Retirement Leaves Investment Expert Little Time to Rest : Assets: The chairman of Twentieth Century Mutual Funds spends much of his time arranging the disposal of his fortune.
Life hasn’t slowed down quite like James E. Stowers Jr. thought it would when he turned over his company, Twentieth Century Mutual Funds, to his son.
There’s the cancer research center to organize, one book to promote and another to write. And as chairman of the company that manages more than $26 billion in assets, Stowers still puts in at least 40 hours a week at the office.
“Honestly, I have a harder time trying to find time to do what I want to do today than I did five years ago,” he said. “And I was pretty busy then.”
“Then” is when Stowers and Twentieth Century were riding the mutual fund explosion of the ‘80s and ‘90s to become the fifth-largest no-load mutual fund group in the country. Along the way, Stowers became a rich man, worth $650 million by one estimate.
His son, 35-year-old James E. Stowers III, last year took over daily operation of the company his father founded in 1958. The elder Stowers no longer needs to work but he still does, apparently relishing the busy life.
Much of his time has been spent arranging the disposal of his fortune--almost all to the Stowers Institute for Medical Research.
In September, Stowers announced he was pledging $50 million to buy the Menorah Medical Center building in mid-town Kansas City and turn it into a cancer research center. The 65% stake that Stowers, 70, and his wife Virginia, 64, hold in Twentieth Century will pass to the nonprofit institute after their deaths.
The couple’s interest in a cancer cure is personal. Stowers’s prostate gland was removed due to cancer 7 1/2 years ago, and his wife lost a breast to cancer 1 1/2 years ago. The institute is to focus on those two types of cancer.
“M.D. Anderson (Cancer Hospital) made Houston different, Mayo’s (Clinic) made Rochester of Minnesota different, by golly, Stowers Institute’s going to do something to make Kansas City different,” he said.
Giving his money to the proposed institute also helps ensure Stowers’ heirs won’t have to make a public offering or sell part of the company to pay a hefty inheritance tax.
Keeping the company in the family is important to Stowers.
“The investor puts their money in here expecting good management,” he said. “I want to make sure that, after my wife and I die, there will still be good management afterward. I want the same management to be here.”
The research institute isn’t Stowers’ first philanthropic effort. Six years ago, he endowed the Mid-America Urologic Oncology Institute at St. Luke’s Hospital. The urological institute gives 2,000 to 3,000 free prostate cancer screenings annually and conducts a fellowship program for clinical research in prostate cancer.
It took the research institute gift to really make Kansas City residents aware of Stowers. Unlike the late Marion Laboratories founder Ewing Kauffman, who spent his fortune sending inner-city youths to college and keeping the baseball Royals in town, Stowers and his company have kept a low profile, despite their huge success.
“They’re kind of insular,” Don Phillips, publisher of Morningstar Mutual Funds newsletter in Chicago, said of Twentieth Century. “They throw up barriers. . . . Hopefully with the son taking on a bigger role they’ll be more cooperative with the public. They really do have a good product to sell.”
But more than 36 years after starting the company, Stowers is aggressively selling his products. An interview with him in the employee lunchroom at the company’s headquarters near the upscale Country Club Plaza felt like another stop on his just completed book tour.
“When I started the company I was a small person myself, and I want to give everybody the same opportunity of getting into a darn good investment,” Stowers said.
In the book, “Yes, You Can . . . Achieve Financial Independence,” Stowers argues investing is a must to beat inflation. He calls the book his greatest achievement “because I can touch the lives of so many more people.”
He’s working on a second book, detailing the steps that made Twentieth Century a powerhouse.
Stowers, a Kansas City native, graduated from the University of Missouri with a medical degree but opted to become a salesman. He was selling life insurance and mutual funds for a Kansas City company when he decided to found his own company.
According to the company, Stowers pioneered the use of computers in investment management and wrote the software Twentieth Century still uses today to pick stocks.
Nowadays, Stowers enjoys a 16th-floor suite in the company’s office tower, right next to a nearly completed $43-million twin tower the firm needs for its blooming work force.
But he still brings a sandwich to work each day and still eats it in the humble-looking employee lunchroom. Since his cancer surgery, Stowers walks or runs a mile a day for his health.
Twentieth Century might become much bigger in the near future. There have been rumors for months that the company is interested in a merger with the Benham Group, a fixed-income fund specialist that would complement Twentieth Century’s stock funds. Neither firm has confirmed the rumors.
But whether that happens or not, Stowers has built a company that’s proven its endurance by surviving the bear markets of the early and mid-1970s, said James Stock, publisher of InvesTech Mutual Fund Advisor in Whitefish, Mont.
Last year, Twentieth Century, like many other funds, took a beating, performing “kind of average to below average,” said Catherine Voss Sanders, an associate editor at Morningstar.
But analysts are upbeat about the firm.
“The company was obviously founded on good merit and is doing something right,” Stock said.
“I think it’s safe to say Twentieth Century will still be a fund company that will be with us after the next major bear market, and that’s not something that can be said of all fund companies.”
