by Dennis Holder
For Virginia Business
Dr. Greg Fairchild took the long way around to academia. As a college student, he aimed for a career in retailing, an ambition that propelled him to a position at Saks Fifth Avenue in New York. His efforts to further that career began a chain of events that ultimately led him to a tenured faculty post at one of the nation’s top-ranked graduate business schools where he now is in charge of the largest research grant it ever received.
The 44-year-old Fairchild seems a bit surprised, and more than a tad flattered, to find himself among the most popular professors at the Darden Graduate School of Business Administration at University of Virginia. His work has attracted the attention of the John D. and Catherine T. MacArthur Foundation, which has awarded him an $850,000 grant to conduct research on community development financial institutions (CDFIs). “With this MacArthur Foundation grant, he now has the makings of an international reputation,” says James Freeland, an associate dean at Darden who recruited Fairchild.
Fairchild says he will use the three-year MacArthur grant to learn how CDFIs support businesses in disadvantaged areas. He will examine 30 banks, credit unions, loan funds and venture capital groups — mostly nonprofits. His target organizations, which he still is identifying, have backed entrepreneurs successfully in areas as diverse as American Indian reservations, inner cities, depressed agricultural communities and immigrant neighborhoods. He hopes to find common elements that will form a framework for the success of other CDFIs that will, in turn, make loans to help build small businesses in struggling neighborhoods.
“This is important work for us,” says Michael A. Stegman, director of policy and housing for the MacArthur Foundation and the organization’s point man for Fairchild’s project. “Over the past 20 years, our foundation has given about $250 million to help businesses in disadvantaged areas. If Greg can find lessons for CDFIs, we can focus on those organizations, and they can spread out to fund entrepreneurial businesses.”
Fairchild intends to produce more from his research than a report for the MacArthur Foundation. He will write academic articles and perhaps a textbook. He also plans more practical results: a handbook for emerging CDFIs and those who might guide them; plus articles advising communities about how to attract CDFI investment. “I want this work to make a difference,” he says.
Saks Fifth Avenue and P&G
Conducting this type of research was not part of Fairchild’s plans when he graduated from Brookville High School near Lynchburg in 1982. He waited tables in the executive dining room at the Philip Morris cigarette plant in Richmond while attending Virginia Commonwealth University. “I wanted to go into retail,” Fairchild says. “When I got a job at the Saks Fifth Avenue store in New York City, I thought I was on my way.”
Fairchild learned, however, that moving up in retail could be a slow, arduous process. A mentor at Saks suggested that a master’s degree in business administration would be the quickest path to upper management. “I had never given any thought to graduate school before,” Fairchild recalls, “but I started to think about it at that point.”
With his family in Virginia, Fairchild chose Darden for his MBA studies. He shifted his focus from retail to marketing and compiled a short slate of first-rate companies he wanted to work for. Procter & Gamble topped that list. “P&G had begun acquiring cosmetics and hair-care companies. When I applied, they said, ‘Here’s a guy with a background in fashion who is interested in marketing and has an MBA.’ They hired me for a position full of opportunity.”
Before Fairchild moved to Cincinnati to work for P&G, he took a trip abroad that altered his future. He studied for two weeks in Russia as part of an exchange program with a university in Moscow. His research there centered on a recently opened Pizza Hut. He hoped to learn what barriers confronted a business starting up in a place where such enterprises had no history and no community support.
During the stay in Moscow, Fairchild roomed with Dr. L.J. Bourgeois III (now an associate dean at Darden), who had taught Fairchild in a class. The professor asked him, “Why don’t you go for a doctorate?”
“I had never even thought about a doctoral degree,” Fairchild says. “I wanted to go work in marketing at P&G, and that’s what I did. But the idea of a Ph.D. stuck in my mind. After a couple of years I decided I would apply to four schools. If I was accepted, great. If not, great.” Stanford turned him down. Harvard added his name to a waiting list. But the University of Michigan and Columbia University invited him to join their doctoral programs. After long discussions with his wife, who encouraged him, and his parents, who could not understand leaving a good corporate job for academia, he chose Columbia.
Finding his field
At first, Fairchild concentrated on traditional business-school concerns — the workings of the corporate world. However, his work in Moscow nagged at him. He began to study small businesses in difficult environments. For his doctoral dissertation, he interviewed 100 entrepreneurs in Harlem’s historic African-American business district to learn how they planned to adapt to an upscale retail center under construction nearby. “The simple act of going into Harlem and talking to people there set me apart from any other doctoral candidate at Columbia,” he says.
With his newly minted doctorate, Fairchild joined the Darden faculty in August 2000. Since then, he has taught entrepreneurship and strategy to students whose evaluations have placed him among Darden’s highest rated professors for four consecutive years.
Although Fairchild has grown comfortable with his life as a scholar, he describes the MacArthur Foundation grant as a bit serendipitous. Community development is not his specialty, he says. Nor is finance, though a Harvard Business School professor he asked to join him on the MacArthur project is an expert in that area. “I was really surprised when the MacArthur Foundation began to talk to me about this grant,” he says.
However, Stegman says that the Foundation considered Fairchild’s expertise exactly right. “I didn’t want people too close to the CDFI industry. Greg was an expert in strategy and innovation.”
Adds James Freeland, “Unlike a lot of what we do in a business school, Greg’s research is aimed at the small-business person. Someone who wants to start a business in a disadvantaged area or expand an existing business into the inner city will benefit from this work. We believe Greg brings exactly the right perspective to this project.”
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