Corwin Flambeau's "A Sampler of Failed Businesses"
Copyright Richard Schwartz, 2001
Corwin Flambeau - now here is a venture capitalist who
marches to his own tune! Screwball, visionary,
misanthrope, Flambeau has been called many things
during his long and colorful life. The book under
review is an apology of sorts, though it defies
easy classification. Flambeau bills his
work as a simple catalogue of flawed business ventures,
though this self-assessment is far from accurate.
While it contains a treasure chest of
egregiously flawed business ideas, the
work reads like a cross between
a memoir and a diatribe. Above all, perhaps,
Flambeau's work should be considered a
textbook on how to
squander an enormous fortune.
The facts of Flambeau's life are well known.
We refer the interested reader to R. K. Hurley's
``The Rise of the Vegas Overlords'' or to
J. R. Valentine's
``Thirty Years Uphill, Thirty Years Downhill'', two
extensive accounts written from very different
points of view. Here we sketch only the barest
facts, in order to put Flambeau's own book in
Born out of wedlock to a
destitute New Orleans woman during the
Great Depression, Corwin Flambeau became a classic
``child hobo''. Ten years of fruitless wandering
back and forth across the country brought the hardened
child-man to the newly booming Las Vegas. Petty thief,
hired muscle, busboy, blackjack dealer, floor
manager, casino manager, Flambeau rose steadily
through the ranks of the gambling industry
under the corrupt but charitable influence of
the Vegas power brokers. Still in his
forties, Flambeau amassed one of the largest
fortunes in America through a string of
astoundingly lucky mergers and acquisitions.
Some say that his luck simply ran out on his
fiftieth birthday. As Valentine puts it,
``Like all winning streaks, Flambeau's had to snap''.
One associate of Flambeau's attributes his
change of course to the result of
a brain fever.
Hospital records indeed show that Flambeau
spent four days in the hospital several
weeks short of his fiftieth birthday, but
there is no indication of the nature of
his malady, nor any indication that it had
any lasting effects. Whatever the cause,
Corwin Flambeau became a kind of patron saint of
quixotic ventures. Former
associates relate how this previously shrewd,
calculating, circumspect, ruthless operator
suddenly countenenced the most harebrained schemes,
giggling like a child over
the most extravagantly infeasible ideas.
Here is Flambeau's own account, taken from his
book: ``Imagine that you ate nothing but
spinach, brussel sprouts, tofu,
carrot puree. You dutifully
did sit-ups and push-ups every morning,
jogged in the afternoons, swam in the evenings,
brushed and flossed your teeth three
times a day,
built and maintained yourself with a grim
efficiency. You stand in the middle of
your life and look behind you at the endless
string of sensible days trailing off into the past;
you look ahead at the same string of days
trailing off into the future, as if
reflected in a mirror. What is it that
comes to mind? Boredom!''
Flambeau tells us that he came to
regard business ventures as a kind of
candy; the wilder the idea, the sweeter the
taste. In his book,
Flambeau dwells lovingly on his
he takes almost a hundred pages to tell the
tale of McSmash, a venture that came to a very public
and spectacular end.
McSmash was the brainchild
of Hideo Murakama and Branson Tap, two
ex-convicts who had nothing to their names but
McSmash was to be a business specializing
in the breaking of glass. For a fee, a client
would be given a baseball bat and ten minutes
alone with a huge assortment of glass fixtures:
plates, lawn statues, old lamps, and whatnot.
Wearing protective gear, the client would be
free to smash the glass fixtures to bits.
Murakama and Tap envisioned this as a kind
of modern therapy and planned to
target ``frustrated professionals'',
people such as doctors
and lawyers and accountants, who worked at lucrative but
ultimately stifling jobs.
The venture presented numerous practical problems.
For instance, these ``smash outlets'', as Murakama
and Tap called them, would require a steady
stream of glass. To deal with this problem,
Murakama and Tap proposed to
set up the outlets near junk yards and glass
processing facilities. In response to the
issue of insurance, which was certainly the most
pressing problem, Murakama and Tap
designed an ironclad waiver that had to be signed in advance
by the client. Nearly ten pages long,
the waiver took into account every
possible contingency, addressed a bewildering
list of mishaps, in all cases directed liability
back to the client.
Satisfied with these solutions, Corwin Flambeau
lavished funding on the venture.
The trio found certain laws in the United States
insurmountable, but they tried their luck
abroad. The first McSmash outlet opened in
Tokyo in August, 1982, followed swiftly by
By 1983 McSmash had become a kind of national
craze in Japan. There was talk of branching
out to Korea, to Australia, to
The demise of McSmash is well known:
The first serious
accident coincided with the first televised
account. Even though
corneal injury was covered by the waiver,
the public was treated to Peter Moore,
a wealthy businessman visiting Japan,
writhing on the floor in agony, clutching
at his eyeballs. Lawyers
descended upon the case like vultures and
ripped the waiver apart into
shreds. McSmash went bankrupt six
months later. The negative
publicity generated by the trial
permanently forestalled any attempts at
reopening the business.
Flambeau looks back with equal fondness on
Carbird, a short-lived company he founded in the
early '90s, in collaboration
with Florence Popp, a retired English teacher
and diehard hippie. After spending several
hours one afternoon looking for her car in a
mall parking lot, Popp had the idea that perhaps
one could push a button and have a mechanical bird
flutter into the air, tethered to the car by a
long string. Seeing the bird from a distance,
the hapless shopper could then easily locate her car.
Popp imagined that her company could produce many
different kinds of birds. The multiplicity of
birds, first of all, would suit differing aesthetics
and, second of all, would prevent the obvious
problem of duplication.
If many people pushed their ``carbird buttons''
at the same time, there would have to be a
method for sorting out which bird belonged to
Thus, for example, I would head off in
the direction of the bright red cardinal while
the person next to me
would follow his bluebird.
Popp wanted to
equip each bird with a small but cost-efficient
computer, so as to create interesting behavior.
She argued that the carbird product
should be entertaining as well as
useful. As she explained to Flambeau, one
could envision a ``symphony of
flight'', with many birds fluttering at once,
each according to its own pre-programmed pattern.
From a practical point of view, Popp argued
that the small computers would make the
birds ``intelligent enough'' to avoid
obstacles such as trees or low overhangs.
To cover the high cost of manufacture,
Popp proposed to aim the product at the rich.
Flambeau built a small carbird factory on the
outskirts of Fresno.
He and Popp hired a slick advertising executive
named Horace Wilson, as well as a team of
graphic artists. They launched an aggressive
marketing campaign which simultaneously
played upon people's fears of losing their
car in a public place and upon their
sense of wonder at the natural world.
As a final publicity stunt, they gave away 1000
carbirds to drivers in Phoenix, Arizona.
Disaster struck in an underground car lot.
Popp had written the instruction manual in
a way which made it clear that the carbird
should not be operated underground. Unfortunately,
she had not calculated on the possibility of
an operator who was unable to read the
instruction manual. In his book Flambeau
recounts with a kind of philosophical mirth an
event which, by all rights, must have
been horrifying at the time. Suffice it
to say that the court did not agree with
Flambeau and Popp that the grabbing of the
control panel by 4-year-old Joey Fickus
was an ``unforseeable event''.
In 1985, Flambeau teamed up with a young genius
by the name of
Terence Caruthers. Fresh out of Caltech
with a Ph.D. in Chemistry,
Caruthers had perfected a method for
producing giant sheets of glass,
thin as razor blades but strong as concrete.
Caruthers and Flambeau hatched the
plan of building transparent,
polyhedral houses. They envisioned
their creations filling entire neighborhoods,
enormous jewels glittering in the sun.
Flambeau purchased land
in Southern California, at the base of
the San Bernardino mountains. He began operations
at once. The
vast production was riddled with difficulties,
but Flambeau and Caruthers plunged forward.
It was not easy, for example, to manufacture
sheets of glass. One required giant furnaces,
clamps which stretched the length of a
building, precision cutters wrought on an
Special vehicles had to be
assembled in order to carry and manipulate the
polygonal sheets of glass, cranes with huge
delicate robotic hands.
Entire industries sprang up
overnight, nurtured by a steady outpouring
of enthusiasm and cash - industries that never
saw a penny of profit. In the end the
beautiful houses stood empty for five
years before they were destroyed by
Corwin Flambeau financed
mechanical insects, luminescent flowers,
mirrored contact lenses,
indoor fireworks, waterproof television sets, a
school for training chimpanzees to play checkers, a
working bicycle made from toothpicks and
feathers - these and more
are described with a mixture of pride and
Reading these reminiscences, one wonders how he felt,
not about the things in themselves,
but rather about their stubborn failure to
thrive in the public arena.
the last several chapters of Flambeau's
work are a kind of post-mortem, an analysis of
his own relentless failure. When he has said everything
he has to say, his final analysis is simply this:
For the most part, people are interested in the