The Toto Package

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Nancy Heslin   Forbes Monaco

Toto Wolff Mercedes F1 Grand Prix Monaco

Mercedes-Benz Grand Prix LTD

They both joined Mercedes in 2013, and although his winning grin may not be as famous as F1 champion Lewis Hamilton's, make no mistake : team principal and CEO Toto Wolff has been driving his team to victory.  

Since joining Mercedes-AMG Petronas Motorsport in 2013, Lewis Hamilton has had a record-breaking career, including smashing Michael Schumacher’s 68 pole positions by 20 (although he still trails him 7-6 for World Championship titles), proving why at 34 he is the most in-demand driver in Formula One.

A less familiar face on camera, team principal and CEO Toto Wolff, who also came on board in 2013, is credited as the man strategically driving Hamilton and turning Mercedes into a profitable team.

As Chris Smith wrote for Forbes, “Last year, Mercedes reported a $22 million operational profit, and that was while spending over $100 million more than any other team not named Ferrari. Mercedes is now worth $1.15 billion, up 46% from our last examination of team values two years ago.”

“You’ll have a better overall performance if you give individuals a clear set of targets that they can be passionate about, which are also in parallel with your company’s objectives,” asserts a thickly- accented Toto Wolff, looking out over the port of Monaco from the top of the Hotel de Paris. “An employee can’t align to an EBIT margin. You need to carve out common goal dominators.”

Aligning values is what has made a successful partnership between Mercedes-AMG Petronas Motorsport and UBS over the past ten years. “They are so successful in performance, collaboration and progress,” says CEO of UBS Monaco, Agnès Falco, who invited Wolff to meet with her 200 employees to share his insight on management and motivation. “Toto has transmitted his core values to his team to help make them this way.”

For Wolff: “The management principles that we apply in a high performance sports environment can be translated into a business environment.”

The 47-year-old (his birthday is January 12) is the total package, having tried his hand at a career in racing before switching gears to running a hugely successful venture capital firm.

“The first time I put a foot on a racetrack was when I was 18, visiting a friend in the German Formula Three Championship at Nürburgring.

I didn’t follow the sport, I had no idols, but I fell in love with car racing,” Wolff, who spent 13 years at the Lycée Français in Vienna, recounts.

A natural born charmer, he convinced his Polish mom, a single parent working as an anesthetist at Vienna General Hospital (his father, a successful business man, died from cancer when he was a teenager), that he would forego 10 years' worth of birthday and Christmas gifts in exchange for lessons at racing school.

“She was a doctor but could in no way afford sport activities for me. We were against the wider family who thought we were mad—racing cars was too dangerous and the money could be used for something more productive,” Wolff recalls.

He started his racing career in parallel with attending the Vienna University of Economics and Business. Even though he was earning money racing in a single- seater in Formula Ford, he quit both driving and uni at age 21.

“I had a Eureka moment when the driver in front was sliding the car on the front wheels on the exit, a natural reaction to compensate for oversteer. I realized my technical skills wouldn’t take me to the next level. That moment never left me.”

The 6’2” entrepreneur wanted to start working before everyone else. “I didn’t want to lose any more time. I’d decided I didn’t want to be a kid anymore.”

While Wolff describes himself as “pretty stable”, his CV is anything but during his early work experience. Speaking Polish, he took an internship at Raiffeisen investment bank in Poland. After two months, he moved over to the Austrian steel company Koloman Handler AG, and within two years set up his first business to act as their rep in Poland.

Wolff and Mercedes team at the 2019 Japanese Grand Prix.

“In 1996, I decided I wanted to be an entrepreneur. Koloman had taught me how to calculate margins as a matter of percentage on a selling price and within a year I started to analyze how much the owner was going to make. I saw that I could earn more as a shareholder in the first year than as an employee.”

With two partners, he set up a company that supplied to the paper industry. When one of their biggest clients was on the brink of administration, they looked at buying the company to recover their outstanding debt. “We analyzed everything but didn’t buy it. This is how I learned due diligence.”

Wolff then travelled to the States as the internet was starting to boom. “In the U.S., I’d read about these up and coming internet providers, search engines, and mobile portals that gave free SMS access and I wanted to see if they existed in Austria.”

He retuned to Vienna and tried to take a stake in as many internet startups as he could find consulting for equity.

“I picked up the phone and called these companies being run out of their apartments and told them I wanted to become a shareholder, find outside investors, and even list them on the Vienna Stock Exchange.” A year and a half later, he listed Jorgan Software Production.

In 1988, he and a “young lawyer” Austrian Rene Berger (who’s now a non-executive director of Mercedes’ F1 team) launched the venture capital firm Marchfifteen.

“I was so passionate about the investment business, I was like a sponge. The motivation was being the best we could be in the tech investment industry.

“We set up PLCs, and I was CEO, COO, executive chairman, non-executive chairman—it was really learning on the job.”

While their business focused on technology, software and internet investment, Wolff says mobile communication was the game changer. “We had a desktop interface where you could send free SMS and download ringtones by hacking into servers of mobile phone companies who had turned us down. We’d find a gateway through Nigeria or Denmark and in a month we’d be online and a client would have free SMS desktop interface.

“It was fascinating that mobile communication would end up as a commodity.”

In February 2000, returning from Bonn to Vienna after selling a business “with no revenue” to Deutsche Telekom for “a tremendous amount of money,” Wolff had another Eureka moment. His CFO, an ex-head of mergers and acquisitions at one of Austria’s largest steel plants, said to him, “Something is wrong. We’ve sold a business that has no proof of concept to a very profitable bricks and mortar retailer listed on the stock exchange.”

They decided later that month to divest their 9 investments. Two months later the bubble burst. By the end of the year they'd sold all investments.

Business acumen or good timing? “We were all sheep who believed in the endless power of the internet. Profits were not metrics that mattered until someone told me that this was wrong.”

The smile of victory at the 2019 Spanish Grand Prix.

Wolff sees the phenomenon happening again, citing an interview he read about a billion dollar startup evaluation. “The CFO was asked about revenue and profits and replied, ‘Profitability is not an important metrics at this stage of the company’s growth.’

“Hold on! I heard that in 1999. Now a new generation of investors who weren’t a part of what happened back in the day believes what they are being sold and what they are selling on to another group of investors. Uber, WeWork ... this is the end of the cycle.”

Having combined his passion for car racing with his entrepreneurialism, in 2013 Wolff left his executive director position at Williams to become a managing partner at Mercedes, taking a 30% stake in the team.

In an interview that year with American motoring magazine, Autoweek, Wolff said that Mercedes’ management told him “we are a group with 100 billion euros in turnover but we are not sure whether we really understand motorsport. We would like a professional who is not only
a manager but is also a co-shareholder, who is involved financially, has an entrepreneurial risk and is, therefore, someone we would be comfortable with.”

In 2014, he took over from Ross Brawn as team principal and CEO, and Hamilton won the title.

Married to Susie Wolff, a former racer and, since 2018, team principal at Venturi Formula E Team, Wolff spends 700 hours a year in flight and 250 nights in hotels. “I read about a successful entrepreneur who only needs four hours of sleep. It’s not true, everyone needs a minimum of regeneration and rest, and this is something I’m wrestling with.”

The father of three rarely says “no.” “I enjoy listening and observing, and I see myself on a trip of permanent development.”

Yet he doesn’t “overestimate his role.” Having missed his first Grand Prix since joining Mercedes six years ago, he commented prior
to the November 17 race, “I have the utmost confidence in teamwork. For the moment, I can contain the control freak in me.”

That same week, Wolff commented to the press that Mercedes F1 future is “not a given” and has since also admitted “he had assessed there was a 25% chance” of Hamilton leaving to end his career racing for the iconic Prancing Horse.

“The highest level of a sports team is a marketing and branding exercise but there is the same financial reality as for any other business,” says Wolff. “Every car company is facing the same challenges of electrification and new mobility.

“I can stay on with the same project if I have a sense of purpose, passion and energy —and can contribute to its success.”

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Nancy Heslin   Forbes Monaco

Nancy Heslin is an established journalist and lifestyle writer. She has been the Editor-in-Chief of Forbes Monaco magazine (bimonthly in English) , since the magazine's 2nd issue . Launched in November 2018, Forbes Monaco is part of the Forbes family, with its 7 million readers and 71 million monthly website visitors worldwide.