CEOs Gone Wild: John Mackey
Whole Foods CEO wants you to know he's "kind of a secret king."
Things aren't looking so good for John Mackey. After being called a visionary, a philosopher and a revolutionary -- kind of a cross between a vegan Warren Buffett and a libertarian Jesus Christ -- the Whole Foods (WFMI) CEO has seen his stock price fall 43% this year alone. His much-vaunted e-commerce venture, WholePeople, hemorrhaged money at a rate of $500,000 a week before closing after only 3 months online. By any measure, a total bummer - even for a guy like Mackey, who's said he believes that "a wonderful life adventure awaits you" so long as you "follow your heart [and] choose love instead of fear." With numbers like these, fear might be the appropriate response.
Shares hit $21.98 on June 7th, their lowest point since October 2002. In fact, the company's fortunes have consistently declined since reaching their apex in 2005.
But then, Mackey has always been one to embrace contradictions. He claims to be pro-consumer, but his prices have earned the store a less-than-groovy nickname: Whole Paycheck.
He preaches a gospel of "self-actualization" for "team members" -- employees, to call them by their more familiar, if less actualized name -- but is passionately opposed to unionization, going so far as to say having unions is like "having herpes... It's unpleasant and inconvenient and it stops a lot of people from becoming your lover."
An anagram of Deborah (the CEO's wife), this was the screen name behind which Mackey made over 1400 Internet postings over a period of 8 years. Some took the form of lewd and lascivious fondling of Mackey's own ego - as in, "I like Mackey's haircut. I think he looks cute!" or "While I'm not a 'Mackey groupie,' I do admire what the man has accomplished."
But Mackey's alter ego saved its real creativity for Wild Oats, saying that "Whole Foods is systematically destroying their viability as a business" and that the firm "clearly doesn't know what it's doing... OATS has no value and no future." Whole Foods acquired the competitor for $565 million in 2007, after winning an FTC lawsuit that challenged the takeover on antitrust grounds.
Here's Mackey on the buyout: "[Wild Oats] is the only existing company that [could] get into this space. Eliminating them means eliminating this threat forever, or almost forever, [and eliminating] the competition."
Eliminating the threat of competition. Now, does that sound like monopoly?
Incidentally, Mackey himself is on record as saying that "Competition is the best way to limit any power." Perhaps that's why he opposes it.
In 2002, while Whole Foods was being slammed by recession, Mackey took a 4-month vacation to hike the
Mackey's self-given Trail name was Strider. Taken from Lord of the Rings, Mackey explained, "[Strider] is really Aragorn, the king. But he wasn't a king on his trail. In 2002, when I was hiking... I was a kind of secret king."
Kind of like the secret author of those Internet postings.
Though the SEC officially cleared Mackey of any wrongdoing in the Rahodeb affair at the end of May, Whole Foods is facing new legal troubles. The Attorney General of California has brought a massive lawsuit against the company for violations of Proposition 65, which requires manufacturers to put warning labels on all products containing the carcinogen 1,4-Dioxane. The level at which warning labels are required is 0.2.
The level found in Whole Foods' private-label shower gel: 20.1.
By any measure, a total bummer - even for a guy like Mackey, who's said he believes that "a wonderful life adventure awaits you" so long as you "follow your heart [and] choose love instead of fear." With numbers like these, fear might be the appropriate response.
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