The Incredible Resilience of Digital Infrastructure with Marc Ganzi

In these times of the COVID-19 pandemic, where almost all industries and infrastructures are taking a hit, the digital space has undeniably stood its ground and even became the connective tissue that is holding things together today. Speaking about the power of digital in this episode, Carrie Charles interviews digital influencer and infrastructure visionary, Marc Ganzi. He is a Managing Partner at Digital Colony, CEO of Colony Capital, and the founder and CEO of Digital Bridge Holdings—a leading global investor and owner of mobile and internet infrastructure. Marc takes us deeper into what digital infrastructure is and what work he is doing with 5G. Addressing the elephant in the room, he then talks about the impacts of COVID-19 to digital infrastructures, where he thinks the industry is headed now, and how he has been adapting and rewriting the rules of leadership to help their employees and consumers better. There is so much to be learned from this conversation, so follow Carrie and Marc as they talk about the incredible resilience of digital infrastructure and more.

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The Incredible Resilience of Digital Infrastructure with Marc Ganzi

I am very excited to have with me Digital Influencer and Infrastructure Visionary, Marc Ganzi. Marc is the CEO of Digital Colony and CEO Colony Capital  He is also the Founder and CEO of Digital Bridge Holdings, a leading global investor and owner of mobile and internet infrastructure. Marc, thanks so much for being on the show with me.

Thanks, Carrie. I’m excited to be here and thank you for the invitation.

Marc, I’m dying to know your journey in digital infrastructure. How did you get to where you are and what has been your path to such incredible success?

It’s like all of us. None of us went to school for digital infrastructure. I feel a little bit sometimes like the accidental tourist and other times, I feel incredibly lucky because the way I got into the industry was probably like most of us. We were invited by somebody to be a part of the industry and to take a chance. My journey started in 1993. I graduated from Wharton and was working at a REIT buying distressed real estate from the Resolution Trust Corporation. When I got to this REIT, we had a number of these antenna leases keep popping up on some of the buildings that we had acquired. Everyone at the firm said, “Let’s give the antenna leases to the young Wharton guy. He’ll probably have an idea of what to do with them.” Nobody at that time understood what a cellular antenna, paging antenna, or broadcasting antenna was.

Magically, all the antenna leases ended up showing up at my desk. I reached out to a lawyer friend of mine and I asked, “What is cellular communications?” He said, “You’re in luck. I have a client who is actually in the cellular telephone business. You should meet them.” That was when I met Alex Gellman and Jeff Ginsberg. In 1994, after talking to them and them giving me some advice on antennas, the three of us came together to build our first tower company, Apex Site Management. I’ll never forget the day I went into the CEO’s office at the REIT that I was working for. He knew that I was meeting with them to talk about ways to help us with antennas. He said, “How did the meeting go?” I said, “I’ve got good news and I got bad news. The good news is this is a great opportunity. We’re going to make lots of money in antennas. There’s an awesome opportunity for you to invest. Here’s the bad news. I’m leaving and I’m going to join them. We’re going to build a company.”

That started my journey. It was purely by accident by having someone flipping an antenna lease on my desk. From there, it’s been a lot of fun. I have the opportunity to work with Jeff and Alex for many years. We built a great business in Apex, merged in SpectraSite, started a business called Eureka Networks in ‘97 wiring up a fiber into office buildings. I decided to leave SpectraSite and go to Deutsche Bank for a couple of years to learn private equity and learn how to invest. I got back into the tower business in ‘03, picking up the pieces of dot-com crash with the Global Tower Partners. We ultimately sold Global Tower Partners two times before we sold it to American Tower. We recapitalized the business from Great Hill to Blackstone, Blackstone and Macquarie, Macquarie to Dutch Pension Fund PGGM and then ultimately selling it to America Tower.

In 2013, I’ll never forget that day. It was the first time I was unemployed since 2003. We had the closing with American Tower and I was the only one asked not to stay on, which was something we agreed to with American Tower. They said, “You probably don’t want to stay here with us.” I have great, profound respect for those guys and made the decision 24 hours later to sign an office lease and started at Digital Bridge because I felt like our work wasn’t done. I decided to create an investment management platform to continue to invest in great entrepreneurs and great businesses. I bring my twenty-plus years of experience in building companies to help other entrepreneurs and CEOs build businesses and do what I do best, which is ground raise capital. I help these guys think about their business plans. Here we are. We have fifteen companies around the world.

We manage $21 billion of assets at Digital Colony, which is the official name of the digital platform. We’re poised to double the size of that portfolio. We think we’ll get to about $42 to $44 billion of assets. There’s no end in sight for digital infrastructure or digital real estate. It’s an exciting time in our sector. While the world is facing a lot of challenges and COVID, and some of the issues that we’re facing here at home which is racial equality and how we treat people. One of the things that have been the connective tissue that held it together is digital. In this massive moment of dislocation and some unrest, we have a business that’s incredibly resilient and incredibly important. Digital tools are continuing to enable our economy and to enable us to continue to go to work. It’s enabling you and I to have this conversation and share it with the world. Whilst we have a lot of turbulence out there, we also have a lot of excitement, purpose, and vision to what we’re doing. It’s an interesting juxtaposition.

Digital is one of the things that has been the connective tissue holding the world together.

Marc, it sounds like part of your success has been your passion behind what you’re doing.  Is that true?

One of my great questions whenever I interview somebody is if you ever have sent a candidate to me and they said, “How was that interview with Marc Ganzi?” They’ll say, “It was great until he asked this very strange question. He’ll always finish the interview by saying, ‘What are you passionate about?’” I’ll preface that comment always by telling a candidate who wants to be my partner and work side by side with me. Not work for me, work with me. I want to understand what makes them tick. For me, you have to have passion. I don’t want to hear that, “My passion is doing models until 4:00 AM.” That’s not passion. That’s working yourself into a bad spot. I want to know what emotionally makes somebody tick.

I want to understand how they wake up. I want to understand how their feet touched the floor and whether they want to get up and compete because that’s an innate quality in a human being. It’s the ability to want to get up and get after it and get in the fight and be a part of it. When the day ends, close your laptop, turn off your smartphone. Do something that makes you passionate, whether it’s getting on your bike or giving time to your charity, spending time with your kids, or going paddle boarding. Whatever it is you do, find that passion because you have to have balance. If you don’t have balance, then what are we here for? Part of the journey is about your spirit and it’s about your desire to improve yourself. It’s your desire to want to make a difference. Those seem like very simple and perhaps almost a little cheesy, but to me, that’s unlocking somebody’s soul and understanding their innate qualities as a human being and as a competitor. Those are things that are inherently important to me when I’m building teams.

Can you give me an overview of Digital Colony verticals, assets, and your role in 5G?

Digital Colony is 77 professionals globally operating from Singapore to London, Boca, New York City, and Los Angeles. We operate a global investment management business where we’re solely focused on the proliferation of 5G and how we build and enable all of the technology that will go through those pipes and how we enable economies going forward. It’s pretty exciting. The business itself has three different strategies that we focus on. One, our biggest franchise is equities, where we make an investment of equity into a company. That’s where we have those fifteen companies. We also have a business called Digital Liquid. That’s our liquid strategy run by Bill Hughes. We invest in public securities. We manage capital for sovereign wealth funds and insurance companies where we helped devise a strategy for them.

At any given time, we’re looking at 400 different public companies and we’re using our toolkit and digital to help make those informed decisions and investing in some of the best digital public companies in the world. The third vertical room is digital credit. We formed a credit team. There’s going to be inevitable situations where we can’t write an equity check and we have the ability to put capital to work across the capital structure. Whether it’s junior debt, term loan B, mezzanine capital, having the capability to play across the capital structure is so important. Not everybody wants equity. When we’re sitting with an entrepreneur and we’re saying, “How can we help your business? How can we fuel your business? Most of them say, “How can we help you make returns?”

Sometimes the right answer is for me to look a CEO and I’d say, “You don’t need equity. Here’s what you need. You need a slice of junior capital and here’s why it’s going to help you. Here’s where you’re going to get to the right turns. This is how you’re going to make money, because by the way, I’ve been in your chair. I sat there once as the CEO and somebody forced equity down my throat when I should have taken a junior piece or I should have taken a convertible preferred note.” There are other ways to finance digital businesses and it’s not always through equity. Part of our job at Digital Colony is trying to help enabled companies and help them try to not perhaps make some of the mistakes that I made in the past.

What is digital infrastructure? Is it technology, is it real estate?

It’s a little bit of both. The expression that we always use, “It’s the pipes.” It’s the pipes and the plumbing that enable everything that is digital, whether it’s content, applications, IoT, distance learning, telemedicine, online fitness, all of the things that make up the mosaic of our lives are enabled by digital. The question ultimately is, how do we transport that data? How do we manufacture that data? How do we store that data? How do we enable all of that ecosystem to happen? The way we do it is it’s through four core verticals. The first and easiest for everyone to understand is towers. It’s been a great gift to all of us for years. It’s a great business, very easy to understand building macrocytes, whether it’s a tower or rooftop site. That’s been a great industry vertical for you, me, and everybody that’s reading.

The second is fiber. You’ve got two kinds of fiber. You’ve got wholesale fiber, enterprise fiber. Also, fibers where we carry traffic for carriers. We’re in essence a carrier’s carrier. We’re helping transport traffic long distances from a data center to a switch or a switch to a central office, the central office to an interconnection point, or switch to a cell site. We provide that long haul and medium-range capacity where we carry traffic for CenturyLink, AT&T, Verizon, Comcast, Time Warner. We’re a “carrier’s carrier.” On the enterprise side, we’re connecting businesses. We’re providing that fiber connectivity, that range of bandwidth solutions. The third vertical is data centers and that is a nuanced business. A lot of people don’t fully understand how to unpack it, but there are four verticals and data centers.

The easiest is totally real estate, which is hyperscale. It’s those big buildings. We own the land and we own the building and we triple net lease it to an Amazon or a Microsoft for 10 to 12-year leases, long-term leases with good investment-grade tenants, low returns. The second piece is edge computing where we’re enabling content and applications to push towards the edge of the network. These are data centers that databank has, by example, where we are bringing together that marriage of mobility, applications, content, and it’s a junction box where it meets and proliferates back out to mobile networks or cable networks. A lot of those facilities, they’re not as big as hyperscale. They typically are 30,000 or 80,000-square foot building. We own the land. We maybe have 2 to 6 megawatts of power, and we may have anywhere upwards of 400 to 500 customers in an edge data center. There’s a small node for companies like Facebook, Salesforce, Time Warner, or Comcast or whoever it is. That’s an interesting business and it’s growing quite fast that has about double-digit 12% to 15% organic growth.

The third vertical is co-location. That’s like the old-style data centers that you see, which are built for enterprises. Whether it’s hosting KPMGs workloads, hosting a Sabre for American Airlines, or hosting workloads for a corporation, or Akamai. It’s a place where you have your data safely stored where you can run active applications. Typically those through workloads that are less than 1/4 megawatt. They’re smaller workloads. A customer will have 4 up to 50 racks. It’s a rental model. It’s a co-location model, a lot like towers. The last piece of the data center space is what we call managed cloud. That’s a hybrid IT solution where we host the infrastructure for the customer. We do this at a company called Appdome up in Canada. It’s a very successful, good business and provides a range of IT solutions from cybersecurity, private cloud, public cloud, hybrid cloud, you name it. It’s a full arsenal of solutions for enterprise customers.

Last but not least is small cells. A lot like towers except flipped on its side. Fiber being the tower, so to speak, as it transports the signal out to a pole. We’ll own the pole on the antenna. In many instances, we’ll own the fiber and we’re backhauling or front hauling that capacity to a switch or a manned location. We’ve got an incredible business in the US called ExteNet. You know Jim Hyde and the team quite well. We have 30,000 nodes, 20,000 miles of fiber. We either manage our own about 600 C-RAN hubs. That’s a good business. Those are what I call the four basic food groups. Towers, fiber, data centers, small cells. That’s the 5G digital infrastructure ecosystem.

I see a book in your future called Digital Infrastructure for Dummies because that was so well explained.

You can ghostwrite it for me, Carrie. I’d be happy to sign the book.

Let’s switch gears to COVID-19. It has had a massive impact on everything and everyone globally. What are your thoughts on how COVID-19 will impact digital infrastructure?

Part of the business journey is your spirit and desire to want to improve yourself and make a difference.

It’s hard to put into metrics what’s going to happen long range. We’re all reacting to it in real-time. We’re seeing the implications on a short-term basis. I’ll come back to the comment I made before. If you think about everything that’s happening in our lives and how you conduct your life and how I conduct my life. We’re both very active human beings. If you think about your ecosystem and what you do day-to-day, Carrie, you use eCommerce, you buy stuff online, I would assume. You probably have some eFitness type of program, whether it’s a Peloton or whatever it is, there’s another impact. You’re telecommuting. You’re sometimes working at home. You sometimes go to your office. You’ve got probably your company.

You guys probably use a cloud service, so you’re linking up to the cloud to grab applications, email, or Outlook. You’ve got virtual events. Like a teleconference or video conference. You probably, at some point, shut your brain down, entertain yourself and watch some guilty pleasure show on Netflix. You’re basically like the rest of us. I had a telemedicine appointment with my knee doctor in Vail, trying to reschedule my plasma injection. I did telemedicine. I’ve got kids at home doing distance learning probably like you do. I’m not on social media, but my kids certainly make up for me. Think about that for a second. I gave you eight swim lanes of what happens in your house every day because of COVID.

When we think about that and we look at the downward pressure on the infrastructure required to enable all of that, it’s mind-boggling. You think about some of the metrics that came out in the first quarter, to give you a couple of things to think about. Microsoft had a 382% increase in teams in the first quarter. That’s incredible to understand. It’d be one thing to say, “We grew by 10%.” Facebook’s messaging platform was up 50% in the first quarter. AT&T saw a spike of 52% growth in video traffic. Verizon saw a 49% increase in their VPN services. They saw a 120% growth in their gaming platforms. Comcast had a 32% uptick in their upstreaming activities and 49% in downstreaming. Video conferencing was up 230% at Comcast. Zoom, I can’t even give you the metrics. It’s crazy.

In December 2019, Zoom was struggling and had ten million users. At the end of the first quarter, they had 200 million users. The word is they’re going to have 290 million users by the end of the second quarter. From 10 million users to 290 million users in a period of five months. We’re tracking all of our customers globally. Vodafone, Charter, and Amazon. Everybody is experiencing massive downward pressure on the network. At the end of the day, what that does for us as an industry is it creates opportunity. When we were talking about what we thought the total addressable market was for investment in 5G over the next few years, the metric I was throwing around at conferences was $860 million.

We had that study refreshed. Our consultants came back and the new number is $1.15 trillion. You’ve got an incremental $200 billion in CapEx that has been increased. That’s all because of COVID. If you asked me what’s the short-term implication, what’s the one-year implication, I’ll give you the five-year implication. It’s simple, more fiber, more towers, more small cells, more C-RAN hubs, more data centers. More jobs, more activity, more opportunity for everyone that’s tuning into your incredible talent talks. It should be a good day for us. Along that road, there have got to be bumps. There’s going to be disruption of the supply chain. There’s going to be disruption in the permitting process. There’s a disruption to our workforce. We’re being disrupted when we go to a street corner to install node and there’s a protest there.

We’re being thrown curve balls that we’ve never had as developers of this infrastructure. It’s a pretty interesting moment in time for us as an industry. While there’s a huge opportunity, we also have this amazing responsibility to get it right and to make sure that we deliver on the promise of breaking down those divides and setting the table to use digital as the ultimate weapon to bridging the digital divide. There’s a social element to what we’re doing that’s very important.

Are we going to be able to build it fast enough? How is this going to work?

The short-range is very challenged. We as an industry wildly underestimating the impact of supply chain. We’re also wildly underestimating the ability of government to be able to react carefully, not only at a federal level creating policy. You’ve seen the struggles of getting the CBRS spectrum out there, some of the challenges that Chairman Pai’s had with that. I sit on his broadband deployment board and it’s been hard. We all want to move fast, but there are locations moving fast. You have your struggles at the state level, as you’ve seen some of the legislation battles we’ve seen. You see the battles that happen are in local communities that are literally street corner to street corner, where we’re fighting for building permits, easements, changing conditional use permits, zoning board hearings. When do you think the zoning board hearing is going to come back? We’ve seen virtual zoning hearings where there’s a call with the city council, and then you see people are able to Zoom in and give commentary. Few cities are lined up to do that. It’s a hard environment. It’s challenging. CEOs and management teams in our industry are all struggling with “the new normal.”

What keeps you up at night?

I don’t sleep that much, so I’d say probably what keeps me up at night is my work. It’s tiring. It’s been exhausting. We’ve been working seven days a week. The new norm is 14 to 16 hour days. Keeping up with our customers has been hard. It’s been a real challenge. Keeping my team focused, keeping them energized, making sure that they’re engaged, and that we’re providing the proper support. I don’t mean IT support. I mean mental support that we’re all there for each other. I’ve got a global call every morning where we bring our whole team together at 8:00 AM, wake them up, Ganzi on caffeine. Let’s go and get it.

I have my infamous, evening calls with some of our senior leadership where they see tequila in my hand and I’m on a cutting board getting ready to cook. I’ve been cooking every night, which has been a real blessing and a lot of fun. You’ve got to keep people connected. This is a hard environment. As much as digital keeps us connected, there’s still a human element to what we do. There’s still a human aspect too. Some people are struggling with this. Some people are having a hard time in this environment because they do feel disconnected.

Some people love this. They’re working from home and they say they’re more productive and they’re not sitting in their cars in traffic and they’re getting to spend time with their kids. Some people are somewhere in the middle, which is they’re ready to come back to the office, but they’re a little scared. They’re a little apprehensive. I don’t think any of this keeps me up at night. I have a singular purpose of making sure that I maintain our culture and I keep our family together. I protect my employees and we continue to help and enable our customers. It’s a challenging environment. We, as CEOs, are rewriting the rules of leadership. There are so many things to leadership that is changing.

The things that we have to do better as Corporate America and as business leaders to create opportunity has never been more in sharper focus. These are things that we started on when we went down the road on ESG, which has a huge aspect of it around social, governance, and around making sure that the workforce is diverse. We’re creating opportunities and we’re creating those opportunities equally. We’re putting people reflective on our boards that there’s a great diversity in our boards. Also, we don’t forget that this country is about opportunity. We, as the business leaders, have to lead because we’re not going to get it from the politicians. You can see that already. The rancor and the bickering that’s happened in this country is horrible.

We, as business leaders, have to step it up. We’ve got to do a better job. Candidly, we’re not even seeing it from our professional athletes who would have an opportunity to bridge some of this divide. Someone’s got to lead and I’m pushing very hard for my side to get other CEOs to stand up and to take action. We’ve taken action and we have a series of things that we’re changing, and there are already things that were in flight, we’re already doing and we’re proud of. The reality is we have to do better. We will do better. I’m an optimist. These are interesting times and they’re serious times. These are serious issues and people can’t post a hashtag and think it’s going to go away. That’s not it. That’s not what this is about. This is about whether or not you have the right moral compass and you understand what your responsibility is and that you understand how you can make a change in people’s lives.

Marc, you had a meeting. I heard it was an optional discussion around social issues. What prompted that and how did that meeting go?

It’s interesting. What prompted it was one of my partners who comes from Haiti. He’s had an incredible journey. He’s absolutely the American dream. The way he and his family came over was in below poverty. They figured out how to scratch literally pennies, nickels and quarters to get to America. His parents gave him an opportunity. As a black executive in Corporate America, he’s always felt that there are challenges that people didn’t understand or respect. He wrote a passionate letter to everyone in the company and I read it, and so did our Chairman, Tom Barrack. We felt very touched because I don’t look at people as black, white or yellow.

Business leaders who give people the power to make decisions create a company that performs at a high level and from an organic growth rate.

I don’t look that way. I look at him as he’s my partner, he’s Rommel. He runs a certain part of my business. He’s such a great guy. His passionate plea was more about, “How should we be thinking about this?” Our policy around diversity is great. We have an amazing diverse workforce. I call him because Tom and I have made it a priority. He said, “We need to have a dialogue.” This thing starts with people being honest with each other and opening their hearts and giving everyone inside of your organization, whether you have four employees or whether like us, you have 380 employees, it doesn’t matter. You have to open the doors and you have to create the opportunity for people to share their thoughts with you. We created an optional town hall for two hours.

The first 30 minutes was an all-company meeting where Tom and I got to share our views and opened the dialogue. We broke the company up into about fifteen different rooms, which you can do in Zoom. It’s a great feature. The company dispersed into 12 or 15 groups. We had 160 employees engaged. I was in one of the breakout sessions and we all broke out for about 90 minutes, talking about the things that we can do to enable the dialogue. The most important thing is the dialogue’s important. The action is even more important. I’m all about the healing. I’m all about the dialogue, but we’ve got to go from here to here.

That requires change and change management is something that we can do in Corporate America. The hope is that if Corporate America leads, maybe our politicians will get a clue and come behind us and follow as well. We need reforms around how our law enforcement behaves and how they treat people. There’s a lot of work to do here. On the corporate side, I loved the dialogue. It was very open. It was transparent. We’ve had a four-quarter approach to diversity. We’re refining those policies in terms of how we can be a part of this. Most importantly, we’ve got to capture people at a young age, and it’s all about talent identification at a young age. Giving everyone that equal footing where they say, “I have a chance to see what Corporate America looks like. I have a chance to apply to a college. I have a chance to get into a college and get a great education. When I’m there and I’m getting that great education, I have a chance to compete for a summer fellowship at Colony Capital where I can be a part of that organization.”

We’ve got to be recruiting. We’ve got to recruit, not at Wharton, Stanford or Yale, but there are other places that we can be recruiting as well. We’re changing some of those policies and thinking about some of the other great higher learning institutions where we can identify talent early, work with them early and give them the chance to be a part of our family. Last but not least, the fourth corner of our covenant to our employees and our shareholders is to continue to promote, train, remunerate carefully, incentivize and give the opportunity for people to have a path of growth and our organization.

It’s high school, it’s college, it’s early hiring. It’s retaining, incentivizing, and promoting great talent from within and creating that level playing field. We’re doing that and I’m excited about it. The early identification piece we’re already doing. We’ve been doing that for a while. Alex has been doing it with his head start program. We’ve done a Digital Bridge. We’ve got this vocation program in Palm Beach County where we’re working with young kids, young high school students that are in the inner city that are in tough places. We’re giving them a chance to come into our office a couple of hours a week to see what this looks like. We’ve got to open people’s eyes. You’ve got to let them know that that invitation is equal. That’s all you can do.

All I can do is open a door, Carrie. I can’t tell someone how to walk through it. I can’t tell them what to do when they get on the other side of that door. If I’ve opened the door and I’ve enabled that opportunity, maybe they don’t end up the Colony years from now after they’ve graduated from the University of Maryland, USC, or they graduated from Boulder, wherever they graduate from. Maybe we’ve changed someone’s trajectory. Maybe that trajectory was headed for a bad place, which was no college. Perhaps it was headed towards crime or it was headed towards a low-income job in fast food. Instead, we’ve taken that asteroid and we’ve shifted it off its path. Now it’s aiming at higher education and it wants to be a doctor or it wants to be a civil engineer, whatever their passion is. Once again, it comes back to where this conversation started, which is where is your passion?

Can I help unlock the soul of a young human and teach them that this is the best country in the world and this is the best place where they’re going to get the fairest shake? It is. If people don’t want to live here and people don’t want to be a part of America, not part of our democracy, I tell every person in Seattle, it’s sitting in that enclave, “Go and live somewhere else. Go and try somewhere else and see how this works out for you.” We all have to be in this dialogue together. We’re all Americans. It’s simple. This is what we are. For better, for worse, I believe for better, we have to make it a better place to be in a better place to live.

I want to talk a bit about the skills gap in digital infrastructure.  It hasn’t changed much with the economic landscape, the need is actually increased. Do you have thoughts on how to bridge this gap and build the workforce so we can make 5G a reality?

This has been the challenge of our industry for a decade. When I was the chairman of PCIA and I hired Jonathan Adelstein, and the first thing I told them we had to do is we’ve got to start training. During my chairmanship, that was a big initiative that we put into work. First hiring Adelstein was a big part of that mission, upgrading our organization and putting more prominence in our organization. We achieved a lot of great things together, but we still haven’t closed that talent gap. It’s hard. We’ve got to create these centers of excellence, where we can get people that have now gotten to 55, 60, 65 where they stop working, but they have so much knowledge. We’ve got to create a path where we can have some of our best engineers, business leaders, and some of our best asset managers.

There are so many skills that go into what we do day-to-day, and you’ve done such a great job of placing people and to all these companies. There are so many amazing people that understand this challenge. We haven’t done enough. That’s the problem. There’s not a university that goes out and teaches these skills. The question is should we be partnering with professional universities like Phoenix University and teaching a curriculum in digital infrastructure, RF engineering, civil engineering, or data engineering? There are so many skillsets that happen. The engineering schools produce the best talent, but when those kids come out of college, they don’t have jobs. It’s like this civil engineering, is it the all-time peak, but you can’t go to school for an RF degree.

Where do you go and learn RF engineering? You have to become a civil engineer to become an RF engineer. This is some of the challenges that we face as a sector. I’ve talked to Jonathan about it. I’ve been long off that board, but the burden probably sits with us with the employers. We’ve got to invest warrant. We need to take a bigger leadership position in that we need to be creating that curriculum. We need to have multiple centers of excellence. They can’t be one center of excellence. Like for example, I know we had one in Aiken that was doing engineering for tower climbing. There was a whole school associated with that, which is a great state-funded program with the state of South Carolina. There are other instances where we’ve got to amplify and we’ve got to grow it.

The challenge is this industry moves so fast. You don’t have time to stop and say, “I’m going to take a year out of my amazing job. I’m going to learn how to become a better RF engineer.” If the person’s making $150,000, $160,000 a year, they’ve got to put food on the table, how can you expect them to stop and train? It’s a real challenge. We’ve got to figure out how to do that. Once again, a lot of that focus has to shift back to the industry, back to our business leaders to try help and figure that out. It’s Tom Bartlett, Jay Brown, Jeff Stoops, it’s Bill Stein at Digital Realty. It’s Charles Smith at Equinix. It’s all the fifteen CEOs that run my companies and myself, we’ve all got to be a part of the challenge. You, as well, as somebody who goes out and hires. That’s some of my thinking around that for the time being.

I want to touch on culture because it’s so important for business leaders to have a strong company culture.  In your opinion, what are the elements of a great company culture? You mentioned diversity. It’s definitely number one, diversity and inclusion, but what are some other elements?

The most important thing is respect. Having good leaders in the C-Suite that are real human beings and that employee is going to identify with and feel like that there’s no ivory tower. I’ve never been the ivory tower CEO. My partners like Alex, Jim Hyde and Dan Caruso, they’re humble guys. They understand where they started from. They understand where they came from. Their value construct is right. They understand the difference between what’s right and what’s wrong. It starts there. It starts at the top of having leaders that have humility, that is transparent and that are willing to be transparent with their employees and give respect. They give the opportunity to make decisions. A lot of our business leaders are all about delegating and giving people the power to make decisions, which is why our portfolio companies perform at a very high level from an organic growth rate.

We put the power in the hands of our employees to make the decisions and ultimately execute for the customer. You’ve got to have this great relationship of trust with your employees because if you trust your employees, they’re going to trust working with the customer. The customer is going to see that confidence and that trust, and they’re going to give trust back. That trust comes back to me in the way of results. Respect, trust, and transparency are simple codes of conduct in leadership. From a culture perspective, it’s also about being very much active and involved in your communities. This is something that all of our portfolio companies do. Mexico Tower Partners was voted the best place to work in Mexico by a big corporate survey that ENY runs. Vertical Bridge was voted best place to work in South Florida. Why? Bernard, Mike, Alex, Rob, and Bob Paige, they get the culture.

They understand it, but they’re also big in their communities. They’re present. Being present isn’t writing a check. Our thought process around community engagement and that culture engagement is so important. You’ve got to have that engagement because once the employees understand that it’s more than about making money and that it’s about giving back in their communities and that we’re giving the employees, not us, not the C-Suite. The decision and the opportunity to make those calls about where they donate their time, where we donate our capital and having that level of engagement, it’s very gratifying to the soul. We call that paycheck satisfaction. It’s not the dollar amount on the paycheck. It’s right here. It’s what’s in your soul. Those are some of the things that I’ve learned through the years. It’s a holistic approach to management and culture. They’re so simple. They sound so good.

The most important thing to be an entrepreneur is team building, finding the right people you surround yourself with.

We have a dialogue. That you have to have this 360-degree review with your employees where you give everyone the chance to review you. You get the chance to review them, but it goes like this. It turns around and comes right back. Having that 360-degree perspective around and giving trust to people to allow them to say, “I do like you, but here’s what you could do better.” Having that active dialogue and getting that feedback, I spent a lot of time listening to the people that work for me. It changes my thinking. My thinking is always very fluid. It’s never rigid and it’s always in change.

Marc, you are an extraordinary business leader and entrepreneur. If you could give one piece of advice to someone who wants to follow in your footsteps, what would it be?

There are so many lessons learned on the road. I’d say, the most important thing to be an entrepreneur is team building. It’s the people you surround yourself with. Once you surround yourself with the right people, make sure that you remunerate them and you would send them and you treat them as equals. If you do that, you’ll have a very long and successful business. In my history of doing this, I’ve shared a lot of the pie with a lot of the people that have worked with me. Somebody once challenged me to think about the Ganzi digital family tree from all the branches of all the leaders and CEOs that have come out of my orbit and it was a humbling experience. I did think that the great thing is I celebrate their successes. If I’ve had the opportunity to give the chance to make others believe they can be entrepreneurs, I’m super humbled by that because I feel the same way. If they’ve had success, then the measure of success is right here. It’s been fun and it’s still a journey. I’m not that old yet. I have a couple more miles to run.

What’s on the horizon for Colony Capital? What’s next for Marc Ganzi?

I become a public CEO. That ought to be interesting. It’s something I’ve tried to avoid for the years of my professional career. That’d be a new challenge. That would be a new journey, a new dialogue with customers and investors. We’re in the middle of an exciting pivot. I’m changing a highly financially structured REIT into a digital reach. It’s going to take 2 to 3 years to transform the company. We’ve got to finish the transformation. My vision is perhaps bold, it’s perhaps stupid. I don’t know yet. I’ve been told a lot of my ideas are bold and stupid, so I’m going to go with it.

My instincts tell me that it’s the right thing to do, but no one has built a global diversified digital REIT yet that is invested in the converged ecosystem. This idea of convergence where the network elements are coming together to harmoniously produce a certain outcome is something that few people have understood for the last couple of years. As we’ve gone down this road together. People are starting to understand my vision and understand this notion of convergence. A lot of people haven’t understood what I’ve built, but it’s starting to come into sharper focus of what we have built. It’s this incredibly big umbrella called Colony that happens to own some of the most unique businesses in the world. The uniqueness of it is our ability to deliver converse solutions.

I was talking to an analyst at Wells Fargo and she asked me, “What’s unique and strategic about what you’re doing?” I said, “It’s simple. Years ago, I sat with Charlie, I had a one-way conversation with him, which is, ‘Charlie, how can I build towers for you?’” That’s such a boring conversation. That’s so 2000 and late. Now the conversation is, “How can I build you a low-cost 5G network where you have an open RAN architecture and you have the lowest cost per bandwidth of your competitors? How do you deliver applications, IoT, and artificial intelligence on a network that would be the envy of your competitors?” It’s that critical thinking of thinking now, “How do I help a customer go from here to here? How can I be deeper in that customer relationship?”

The only way you can be deeper with a customer is if you understand the entire journey and that entire journey revolves starting in an open RAN architecture in a data center, using fiber, proliferating out to a small solar tower, front hauling that network, bringing that back to an SDM location, which is an EDS data center where you have that intelligence from a Nokia or an Ericsson, or Huawei in another country where we do business. Understanding the entire playing field is where I’m going. That ability to communicate with customers in a way that I’ve never been able to communicate with them, which is I can solve all of your dumb plumbing issues as we go forward. Let me be your dumb plumber. Let me help you deliver the entire range of solutions for your infrastructure and your real estate.

Being a global solutions partner is where we’re going. Our chairman says it best. You follow the logos. Tom Barrack hasn’t spent a lot of time in digital infrastructure, but he’s a fast learner. If you follow the logos and you stay close to your relationships, you’re close to Vodafone, Telefonica, Facebook, Google, Amazon, Microsoft, AT&T, we can go on and on. You serve close to 55,000 customers at Colony globally in digital. It’s incredible how many customers we have around the world, but here’s the vision. It’s so simple where we’re going is we want to be the only diversified digital REIT in the world that understands how to deliver a converged network. Ambitious, bold, perhaps dumb, who knows? That’s the journey I’m going on. I’ll be a lot more public. I’m going to be facing more of the public eye. That has a whole new set of challenges. I’m being told what to say and what not to say, but at the same time, I’m still me. My instincts will always take over. I’m painfully transparent. Investors are going to have to get used to that. A public CEO that’s painfully transparent. Maybe that doesn’t work out so well. I’m not going to change who I am.

Marc, I have no doubt in my mind that your vision will become a reality. Thank you so much for being on the show.  Good luck to you and be well.

Thanks, Carrie. I appreciate the opportunity. Be well and we’ll see you soon. Take care.

Important Links

• Digital Colony
• Colony Capital
• Digital Bridge Holdings
• Bill Hughes
• Appdome
• ExteNet
• Digital Realty
• Equinix
• Vertical Bridge

About Marc Ganzi

President & Chief Executive Officer, Colony Capital, Chief Executive Officer, Digital Colony

Marc C. Ganzi is President and Chief Executive Officer of Colony Capital, Inc. and Chief Executive Officer of Digital Colony. He is also a founder and Chief Executive Officer of Digital Bridge Holdings, a leading global investor and owner of mobile and internet infrastructure.

In July 2019, Digital Bridge was acquired by Colony Capital to become the premier platform for digital infrastructure and real estate investment, and Mr. Ganzi was announced as Colony Capital CEO, Thomas J. Barrack, Jr.’s successor. At the time of the acquisition, Digital Bridge managed nearly $20 billion of global digital infrastructure assets, directly, through Digital Colony Partners, and pro forma for Digital Colony Partners’ pending acquisition of Zayo Group Holdings, Inc. (NYSE: ZAYO).

Prior to Digital Bridge, Mr. Ganzi was the founder and CEO of Global Tower Partners (“GTP”), which grew from inception in 2003 to become one of the largest privately-owned tower companies in the U.S. when it was sold to American Tower Corporation in 2013 for $4.8 billion. At GTP, Mr. Ganzi executed a series of strategic acquisitions, build-to-suit agreements with wireless carriers and financings in the credit markets.

Prior to the formation of GTP, Mr. Ganzi worked as a consulting partner for DB Capital Partners in New York City from 2000 to 2002 where he was tasked with overseeing the institution’s investments in the Latin American tower sector. Prior to his tenure at DB Capital, Mr. Ganzi was the President and co-founder of Apex Site Management, one of the largest third-party managers of wireless and wireline communication sites in the United States. Apex merged with SpectraSite Communications in 2000 to create one of the largest telecommunications site portfolios in the United States at the time.

Mr. Ganzi has served on the boards of numerous corporations, including: Apex Site Management, Global Tower Partners, Olympus Outdoor Media, Mexico Tower Partners, Vertical Bridge, DataBank, Vantage Data Centers, Andean Telecom Partners and ExteNet Systems.

Mr. Ganzi received a B.S. from the Wharton School of Business in 1993. He was a Board Member of the Wireless Infrastructure Association from 2008 to 2017 and served as Chairman from 2009 to 2011. He is a member of the Young Presidents’ Organization, the Broadband Deployment Advisory Committee of the Federal Communications Commission, and he currently serves on the board of the Aspen Valley Ski Club.