Caracal’s Don Roberts advises future CEOs to focus on AI and mentorship

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Donald C. Roberts, an accomplished leader with over 30 years of experience in the corporate world, is the founder, president, and CEO of Caracal, a certified Minority Business Enterprise based in Detroit. An alumnus of the Virginia Military Institute with a degree in economics, Don has made significant strides in various industries, including health care, insurance, and financial services. His resume includes pivotal roles such as vice president and general manager at Unisource, senior vice president of Global Diversity at Unisource, and key sales positions at Office Depot. Beyond his professional success, Roberts is deeply committed to mentoring the next generation of business leaders through initiatives like the Caracal Academy and the LYNX Program. He also serves as chairman of the Board for the Minority Business Enterprise Legal Defense and Education Fund (MBELDEF), advocating for the rights and opportunities of minority-owned businesses. In this “CEO to CEO” interview with rolling out publisher Munson Steed, Roberts shares insight on leveraging AI, fostering sustainability, and the crucial role of mentorship in driving business success and community development.

Munson Steed: Why and how did you start Caracal, and what is your vision for it?

Don Roberts: The impetus for starting Caracal came from my corporate experience. I started my career in New York City, then went to Philadelphia, Indianapolis, and then Detroit. I realized that there are multiple individuals like myself who have the skill set to generate lots of opportunities, create businesses, and [create]significant enterprise-level relationships. I formed a couple of strategic alliances and started Caracal 20 years ago on the west side of Detroit, and the business has evolved to seven businesses now. We’re a little shy of $150 million annually. But what’s most important is that we’re creating jobs in those communities that need the support. [These are] individuals that are asking for a hand up, not a handout. And that’s really important to us.

Today, what we’re doing is focusing on our planet. We have a new recycling business in North Carolina, where we are collecting polypropylene materials from hospitals, from corporations. We’re amalgamating those materials, [stripping them]down, [and]creating resin. And then we’re taking the resin and we’re actually upcycling that to a new product. And with that new product, we’re reentering the supply chain at the same corporations that we collected the used polypropylene from. So, that’s really exciting. And there’s job creation that’s associated with that business. So, more to come.

MS: Why should young people and individuals who are thinking about being in business consider the sustainability business and playing a role in the green economy?

DR: We need to reinvest in our youth. And our youth [are]focused on investing in their planet. And I say “their” planet because, quite candidly, we haven’t done the best job of protecting “our” planet. And that should be a focus. It’s a business model. […] Whoever leads with this initiative is going to lead the next generation, the next economy along with AI. I mean, protecting our planet and AI are going to be the two leading initiatives for the next 30, 40 years.

MS: What role do you see AI playing? And how are you leveraging AI in your business?

DR: Well, AI, as a small business, you always have to look for what we call force multipliers. And AI is a force multiplier for us. I went to a military school, so we always tried to create force multipliers. [Using AI], I can reach more customers quicker and qualify those customers today than I could hiring 50 folks yesterday. And not to say that we’re trying to eliminate jobs. What we’re trying to do is be more focused on those that are really a good fit for what we’re trying to achieve. So now, we’re qualifying customers around the globe, and we can do it in a less expensive way than hiring folks. And [we’re] going out to customers in multiple different markets. So, it’s creating an advantage for us. And then, when we create value for our customers, we can then communicate that faster in a more qualified way to those that are looking for that value offering. So, that’s how we’re using AI today. We have a very young, dynamic business development group, and they’re leveraging AI to reach those customers that are looking for folks like ourselves.

MS: How important is it to be open to change when you’re thinking about your business?

DR: It’s incredibly important. We’re 20 years old, and I will tell you, when we started our business, there was a focus on paper and a focus on commercial print. And that was the livelihood of our business… Now, you have fewer people working from the office. You have fewer people using paper or commercial print. So, we had to reinvent ourselves multiple times over our 20-year journey, especially after 2008, ‘09, and ‘10, when we had the financial crisis. We’ve had to become more diversified. 

MS: For those CEOs that have never really forecasted 4 or 5 years in advance, how do you forecast the next five years?

DR: Well, I think first, you have to understand exactly what your value is to your customer base and how you’re positioned with your suppliers and with your partners. You have to understand those two very crucial things, and then you need to have a financial strategy that can bridge the two. If you can understand those two value offerings and understand your financials, then you can create a very credible forecast. But have your customers validate that forecast. And, by the way, you could use AI to help you do that.

MS: What did you gain from going to a strategic military institution that you share inside your organization?

DR: My favorite book is The Art of War by Sun Tzu… My favorite document is The Rules of Leadership from Colin Powell… We implement the understanding that command is very lonely. So, you have to create an environment where you can have peers and talk to folks that have already been through where you’re trying to go. Then, the biggest thing, and I tell folks this all the time, is that we exercise backward planning in everything we do. Backward planning is understanding what the objective is and what the answer is and then working your way backward. So, if we have a strategic objective out there, we’re defining it in advance, and then putting the plan [in place]step by step backwards to make sure that we can get there.

MS: For those individuals who want to be CEOs, what would you tell them now that nobody told you before you started?

DR: Find a small group and interview your mentors. You better find a mentor or two, and interview them, and make sure that you can trust them. Make sure that you’re aligned from a character perspective, and lean upon those mentors, because those mentors can eventually become your board of directors or your advisory board. They can help you with financing if you need financing. They can help you with a strategic business plan if you need a strategic business plan. Finding mentors…becomes the biggest force multiplier that a young CEO can create for themselves.

MS: How have you become a mentor for others? And what’s the benefit of mentoring other individuals?

DR: Well, first, it creates excitement for your business. Secondly, I would say, 70 to 80% of our ideas come from the young folks that we mentor. We have a very specific program at Caracal called LYNX. And LYNX is run by a young person at Caracal… [Through LYNX], we are mentoring–I think the number is–26 or 27 current MBEs or women-owned businesses. And it’s interesting. You talk to these young businesses, and they’re less than 5 years old, and they’re underfunded or undercapitalized. They don’t have the infrastructure or foundation necessary to capture a piece of business that they may need. We start mentoring those folks and realize they are on the ball. And we just close that gap. We bridge that gap for them. We provide capital… We have a microloan sometimes that we’ve offered to folks. We’ve let them use our foundation, our infrastructure, our experienced management team. But they provide talent to us, and they provide fresh ideas. In some cases, we’re doing joint ventures today with some of those folks, understanding that our future CEO or our future leadership could come from those businesses.

MS: You’re also chairman of the Board of the Minority Business Enterprise Legal Defense and Educational Fund. How did that pop up, and why is that meaningful to you?

DR: Well, a very large customer of ours, a very large bank in the U.S., I won’t say any names without their permission, introduced a group of MBEs to this prestigious organization. And during that meeting, I learned the history of Congressman Parren Mitchell. I learned the history of Tony Robinson, the chairman of the organization’s board. I met their dynamic leader, Sarah, and she talked to us, and she laid [out]what we’re up against as MBEs in the marketplace…and a very defined effort that’s…been presented by folks to make sure that they slow the development of companies like ours. [To help change that,] they said, [they]need fundraising help. And I said, “Okay, I can help with the fundraising. What else can I do?” [They said,] ” Well, we have a board position that’s open. […] I took the board position and I added some new ideas… After a few months of being on the board, they said, “Our focus is fundraising. Don, you know how to fundraise?… Would you consider being chairman of the board to put together a strategy over the next year so that we can make sure we have the appropriate level of funding so the organization can move forward?” And that’s how that happened.

MS: What do you think the main purpose of moving this fund has been? Why does it exist? Why is it needed?

DR: Well, there are lawsuits out there today that have been introduced by folks to, quite candidly, quell diversity, to get rid of DEI. The argument is that diversity is discriminatory. We don’t believe that’s the case. We think that we should create the opportunity for everyone to compete. And everyone should have the opportunity to participate in the American story, and perhaps it becomes the American dream. But without the opportunity to compete, how do you create the jobs? How do you create the financial infrastructure that certain communities need and haven’t had in years? We’re the ones out there hiring folks in communities where some corporations can’t hire folks. So, the country needs that. Anyone who’s fighting that [DEI] initiative, we want to make sure that MBEs have some protection in court, and from a strategy perspective, because there are folks that don’t think that diversity is necessary. We do.

MS: If you were getting ready to give a speech for young brothers and sisters at the military college, Morehouse, Spelman, or Howard, what are three challenges you would give them as young, Black professionals coming into the world?

DR: They better be engaged politically and understand the significance of it, because that’s not something that’s taught to young kids of color in their living rooms, in their kitchens, and they need to understand that. And they need to teach it. Number two, they better understand financial literacy because that impacts every aspect of your life. And if you don’t understand that… you wake up at 30, 40, 50 years old, and you’re asking, “Hey, how am I going to execute now? I have the knowledge, I have the expertise, but I don’t have the ability to execute.” And I’m talking military jargon, but [have]an “operation,” if you will, that they want to execute. And number three, make sure that you maintain your spiritual balance. Make sure that you’re well-rounded because that becomes incredibly important. You need to continue participating in anything you can to support the communities needing help. That’s what Americans have done for generations. And we need to continue to do that. And it needs to be as much of a focus as other things that you’re doing that may be important to you, but protecting your community should be important, as well. 

MS: How do you get information? Are you a reader?  

DR: I watch 15 minutes of Fox, 15 minutes of MSNBC, and 15 minutes of CNN every day… [I] get to hear different perspectives… I’ve been to every part of this country. I’ve lived on other continents and in other countries, and it’s incredibly important to listen to other folks. I do read, but I do more listening than I do reading.

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