The true worth of Dan David
ROME - The fact that it's All Saints Day doesn't stop Daniel David from working, dictating letters to his secretary at his office in a modest building in one of Rome's most beautiful neighborhoods. Thank-you notes, answers and directives to companies overseas - it's all in a day's work to Dan David, 78, who tracks the world via his Blackberry and two cellphones.
For years, he worked 16-hours days, seven days a week, says David. He'd make his long-distance calls after midnight, to economize. Now he only works 10 hours a day, and doesn't cavil at working part-days on weekends and holidays. "I will never retire, but I'll work less hours. We'll see," he says.
He isn't a household name in Israel, but David's presence is felt in every mall in the country. That's because he was the first to import instant-photo booths, back in the 1960s. Today he owns PhoMat, which manufactures the machines, and owns shares in two other companies. A few years back, David tried to buy the controlling interest in the Bezeq phone company from the state, together with others, but lost to the Saban-Apax-Arkin group. His deepest connection with Israel's business scene is through the Dan David Foundation.
Founded in 2000 with a $100 million donation from David, the foundation endows research in science, economics and history, and young people as well. Now the foundation is collaborating with TheMarker on Easy Start, a project designed to give a chance to budding entrepreneurs with innovative, surprising ideas.
Why his focus on Israel? When the Internet started taking off in the late 1990s, he was wealthy and figured he didn't need that much for himself. He thought it appropriate to give something back to society. David says: "I donated the money to the foundation, which invested it and made a great deal more."
To what degree do you control the foundation you founded? "The money doesn't belong to me, but to the foundation," David says. He sits on its board and does have influence, but there's an awards committee chaired by Itamar Rabinovich, the outgoing president of Tel Aviv University. David's opinion doesn't always win the day, he says, and yes, there have also been decisions that he opposed. The foundation used to award a prize for journalism as well and he'd wanted to give it to Oriana Fallaci, a well-known reporter in Italy and the U.S. The board balked. It's part of his management technique today, to listen to what others have to say. He is capable of accepting a different view. He also believes in promoting people from the inside in his businesses, not hiring outside talent: He did that once in 45 years and felt it was a mistake.
Yet he isn't only business-oriented: he donates more to charity in Israel than to business, it's said. "Not accurate," David corrects. "We are constantly expanding our activity in Israel." At present, he's negotiating to buy shares in two Israeli manufacturers, though he won't name names lest other potential buyers notice.
What does the Israeli economy look like to him? "Israel is a highly-competitive, modern market," he says. "It's a challenge to produce something in Israel. That's why we're launching Easy Start, to help other people with the challenge."
All entrepreneurs with a clever idea, or owners of small- to medium-size businesses, are eligible to contend in Easy Start. Entrants who pass the grade have a chance to win a $100,000 loan, free of guarantees and interest. From October 31, TheMarker began accepting submissions. One winner a month is declared. A year from the loan date of issuance, the entrepreneur will begin returning the loan in equal installments throughout 18 months. No interest will be due. All the money returns to the foundation for investment in other entrepreneurs. At the same time, the entrepreneur will allocate 25 percent of the shares in his company to the foundation, which will be sold and the income generated thereby will be used to further the foundation's ongoing investments. If the venture fails, the entrepreneur doesn't have to return the money.
At the year's end, the panel will convene for one last time and evaluate the 12 entrepreneurs chosen throughout the year. One will be chosen Entrepreneur of Entrepreneurs, and receive another loan, this time of $120,000.
He started with hard work and got his chance through a loan. Now he wants to give that same chance to the next generation.
David is believed to be worth several hundred million dollars. How many? "I don't know," he says. "My companies are privately-held and I haven't checked how much they're worth. I know how much salary I get paid each month but not what the companies are worth." Nor does he seem terribly interested: Money has no intrinsic value, he feels: If a person has enough to eat, dress and wander the world a bit, that's enough.
Aside from his investments in Israel David also owns Dedem, which makes photomats in Spain, Italy and Britain. He also owns a Romanian company and runs a private investment fund in Britain, which has 25 shareholders. "From September 1998 to September 2007, its share price rose from $100 to $360," David boasts. He picks the type of investments, securities and currencies. He also sits on the board of the hedge fund GLG, run by Noam Gottesman.
Dan David was born in 1920 in Bucharest, Romania, with the surname Goldenthal. He began his career in business at age 10. He and a friend, later Prof. Theodor Janku of University of Haifa, would buy cigarettes and canned food cheaply, and sell them at a profit. After two years, they started rebinding and reselling books. As a child, David was active in various movements and became active in Zionism following his experiences in the Second World War.
At 16 he joined a Zionist youth movement and helped organize aliyah from Romania, where he continued to live. He studied economics at university. That taught him nothing: practical experience was his teacher, he says. Upon graduation, he worked at a Romanian government import company as a bookkeeper and hated every minute. Unable to bear the boredom, he quit and four months later decided to make a career out of his penchant for photography. He studied it, even won prizes and later worked for Romanian television. Today he owns a Romanian photography company, which he founded after Ceaucescu's fall.
He worked at a newspaper but was fired when a Securitate (secret police) check found that he'd been active in a Zionist youth organization. "They thought I was a traitor," David explains, but that was a turning point. Though the authorities had refused to let him out of the country several times beforehand, he did wind up leaving Romania. He went to relatives in Paris and in August 1960 he, his mother and aunts sailed on the Theodor Herzl to Israel. They lived in Herzliya and later moved to Tel Aviv. He worked as a photographer and had a great year, he says.
In 1961, he moved to France and encountered automated photography for the first time. He wanted to take the technology around the world but didn't have the means, nor did the banks want to give him any. Finally a kinsman named Pierre Valle staked the young David, lending him $200,000, worth $2 million in today's terms. David offered his services to a British firm Photo Me International, received a franchise and set up companies and photoshops in Israel, Spain, Romania and Italy. In time he returned the loan and Valle's heirs own 49 percent of Dedem.
In 1961, he set up PhoMat in Israel, which made and marketed photography machines. By 1968 he'd collected enough shares to take over Photo Me. He joined the board and in 1992 became the company's chairman. Two years later, he decided to merge it with a French company that had invented the technique for developing film within an hour, and retained the chairmanship of the merged company.
Photo Me evolved with the times and in the 1990s developed technology for Internet. Shareholders stampeded for its stock, which imploded with the Internet bubble. Dan David left the chairman's seat in 2006 and accepted the presidency for life. But beforehand, he moved most of his shares in Photo Me to the Dan David Foundation, which later sold them at great profit. He retains a small shareholding and if the share price falls, says he may buy more.
Dan David has been married three times: Circumstances forced his separation from his first wife and love, Dorothea, who made aliyah and waited for him, but he was trapped in Romania. Finally he gave her a divorce so she could move on. His second wife passed away from a stroke and he met his current spouse, the actress Gabriella Ohad, in Israel. They married in 1980 and have one son, Ariel, 29, a journalist. Living his life between Tel Aviv, Rome and London, he insists that he's Israeli and conducted the entire interview in Hebrew. "I would be glad if you write that the best thing I ever did was my son," he says.