How John W. Rogers Jr. built a $15 billion firm

BY Preta Peace Namasaba January 25, 2024 7:36 AM EDT
John Rogers, founder of Ariel Investments. Photo Credit: Bob Stefko

With over $15 billion of assets under its management, Ariel Investments has prominent market presence. The company, where John W. Rogers Jr. is the founder, chairman and co-CEO, is arguably one of the most successful stories of a minority-run investment firm in the United States.

It is fair to characterize Rogers as having been prepared by an illustrious family legacy. His great grandfather was J.B. Stradford, a lawyer and owner of Greenwood’s Stradford Hotel, the largest Black-owned hotel in the nation at the dawn of the 20th century. Rogers is also the only child of John Rogers Sr., a military aviator in World War II with the Tuskegee airmen, the military’s first squadron of Black pilots, and was also a judge in Chicago’s juvenile court system. His mother, Jewel Lafontant, is the first Black woman to graduate from the University of Chicago law school and the first woman and first Black person to serve as U.S. deputy solicitor general.

On his 12th birthday, Rogers remembers his parents buying him blue chip stocks although he preferred toys.. He received more stocks during Christmas and subsequent birthdays.

But although Rogers enjoyed doing jigsaw puzzles, he soon came to add reading the quarterly reports of the companies for which he owned stocks as one of his favorite pastimes. Between the ages of of 16 to 22, he took his first job a vendor at Wrigley Field and White Sox Park where he sold sold soda, beer, peanuts and popcorn.

“I got comfortable with volatility and the general ups and downs of the market early on [in my life]. I learned from a few of the stockbrokers I was around in my younger years, so all those things helped me to come up with the strategy I have,” Rogers said about how childhood conditions adjusted him for the big leagues.

He went on to pursue a bachelor’s a in economics at Princeton University, where he played basketball. Although he wasn’t a star athlete, Roger had become the team’s captain by senior year. From team sports, Rogers embraced the values of patience and teamwork, two virtues that would become a part of his investment strategy.

After graduation, Rogers worked as a stockbroker at William Blair & Company. He left after three years to establish what was the first Black-owned money management firm in the country, Ariel Investments. Rogers’ firm invested in small and midsize companies in the United States. It also bough cheap stocks in industries within its competence, held them longer than most firms and then sold them for a profit.

“I constantly make sure we’ve created an environment that encourages people on the team to really say what they think, to get their ideas out on the table and to give them the opportunity to argue those perspectives and make sure they’re not holding them inside and going home and talking to their family about the idea,” Rogers said of his leadership style.

Rogers has emphasized the importance of having a skillful manager in a workplace. He has earned a reputation for developing and mentoring leaders both within and beyond Ariel. One of his mentees, Mellody Hobson, led the firm through the 2008 financial crisis when its flagship fund fell almost 50 percent. The firm eventually survived the crisis. Hobson has served alongside Rogers as co-CEO since 2019.

Rogers is still the firm’s chief investment officer and stock-picker. He is betting big on Ariel’s entertainment and private equity ventures. Madison Square Garden Entertainment, the firm’s largest holding owns the MSG Network, Radio City Music Hall and the recently opened $2.2 billion MSG Sphere in Las Vegas. Ariel is also holding Paramount Global, investment bank Lazard, and private equity firm The Carlyle Group. Rogers particularly likes the consistent fees brought in by small- and mid-cap private equity funds.

He predicts an upswing in the housing market and has accordingly invested in flooring company Mohawk Industries and repurchased shares of power generator manufacturer Generac. He earned a fourfold profit on Generac during the coronavirus pandemic. Rogers’s high-conviction and high-concentration investment style has grown the flagship $2.5 billion Ariel Fund in 1986 to a leading $15 billion asset management firm. It is the longest-running fund in Morningstar’s mid-cap value category.

His relationships with prominent African-American business leaders also exposed Rogers to the importance of philanthropy. He has followed in that path and has been known to give healthily back to the community. The Ariel Community Academy educates and invests in the futures of inner city children and a partnership program with the University of Chicago helps minority students to get paid internships in the investment offices of major endowments and foundations in the United States. Ariel Investments also launched Project Black, LP which seeks to invest in middle-market companies with $100 million to $1 billion in revenue.

“I think a really important part of moving our community ahead is to make sure that those of us in leadership roles are going to hold any organization accountable and that we’re involved to create equal economic opportunity for everyone,” Rogers said on the driving force behind his philanthropy.

His civic engagement extends to political and corporate leadership. Rogers co-chaired President Barack Obama’s 2009 inauguration and serves on the Barack Obama Foundation’s Board. He is a board member of McDonald’s, NIKE, The New York Times Company and serves as vice chair of the board of trustees of the University of Chicago

Rogers is also a member of the American Academy of Arts and Sciences, a director of the Robert F. Kennedy Human Rights and was awarded Princeton University’s highest honor, the Woodrow Wilson Award in 2008.