April 14, 2008
Howard Milstein '73 stresses unorthodox approaches as pathway to success
For the 1986 Super Bowl, General Motors purchased ten 30-second advertising spots at a discount for $300,000 each. The Milford Plaza Hotel in New York City advertised during the game for $33,000 per spot -- 90 percent less. How did one of Milford's owners, Howard P. Milstein '73, arrange such a favorable deal?
"We were successful because we acted entrepreneurially. We weren't constrained by traditional assumptions," Milstein said, explaining that he took advantage of quick, unorthodox thinking to land cheap airtime. He got the deal, he said, by building strong relationships with the advertisers, thus being "in the loop" when they were looking for a buyer for unused airtime, and by making a decision immediately.
Milstein, the 2008 Cornell Entrepreneur of the Year, delivered the keynote address at the Entrepreneurship@Cornell Celebration 2008 in Statler Auditorium April 10 about what it takes to succeed in business. The most prosperous individuals, said Milstein, who is co-chair, president and CEO of Emigrant Savings Bank and its holding company, New York Private Bank and Trust, and managing partner of Milstein Properties, are those who commit themselves to constant innovation and improvement.
"There are always ways to improve a situation, there are always ways to do things better than they've been done before. So to me, there is opportunity in everything," said Milstein, who has served Cornell for more than 20 years as a member of the Board of Overseers of Weill Cornell Medical College and as trustee, trustee emeritus and presidential councilor of Cornell.
Milstein faced his first business challenge as a 28-year-old, he said, when he joined his father's real-estate business and took control of the Biltmore Hotel in New York. Realizing that most of the hotel's customers were business travelers seeking rooms during the workweek, Milstein refined the hotel's price structure to maximize profit Mondays through Fridays. His proposal was initially met with little enthusiasm among managers, who feared that the changes would send customers to competing hotels, he said. But once the plan was implemented, profits tripled, forcing hotels throughout New York to readjust their prices in response to the Biltmore's success.
"This was a case of free-market innovation," Milstein said.
Milstein also described his success in a standoff with Time Warner, which refused to offer cable TV service to Milstein's hotel at an affordable rate. Milstein decided to form his own cable company to provide service to his properties; it became profitable by adopting an innovative approach -- using satellite delivery.
"At the end of the day, our economy is fundamentally dependent on what entrepreneurs have brought forth and will be dependent on what they will bring forth in the future," he said. "I believe that everyone has an entrepreneurial spirit inside."
The Cornell Entrepreneur of the Year Award, first given in 1984, recognizes Cornell graduates who exemplify entrepreneurial achievement, community service and high ethical standards.
Chris Tozzi '08 is a writer intern at the Cornell Chronicle.