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At 61, Roy S. Roberts was in the high-ranking position he had been preparing for most of his life. The vice president of General Motors’ North American Vehicle Sales, Service and Marketing Group had dedicated nearly 20 years of his life to the American automaker, rising from his work in a manufacturing plant in upstate New York to a seat in the executive boardroom at GM’s headquarters in Motor City, U.S.A. Now, Roberts will be in the driver’s seat of a Web-based company that may very well revolutionize the way African American companies gain corporate contracts.
Roberts presided over the successful merger of the Pontiac and GMC divisions in 1996, and helped conduct a major reorganization of the company in 1999. That year was also a record setter for GM sales. Roberts’ achievements earned him inclusion among black enterprise’s ranking of the top 50 blacks in coporate America. (See :The Top 50 Blacks in Coporate America,” February 2000.)
When he announced his retirement in January, Roberts hinted he was looking to begin his own venture, but no details were provided. “GM’s on a roll,” he said, “but I’m thrilled to be going out on my own in an exciting new venture.”
His retirement was seen as a loss for the business world. He was the most powerful African American in the global automobile industry, and one of few blacks to gain access to the executive boardroom, and .many wondered where the next Roberts would come from “Saddened and dismayed” were the words used by Glenda Gill, deputy director of the Rainbow/PUSH Coalition’s Detroit office. Gill said she hoped the positive relationship created between GM and the group would “continue uninterrupted, especially as it relates to diversity.”
But enjoying retirement on the golf links wasn’t what Roberts had in mind. His new venture is MXchange.com, an Internet exchange that will link minority businesses with large corporations. He is part of an increasing trend, as executives leave their comfortable corporate lifestyles for the potential big money of the Internet. As the Nasdaq continues to outperform traditional economic indices, dotcoms are garnering more venture capital and greater visibility. They’re no longer the uncertain terrain dominated by Gen-Xers.
VentureOne, a San Francisco-based research group, revealed in a survey that venture capital raised by private companies was up nearly 155% from 1998 to $36.5 billion in 1999. Venture-backed Internet companies raised $25 billion, over four times the 1998 mark, the study found. Ironically, the Internet company that raised the greatest amount was an online automobile retailer-CarsDirect.com-with $280 million.
Dotcoms have also become wiser, investing their capital windfalls in old economy talent. Executive headhunters regularly do their shopping at General Electric, AT&T, IBM and other companies. Studies over the last five years suggest the median salaries and bonuses of e-CEOs and other e-execs are closely approaching, if not overtaking, those of the Fortune 500 bosses.
A study by USA Today shows that seven out of 1999’s 10 most highly paid CEOs run technology ventures. It’s the lure of attractive compensation packages-including stock