400th Post What I Have Learned From Blogging Over The Years

I honestly can't believe this is my 400th blog post. Originally I started to write a blog to keep track of things I was noticing in the world. My first blog post was back in October 30, 2009. My original intention was to keep a diary of my thoughts. At the time I wanted to focus on "finance, economics, current events". Originally I did blog on a garden variety of things-from hair loss, to organ donation, to Tiger Woods. However, probably what this blog is most known for is following Koch Industries and the Koch family over many years. This blog was the first and only blog to have a historical net worth estimate for Charles and David Koch. Also it is on this blog that I calculated the annual dividends (along with net profit) of Charles Koch and David Koch. I haven't tracked my time on the issue but I would say I have spent a few hundred hours studying/following the Koch family.

Back in the early 2010's I was in graduate school and often found free time on my hands to write blog posts and during those years I spend dozens of hours looking up old articles on the Koch family. The graduate school I was at had a subscription to NewsBank database which was a great resource to find articles on the Koch family.  Although, I have seen it sourced in many Koch books such as Kochland and Sons of Wichita one piece I wish I could obtain is the Koch vs. Koch trial transcript. I have been able to find summaries online however the actual transcript would be really interesting to look through. 

What is interesting is I somewhat stumbled upon the Koch family. Back in the early 2010's (while I was in grad school) I became interested in learning more about Walter Williams. I remember watching a video that was a toast to him (here is the video from 2003). At one point Charles Koch speaks saying that him and Walter Williams had been friends since about 1983-1984 (it should be noted when Walter recently passed away Charles contacted Walter's daughter (Devon) to express his condolences). The first post I have had on something Koch related was back on June 23, 2011 when I wrote about the Koch philosophy of management. 

What I am probably most proud of is my ability to research rare items on the Koch family and write wonderful blog posts that are fun, entertaining, and share information that you can't find anywhere else on the internet. I often think of how sloppy some writers are. What I mean by sloppy is they don't get into the nitty gritty details and often use flowery language with not much facts/data. It also irritates me when writers can't get to their point or have a take away or action item. There are a few writers like James Stewart or Bryan Burrough who are able to weave incredible stories with facts and data. If you look back at my blog posts I try to include as much data as possible (perhaps sometimes too much) with appropriate hyperlinks so if people are curious they can check out the resources on their own (you don't have to just take my word for it). 

The most popular post on the blog has been my post on Elizabeth Koch (what is interesting is this all started from a footnote in "Sons of Wichita" and then became a project of mine. People often don't realize a few of the blog posts I have written occurred over many days/sometimes months (often saved as a draft and then I will come back to it for additional ideas or editing). Most posts I try to knock out in a few writing sessions. However some posts I did have writer's block of how to organize or what I felt was the most interesting. To posts that come to mind are the ABKO deal between Koch Industries and Chrysler and the other was the Pine Bend Refinery that Koch owned. Both posts were written over a couple of months of back and fourth. The ABKO deal and Pine Bend refinery are two of my favorite posts though. Also I would challenge anyone to find posts that are more detailed and have more analysis then those two posts. My general process has been to get all the data and do some type of brain dump and then structure the information in an organized fashion. The fun part is what I call the editing of trying to move facts to their respective positions and tidy things up. 

One of the things I was able to break on my blog is that Koch Industries is a C Corporation (and not a S Corporation as S Corporation as Austan Goolsbee tweeted that Koch Industries didn't pay any corporate taxes (the tweet was then deleted). In actuality Austan (who unfortunately is a professor at the University of Chicago) confused the Koch brothers and was confusing Bill Koch with Charles and David Koch. 

My most productive year was in 2011-2012 (at the time I was in graduate school and had a lot of free time on my hands). During this time I read through hundreds of pages from the Koch vs. Koch trial (part 1, part 2, part 3) and tried to boil down all these into the important pieces. Probably the most interesting part was learning the work schedule of Charles Koch. At one point Koch executives were working a full day and part of the Saturday night. In fact there was a meeting on a Sunday in August 1968 that went from 4 P.M. to midnight! Brother David Koch was no slouch either. As I remarked here David woke up at 7:30 A.M. and had his breakfast and would work until 7 P.M. and then go home to his wife, kids, and personal chef. Back in his younger days David (who was a bachelor for many many decades) would spend weekends at the office studying pollution control designs (for fun he would ski). Probably one of my favorite interviews is the one MIT Spectrum did with David Koch back in 1999. In the interview David admits he gives away about half of his income to charity. For fun he enjoys reading biographies, historical fiction, and military fiction (back in the 1980's he mentioned that he read about 24 news/opinion journals (and that didn't even include technical trade journals). Also he takes some of his friends on exotic trips to the Amazon jungle on his private jet. According to David traveling "takes you out of the rut you get locked into as a businessman". I truly believe both Charles and David Koch are interesting individuals who undeniably built an amazing business with an extraordinary long term growth rate. 

One of the largest contributions this blog has made was estimating what Koch Industries earn and the dividends they pay out to shareholders. Koch Industries routinely invests 90% of their earnings back into the company. Well simple math would show that if I knew the revenues I could back calculate how much profit there was. What I probably am most proud of is my research that has put a ballpark estimate on the dividends and profits of Koch Industries. My estimates show that Koch Industries generates roughly $17 billion of earnings (before tax) which would translate into $900 million of dividends available to all Koch shareholders which would say the Koch brothers each pull in close to $400 million of dividend income (dividends have grown at a compound growth of 21%/year-over 50 years!). I also compared Charles Koch as a businessman to John D. Rockefeller here (John Rockefeller retired at 57 and Charles Koch is currently 85 years old and still working at Koch Industries). Speaking of dividends I also wrote how Bill Koch and Frederick Koch (brothers to Charles and David Koch) left billions on the table for their shareholder dispute with their brothers and would both have had more of a net worth and dividends if they never sold their Koch shares. 

Speaking of Bill Koch I also covered the Oxbow Carbon corporate coup that almost lead to the fire sale of Oxbow Carbon (ultimately a judge ruled that Bill Koch would not be forced to sell his company-however the story is still quite interesting). The whole corporate coup was filled with corporate governance issues (such as Bill Koch using the company as as a piggy bank (for his private jet), valuation issues of what Oxbow was really worth, and key executives at Oxbow employees going behind the back of Bill Koch to try to negotiate deals without him knowing. 

It really has been amazing to see the growth of this blog over the years. I have close to almost 250,000 visitors which I never in my wildest dreams never would have believed. What has been really fun is putting my ideas, thoughts, and research out there to share with the rest of the world (yes I do have a worldwide audience). My goal is for someone to stumble upon a blog post and think "Wow this person really does their research when looking into things". I am sure in the coming years there will be more news from Koch Industries and what the succession plan of the company looks like. This experience of blogging has taught me that I truly took the road less traveled.