HEART AND SELL : A Self-Help Author Is Taking His Own Advice in Rebuilding After a Bankruptcy and Coronary

Charles R. Whitlock is a Westlake Village businessman who claims to have earned millions of dollars from starting several small companies. On March 3, 1985, he suffered a heart attack at age 42 while having dinner.

Whitlock survived the attack, and while he recovered he searched for one book or magazine that had all the diet, exercise and psychological help that a heart attack victim would need to stay healthy. There was none.

So as an inveterate entrepreneur, Whitlock last year started HeartCorps magazine, “a self-help journal” for heart patients. The bimonthly publication, which premiered last summer, is getting early raves from patients, doctors and insurance companies, said Whitlock, who is the magazine’s publisher. No less than Dr. Michael E. DeBakey, the famous heart surgeon in Houston, has loaned his name to HeartCorps’s advisory board.

Things are going so well that another health-related magazine, Hippocrates, which is half-owned by Time, already has offered to buy HeartCorps for $2 million, Whitlock said.

The story of HeartCorps, in fact, would likely have made another chapter in a book Whitlock wrote two years ago, titled “10 Ways You Can Earn $1 Million This Year,” in which he reveals his secrets of success. The book’s cover shows Whitlock standing next to a limousine in front of his $1-million house.

“He has a magic touch,” said William L. Bush, a former hospital manager whom Whitlock hired as HeartCorps’s editor.

The Other Side

Maybe not. As Whitlock’s book was coming out in 1987, he was filing for personal bankruptcy protection in federal court in Los Angeles. Meanwhile, a windmill-energy company he helped start a few years earlier also was filing for protection from creditors in bankruptcy court. And just as embarrassing, the house pictured on Whitlock’s book doesn’t belong to him anymore. His bankruptcy led to its foreclosure.

It wasn’t the first time Whitlock had stumbled financially. He had filed for personal bankruptcy in Green Bay, Wis., in 1969, although he neglected to mention that in his book. Whitlock said he “elected not to include it.”

And, Hippocrates says it has not offered to buy HeartCorps, it has only held exploratory talks with the magazine.

Although his financial setbacks aren’t in his book, Whitlock said recently that “half the battle in this life is to be able to get back up and dust yourself off.” In many ways, his hopes of returning to financial health depend on the success of HeartCorps magazine.

How did Whitlock find himself in such a deep hole? His problems stemmed from Airtricity, a venture he helped start in 1982, which built and maintained powered windmills in the aftermath of the oil-shocked 1970s, when alternative energy was all the rage.

Tax Incentives

The windmills were popular with investors, largely because of tax incentives, and Whitlock said about 3,000 of his windmills are among the wind farms that populate the desert near Palm Springs. Whitlock was president and owned 39% of Airtricity.

But in 1986, the tax incentives were repealed, world oil prices collapsed from around $30 a barrel to $10, and interest in alternative energy waned. By May, 1987, Airtricity had fled to federal bankruptcy court amid a flurry of lawsuits between the company, its management, creditors and investors.

Whitlock said some Airtricity investors and creditors sought damages directly from him, and that most of his money had been invested in Airtricity, both of which led to his personal bankruptcy filing.

Whitlock claims to have made millions, but according to the filing, the millions had vanished. He listed total assets of $1.22 million, but $1.2 million of that was the market value of his 5,500-square-foot house in the exclusive North Ranch district between Westlake Village and Thousand Oaks. His debts totaled $986,946, including a $738,276 mortgage on the house, and more than $93,000 of bank and credit-card debt.

After filing for bankruptcy protection, he hoped to sell the house, pay off his mortgage and use his $460,000 of equity in the house to pay off other creditors. But he discovered that the house was built on loose, shifting land, and he could not sell the property, Whitlock said.

So Whitlock’s lender, Glendale Federal Savings & Loan, foreclosed on the property last August by purchasing it for the amount left on the mortgage. Proceeds to Whitlock? Zero. And “the builder had gone bankrupt so there was no recourse through him,” Whitlock said.

Whitlock’s book recounts how he started each of his businesses, along with advice and upbeat tips: “Be prepared to work hard, but be positive about your own capabilities.” Chapter 2 is titled, “The First Million(s)” and Whitlock lists in detail what “action steps” the reader must take to succeed.

The book also portrays a man constantly searching for greener pastures. Born and raised in Chicago, Whitlock says he snuck into the Marine Corps at age 12 by altering his birth certificate, took basic training and then was honorably discharged after admitting his true age. He claims to have done it again at age 14, only this time he joined the Air Force and studied electronics.

More Businesses

Over the next 25 years, Whitlock’s resume fattened considerably. He says he started a firm that made printed circuit boards in Illinois, started a Chicago-area magazine devoted to the circuit board industry, briefly became a policeman in Lexington, Ky., revitalized another circuit board company in Eveleth, Minn., started a Green Bay, Wis., firm that serviced medical equipment, spent brief stints as a medical marketing officer at such large industrial companies as Honeywell, Bendix and Baxter-Travenol.

Next, having moved to Southern California, he started a Woodland Hills company to sell add-on products for dialysis machines, started a company to extract silver from hospital X-rays, started a firm that provided security guards for hospitals and then started Airtricity.

Whitlock said some of the firms he started were later sold to other corporations, giving him money to plow into his next venture. The security business, for instance, was sold to Bekins, he said. Others, like the circuit board magazine, were unable to compete in their markets and were discontinued.

‘Poor at Maintenance’

“I’m a concept man,” he said. “I’m very poor at long-term maintenance. I’m very good at getting something launched and started and built up to a certain level.”

Whitlock says he got a bachelor’s degree in business from LaSalle Extension University in Chicago and an MBA from American University in Washington.

Whitlock’s personal bankruptcy case was formally discharged by the court in October, and in the meantime, he managed to raise about $200,000 from consulting jobs and loans to help start HeartCorps magazine.

Currently, 125,000 copies of each HeartCorps issue are printed at a cost of $180,000, but paid subscriptions total only about 10,000, Bush said. An additional 70,000 are being sent to hospitals, cardiac-rehabilitation centers and other medical facilities nationwide in the hope of luring subscribers. Another 55,000 copies are handled by U.S. and Canadian newsstands and bookstores, with about a third being sold, he said.

Life Style Questions

HeartCorps addresses various life style questions facing heart patients. Its stories provide diet and exercise help, describe which medicines are “heart healthy,” and help family members cope with a relative who has heart trouble. The current issue’s cover story asks the question, “Should recovering heart attack patients have sex?” The answer: Yes, but carefully.

There’s no question HeartCorps’ potential audience is big. About 60 million Americans have some sort of heart disease, and each year 1 million of the 1.5 million Americans who suffer heart attacks survive, according to the American Heart Assn.

Whitlock said his priorities changed after his heart attack. “I don’t work for money,” he said. “I work to enjoy my life style, to live a healthy life and to help others do that.”

Heart disease remains the nation’s biggest killer, accounting for more deaths than cancer and AIDS combined.

But that doesn’t automatically build a magazine’s circulation. Jim Martay, executive publisher of Hippocrates, an 18-month-old magazine based in Sausalito, Calif., said “we probably could identify 20 million people interested in health, but we’re doing well at 500,000” circulation. In November, Time paid $9 million to buy 50% of Hippocrates.

Selling Ads

He said the hard part of making health magazines successful is selling enough advertising. “That’s part of the question we have, whether HeartCorps has enough potential on the ad side to succeed,” Martay said.

Whitlock and Bush asserted that HeartCorps’ advertising is off to a fast start. Although advertisers often agree to place ads in a magazine’s first issue only if it’s free, 18 of the 24 ads in HeartCorps 74-page debut issue were paid, and paid advertising is now running about 30 pages, Bush said. The magazine needs about 40 pages of ads to make money and Whitlock says that the magazine will be making money in a year.

Most of the start-up and operating costs not covered by ads or subscriptions are picked up by HeartCorps’ printer, Amway Corp. in Michigan. Also, HeartCorps is saving money by paying Amway with stock in the magazine instead of cash. Whitlock and Bush each still own 25% of HeartCorps; the rest is owned by Amway and other investors.

Ironically, giving a printer stock in exchange for its services is one of the techniques Whitlock’s book prescribes for budding publishers who want to save cash. So Whitlock is following his own advice in the hope of making a financial comeback.

Which to brings to mind what B.C. Forbes, the late founder of Forbes magazine, once said: “You make more money selling advice than from following it.”