Episode 75: Gerald Alley
Gerald Alley is the founder and CEO of Con-Real, LP, a diverse company providing construction, real estate, program management, and technology and innovation services to clients and is one of the nation’s largest minority-owned businesses. He was recently inducted into the Arkansas Business Hall of Fame. Read More
More About This Episode
Gerald Alley is the founder and CEO of Con-Real, LP, a diverse company providing construction, real estate, program management, and technology and innovation services to clients and is one of the nation’s largest minority-owned businesses. He was recently inducted into the Arkansas Business Hall of Fame. Prior to the business college becoming the Sam M. Walton College of Business, Gerald was challenged by his mother to broaden his horizons, leave his home town of Pine Bluff, and study in Fayetteville. In this episode, Gerald talks about his time at the University, and the lessons he learned that helped him achieve success.
00:07 Matt Waller: Hi, I'm Matt Waller, dean of the Sam M. Walton College of Business. Welcome to Be Epic, the podcast where we explore excellence, professionalism, innovation and collegiality, and what those values mean in business education in your life today. I have with me today, Gerald Alley, founder and CEO of Con-Real LP, a construction and real estate firm in Texas, as well as in the southwest of the United States. Gerald, you're also an alum of our college, and thrilled to have you on this podcast, the Be Epic podcast. Thanks for joining me.
00:47 Gerald Alley: Thank you for inviting me to this. I really appreciate it.
00:51 Matt Waller: Now, you're also on my executive advisory board and you've been on the board for quite a while. Thank you for serving in that regard. But maybe more importantly, you're about to be inducted into the Arkansas Business Hall of Fame, and congratulations on that.
01:09 Gerald Alley: Thank you, thank you.
01:11 Matt Waller: There's only four people that are inducted each year, and as you know, we have hundreds of nominations. So it's quite a recognition of your tremendous accomplishments.
01:24 Gerald Alley: I'm honored, first of all and I'm very humbled by that honor, because I looked at your previous inductees and never in my wildest imagination, I would even consider I would be in that group that would be inducted 'cause it is outstanding recognition of legacy, of time in area of business and in life. So I'm humbled by it, I'm appreciated by it, and I'm just glad to be honored in that way.
01:52 Matt Waller: What city did you grow up in?
01:53 Gerald Alley: I grew up in Pine Bluff, Pine Bluff, Arkansas, which you know is about 45 miles southeast of Little Rock. And grew up there, all the way until I left to go to the University of Arkansas. Matter of fact, celebrating my 50th year since I left from Pine Bluff to go to Fairview at the great age of 16.
02:18 Matt Waller: How did you decide to come to the Walton College? I know it wasn't called that back then.
02:23 Gerald Alley: To be honest, my mother put a gun to my head.
02:26 Gerald Alley: I mean, and she did it from the standpoint of challenging me because the University of Arkansas was a new horizon she felt. Back then it was, African-Americans were really sort of restricted to go to, at that time it was Arkansas AM&N, which is a historical black college right now. It would have been an easy route for me to go across the street to the local college. She felt like that if I was taken to another environment, that then I would have to adjust to that. In the end the guidelines of trying to perform would be challenged. I did it in the summer and I started in the fall, and that's when I faced my first challenge. And that challenge was, I went from nine hours in the summer to 16 hours in the fall, and the whole requirement of classes became dominant, the socialization. The campus grew from maybe 2000 on campus to 15,000 on campus. The environment was different, the classes were packed, stacked behind each other by mid-terms. I did some totally, which was in my DNA. I said, "Well. Okay. I'm getting here. Instead of staying in a dorm, I'm moving out of campus." Rule number one, you don't move out of campus. And besides that I need to have a party house off-campus, so that was rule number two.
03:54 Gerald Alley: That should give you indication that my environment didn't breed toward what I needed to do to deal with the challenges of the curriculum and the time and the pace and all this other stuff. Then I really realized that at Christmas break. Back then in Christmas, the semester would not end at Christmas break. It would end three weeks after Christmas break. When I went home Christmas, I had my mid-term grades and they were not... If you do anything, don't check my freshman year mid-term grades, if you do anything. But I did come back during Christmas. My mother was promoting me to go to university of Arkansas 'cause she felt that I could have a more challenging education. My father was more doubtful, because he knew my DNA. He said, "He's not gonna fall in line" and when I got there Christmas Day, he said some profound statement to me that just went to my core. He said, "Do not mess up my money." Christmas Day I made my decision and said, "I need to go back and study." The day after Christmas, I took a bus back to Fairview. Now school wasn't in session, but Yocum Hall was open for a few students, and only thing they had was a study room down at the basement. First time I drank coffee in my life.
05:21 Matt Waller: Wow.
05:22 Gerald Alley: And my goal was, looking at my midterm grades, that I had to do a dramatic turn around. It was one of those paper chase things. For two weeks, all I did was study. I missed not getting on probation by two basis points. Grades were not good at all, but I missed probation. And that was 1969, the Vietnam war was in its heat. The lottery had just started, 'cause that was also in the back of my mind. If my number is at a certain level, I'm going. You had a lot of student unrest. I sort of tapered that back to say, "What is my purpose?" And I ended up staying at Walton because it became a challenge for me that I liked the idea of business because at the end of the day, they were still saying things that, from a practical sense, it applied the theory and the mechanics to something that I had exposure to that I wasn't aware it was an actual business prospect. The finance major at that time was really geared around how you build wealth, and how do you expand from an asset.
06:40 Gerald Alley: And I thought they had a good way to present that to students who probably really were not exposed, 'cause most students were really all coming from the state of Arkansas, and they were not coming from large sophisticated cities. So in a way, we were being taught really about the world that we hadn't yet seen. And I felt that that was good 'cause I didn't think I would get that exposure at the local college. I got a chance to go... They were having a student meeting in Dallas for people interested in advertising. And that wasn't my major, but I liked the elective course. It wasn't finance, it was retail advertising. And we got a chance to see large advertising companies in Dallas talk about brand identification, brand product, things of that nature.
07:36 Gerald Alley: And again, I was in an environment, in the whole group seminar, nobody else looked like me, but I was already sort of geared toward that and so I didn't feel that it would make me less willing to engage. And by being exposed into Dallas, which gave me an opportunity to go from Fairview to visit other places, let me think beyond what my past was. And being raised in a family that had a service station business, where that there were at the most two to three employees, to go look at businesses that there were a lot of people, was eye-opening to me. And that was the time there wasn't many African-Americans in corporate America. So the business school had a good segue into saying, "Let's bring on leaders to meet students, not just go on Interview Day, but come in and talk to students." And I really felt that that was the exposure where students could engage with leaders. They could ask them questions, and usually... And as a matter of fact, that's how I got my first job.
08:56 Matt Waller: Your first job after college?
08:57 Gerald Alley: After college I was taking a retail advertising class, and they had a gentleman who was the President/CEO of a department chain retail store in Dallas, at that time, called Sanger-Harris, which was part of Federated chain stores, which owns Macy's, and Foley's, and May Company stores. I normally... 'Cause I knew I was graduating and I was working full-time at the Union, I was the manager of the Union building at night, I normally wouldn't go to that class, because I didn't need that class. That day I elected to go and to my surprise, here was the president of this store, and I knew nothing about the store. And Dr. Ainsworth would always encourage us, "Whoever you meet, ask the question you really wanna ask." So he was talking about his store and he was looking for buyers to come in and buy merchandise. And so I said, "Okay, let me liven this up a little bit." So he was talking about, "Well, you know we have about 200 buyers, and it takes about three years for a managed trainee to become a buyer, or four years, whatever it was.
10:08 Gerald Alley: So I raised my hand up, and at this time still, I had sort of an edge to me, and my brother was in the military, my other brother was in the military. So I had a jacket, I had an afro five inches wide, just really living that lifestyle. And so I asked, I said, "Mr. Miller, I have a question." He said, "Yes?" I said, "You said that you have about 200 buyers that go from management training to be a buyer to run your store. You have about 10 stores in Dallas." He said, "That's right." I said, "Out of curiosity, how many of those buyers are black?" The class goes quiet. He said, "Well, I really don't know." I said, "What do you mean you don't know?" I said, "Well, let me approach it this way. What percentage of your market is represented by buyers that are black consumers?" He said, "I really don't... " I said, "Wait a minute, I thought you were the CEO. Dr. Ainsworth always tell us to know your customer." Ainsworth looks at me, I look back at him. And everybody could tell that my approach was more than just a business model. It was a social model, but I used business techniques.
11:34 Gerald Alley: He said, "Well I don't really know." I said, "Would you say it's 40%?" He said, "No, maybe 25-28%." I said, "So let's use that. Let's use 25%." He said, "Okay." I said, "So you got 200 buyers and you got, just basic math, at least you should have around 50 blacks to represent the product you're selling to your consumer?" He said, "Well we just... We don't really know." I said, "Well, let me ask you another question. What is your profit margin? Could you lose 25% of your customer base and still make a profit?" He said, "That'd be difficult." I said, "Wouldn't it make sense to buy the products you sell to the consumer to have representation to buy these products?" Everybody's looking like, "This guy, normally, is not here and now he's asking this president that everybody wants a job from, questioning him." He said, "Well, we just hadn't found anybody qualified." So I go off. I said, "Wait a minute, you're trying to tell me there's nobody, you're in Dallas, qualified to buy the merchandise that you sell to 25% of your market, nobody in Texas, nobody in the United States, nobody on earth?" He says, "Well, I don't mean they weren't qualify, they've been in the program, they just haven't become buyers." I said," Okay. So you said earlier that it takes about four years. So, this idea for them to make it from trainee to buyer, probably hadn't hit your mind. It only hit you less than four years ago, why then not buyers? I don't see how you would risk your profit."
13:18 Gerald Alley: I'm feeling pretty good. I just chewed on a CEO, I'd never see him the rest of my life. So I'm walking out of the class, and he pauses and he said, "You got a minute?" and I said, "Yeah, I just told a big wig where to go, right?" And he said, "Oh, have you interviewed with our company?" I said, "No." He said, "Well, if you don't interview, you'll never know the challenge." He said, "Why didn't you interview?" I said, "Well, you all came and I work 40 hours a week." And he said, "What do you do?" I said, "I run the Union building at night?" He said, "You run the Union building at night?" I said, "Yeah." He said, "So what do you do?" and I told him what I do. He said, "If you had an opportunity to interview with our company, would you do it?" And it dawned on me right there and said, "Wait a minute, I'm not a hostile guy, this is an opportunity." I said, "Yes sir, I would." I went from radical to, "Yeah, I want a job". So he said, "Well, I'll get your name. We'll see what happens." Three days later, I get a personal invite from Sanger-Harris to come down and interview in Dallas.
14:20 Gerald Alley: So I go, and I work at Sanger-Harris and I work... They said, "Where you don't wanna work?" I said, "I don't wanna work in toys and women's lingerie." They put me in toys right before Christmas. So I did that for a while, and then they moved me up into men's clothing, and I started seeing that when we would be working in bull pens as junior buyers or assistant to the buyers, that that was time at work and there was time after work, and when it came... And the senior buyer would travel around the world, buy clothes to ship back, and he would say, "Okay, alright, we going do a happy hour, everybody come, Gerald, you stay in the stock room and make sure that inventory. " So, it became clear, the ones that were moving, the ones who were gravitating toward the boss. So I got pretty frustrated because I'm seeing, it's not about just doing the work, it's about the connection of who you do the work with.
15:22 Gerald Alley: So I called my counselor, my mother. Said, "I'm thinking about looking for another job." She said, "What would other job give you?" I said, "I don't know, I just... I'm not moving here." And she was big on education. She said, "You don't need to find another job, you need to get another degree." And I'm saying, "Oh, Mom, I just got through Arkansas." I'm, "Wow, lady, are you crazy? I barely got out of there." So I took her advice and I start interviewing places. Meanwhile, I was looking at another job, looking for other jobs. And it rung true that says, "You never know until you're asked. So after applying to different schools, I live north of Downtown. I would catch a bus. I didn't have a car, I'd catch a bus and I keep hearing people say, "Well, that's SMU over there." That's a private school. A number of rich kids go to school there. Even the people at Sanger-Harris saw it as somewhere that they couldn't get to. I said, "Well, I'm going in and apply, but I gotta have a different approach."
16:32 Gerald Alley: So I go over to the MBA program, and I asked to speak to the director of the program. I asked about it, and she said, "Well, he has somebody, but you wanna wait?" Wait. The lady was nice. I said, "I wanna apply to SMU." And he said, "Oh okay, we only take so many students in our graduate program and we got this fast track program and it's pretty selective." And he said, "Why would we consider?" I said, "Because, I can do something that you haven't been able to do." He says, "What's that?" I says, "Easy to make rich kids richer in a generation, but you as an education institution, what have you done about kids that don't have any money?" He paused and looked at me and said, "What are you saying?" I said, "There's Downtown Dallas, there's North Dallas and there's South Dallas. How many of your students come from South Dallas? How many people you know from South Dallas? But for you to be a true education, you have to prove yourself, you can take people who have the tenacity, the will, the capability and the desire and make them a return on your investment." He looked at me like, "So what does that get? How did we get in this conversation? You interviewing me, right?"
17:54 Gerald Alley: And I said, "I'll do this. If you let me in, I will assure you I will pay you back one day." He said, "Now, we have one program right now, that's for full tab, and they call it fast track. You start in the fall, and you go fall, spring and summer. You can't drop a class. There's A-B and you're out. No other, no relief." I said, "Okay." So, sure enough, late that summer, I go down in my apartment, open the mail lot and I look through. A letter here. And I said, "This is SMU" and it says "You've been accepted." And I look down, I see the scholarships and stuff, and I added up the money and the grants and I said, "This is more money than I'm making right now." So I go back to Sanger. I said, "How do I do this?" I said, "So first of all, I need to carry myself from the summer to the fall, so I'm just gonna go in with all my frustrations, forget those frustrations, just keep my head down and work." I end up in the program. Went to first, I remember the first day was 114 students, and the guy with the program said, "Look, we expect you guys to be leaders. You all come from good schools to gain the mechanics. Now we're gonna teach you how to be leaders." So after I finished, I started working for this non-profit organization. They have small business people, and that was sort of a consultant piece. After the experience at Sangers, I really didn't want the big corporation pie.
19:39 Matt Waller: And this is 1974...
19:40 Gerald Alley: '75 there. I finished in '75. So as that happened, I got a call. This organization that was sort of representing small and minority business, people called me from Fort Worth saying, "I hear you help small contracts to do financing and we're looking to fund something, of an organization to do this." And I said, "Okay." I was the vice president of the consultant firm over construction. I would go to the president, and say, "We need to go after this project because we believe we can expand out of Dallas to Fort Worth." He said, "No, no, no. I don't think we should because we know people on that side." And I said, "You know, I came in here not knowing what I was gonna do, but you just told me not to run a race that I think I can win. You've given me the confidence, I should try." I went back, I wrote the proposal. Sure enough, I win the proposal, and that's 40 years ago.
20:44 Matt Waller: Wow.
20:45 Gerald Alley: So, I believe that the University of Arkansas prepared me for uncharted waters. It also prepared me for not saying, "Well, if it didn't work right at first, then the dice is cast. It's sort of like, you don't know what your life is until you try. So, there is a risk in everything you do. You try to calculate the best you can, but at some point you gotta pull the trigger and if it don't work, that don't mean that it's over with. It just didn't work that time."
21:36 Matt Waller: Thanks for listening to today's episode of the Be Epic podcast from the Walton College. You can find us on Google, SoundCloud, iTunes, or look for us wherever you find your podcast. Be sure to subscribe, and rate us. You can find current and past episodes by searching Beepicpodcast, one word, that's B-E-E-P-I-C podcast. And now, be epic.