. He is a co-chair of
the class of 1992 Reunion
committee. (For more about
Ryder’s time with classmates,
see “A Return to the Slopes,”
page 52.)
Jay Schmelter is founder
and managing director of
RiverVest Venture Partners.
Th e St. Louis–based fi rm has
sold four life science compa-
nies for more than $1 billion,
according to a February
press release. One of the four
companies, Salient Surgical
Technologies, Inc., was
founded by Schmelter. “At
RiverVest we strive to build
early-stage life science compa-
nies to sell within three to fi ve
years, including companies we
found,” Schmelter said. “Our
strategy is to focus on a few
high potential investments,
take an active role, sometimes
as interim management, and
leverage our research, clinical,
operational, and investment
expertise to make them attrac-
tive for strategic buyers.”
Eileen Weisenbach has been
named director of Fift h Th ird
Bank Entrepreneurship
Institute. Th e institute is
part of Northern Kentucky
University Haile/US Bank
College of Business.
1993
Tom Clark (see “A Return to
the Slopes,” page 52)
Miles McHugh has been
appointed CFO of Exopack.
Headquartered in Hoff man
Estates, Illinois, the company
makes fl exible packaging and
special coatings.
Pat Schwinghammer (see
“A Return to the Slopes,”
page 52)
50 Chicago Booth Magazine Summer 2012
Alumni News
1997
YOU HAVE TO BE THERE.
OCTOBER 4–6
ChicagoBooth.edu/reunion12
2012
1998
Jake Crampton (see “CEO
Watch,” opposite page)
Ajay Desai is managing direc-
tor and private wealth advisor
of Th e Desai Group, which
has joined the Chicago-based
private wealth manage-
ment offi ce of UBS Wealth
Management Americas. UBS,
a global fi nancial services
company, has headquarters in
Zurich and Basel, Switzerland.
Michael Durbin is featured
on the 2010 DVD package,
Strategies for Increasing Profi ts
under an Evolving Regulatory
Framework, which was put
out by Golden Networking’s
Derivatives Leaders Forum.
On Disc 2 of the four-disc
package, Durbin moderates a
panel called “Th e Exchange-
Traded Derivatives Changing
Landscape in 2010 and
Beyond.” Durbin wrote the
book, All About Derivatives. He
also is a lecturer and fi nancial
technology consultant with
a focus on high-frequency
options and futures trading.
1995
Andrew Ackerman (see “CEO
Watch,” page 49)
Urs Daniel Baumann (see
“CEO Watch,” page 49)
Kevin Phillips has been named
executive vice president at
North America of Th etford
Corp. Headquartered in Ann
Arbor, Michigan, the com-
pany makes sanitation and
refrigeration products for the
recreational vehicle, marine,
and heavy truck industries.
1996
Dean Curnutt (see “CEO
Watch,” page 49)
Sean Kell (see “CEO Watch,”
opposite page)
Robert Krakowiak has been
appointed vice president and
treasurer of Visteon Corp.
Th e automotive supplier
has corporate offi ces in Van
Buren Township, Michigan;
Shanghai; and Chelmsford,
United Kingdom.
Jennifer O’Connell has joined
HB as director of account
development. Th e integrated
branding, marketing, and pub-
lic relations agency has offi ces
in Newton, Massachusetts,
and San Antonio.
Videos Interviews StoriesGet 360 coverage at ChicagoBooth.edu/360.
51Summer 2012 Chicago Booth Magazine
Class Notes
T A K I N G T H E L E A D
Sean Kell, ’96CEOA Place for Mom, Inc.A referral information service and resource center about senior
living, the company is based in Seattle.
M A K I N G H E A D L I N E S
Jake Crampton, ’98CEOMedSpeedCrampton spoke at the World Congress 6th Annual
Leadership Summit on Health Care Supply Chain
Management in Orlando, Florida. His company works to
improve business operations and supply chains for health
care companies.
M A K I N G H E A D L I N E S
Dhiraj Rajaram, ’03Founder and CEOMu SigmaTh e data analysis company has raised $108 million from
investors, according to a December 2011 article in Crain’s
Chicago Business. A January article in the Chicago Sun-Times
said the company plans to buy back shares from shareholders
with the money raised—believed to be one of the largest
investments in the data analytics fi eld. Th e data-crunching
company intends to accelerate its growth, the article said.
Rajaram was hailed as “Master of Data Universe” in a head-
line to a February profi le that appeared in India’s Business
Today. Th e story looks at his unconventional ways, from his
continued thrift iness despite monetary success, to his insis-
tence on being super-selective when hiring an A-team. Yet,
“the seven Indians on his sales team never held a sales job
before; four have less than a year’s experience,” the article
said. His strategies appear to be paying off : the data analysis
company has raised almost $150 million, the article said, and
his company has been valued at about half a billion dollars.
Murli Buluswar has been
named chief science offi cer,
a newly created position, at
Chartis. Th e insurance bro-
kerage is based in New York.
What has happened to the
Chicago Booth class of 2001,
which survived two fi nan-
cial crashes and lived to tell
about it? At her 10-year class
reunion, Megan McArdle, a
senior editor at the Atlantic,
got the scoop on classmates’
ups and downs and wrote
about it for the January/
February issue of the maga-
zine. “Th e good news is that
most of my classmates seem
to have landed somewhere
safe, warm, and in the work-
force, which should reassure
recent graduates wondering
if their life is over,” McArdle
wrote. “Less happily, that
somewhere isn’t really where
many expected to end up;
reality has taken us down a
peg or nine.” In the article,
Julie Morton, associate dean
for Career Services and
Corporate Relations, confi rms
that McArdle’s class and
the one following it were hit
harder than others before
or aft er, because of massive
layoff s in the fi nancial sector
during their careers’ fi rst years.
Chris Walters has joined
Th e Weather Channel as
chief operating offi cer. Th e
television station is based
in Atlanta.
2000
John Snyder has joined WebQA
as vice president of product
management. Th e company
provides customer service
for governments, businesses,
colleges, and universities. It
is based in Woodridge, Illinois.
2001
Maggie Anderson, JD ’98, MBA ’01, spoke about the
book she cowrote at Eastern
University, according to a
February article in the Daily
Eastern News. Anderson and
her husband spent a year
attempting to buy goods only
from black-owned businesses,
an experience which she
documented in her book,
Our Black Year.
Thomas Bracken will suc-
ceed his father on the board
of trustees at Ball State
University. Indiana Governor
Mitch Daniels appointed
Bracken to a term lasting until
December 31, 2015. A mem-
ber of the Bracken family,
which is related to the uni-
versity’s founding Ball family,
has served on the board since
its inception. Th e university
is located in Muncie, Indiana.
Bracken owns Auto Build
Assemblies and works as a
soft ware programmer at the
company.
52 Chicago Booth Magazine Summer 2012
Alumni News
2002
YOU HAVE TO BE THERE.
OCTOBER 4–6
ChicagoBooth.edu/reunion12
2012
Douglas Baker has been
named to the portfolio man-
agement team at Nuveen
Multi-Strategy Income and
Growth Fund. Baker also
serves as portfolio manager
for the Nuveen Preferred
Securities Fund and related
preferred security strategies.
Nuveen Investments is based
in Chicago.
At Behringer Harvard, Andrew Bruce has been appointed
CFO of Behringer Harvard
Opportunity REITs I and II.
He will continue to serve
as senior vice president of
capital markets. Th e real estate
company is headquartered in
Addison, Texas.
Stacie Frank has been pro-
moted to vice president and
treasurer at the Chicago-based
electric power utility Exelon.
Previously, Frank had been
vice president of investor
relations.
Kim White has joined
Numerof & Associates, Inc.,
as a consultant. Based in St.
Louis, the strategy consulting
fi rm focuses on industries in
transition, with a particular
focus on health care.
Jeffrey Yuknis has been pro-
moted to COO of Exelon
Transmission Company and
vice president, corporate
transmission analysis and
development at Exelon. He
had previously been direc-
tor, transmission develop-
ment, Exelon Transmission
Company.
2003
Dhiraj Rajaram (see “CEO
Watch,” page 51)
Scott Sharabura (see “Mergers
and Acquisitions,” page 55)
To improve development
of players in youth soccer,
U.S. Soccer, the sport’s gov-
erning body in the United
States, is pairing with EXACT
Sports, a company that off ers
behavioral assessments and
sports psychology tools.
“Th ere are many elements
within soccer that are mental,
such as managing adversity
during a corner kick, being
confi dent in goal, showing
leadership on the fi eld, and
interacting with coaches
and teammates,” said Barry Tarter, EXACT Sports execu-
tive director, in a February
news item at USSoccer.com.
EXACT Sports is monitor-
ing and training more than
4,000 players and coaches in
Development Academy clubs.
To do so, the company is
using a new behavioral assess-
ment tool called the Mental
Achievement Program.
Eduardo Veiga (see “Mergers
and Acquisitions,” page 55)
A Return to the SlopesContinuing a tradition that began at business school more
than 20 years ago, a group from the class of 1992 completed
another annual ski and snowboard trip, this time to Vail,
Colorado. Enjoying this year’s venture to Vail or to the warm-
up in Boulder were Bill Bruckner, Ari Chaney, Kelley Drake, Nanci Meyer Fastre, Dave Fong, Reid Funston, John Greener, Mike Hajost, Dan Hoskins, John McBane, Amy McGowan, Ed Ryder, Kevin Smith, Jim Tuchler, Grant Van Voorst, 1993 class-
mates Tom Clark and Pat Schwinghammer, and several friends
and relatives.
Th e score this year? Chicago Booth 49–Mountain 48. No
injuries were reported, other than a few bruised egos aft er
the moguls on Skyline. Classmates interested in joining the
next trip should contact Ari Chaney or Dan Hoskins, who are
looking forward to Reunion weekend in October.
On top of the world: Dan Hoskins (far left), Ari Chaney, John McBane, John Greener,
and Ed Ryder’s brother-in-law, Andy Stavre, take a moment to pose for a photo from
the mountain peak.
Warming up: Kevin Smith (far left), Kelley Drake, John McBane, Reid Funston,
Jim Tuchler, Dan Hoskins, Nanci Meyer Fastre, Mike Hajost, Grant Van Voorst, and
Ed Ryder take a break inside.
53Summer 2012 Chicago Booth Magazine
Class Notes
2004
StrongMail continues to
attract clients and has added
CheapAir.com to its list of
users of its cloud-based email
marketing services, according
to a January article on Yahoo!
Finance. StrongMail was
selected by Forrester Research,
Inc. as one of six email mar-
keting providers “best-suited
for enterprise marketers,”
according to a January PRWeb
article. A team of Booth stu-
dents, who were fi nalists in the
2003 New Venture Challenge,
has been credited with devel-
oping the business plan that
enabled StrongMail to attract
fi nancing. One of them, Rita Ravindra is the former director
of fi nance at StrongMail.
2005
Peter Boodell (see “Mergers
and Acquisitions,” page 55)
Do-it-yourself science experi-
ments are a great way to keep
children entertained and edu-
cated. In a December 2011
article in USA Today, Shegan Campbell, cofounder and
executive director of Kids
Science Labs in Chicago,
listed fun experiments and
what they can teach children.
Experiments include making
homemade slime, or oobleck,
which is made from corn-
starch, water, and food color-
ing, and which acts as both a
liquid and a solid. Children
also can make homemade
M A K I N G H E A D L I N E S
Karan Goel, AB ’04, MBA ’06Founder and Former CEOPrepMe, Inc.Goel stepped down as CEO of the online college test prepa-
ration website he founded. In February, the company was
acquired by Naviance, a division of Cincinnati-based
Hobsons, Inc., which provides soft ware and other tools for
higher-education administrators and students. Goel said in
a Crain’s Chicago Business article that aft er a break he may
start another company. In an announcement of the sale in
a February PRNewswire article in Digital Journal, Goel said,
“In a time of increasing mandates for student success, schools
and districts need cost-eff ective, comprehensive programs
that help students connect learning to personalized goals.
Th e combination of PrepMe and Naviance will allow stu-
dents and families to realize the impact their PSAT, SAT, and
ACT test preparation has on postsecondary planning and
achievement.”
M A K I N G H E A D L I N E S
Sean Harper, AB ’03, MBA ’09Cofounder and CEOFeeFighters
Harper enlisted the help of Joshua Krall, MBA ’09, MPP ’09, cofounder and chief technology offi cer, to work on the start-
up, which off ers online comparison shopping for credit card
processors, aft er Harper found himself “shocked at how
in effi cient” the process was. “Finally fi nding what I thought
was a ‘good deal,’ I learned later that I overpaid by $40,000 in
the fi rst year…money that I could really have used elsewhere
in my business,” Harper said in a January Illinois Technology
Association ITA Spotlight article. Chicago-based FeeFighters
employs developers and designers across the globe. Th e com-
pany was acquired by Groupon in March.
tinker toys or a tornado in a
glass. Campbell started the
company with 2005 classmate
Keith Norsym.
An impending banking crisis
in China may be soft ened
temporarily by the country’s
policy of transferring bad
loans to government-owned
entities, but that strategy has
its own drawbacks to the
economy, said Ben Fanger, MBA ’05, JD ’05. “Th e seeds
of a potential crisis started in
2008,” Fanger said in a Febru-
ary Wall Street Journal article.
“In an eff ort to fuel growth,
China more than doubled its
loan book in the two years fol-
lowing the crisis by increasing
loans to both infrastructure
and corporations. History tells
us that such spikes in lending
are almost always followed by
a banking crisis, or at least a
wave of bad loans that must
be cleaned up. It also became
clear that much of China’s
lending was being allocated
for policy reasons, not credit-
worthiness. As concerns about
infl ation mounted, and China
slowed credit growth in 2010,
banks lent to state-owned
enterprises but left private
companies and real estate
developers starved for cash.
Last year analysts estimated
that between $1 trillion and
$2 trillion of nonperforming
loans would eventually surface
because of this lending glut.”
Fanger is cofounder of Shore-
line Capital Management,
which invests in Chinese dis-
tressed assets.
54 Chicago Booth Magazine Summer 2012
Alumni News
Shoprunner, an online shop-
ping site that off ers free
two-day shipping, recently
bought Shopsanity, an
online shopping organizer.
PandoDaily.com reported
on the sale in February and
Shopsanity cofounder John Rodkin subsequently com-
mented on the deal in a
blog post on the company’s
website. Rodkin said that
the number of transactions
recorded by his company was
growing “exponentially” just
nine months aft er its launch.
“I’m proud of how hard
the team cranked, and I’m
extremely proud that what we
built scaled like mad and grew
quickly on a lifetime total of
$7,000 of marketing spend
and no PR.” He said that the
two online businesses are a
“great strategic fi t.”
2006
Darin Facer has been pro-
moted to managing director
from director in the enter-
prise improvement unit of
AlixPartners. Th e restructur-
ing, consulting, and fi nancial
advisory fi rm is headquartered
in Southfi eld, Michigan.
Karan Goel, AB ’04, MBA ’06
(see “CEO Watch,” page 53)
Lukasz Pomorski, PhD ’06, and a colleague from the
Rotman International Centre
for Pension Management
have won the 2012 Canadian
Investment Research Award
of Can$10,000. Th e award
was presented by the Toronto
CFA Society and Hillsdale
Investment Management
for the research paper,
“Is Bigger Better? Size and
Performance in Pension Plan
Management.” One of the
paper’s key fi ndings is that
“the majority of superior
returns come from expan-
sion into alternative asset
classes, such as private equity,
real estate, and infrastruc-
ture, where size and direct
investment capabilities are
an advantage,” said a March
article in Digital Journal.
Avi Stopper is one of the
founders of CaptainU, a web-
site that helps parents and
coaches promote student ath-
letes for college recruitment.
He discussed his journey from
business school to start-up in a
Q&A for “Th e Small Business
Center” of Fox Business News
that ran in December 2011.
When asked by Fox how
Launching a Venture in India
Vikram Vuppala, ’07, returned to his native India to launch a
group of kidney care clinics in the midst of the global reces-
sion. “Th ere is no perfect time to launch a company,” said
Vuppala, a medical doctor, who cofounded NephroPlus in
2010. Vuppala told the Economic Times of India that in light
of the economic climate, the start-up decided not to seek ven-
ture funding, and instead to hold events for patients and care-
givers. “We wanted to prove the concept fi rst,” Vuppala said.
“Th e fi rst fi ve patients are important. Th ey will carry the word
around,” Vuppala said. Today the company runs fi ve centers.
Vuppala knew he would become an entrepreneur when
he completed high school. He graduated in engineering from
IIT Kharagpur and completed his MBA at Booth. “I always
dreamed of establishing my own business,” he told Post Noon
in a March article. Vuppala invested his life savings to start
NephroPlus.
Vuppala had been working as senior associate at McKinsey
& Company when he returned to India in 2009 to become
an entrepreneur, according to the February article in the
Economic Times.
55Summer 2012 Chicago Booth Magazine
Class Notes
A new talk radio show, “Other
People’s Money,” is being
hosted by Jeffrey Sexton. Th e
one-hour Sunday evening
show is being broadcast to
the Louisville, Kentucky–area
and southern Indiana on
WKJK in Louisville. “I am not
an armchair quarterback,”
Sexton, portfolio manager
for the Deluxe All Cap stock
fund, said in a press release. “I
walk the walk and talk the talk
when it comes to investing.”
He added, “Th e results of my
research instilled convictions
and taught me the conse-
quences of managing ‘other
people’s money.’”
Vikram Vuppala (see
“Launching a Venture in
India,” opposite page)
Chicago Booth helped him
to become an entrepreneur,
Stopper said, “Our business
really embodies the spirit
of the school: to be rational
and rigorous about how we
do things. We are constantly
testing new ideas through sci-
entifi c methods and it’s always
a work in progress. Th e evolu-
tion has been phenomenal to
watch.” CaptainU shared the
New Venture Challenge prize
for $25,000 in seed money
in 2008.
2007
YOU HAVE TO BE THERE.
OCTOBER 4–6
ChicagoBooth.edu/reunion12
2012
Derek Robinson has been
appointed executive direc-
tor of the Illinois Hospital
Association Quality Care
Institute. Headquartered in
Naperville, Illinois, the asso-
ciation represents and advo-
cates for 200 Illinois hospitals
and health systems and their
patients.
Peter Boodell, ’05, announces the
birth of Matthew Thomas Boodell,
who arrived January 25 “with 10
fi ngers and 10 toes.” “Mom and Matt
are getting to know each other well
by now,” Boodell writes, “and
everyone is happy and healthy, albeit
a bit tired. Our very own Golden
Dragon baby!”
Eduardo Veiga, ’03, and his wife,
Luciana, would like to announce
the birth of their son, Daniel, on
June 16, 2011. They and big sister
Julia are looking forward to celebrat-
ing his fi rst birthday.
Alberto Plaza, ’11 (EXP-16), and
his wife are happy to announce the
birth of their third child, Beatrice, on
“11/11/2011.”
Scott Sharabura, ’03, and his wife,
Kim, announce the birth of Colin
Jamie Sharabura on January 10 in
Calgary, Alberta, Canada. Colin joins
big brother Dougie, age fi ve, and big
sister Connie, age two, in the family.
Mergers and AcquisitionsRecent Weddings and Births
56 Chicago Booth Magazine Summer 2012
Alumni News
2009
Sean Harper, AB ’03, MBA ’09
(see “CEO Watch,” page 53)
Joshua Krall, MBA ’09, MPP ’09 (see Sean Harper, AB ’03, MBA ’09, “CEO
Watch,” page 53)
Phillip Leslie (see “CEO
Watch,” opposite page)
Lee Rash has joined Cotton
Creek Capital as senior
associate. Th e Dallas-based
private equity fi rm focuses on
middle-market companies.
2008
A new website connects busi-
nesses to other businesses so
that they can barter for favors
from one another. Called
favo.rs, the start-up cofound-
ers include Booth classmates
George Aspland, AB ’97, MBA ’08, Scott Roberts, and
Adam Rodnitzky. “For exam-
ple, you can use the site to ask
someone to retweet a link or
give you an introduction.
favo.rs keeps track of who’s
helping you the most,” said a
December 2011 article in
Crain’s Chicago Business. Th e
company is based in Chicago
and San Francisco. Its
December 2011 launch drew
attention from Wired.com.
“We thought about what
makes Silicon Valley tick—
and the business world in
general,” Rodnitzky said in
the December article. “And
came up with this.”
David Abuaf, AB ’02, MBA ’08, has joined Heft y Wealth
Partners as chief investment
offi cer. Th e wealth manage-
ment fi rm is based in Auburn,
Indiana.
Michael Holmes made a satisfy-
ing career leap from private
equity giant Carlyle Group to
working as vice president for
his father-in-law’s chain of
tire and auto stores. His busi-
ness success was featured in
a January profi le of Holmes
by the Washington Post. “I
thought it would be an inter-
esting opportunity to build a
business,” Holmes said of the
career switch he made fi ve
years ago. He put all the stores
under a single brand, Virginia
Tire and Auto, and spent
$1 million to automate them
under one computer network.
He also bought the land that
housed three of the stores as
a real estate investment. Th e
chain boasts 403 employees
and $67 million in revenue, the
article said. Holmes’s father-
in-law, Myron, “built this up,
and now we want to take it to
the next level,” Holmes told
the Post.
YOU KNOWTHE VALUE OF THE CHICAGO APPROACH.
SHARE IT.Invite a colleague to experience an upcoming
nondegree Executive Education course with
Chicago Booth’s world-class faculty.
For more information and a complete
list of upcoming courses, visit
summer2012.chicagoexec.net.
57Summer 2012 Chicago Booth Magazine
Class Notes
2010
Seyi Fabode (see “CEO
Watch,” this page)
Kilton Hopkins (see Jeb Ory, ’11,“CEO Watch,” page 59)
Matt Maloney, SM ’00, MBA ’10(see “CEO Watch,” page 58)
Philip Nevels (see Seyi Fabode, ’10, “CEO Watch,” this page,
and Career News, page 40)
2011
YOU HAVE TO BE THERE.
OCTOBER 4–6
ChicagoBooth.edu/reunion12
2012
Jeb Ory (see “CEO Watch,”
page 59)
Young entrepreneurs are
constantly working, and when
they’re not, they tend to be
thinking of new business
ideas, said a January article
in Crain’s Chicago Business.
Entrepreneurs “can’t help
it,” said C. J. Przybyl, CFO of
BodyShopBids, Inc., a web-
site that allows car owners to
seek competitive bids from
local body shops by upload-
ing photos of the car damage.
“You’re always thinking of
something,” said Przybyl.
Ashish Rangnekar (see “CEO
Watch,” page 60)
While business school grads
aren’t fl ocking overseas for
jobs in record numbers,
they are more open to geo-
graphic fl exibility, according
to a February Bloomberg
Businessweek article. For
example, Ronald Rolph had a
chance to work either in the
United States or to take a posi-
tion with the same company
overseas that off ered the mul-
tiple attractions of engineer-
ing, construction, and project
management work in the
mining and metals industry
in Santiago, Chile. Rolph took
the job in Chile. “Just because
you go overseas initially does
not mean you’re relegating
yourself to working overseas
for the rest of your career,”
Rolph said.
Uzi Shmilovici (see “CEO
Watch,” page 60)
M A K I N G H E A D L I N E S
Phillip Leslie, ’09Founder and CEOProOnGoTh e company made the Illinois Technology Association
“Spotlight” in January. “What really makes ProOnGo special
from the other 1,000 expense-tracking programs out there is
our expense-approval system,” Leslie said in the article. “With
no other service are you able to pull up your entire sales
team’s expenses on your mobile device, view their receipt
images, and make changes to the expenses, as well as approve
or deny the expenses.”
M A K I N G H E A D L I N E S
Seyi Fabode, ’10CEOPower2SwitchTh e website that helps consumers switch to cheaper sources
of electricity has been drawing press for its cofounders, CEO
Fabode and COO Philip Nevels, ’10. “We believe that folks
should have full fl exibility in choosing their power source,”
Nevels told the Peoria (IL) Journal Star in January. “One of
the problems with municipal deals is that they take time,
sometimes up to a year. You can start saving today by select-
ing your own supplier.”
Nevels (also see Career News, page 40) discussed the
growth of alternative power sources in a January article in the
Galesburg (IL) Register-Mail. “Awareness of the choice option
has come a long way,” he said. In early 2010, the penetration
rate of the alternative companies was about 2.5 percent. Now,
it’s around 5 percent, and expected to rise to 10–15 percent by
the end of the year.
Th e company also made the Illinois Technology
Association’s January “Spotlight.” Fabode explained why
his company’s service should gain popularity. “We fully
understand the user experience and have factored this into
providing the most convenient end-to-end service for elec-
tricity price comparison,” Fabode told the ITA. “Additionally,
Power2Switch uses electricity usage data collected from our
customers to help them track their savings, understand their
carbon footprint, and optimize their energy use over time.”
58 Chicago Booth Magazine Summer 2012
Alumni News
Executive MBA Program North America
XP-13
At Lubin School of Business
at Pace University, John James, ’57, has been named
inaugural executive director
of the new Center for Global
Governance, Reporting,
and Regulation. James is a
professor at Lubin, based in
New York.
XP-26
Blaine Rieke, ’70, has joined
the board of directors of
CerMed International, Inc.
Based in Monterey, California,
the international medical
device company develops
products to reduce the risk of
female reproductive diseases.
XP-56
Robert Mariano, ’87 (see
“CEO Watch,” page 61,
and “Understanding How
Shoppers Behave,” page 33)
At CBOE Holdings, Inc.
Edward Provost, ’87, an execu-
tive vice president, has been
named chief business develop-
ment offi cer for the Chicago-
based holding company for
the Chicago Board Options
Exchange.
XP-58
Carlos Cabrera, ’89, has been
appointed executive co-
chairman of Ivanhoe Energy.
Th e heavy oil development
and production company is
headquartered in Vancouver,
British Columbia, Canada.
Cabrera is a former chair-
man, president, and CEO
of UOP, LLC.
XP-64
A copy of the Th irteenth
Amendment, signed by
President Lincoln to abolish
slavery, was recently restored
by Graphic Conservation
Company. Russ Maki, ’96, company president, said
that as a result, the company
experienced a media storm,
appearing in 200 newspapers
within two days, and also gen-
erating television and radio
coverage. Th e copy was one
of at least 14 signed by Lincoln
and also bears the signatures
M A K I N G H E A D L I N E S
Matt Maloney, SM ’00, MBA ’10Cofounder and CEO GrubHubWhen asked by new entrepreneurs about fi rst steps in start-
ing a business, Maloney advised: “Find a partner. Find
someone you absolutely trust and respect and then just
go for it, because six months or two years in, you two will
always be fundamentally aligned. And if you trust your
partner and respect your partner, then the compromise you
come up with is typically better than either position the two
of you had [individually].” Maloney made his remarks on
Crain’s Chicago Business “Crain’s Tech Talk Live,” fi lmed in
December 2011 at the Ravenswood Event Center. A Crain’s
article about the event said that customers have ordered more
than $250 million worth of food through GrubHub, an online
restaurant-delivery company.
Th e booming start-up has grown out of three offi ces since
its 2004 inception. “Th is is our fourth offi ce and at every point
we’ve said, ‘there’s no way we’re going to max out of this
offi ce,” Maloney said in a February Business Insider article.
“Every time we’ve been wrong.” Th e online site now off ers its
services in around 300 cities, with its mobile app growing to
account for 20 percent of orders, he said.
59Summer 2012 Chicago Booth Magazine
Class Notes
M A K I N G H E A D L I N E S
Jeb Ory, ’11Cofounder and CEO5Degrees
Ory and Kilton Hopkins, ’10, chief technology offi cer, were
slated to take their start-up to the SXSW (South by Southwest)
Accelerator competition held in Austin, Texas, in March. Th e
company makes an app to consolidate all mobile communica-
tions by person or relationship. It was one of 48 companies
invited to the competition out of nearly 700 companies that
applied. “Th e initial version we’ll launch [at SXSW] will be
focused on very basic information that’s contained on your
mobile device or integrated within people’s email,” Ory said
in a February Crain’s Chicago Business article. Later the app
will allow users to add information from social networking
profi les. “We’ll also let you split up [diff erent categories of
contacts] so that if you have customers’ phone numbers and
friends’ phone numbers, they don’t both show up in a mailing
list for a marketing email list—that’s a big pain point,” Ory
told Crain’s. Added to the app will be a day-management sys-
tem of communication reminders.
“Th is is the infl ection point, the diff erence between people-
centric and function-centric soft ware,” Hopkins told Crain’s.
“Nobody’s done that before, make soft ware about people.
People have been stored as data, as contacts or customers.
Th ey’re pieces of information or accounts. But we’re realizing
that by putting together a Twitter profi le, a Facebook profi le,
an email address, and a number from your mobile device’s
phonebook, you’re talking about a person. Put all that infor-
mation together and you have the world’s fi rst people-centric
mobile relationship management platform.”
of most of the lawmakers
who voted for the legislation,
according to a December 2011
Associated Press story on
the purchase. Graphic
Conservation Company per-
formed the restoration at no
cost to the state, enabling it to
be displayed at the Abraham
Lincoln Presidential Library
and Museum in Springfi eld,
Illinois. “You’re in the pres-
ence of what I would con-
sider to be one of the most
important documents in our
nation’s history,” Maki was
quoted by the Huffi ngton Post,
which credited the AP story.
“It really takes your breath
away to be involved in some-
thing of this level of historic
importance to our country.”
XP-71
With the departure of some
old-guard employees at
John Buck Co., some have
speculated on the future of
the real estate power, as John Buck, ’02, is handed more
day-to-day control from his
father. But Buck doesn’t see a
problem. “We haven’t missed
a beat,” he said in a March
Crain’s Chicago Business
article. “We’ve got a bunch of
deals we’re working on. We
haven’t lost any opportuni-
ties that I’m aware of.” Buck
joined his father’s fi rm in
1996, and so far has done leas-
ing and project management
there. He currently is working
on a couple of hotel develop-
ments, the article said.
XP-72
“Th e US economy is gaining
steam,” Jim Oberweis, ’03, president and CEO of Lisle,
Illinois–based Oberweis
Asset Management, Inc. said
in a February Forbes article.
He cited improvements in
the gross domestic product,
employment, consumer
spending, and housing
sales. When picking stocks,
however, Oberweis recom-
mends innovative small-cap
companies that will grow
no matter the state of the
economy. He recommends
four stocks: Pennsylvania-
based Kenexa, a developer of
soft ware to help companies
recruit and retain employees;
Massachusetts-based IPG
Photonics, the leader in fi ber
lasers used in cutting and
welding; Faro Technologies
of Florida, which provides 3D
measurement and imaging
systems to manufacturers;
and Minnesota-based Select
Comfort, which operates 400
Sleep Number mattress stores.
60 Chicago Booth Magazine Summer 2012
Alumni News
XP-76
Jeff Carter, ’07, once asked
Steven Kaplan, Neubauer
Family Distinguished Service
Professor of Entrepreneurship
and Finance, “Do you bet on
the horse or the jockey?”
“He said in start-ups, always
bet on the jockey,” because
great jockeys can change
course,” Carter wrote in a
March Townhall.com article.
Carter, an independent specu-
lator, shared what he thinks
makes a great jockey. One
crucial characteristic: leader-
ship qualities. An idea person
does not necessarily make
the best CEO, but “leadership
characteristics can be taught,”
Carter said.
Another characteristic:
clear communication. “Th e
best founders ask their inves-
tors to clearly state their
expectations. Th is minimizes
confl ict,” he said.
XP-79
Brandon Moore, ’10 (see “CEO
Watch,” opposite page)
Honeywell vice president for
renewable energy and chemi-
cals Jim Rekoske, ’10, talked
about the biofuel business in
the November 2011 issue of
Fast Company. “We’ve been
in the industry for 97 years,
and we’re very good at know-
ing how to make the right
fuels for the right specifi ca-
tions,” he said. “We transform
natural oils to look exactly like
the petroleum-based fuels of
today. Our fuel can come from
camelina, which is grown
in dry-land wheat rotation.
Nature provides the energy to
create the feedstock—we just
have to nudge it in the right
direction. With a single feed-
stock, we can make fuel for the
military, commercial aviation,
trucks, and cars. It’s chal-
lenging to get the whole value
chain—agriculture, chemistry,
logistics—to work together.
We’re not going to change
over from petroleum anytime
soon, but there will be other
solutions too.”
Kevin Willer, ’10 (see “CEO
Watch,” opposite page, and
“Investing in Chicago Tech
Start-Ups,” page 44)
M A K I N G H E A D L I N E S
Ashish Rangnekar, ’11CofounderBenchPrepBased in Chicago, BenchPrep is an online source of textbooks
and test preparation. Rangnekar talked about the advantage
of online studying in a January article in Crain’s Chicago
Business. “With a traditional question-and-answer section
in a textbook, typically you have questions (at the end of a
chapter) and then the answers are at the end of the book,
and you have to go back and forth to fi gure out what you did
right or wrong. But the best way to (off er a Q&A) is to build
an interactive quiz module that will both ask and answer
the question and give the student feedback. We have a lot
of analytics around those content modules with graphs and
charts to really help students understand the concepts they are
good at or not so good at. And because we understand their
strengths and weaknesses much better, we are then able to
recommend a diff erent course, so if someone studying for the
MCAT is not doing as well at biology as other students, we
can then recommend an MCAT biology course by a diff erent
publisher.”
A January TechCrunch.com article noted, “BenchPrep is the
future of the ‘education anywhere’ movement.”
M A K I N G H E A D L I N E S
Uzi Shmilovici, ’11FounderFuture SimpleTh e Chicago-based company has released the fi rst small-
business customer relationship management app in the
Android market, according to a January article in Tech
Crunch Europe. Future Simple is raising a second round of
funding, the article said.
Mobile computing, smart computer algorithms, and plum-
meting soft ware creation and distribution costs are revolu-
tionizing the small-business soft ware industry. “For the fi rst
time in the history of business soft ware, small businesses can
use soft ware that is as good, if not better, than the soft ware
bigger corporations use,” Shmilovici wrote in a February guest
post for Forbes. “Th ere hasn’t been groundbreaking innova-
tion in the business soft ware space for the last decade,” he
said in a January Illinois Technology Association “Spotlight”
article. “We’re building the future of it.”
61Summer 2012 Chicago Booth Magazine
Class Notes
Executive MBA Program Europe
EXP-7
Michael Peterson, ’02, has
joined MLV & Co. as manag-
ing director and senior energy
research analyst. Th e boutique
investment bank is based in
New York.
EXP-9
Erich Hofer, ’04 (see “CEO
Watch,” this page)
EXP-10
Noelia Fernandez Arroyo, ’05, has been pro-
moted to vice
president,
head of audience at Yahoo!
EMEA. Previously, Fernandez
was editorial and program-
ming director with Yahoo!
Europe.
EXP-12
Saad Khan, ’07, has been
appointed regional managing
director in the Middle East
at Ciena Corp. Th e compu-
ter network, soft ware, and
cloud-computing company is
headquartered in Linthicum,
Maryland.
EXP-14
Omar Nasser, ’09, has been
appointed director of corpo-
rate development of MENA,
based in Cairo. Headquartered
in Calgary, Alberta, Canada,
MENA Hydrocarbons
explores for oil and gas in the
Middle East and North Africa.
EXP-16
Alberto Plaza, ’11 (see
“Mergers and Acquisitions,”
page 55)
M A K I N G H E A D L I N E S
Robert Mariano, ’87 (XP-56)Chairman and CEORoundy’s SupermarketsTh e company plans to raise an initial $230 million when it
becomes publicly traded, said a December 2011 article in the
Chicago Sun-Times. Th e company runs four Mariano’s Fresh
Market stores in the Chicago area and plans to at least double
that number within three years, the article said. (To read
Mariano’s insights on purchasing data, see “Understanding
How Shoppers Behave,” page 33.)
T A K I N G T H E L E A D
Brandon Moore, ’10 (XP-79)CEORealtyTracMoore joined as CEO in November. Th e online marketplace
for foreclosure properties is headquartered in Irvine, California.
M A K I N G H E A D L I N E S
Kevin Willer, ’10 (XP-79)CEOChicagoland Entrepreneurial CenterWTTW Channel 11’s Chicago Tonight ran a story on 1871,
the 50,000-square-foot tech center that opened this spring at
the Merchandise Mart. Th e center will be run by Chicagoland
Entrepreneurial Center. In the broadcast, Willer, in a hard-
hat as construction workers prepared the space behind him,
said that the tech center would be for “digital start-ups in
the early stages.” Willer said there was a lot of demand for a
space where digital entrepreneurs could sit and work together
“but we didn’t see a lot of supply.” Th e tech center is named
aft er the year of the Great Chicago Fire, the disaster that set
the stage for the city’s emergence on the world stage. (To
read more about Willer’s work with entrepreneurship, see
“Investing in Chicago Tech Start-Ups,” page 44.)
T A K I N G T H E L E A D
Erich Hofer, ’04 (EXP-9)Interim CEOSunovia Energy Technologies, Inc.Th e clean-tech lighting company is based in Sarasota, Florida.
Hofer was tapped as a member of the company’s board of
directors to lead the company.
62 Chicago Booth Magazine Summer 2012
Alumni News
Executive MBA Program Asia
AXP-1
Curtis Espeland, ’02, has
been elected to the board of
directors of Lincoln Electric
Holdings, Inc. Based in
Cleveland, Lincoln Electric
makes arc welding products.
Espeland is senior vice presi-
dent and CFO of Eastman
Chemical Company.
AXP-2
Mimi Bangash, ’03, has been
appointed chief strategy offi -
cer of JS Investments Limited.
Th e asset management fi rm is
based in Karachi, Pakistan.
AXP-6
Suria Suppiah, ’07, discussed
the benefi ts of obtaining
an executive MBA in a
December Business Times
article. Going through the
program has helped him
to make decisions, he said.
While following a gut feeling
is good, combining a gut
feeling with an analysis of
data is even better. “Th e
EMBA was an eye-opener,”
Suppiah said in the article.
“It has helped me make
a lot more decisions with
the information that is
available.” Suppiah, who
is head of group synergy
and chief administrative
operating offi cer for Parkway
Laboratory Services, said
the Executive MBA helped
him with a decision to bring
two health care companies
together, saving money and
procurement costs.
AXP-7
Gul Chotrani, ’08, was
interviewed about photos he
took of the Omo people in
Ethiopia for a January blog
post on the Leica website. His
journey also was discussed
in the January issue of Conde
Nast Traveler. In the blog,
Chotrani explained why
an investment banker such
as himself would want to
photograph indigenous people
in a traditional culture. “Like
most curious people, I have
innate interests or passions
of a deeply personal nature,”
Chotrani said. “Perhaps mine
revolved around design and
aesthetics, but I never was able
to pursue them in the early
part of my life.”
twitter.com/Booth hinking
@BoothThinking
Join the conversation
63Summer 2012 Chicago Booth Magazine
Class Notes
behalf of his fi rm’s internet
and e-commerce practice,
according to a December
PRLog press release. Case
is managing director at the
Tokyo-based fi rm. Case writes
that his fi rm was one of the
sponsors of the Economist’s
Japan Summit, which drew
economists, academics, and
200 of the region’s top CEOs.
AXP-10
Nader Tadros, ’11, has become
head of sales and marketing
in Singapore for Intuit. Th e
soft ware company is head-
quartered in Mountain View,
California.
Th is section was written by
Mary Sue Penn.
In MemoriamChicago Booth Magazine has learned of the deaths of the
following alumni:
Full-Time, Evening, and Weekend MBA Programs
1940sAlbert Poll, PhB ’45, MBA ’48
Conrad Howard, AB ’38,
MBA ’49
Edwin Humiston, PhB ’47,
MBA ’49
1950sVincent Profi ta, ’51
Jay Buck, ’54
John Bjork, ’57
William Rowan, ’57
1960sEdward Dillmann, ’61
John Carr, ’62
1970sFlynn Terrence, ’71
John Curran, ’72
Charles Whalen, ’74
1990sBruce Norlund, ’97
2000sAlfred Gomes, ’00
Jeremy Hill, ’01
Daniel Lok, ’08
Executive MBA Program
1950sLe Roy Palmer, ’58 (XP-13)
1960sJay Corbett, ’66 (XP-22)
Walter Treichler, ’64 (XP-20)
1970sDavid Rampe, ’78 (XP-41)
Mark Harris, ’08, has been
named CFO of Apollo
Investment Corp., the New
York investment giant.
AXP-8
Ramanan Govindasamy, ’09, has been appointed to the
board of People’s Merchant
Plc as a nonexecutive direc-
tor. Th e fi nancial institution
is involved in leasing, real
estate, and corporate and
trade fi nance. It is based in
Sri Lanka. Govindasamy is
managing director and CEO
of Capital TRUST Financial
Management and Capital
TRUST Wealth Management.
AXP-9
Wahl & Case, a recruitment
fi rm, has won the top prize
at the Japan Headhunter
Awards. At the awards cer-
emony, Michael Case, AB ’99, MBA ’10, was named MVP
in the internet industry on
Chicago Booth Magazine Summer 201264
Back Story
“ We get analytical about what goes on when we play a round of golf. It’s all about probability and statistical distributions.”
Chad Syverson, professor of economics, is a frequent golfer and often plays with
University of Chicago economists Steven Levitt, John List, and Derek Neal. The team
usually plays in scramble tournaments, in which the best shot among the four
determines the starting point for each subsequent shot. Inconsistency becomes an
advantage as the golfers pick the best and discard the worst. “In a scramble, we don’t
need everyone to do something good, we just don’t want the same bad shot,” said
Syverson, who was photographed by Chris Strong at the Jackson Park Golf Course on
Chicago’s South Side. “It’s a portfolio problem.”—Judith Crown
Accessorize with Booth: It all started when David Booth, ’71, suggested that the school
should have a signature tie. The student-led Dean’s Marketing Advisory Committee
offered to help run a design contest, which concluded in May, with a $300 check and
bragging rights for the best overall design going to fi rst-year Full-Time student Joseph Ryu.
Meenakshi Dash, ’08, won $100 for the most original design and Mark Zmijewski,
Leon Carroll Marshall Professor of Accounting, won $100 for scoring the most “likes”
on Facebook. The fi ve-judge panel evaluated the designs for originality, suitability for a
business setting, and ease of manufacturing. To view all 60 design submissions, visit the
Booth Community Facebook page at Facebook.com/ChicagoBoothBusiness.
From left to right: David Booth, Meenakshi
Dash, Joseph Ryu, and dean Sunil Kumar.
Not pictured: Mark Zmijewski.
Chicago Booth Magazine…
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How Scott Griffith, ’90, CEO of Zipcar, drove car sharing to the mainstream
Opening New Routes
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The University of Chicago Booth School of Business Summer 2012
Critical DialoguesDean Sunil Kumar gets the inside track on Zipcar from CEO Scott Griffith, ’90 20
Temptation’s Siren SongResearch by Wilhelm Hofmann investigates desire, willpower, and self-control 10
Good Energy Experts discuss fueling the future at the 60th Annual Management Conference 26