Hubbard ‘Makes Own Luck’

R. D. Hubbard calls the press box at Los Alamitos Race Course andasks for the results of the early quarter-horse races when the line suddenly goes dead.

“Oh, no,” said the press liaison who was giving Hubbard the information, “I think I just disconnected R. D. Hubbard !”

Less than a minute later, the phone rings again and the liaison grabs it. “R. D., what happened?”

Suddenly, the liaison smiles. “Hey,” he says to others in the press box, “Guess what happened. R. D. says he ran out of money for the pay phone.”

Those in the press box break into laughter as they picture Hubbard, a self-made multimillionaire who has phones in his car, limousine and private jet, standing at a pay phone, searching through his pockets for loose change.

But that is the paradox of Hubbard, chairman of Irvine-based AFG Industries Inc. Hubbard is an executive as much at ease in a corporate stockholders meeting as he is along the backstretch at Los Alamitos. Even when he’s sitting in his favorite country-western bar, talking about his Thoroughbred and quarter horses, there’s a sophistication that separates him from the other “good ole boys” who’ve struck it rich.

“A lot of people say R. D.’s lucky,” said Brad McKinzie, co-editor and part owner of Quarter Week magazine, of which Hubbard is also a part owner. “But I have a feeling he makes his own luck.”

Indeed, Hubbard worked his way up from a job as a $90-a-week auto-glass salesman in Wichita to become chief executive of AFG, the fifth-largest manufacturer of flat glass in the United States and the fastest-growing company in the glass business, according to industry analysts.

Hubbard, however, didn’t assume control of AFG--he created it out of a sea of red ink. In 1977, Hubbard, then president of Safelite Industries, acquired two debt-ridden glass-manufacturing companies--Fourco Glass of West Virginia and ASG Industries of Tennessee--and merged them to make AFG Industries. Within seven years, Hubbard had turned the two failing entities into a business with $284 million in annual revenues.

“When R. D. took over, Fourco was losing $1 million a month and was $32 million in debt,” said Billy M. Jones, holder of an endowed chair at the Wichita State University College of Business and author of “Magic With Sand,” a book about Hubbard and AFG Industries. “R. D. took that company and turned it around so that only six months later it was showing a profit.”

A business associate adds, “R. D. doesn’t miss a single trick. He can keep track of everything and everyone. He picks up on all the little things most people don’t think about. He never forgets a face or a name.”

Although Hubbard, whom business associates estimate has a personal net worth between $68 million and $72 million, is recognized as one of the most influential owners in quarter-horse racing, he has been known to invite the waiters at the Los Alamitos clubhouse to celebrate with him after one of his horses scores a big stakes victory.

“R. D.’s just like that,” said trainer Don Farris, who works in Hubbard’s quarter-horse and Thoroughbred operations. “In my work, I’ve been around a lot of wealthy people. But R. D. stands out. Everything he’s got, he’s made and he’s done it from nothing, from scratch.”

As head of AFG Industries, Hubbard sits in a high-tech office that takes up the better part of the seventh floor of the Burlington Northern Building in Corona del Mar, overlooking Balboa Island and Newport Beach. The executive suite, filled with mirrors, chrome and black lacquer furniture, looks like a “Dynasty” set. You half expect to see kleig lights hanging from the ceiling.

The elegant high gloss of Hubbard’s headquarters is worlds away from the Smith Center Ice House, the family-owned business where Hubbard worked as a child. When he was 11, Hubbard, the eighth child of Miner and Loese Hubbard of Smith Center, Kan., carried 25- and 50-pound blocks of ice to neighboring houses. At 14, Hubbard strung electrical lines to farm houses for the Rural Electrification Agency. In high school, he worked building highways. After graduation, Hubbard served as a farm worker, following the wheat harvests from Texas to North Dakota for $20 a day.

In 1954, he entered Bulter County Community College at El Dorado, Kan., and held odd jobs to help support a wife and two children. After two years at the college, he accepted a position as a teacher and basketball coach in the Towanda, Kan., schools for $3,200 a year.

Basketball was always a passion for Hubbard. In fact, it was basketball that got Hubbard into college. He was lured to the school by his former high school coach to play college basketball.

Perhaps that is where Hubbard developed the competitive spirit that today drives his business interests. When asked what he enjoyed most about his horses, Hubbard’s one-word answer said it all: “Winning.”

Hubbard knows what it’s like to win, but only because he has not been afraid to lose. His colleagues say Hubbard thrives on challenges and grabs new opportunities as eagerly as he once did rebounds.

“When opportunity knocks, R. D. takes hold of it and doesn’t let it get away,” Farris said. “Where others hesitate, he doesn’t. He goes right after what he wants. What really makes him so successful is that he’s willing to take a gamble to see if something will work.”

That’s how Hubbard got into the horse-racing and breeding businesses. That’s how he got into the magazine business. And that’s how he got into the glass business.

“Hubbard’s most identifiable trait is his fearless tenacity,” said Jones, who spent more than a year researching his book on Hubbard. “He is not afraid to work and learn and, most important, he’s not afraid of risks.”

Hubbard is also not afraid to share the rewards of his work. “If you do well for him, he’ll do well by you,” McKinzie said.

Direct Incentive

Hubbard has incorporated this philosophy into his management practices. When he assumed control of Fourco, he called the salesmen together and introduced a very simple “Incentives Program”: If each salesman did not improve his sales quota dramatically, he would be fired.

“What really makes R. D. successful is that he surrounds himself with the best people he can find,” Farris said.

McKinzie agrees. “He finds people who he trusts that know a particular business and let’s them loose. That’s what he’s done on the magazine with Bruce (Rimbo, co-editor and part owner) and me. He’s confident enough in his judgment of people so that he doesn’t have to be involved in everything.”

Aside from being one of quarter-horse racing’s most visible personalities, Hubbard is also one of its biggest boosters. He has worked with former Los Alamitos owner Mildred Vessels and current owner Marje Everett (who also operates Hollywood Park) to promote the sport and serves on the board of the recently formed Quarter Horse Breeders’ Trust, which is the sport’s answer to the Breeder’s Cup for Thoroughbreds. He has been an industry leader in stallion syndication, with top sires such as the world champion Super Sound Charger and The Signature.

Last December, though, Hubbard announced that he was curtailing his extensive quarter-horse racing and breeding business and instead would expand his Thoroughbred business. Hubbard maintains that he will continue in the quarter-horse business in a “very limited role” and has announced a nearly complete dispersal sale of his 140 quarter horses in August.

Hubbard and partner Farris already have sold their quarter-horse ranch, Frontera Farms in Sunland, N.M., and jointly purchased, with Edward Sczensy, chairman and president of the AFG Technologies Inc. unit, the 235-acre Holly Hill Farms, outside Paris, Ky.

“We operated (quarter horses) as a business and that’s the main reason why we’re going into Thoroughbreds,” Hubbard said. “We think there’s more money potential in the Thoroughbred business. I think Spend A Buck’s a good example. They paid $12,500 for the horse and now they’re talking $25 million to $50 million in syndication, depending on what he does. The same horse in the quarter-horse industry would bring $2.5 million to $4 million.”

Hubbard initially entered the Thoroughbred industry in 1979. He already owns breeding shares in Alleged, a two-time winner of the Prix de l’Arc de Triomphe, the most prestigious race in France, and Danzig, sire of Chief’s Crown, one of this year’s leading 3-year-olds, among others. At last November’s Keeneland Fall Sale, Hubbard and Sczensy sold a filly for the highest price of any weanling Thoroughbred ever sold at auction--$750,000.

Hubbard may talk about his horses as “just a business,” but there appears more to it than that.

“There’s nothing like the feeling of seeing your own horse win. Nothing,” he said. “The greatest thrill, of course, is winning when you’re not supposed to, when the odds are against you. . . . But the other feeling’s good, too--I assure you.”