Karl Eller, an appreciation

The last time I sat down with Karl Eller in his office on the Camelback Corridor, he said, "If I were 30, I'd move to China."

It was classic Eller: Ambitious, brash, optimistic, visionary. This was in the 2000s, before Xi Jinping's crackdown, when the People's Republic seemed to be an endless source of opportunity. Rather like the Phoenix of the 1960s and 1970s, when he was young.

Eller, age 90, died on Sunday. He was the last of the old Phoenix stewards — people such as Walter Bimson, Frank Snell, Eugene C. Pulliam, and John Teets who could knock heads and write checks, who saw their companies' interests as synonymous with the health of Phoenix. Those essential stewards no longer exist and Phoenix is crippled as a result.

If you grew up in that 1960s Phoenix — a new city of the future, or so it seemed — you couldn't drive down a street without seeing Eller's name on the bottom of a billboard. Eller Outdoor was his first big score, a business he bought from the outdoor advertising pioneer Foster & Kleiser, for whom he worked as a "lease man." With roots in the Northwest, F&K, by this time a division of Metropolitan Broadcasting, offered Eller the billboard business in Phoenix, Tucson, Bakersfield, and Fresno. The $5 million price seemed impossible for a young man with net worth of $50,000, but he rounded up investors and closed the deal. He turned it into his first empire.

This was a very different Phoenix from today. It boasted a strong local economy with three bank headquarters and a robust defense/technology sector anchored by Motorola, AiResearch, and Sperry. The city, majority Anglo and middle class, dominated the Salt River Valley whose small farm towns had yet to grow into supersized suburban competitors. Business leaders ran the city, including municipal government.

Eller was the youngest of the group. He'd grown up in Tucson and graduated from the UA. His entrepreneurial talents showed early when he built his morning newspaper route into 500 customers. "I had a winning system," he recalled. "Riding my bike in the desert dawn, a small Lone Ranger chasing imaginary banditos, I folded and flipped papers nonstop, firing them left and right as I pursued truth, justice, and profit."

Eller Outdoor purchased KTAR television and radio, then the NBC affiliate located on Central and Portland. He built it into Combined Communications, a company that owned seven television stations, 14 radio stations, numerous outdoor advertising companies, and two metropolitan newspapers. Among the latter was the Cincinnati Enquirer, where I would later serve as business editor.

His career is full of "might-have-beens." In 1978, Eller negotiated a merger with Gannett for $373 million dollars. He became Gannett's largest individual shareholder and assumed he would run the combined entity. Unfortunately he was negotiating with Gannett's Al Neuharth, whose autobiography was appropriately titled Confessions of an S.O.B. Neuharth reneged on the promise to make Eller president and eventually forced him from the leadership. Might have been: The nation's largest media company headquartered in Phoenix.

Sadly, Eller let his anger overpower his native shrewdness. Instead of biding his time as a major shareholder, he quickly launched a boardroom coup and lost. "I left Gannett after about six months, soundly whipped," Eller recalled. In classic Neuharth fashion, he sent Eller a copy of his memoir inscribed, "In friendship." Gannett purchased the Arizona Republic in 2000.

His Circle K adventure began when he was recruited to lead the chain of convenience stores. He improved the stores and products, expanded massively to compete with 7-Eleven, and profits soared. He looked back on that as a warning sign he failed to heed, realized he hadn't learned the business as well as he should. Success created complacency and Circle K ended up seeking bankruptcy protection. Another might-have-been: Circle K's headquarters in downtown Phoenix.

Interestingly, he tangled once again with the ruthless Cincinnati financier Carl Lindner. As Circle K swung from profits to losses and debt, Lindner took a large stake in the company's stock. He knew the business — unlike Eller — from his family United Dairy Farmers chain. He was also a pioneer in using "prepackaged" bankruptcy protection as a weapon. This wasn't the first time the two had battled — Lindner had been a Combined Communications shareholder and pushed for a merger. Eller called Circle K one of his "most traumatic failures." It was 1990 and Eller was 62.

He was not done.

Gannett had been in the outdoor advertising business. Eller arranged a complex deal to acquire its Phoenix business, selling most of it to Arte Moreno, an Eller Outdoor alum who owned Outdoor Systems. Eller's name was once again on small billboards ("posters") and he was an elder statesman. He also had a career as a steward who was instrumental is setting up the expansion Phoenix Suns (and attracting Jerry Colangelo), the Fiesta Bowl, and, less happily, the Phoenix (now Arizona) Cardinals. He helped the push to land TGen.

Eller always made time to talk to me, even though he had less than flattering words about the Republic under Gannett. I never break the seal of off-the-record conversations with sources. But he was an optimist, even about Phoenix, a place that had changed so radically. His memoir-cum-advice book was titled, Integrity Is All You've Got. He had it. You will be missed, my friend.

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My book, A Brief History of Phoenix, is available to buy or order at your local independent bookstore, or from Amazon.

 Read more Phoenix history in Rogue's Phoenix 101 archive.

 

 

 

 

 

 

 

 

 

 

 

 

 

Comments

[Mike Doughty]

RC. I kept hoping for Ellers foray into the ice cream business and his venture as Swensons He persuaded my bother to be president of the company and move to Florida. Elder sold it from out from under him and he came back to Phoenix to run a successful Cleaning product company. He recently retired and I would like your take on ellers Swenson period.

[Rogue Columnist]

Mike, I'm not aware of Swenson's. I suspect it was a casualty of his Circle K-era disasters.

[B. Franklin]

Though I'm not really sure if billboards and bankrupting Circle K contributed anything positive to Phoenix's quality of life, I will agree that the "old stewards", in addition to wanting to make a tasty profit, at least cared a little about the town.

I'm not sure that the soup billionaire, the cheap tire billionaire, and the phony university billionaires, do.

[Cal Lash]

John W "Jack" Swilling?

[Chuck Albertson]

Sorry to hear of his passing. My Dad went to Tucson High with Karl Eller and they wound up in the same frat at the UofA. He particular remembered encountering Eller on the first day of classes at the UofA; the registration lines were pretty long, and Eller was making a killing by selling sandwiches to the students waiting in line.

[john tally]

Billboards are a blight on the landscape, and Karl fought against compliance with Tucson dark skies.

[cal lash]

Doctor Tally is correct. Fortunately there are some still dark places in and around Tucson. But I fear the infill between Tucson and Benson and too the south border with Mexico will continue and next we will import an artificial moon from China.

[john tally]

Dr. John Talley and John Tally are separate entities going about their lives in The Old Pueblo. Thanks anyway, Cal.

[Cal Lash]

DeNada!
PS, Charles Bowden was my friend.
Ill be in town mid July.
And i wrote about 1200 words for some Tucson professors in a book soon to be published about Chuck
Heres to the Dark Side
Hasta luego
Cal

[James Landon]

Eller hired me in 1978 as his VP-Marketing at Combined Communications. He was also Swenson's largest franchisee, owning the stores in Arizona. When he did the Gannet deal and had his fall out with Neuharth, he bought Swenson's from its founder, Earl Swenson, and moved the company to Phoenix. His management team at Combined then moved over to Swenson's. Larry Wilson became president, I was VP-Marketing. Eller was the most charismatic person I worked for, a classic entreprenauer. Loved working for him.