Charlie Zelle '83, President and CEO, Jefferson Partners, LP
Charlie Zelle didn’t intend to take over the family business. He graduated SOM in 1983 and got a job at a Wall Street firm that soon merged with Merrill Lynch. He liked the work, and a short-term stay in New York started to look like it could last a good deal longer. But then in 1986, the family business, Jefferson Lines, fell into trouble and he had to return to Minneapolis to determine if it could be saved.
Zelle took a leave of absence, thinking he might return to New York. But the company, which operates bus lines on a north-south axis from Winnipeg to Dallas, was in worse shape than he had thought. It teetered on the edge of collapse due to a number of factors, ranging from the effects of government deregulation to union issues to poor internal controls. “Most folks engaged in trying to work through these difficulties were recommending we just liquidate the company,” he said. “It was my irrational desire at that point to keep it together. I committed quite a few of what I refer to as my ‘George Bailey moments’ where I said ‘We can't just liquidate it. There's people's lives and there's history, and let's try to restructure it.’ But it was really the advice of outside executives that convinced me to stick with the company. What did I have to lose? I wasn't married. I didn't have a mortgage. And at the very least, I had an education. And the phrase that one said that still rings in my ears is ‘Don't commit suicide for fear of dying. If you don't make it, fine. But give it a shot.’ So that's what I did.”
He took the company into Chapter 11, to give it the time and space to develop a recovery plan. At one point, Jefferson had 300 buses, a number that would drop to 55. The company shed routes and a significant charter business. Zelle found a 40 percent partner in a fellow bus entrepreneur from Texas and set the company back on the path to profitability. For someone who had grown used to the luxuries of the corporate world, the changes in his lifestyle were dramatic. “I had a high-pressure job, working for Merrill Lynch, traveled a lot, stayed up late, worked hard, but it wasn't stressful,” he said. “I came back to something that was extremely stressful. And to go from expensive hotels and law-firm conference rooms to a Super-8 Motel where I'm meeting with drivers' unions was a culture shock. But, in the process, I really appreciated an operating company, and the commitment, and the humanity of the employees and towns, and the great range of experience, working for a bus company where, at one point, I'd be having lunch at the Minneapolis Club, and the next in a small shop in Fayetteville, Arkansas. I was just tremendously lucky, because it wasn't out of any kind of grand plan of my own. It was much more kind of plodding, and sheer persistence, and dogged stubbornness.”
Now Zelle is a part of the Minneapolis business and cultural scene, spending a significant chunk of his time working on community projects. He’s involved in trying to improve the region’s transportation infrastructure, an initiative that’s taken on greater urgency since the collapse of the I-35W bridge in Minneapolis. He also speaks to groups around the country talking about how Jefferson is currently working to integrate transportation systems in the area it covers. “There’s going to be an endless trend toward more high-density, convenient public transportation,” he said. “There’s not enough cement, nor can the environment sustain the growth in single car traffic of the last 20 years, let alone the next 20 years.”
Earlier in his career, Zelle decided he wanted to help re-build cities someday. He assumed this would be done either through investment banking or real estate. What he discovered was that one way to help communities was through Jefferson Lines. The company partners with isolated rural towns to help provide transportation, connecting them to the larger world. And due to the north-south orientation of the business, Zelle found he’s able to serve a far greater diversity of people than he would had he stayed in big business. “People ask me who our average consumer is,” he said. “There isn't an average consumer. We carry everything from a Latino immigrant coming up to work at a chicken factory in Arkansas or southern Minnesota or South Dakota, or we're carrying a grandmother to a clinic. Or we're carrying students through a new program we have, called College Connections, where we actually go on campuses, and universities become our agent and they sell tickets through their own intranet to students. Students are great bus passengers. The new economy is much less east-west now than north-south, Mexico to Canada. And that’s where we are. A lot of people wonder how a bus company will adapt to twenty-first century economic realities. Jefferson is a story of the twenty-first century.”