Seattle businessman Joshua Green did a lot of things right when he built his fortune during the Gold Rush era. The shipping fleet he created was the precursor to the Washington State Ferries system. The insurance company he started became Safeco Corporation.
Particularly canny was the Seattle pioneer’s decision not to let his progeny break up the family empire. Instead, Green put his considerable wealth into a corporation with the family as shareholders. That decision has benefited not only his descendants but also a collection of Northwest businesses that have access to the capital Joshua Green Corporation (JGC) has patiently amassed over the long term.
By pooling his fortune into a single investment vehicle, the one-time steamboat purser made it possible for heirs to invest in diverse assets that are now worth “well north of one billion dollars,” in the estimation of JGC’s CEO, Stanley B. McCammon.
McCammon, who is not a member of the family, joined Joshua Green in 2005. He took a portfolio of assets that had been passively invested up to that time and revamped the investment approach into one not unlike that championed by Warren Buffett. “We’re a mini-Berkshire Hathaway,” says McCammon. “As long as there’s a symmetry of view of the overarching objective, we have a pool of funds that creates greater, better opportunities.”
McCammon adds, “We invest for the long term with the object of growing our assets based on real returns — after inflation — while at the same time growing distributions with some degree of predictability.”
The family, led by Joshua “Jay” Green III, remains intimately involved. An elected family council meets six times a year to deal with family issues, and the 91 descendants of Joshua Green meet annually to review the family company’s progress toward its goals.
Unlike a traditional family office, JGC does not assist family members with their personal interests. Family members instead engage their own financial advisers, CPAs, tax consultants and trip planners.
JGC operates under the direction of a 10-person board of directors consisting of McCammon, the family council president, three other family members and five independent directors who oversee the corporation’s investments on the family’s behalf.
The family’s philanthropy is handled by the Joshua Green Foundation, which supports local educational, cultural and arts organizations, and social services.
McCammon says the family gives him considerable autonomy in making investment decisions. A former tax attorney at the Seattle law firm Davis Wright Tremaine, McCammon has deep experience in wealth management and equity investment. He bought his first stock when he was in the eighth grade. Prior to joining JGC, he managed the family office of John McCaw Jr., a one-time part owner of McCaw Cellular. McCammon also was a cofounder and managing director of Orca Bay Partners and the Tahoma Fund.
For a family to retain its fortune for more than a century is rare. Most wealthy families — seven in 10 — lose their fortunes within three generations, according to The Williams Group, a family wealth consultant in San Clemente, California. Joshua Green’s family is now entering its sixth generation.
Most of the Green family’s money is invested in the publicly traded debt and equity markets, with roughly 25 percent invested in private companies and about 15 percent in real estate.
JGC’s investments target local and regional firms with defensible positions in their sectors. These private companies range from a set of businesses that make fly-fishing gear to food manufacturers, a heavy equipment distributor and a producer of food and beverage containers.
“We’re interested in investing in companies we can own for an extended period of time,” McCammon explains.
Joshua Green has been involved in fly-fishing gear since the early 1900s, when it invested in Far Bank Enterprises. Nearly a century later, soon after McCammon took charge, the company acquired Sage Manufacturing, a Bainbridge Island-based fly-fishing-equipment maker.
“We wanted to find an operating business the family could be emotionally invested in and have some familiarity with,” McCammon notes.
That purchase was followed by the acquisition of additional fly-fishing-equipment makers — Redington, also situated on Bainbridge Island, and Idaho-based Rio Products. All three fishing-related companies now operate as Far Bank subsidiaries. And all meet a key criterion for Joshua Green: defensibility. “Anglers know that it will be a high-quality product,” McCammon says, “that the company will stand behind it and that new products will be good.”
A JGC investment in Seattle-based Pacific Market International (PMI), which makes food and beverage containers under the Stanley, Aladdin and Migo brands, helped the company to expand rapidly into a global business that puts out some 100 new products a year and registers more than $120 million in annual revenues.
PMI founder and CEO Rob Harris was looking for a partner who cared about more than just a return on investment. He wanted an investor who supported his firm’s values, its people and its commitment to the community.
“Their time horizons are different,” Harris says of JGC. “They really are a long-term investor. They are not constantly agitating for quarterly returns. They are looking to build a great company.”
That realization came to the fore in 2012, when PMI had an off year, Harris says. The response from JGC, he explains, was, “So, financially it was a bad year, but we think it’s one of the better years in the company’s history. That’s because they recognized we were doing all these things to build the company for the long term.”
Another JGC investment, Portland-based Harry’s Fresh Foods, provides food products to grocery, club and food-service clients in 30 states. JGC acquired the firm in 2013 and made it part of JGC Foods, along with Cuizina Food Co., a Woodinville maker of all-natural frozen soups and sauces that it acquired in 2012.
Harry’s CEO Jamie Colbourne agreed to the deal because he liked Joshua Green’s investing strategy. “They had a strong balance sheet, the [same] value system I had and a very long-term view on the business,” Colbourne says.
With JGC’s backing, Harry’s recently opened a 200,000-square-foot production facility in Nashville to better serve customers in the East. Colbourne expects JGC’s long-term approach to its investments will also ease the transition when he retires.