ISTAT Jetrader - Spring 2023 - 15

monetization event as an entrepreneur. RBS acquired IAMG in June 2001. This
is an important date. The bank had allocated $5 billion to build, from scratch, an
aircraft leasing business. I was the chief executive; it was my team, my strategy
and it was a marriage made in heaven. They had the cash, and we had a wonderful
network globally. We started doing transactions, and literally just months later, 9/11
happened, and everything changed. For several months thereafter, nobody flew out
of fear. There were deep concerns that
the global airline industry was going to
go bankrupt. It was a disaster. My view
was it that it was going to be for a finite
period of time, so I went to Fred and
basically pitched him that, instead of
a $5 billion balance sheet, we wanted
access to between $10 to $15 billion,
and instead of making a return on
equity of x%, it should be x-plus%,
and he backed us.
In January 2002, we set out our
vision to become the premier aircraft
leasing business in the world. At
that stage, I think we had five aircraft. It was nothing. We traveled the world, and
we identified what we called the " Survivors and Thrivers. " We had pre-approved
half a billion dollar line for each of these airlines, whether it was aircraft leasing,
aircraft debt financing, financial derivatives, whatever they needed to survive.
The environment was distressed, but we flourished. The RBS aviation business
went from a startup with not a single aircraft to, three years later, the third largest
aircraft financier in the world.
The platform was now a pretty big business, but I had made my mind up that
I didn't want to work at a bank. I had experienced the special feeling of being a
founder and entrepreneur, and that was just niggling at me, so I stepped down
in 2004. I had made the decision that I'd done everything I ever wanted to do in
aircraft leasing, so between 2004 and 2009, I pivoted and focused on managing my
own money and set up a family office, Claret Capital, in Ireland and made a number
of investments in all kinds of things. We had aspirations of becoming a major private
equity firm, and that ended up not working as a consequence of the financial crisis.
By 2009, I had lost every single penny. And a little bit more with that.
Jetrader: So, can you talk about the Avolon journey?
DS: I had two options facing me in a personal capacity in 2009: one was to declare
bankruptcy and go through that process. The prospect of going bankrupt was
untenable, but I knew the one thing I was pretty good at is the aircraft leasing
business. I decided I needed to start again, and that became Avolon.
During 2009, and up to the first half of 2010, I put a new team together,
although some of it would qualify as " old. " A constant lesson since I began in
aviation over 20 years before was that a company will only ever be as good as
its people, and I had been very fortunate to work with some gifted people. In
RBS, my wing man was Peter Barrett (current CEO of SMBC Aviation Capital); my
brother John Slattery ran the Americas and, in 2007, became the youngest and
first non-American president of the Wings Club. Others like Barry Flannery (current
chief commercial officer of SMBC Aviation Capital) and Ruth Kelly (former CEO of
Goshawk) drove the business.
The founding partners of Avolon would go on to be the key to its success over
the next decade, including colleagues like John Higgins, Tom Ashe and (current
Avolon CEO) Andy Cronin. Steven
Graham, Paul Geaney and Daire
O'Criodain had worked closely with
me in Claret; they were on board
from day one of the Avolon planning
stage. In fact, Steven Graham, at
A constant lesson since I began in aviation over
20 years before was that a company will only ever be
as good as its people, and I had been very fortunate to
work with some gifted people.
the tender age of 26, built the first
financial model for the Avolon business
plan. Simon Hanson, Ed Riley and Pat
Hannigan (former CEO of CDB Aviation)
were there at the very start, as was
the incomparable Dick Forsberg, an
aviation strategist like no other who
has been a valued link to all of my
businesses and throughout my career.
With a team of this strength, I always
felt deep down that we would succeed.
Among all my wonderful colleagues
was a special person, Paul Barton. He
first introduced me to Oak Hill Capital,
gave Avolon its name during a walk
with me in my native County Clare, a
place called Clahane, and he helped
bring John, Tom and the others on
board. He sat on our first Avolon board
and was an invaluable guide in helping
navigate the early years of our private
equity ownership - always calm and
always on the button.
Having begged, scraped and
borrowed the money to travel around
the world, I pitched the idea of a
startup aircraft leasing company to
the world's private equity firms and
sovereign wealth funds. The thesis was:
The great financial crisis will provide
even greater opportunities than even
9/11's aftermath. From IAMG and RBS
Aviation we had a demonstrated track
* SPR I NG 2023 * 15
ISTAT Jetrader - Spring 2023

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