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2010 Horatio Alger Award Winner

Joseph M. Grant

Chairman and Partner, BankCap Partners
Chairman Emeritus, Texas Capital Bancshares

"I don’t measure success by the money you make; I measure it by what you do."

Jody Grant was born in 1938 in San Antonio, Texas. His father was a brilliant lawyer, whose clients were the wealthiest oilmen of the time. "Even though it was shortly after the Depression when I was born," says Jody, "we were a moderately well-to-do family. But during my childhood my father began to battle a drinking problem, which he could never conquer."

With each year, the alcoholism that gripped Jody's father became worse and worse. Ultimately, his father was forced to leave the law practice in which he was a partner because he couldn't control his drinking addiction. He started a private practice, but that failed a short time later.  "My father's condition saddened and depressed me, and I was afraid to invite friends to my house because of his erratic behavior," says Jody.  "He would hide bottles around the house, and that became a dilemma for me. Should I tell my mother he was drinking when she wasn't aware, or should I protect my father and not tell her?  Eventually, I decided to do the right thing and tell my mother even though that was very difficult for me."

Once it became clear that Jody's father would be unable to provide for the family, his mother went to work. "We had lost nearly everything at that point," he says. "But my mother was a remarkable woman. She was such a positive person and believed that if you set a goal and worked toward it, then you could achieve almost anything. ‘Do the best you can today,' was her creed. To support the family, she ran a private luncheon and dinner club in San Antonio, and she did it very well. We lived in the club, so we had meals, a roof over our heads, plus her income. We were able to survive."

Looking for a positive outlet for her son, Jody's mother encouraged him, at the age of 14, to become a competitive swimmer. The following winter he set a state high school record in the 200-yard freestyle. A short time later he set two national records. "I was completely absorbed by swimming," he says. "I wanted to establish my own identity. My father's failures produced in me a burning desire to redeem the family name and to demonstrate that I had the inner strength and determination to succeed where my father had failed.  I think swimming saved my life."

Swimming provided a needed escape from Jody's dysfunctional home life. It also provided a way for him to go to college. "I came from an educated family and college was expected," he says, "but I had no idea how we would pay for it. As a sophomore in high school my swimming times were faster than most of the college guys. I knew that if I continued to improve I would receive a scholarship. That was very reassuring for me."

Jody Grant was named to the high school All America team his junior and senior years in high school. Upon graduation, he accepted a full swimming scholarship to Southern Methodist University. While there, he won four individual Southwest Conference championships, was named to the collegiate All America team, and was ranked in the top 10 in the world in the 1500-meter freestyle in 1959.

During his junior year in college, he met his future wife, Sheila. "That got me to refocus my attention on something other than swimming," he says. "I decided to enter the business school, which meant I had to go to summer school and take two semesters of 18 hours each to graduate on time. A finance professor brought that subject to life for me and I realized I wanted to make banking my career."

After he graduated from college with a degree in finance, Jody Grant earned an MBA from the University of Texas at Austin. He worked his way through school as the assistant swimming coach. He married Sheila and then took a job in the executive training program at Citibank in New York. Even though he achieved success in this program, he felt disadvantaged competing against fellow trainees who came from elite eastern families and who had attended Harvard, Princeton, and Yale. After five years of hard work in climbing the corporate ladder, he decided to return to Texas to enter the Ph.D. program at the

University of Texas at Austin. He worked his way through the program by teaching at the undergraduate level, and was awarded a fellowship, which paid for the last two years of the three-year program.

Jody Grant finished his doctoral program and accepted a job as chief economist for Texas Commerce Bank in Houston. There were no economists in the other Houston banks at the time, which gave him a unique platform. Almost immediately he was thrust onto the national scene as a result of the oil crisis of the early 1970s. He became an energy expert and was quoted widely in the national press. As a result, he was asked to join the Economic Advisory Committee of the American Bankers Association. While at Texas Commerce, Mr. Grant led the effort to convert it into a bank holding company. He executed its expansion plan, which ultimately produced the twenty-fifth largest banking company in the country and the predecessor to J. P. Morgan Chase in Texas.

In 1976, Mr. Grant was asked to join the Young Presidents Organization. He went on to serve on the international board of directors, and was selected to be International President for 1987-1988. His post-Ph.D. career to this point seemed perfect, and at 46, he was positioned to do almost anything he desired. However, he could not have imagined what fate had in store for him.

On the day he was elected chairman and CEO of Texas American Bancshares, the company announced its first quarterly loss since its founding in 1873. To illustrate the distressing circumstances of this news, Jody Grant says, "It was like being handed the wheel of the Titanic just as it hit the iceberg."

 The Texas economy was reeling from a decline in oil prices from $30 per barrel at the end of 1985 to $9.75 per barrel in April 1986. Grant's company was in the vortex of the "perfect storm" of events. During the 1980s in Texas, the oil and gas industry had collapsed, the savings and loan organizations had been swept by deregulation followed by loose lending practices and fraud, and real estate was in a depression. Jody Grant worked tirelessly for three years to try to save his bank, but the FDIC took it over in 1989 and with new owners, there was no place for him.  He says of this devastating time in his life, "I lost not only the bank, but I believed I had lost my career and future, which I had so carefully planned and managed. My entire net worth was invested in the company, which was now worthless. It was an unimaginable loss for me and my family."

The Grants sold their house and used the proceeds to pay their debts. He was hired as the chief financial officer with Electronic Data Systems (EDS), the largest information technology service company in the world. He became one of two executives to lead the separation of EDS from its parent company, General Motors—a process that took four years. In the end, it was the fourth largest transaction in the history of Wall Street and netted GM $23 billion in 1996. That same year, Jody Grant published his book, The Great Texas Banking Crash: An Insider's Account. He came to believe there was a market for a new middle market bank in Texas to replace those that had been lost. He began outlining a new banking model and in December 1998, with financial and technical backing from EDS, Mr. Grant opened Texas Capital Bank with the largest initial capitalization in U.S. history.  The bank met with immediate success and Jody Grant was named Community Banker of the Year in 2001 by the prestigious daily newspaper, American Banker and

Entrepreneur of the Year in 2002 by Ernst & Young.  Texas Capital went public in 2003 and now has $5.6 billion in assets.

When asked how he defines success, Jody Grant says, "I don't measure success by the money you make; I measure it by what you do. I've never seen a tombstone that states a man's net worth.  I would like mine to simply say, ‘Here lies a good man—a man who made a difference.' The things I think are important are giving back to your community, being true to yourself and the people around you, and always being fair and honest."

When offering advice to young people, he harkens back to something his grandfather told him when he was eight, which was, "Do the best you can today and tomorrow will take care of itself."

"I still think that's good advice," says Mr. Grant. "Of course, I tell all young people it's important to get a college education. It's essential not only for their future well being, but for the well being of the country."

Jody Grant's Activities and Honors

Based on the success of Texas Capital Bank, Jody Grant transitioned to chairman emeritus of Texas Capital and became active in BankCap Partners, a private equity firm he incubated within Texas Capital to replicate the Texas Capital model in other major U.S. markets.  BankCap has been the catalyst for Xenith Bank in Richmond, Tri-State Capital Bank in Pittsburgh, and Atlantic Capital Bank in Atlanta, which supplanted Texas Capital as the largest start up in U.S. history.

Mr. Grant serves as chairman of Communities Foundation of Texas and of Woodall Rodgers Park Foundation, which is building a $105 million 5.2 acre park over a major freeway in downtown Dallas.   He also is on the board of visitors of the foundations of M. D. Anderson Cancer Center, University of Texas Southwestern Medical School, The University of Texas at Austin College of Business Administration, and Dallas County Community College.  Mr. Grant has served on the boards of trustees of SMU and TCU, and the boards of numerous public companies.