Michael White shares his journey and lessons learned from navigating the rugged terrain of the mining industry, where success hinges on possessing both literal and metaphorical mettle.
One of the essential characteristics of any successful entrepreneur is possessing mettle – defined as the type of character that is resilient and gives you the courage to carry on.
Michael White, BA’94, MBA’00, knows first-hand that overcoming obstacles is part of life.
White is President and CEO of IBK Capital Corp., a company involved in private placement financings and advisory services totaling over $5.6 billion for emerging companies in metals exploration and mining, and technology.
By any standards, the mining industry is not for the faint of heart. It is an industry of tough characters on the site and tough characters in the boardroom. As an industry, it faces challenges from all directions. Environmental and climate change pressures, trade wars and geopolitics, changing and uncertain demand, technological changes, and a global maintenance skills shortage to name a few.
From stuffing envelopes to striking gold
White's journey began with a deep-rooted fascination for earth sciences, complemented by a flair for mathematics and analysis. This passion propelled him to pursue an undergraduate degree in geology and subsequently an MBA, both of which served as catalysts for his future plans.
During the summer break from university, he worked at IBK Capital where his father, Bill White, MBA ’69, was a founding partner. But far from starting anywhere near the top of the heap, he found himself churning out basic, non-glamorous office tasks - stuffing envelopes, sending faxes, and in pre-internet days – compiling binders of corporate dealings and maintaining the corporate library. It was a tiny step on the ladder and enough to let him know the business could be interesting.
After graduation, he joined the company full-time and worked under two of the partners. This time he was elevated to writing corporate summaries for mining clients. This allowed White interactions with various geoscientists and a chance to go out on site visits or as he puts it, “bang on some rocks.” Rocks that could be located in North America, South America, Asia, Africa - anywhere there was an initial exploration of a mining site underway.
These visits involved critical assessments of mining sites, evaluating factors such as accessibility, community support, material quality, and the competence of management teams. White emphasizes the pivotal role of effective management in ensuring operational success, highlighting how poor management can lead to inefficiencies and worker dissatisfaction.
IBK Capital is often looking into existing mining operations that have viable production possibilities but are under-producing. White’s job is to assess the potential that a new management team can make on the situation.
He cites the example of an open pit gold mine in California, which had always been a bit of an “orphan” in the sense it was always underappreciated by the parent company and shuffled through mergers and divestitures. It was a respectable mid-tier operation, producing 4 million ounces of gold over a span of 12 – 15 years. A fellow geologist wanted to put together a deal to buy the mine as he felt geologically it was ideal for further expansion. White saw it as a huge opportunity to create value because the market was viewing the asset as depleted and therefore a liability - and practically giving it away.
White and his fellow geologist, in time-honoured tradition, went out into the blazing desert to reconnoiter. White was told to keep an eye out for “VG” or visible gold which is a sign of higher-grade gold.
Normally in a low-grade mine, the actual gold is impossible to see and only appears when assayed. His geologist friend, who had spent more than a few boiling hours crawling around the mine site probably didn’t expect White to find VG within 30 minutes!
A momentary chagrin that did not taint the joy of discovery. The mine could produce more gold.
The next step of the project was to raise the capital to buy the mine and bring in a crackerjack operational management team to run the project which IBK then did. White views these types of opportunities as real winners. Difficult situations present opportunities for the right investors. The easy ones sell early to investors with deep pockets.
It’s About People
While the physical elements of mining play a significant role, White acknowledges the critical importance of human dynamics. He recalls a situation where a formerly competent management team made detrimental decisions, sparking internal conflicts and a proxy battle that endangered the company’s one and only mine operation.
In a gutsy move, White’s company decided to find a new management team in very short order to keep the operation going and hope the shareholders would agree. Part of the process meant White had to meet the miners face-to-face and let them know the situation.
These were old-time Montana miners who were told White and his team were there to pull the plug on operations. They were not in the mood for a polite discussion. After five hot hours piled in pick-up trucks in front of a locked gate, White and his team finally got access to the site. White instinctively knew that he needed to be 100% transparent and gathered the whole group for a frank talk. He managed to convince most of them that although there would be changes, the intention was to keep the mine going in the best interests of all.
When they are all standing there, you just look at their faces – you can see who you can go to and talk to. We needed that trust.
Transparency, candor, and a good plan worked. The transition was successful and the company now operates mines in the US and Mexico.
The importance of mining to the local people can never be underestimated. The jobs are well paying and can involve and benefit the whole community.
Lessons From decades of digging deep
Beyond his boots-on-the-ground involvement, White's analytical acumen allows him to contribute to the marketing side of the business as well. This entails traveling all over the globe, especially in Europe (London, Paris, Geneva, Zurich, Frankfurt, Monaco, and Scandinavia) to meet with potential investors, including very successful entrepreneurs.
When asked about commonalities that successful entrepreneurs share, White says, “They commit completely to what they are doing – they have this clear vision in mind and they know how it will solve a problem and benefit people.”
White again refers to the inevitable obstacles that entrepreneurs face.
“You have to be able to get around them, get under them, get over them, or bash them out of the way. Whatever gets you through,” said White.
He adds that successful entrepreneurs must have a thick skin or an innate resilience. You have bad days, bad months, even bad years, but you can’t let it get you down. You are going to have doubts and fears but good entrepreneurs find a way to manage those anxieties and turn it around.
IBK Capital has a motto that “perseverance pays” and it is one they live by. Although you must accept “no” for an answer when it’s given sincerely, White regards every “no” to a proposal as being one step closer to a “yes.”
You may get 19 “no’s” but your twentieth one may be a “yes.”
Or as his father puts it – you need your Teflon on so things slide off you. Never take it personally.
White advises that a good moral compass is a necessity. It’s OK to realize profit from a venture, but on projects based on “reckless greed,” he takes a hard pass. Something based solely on fast cash is never worthwhile for anyone.
White and his company believe strongly in giving back. He thinks everyone should give what they can when they can. You may not always be in a position to give and that’s OK, but if you can – you should.
IBK Capital Corp. sponsors many philanthropic activities including universities, hospitals, and church organizations. White himself sits on the Advisory Board for the Morrissette Institute of Entrepreneurship and generously volunteers his time to mentor young entrepreneurs.
His advice to his young entrepreneurs is based very much on his own experience of getting out there, seeing things for themselves, and talking to people face-to-face. White notes that social media, emails, and the internet are all fine tools but they are just that - tools. Five emails yielding no replies are never as effective as picking up the phone or going to see someone in person. Using the “six degrees of separation” - someone who knows someone who knows someone - to get to your target is sound advice in an age of endless digital networks. Contacts count as a way of getting around those inevitable obstacles.
And in all cases, perseverance pays.