Still Sharp: How Isadore Sharp built a luxury-hotel empire

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The word “unicorn” has been misapplied and needs to be repurposed. While billion-dollar startups seem to proliferate, in the world of Canadian enterprise, there remains only one, magical, Issy Sharp. How else to describe someone who, without a background in business or access to family wealth, built one of this country’s most iconic companies and created a brand synonymous with luxury around the world? For added amazement, he did it with hotels. It’s hard to think of an industry more vulnerable to economic whim. And ever since Sharp started in 1961, the cycle of crises—recession, war, terrorism, pandemic—attacked the bottom line. Yet Sharp never faltered. Every predicament was an opportunity: to expand, to become more efficient, to burnish the image of Four Seasons Hotels & Resorts even more. He consistently out-strategized his competition, pulled off deals the experts considered impossible or foolish, and stayed true to one central idea: impeccable service. All the while, he maintained a reputation for honesty and nice-guyism that would do any Canadian proud. Now on the cusp of 92, he still plays a role in the company he built, as a symbol of singular achievement. We met in the atrium of the Toronto home where he lives with his wife, Rosalie, surrounded by her paintings and collection of fine porcelain.

You built your first hotel in the middle of Toronto’s red-light district, against the advice of everybody. You built your second hotel on an empty field across from a garbage dump, and everybody said you were nuts. You’ve done many other perilous deals, and apparently you used to love heli-skiing down remote mountains.

Yeah.

So, what is it about risk that attracts you?

Attraction, I don’t think, is the right description. Risk has never been an issue for me. Whatever I was starting out to do, the idea of failing never crossed my mind.

Were you blind to how it could go wrong? Or did it just not matter?

People tell you, “You don’t know what you’re doing.” But you’re young; if it doesn’t work, you pick up the pieces and you go on. There’s an interesting phrase—the Wallenda Factor. Wallenda was the founder of a family of tightrope walkers—famous for tightrope walking without a net, the most treacherous thing. And he never, ever thought of failing. But one night, he told his wife, “You know, someday I might fall.” And the next day, he fell.

When you graduated from Ryerson in architecture, your father let you run the family construction business, Sharp and Son. What did you learn about being the boss as a young man?

As a kid growing up, I used to work during the summer in construction with these tough, hardworking immigrant people—Poles, Italians, Jews—and they had a work ethic that I admired. Never complained. I guess over the years, I learned how to get people motivated. I think a lot of that even comes from the sports you play. I was the captain of many teams. I just, by nature, was a good leader.

In 1963, you were 32 years old, and you stayed at the Dorchester Hotel in London.

You’ve done your research.

You met somebody who was connected to it, and you said, “Tell the people who built this hotel, if they ever want to build a hotel better than the Dorchester, I could do that for them.” Was that arrogance? What caused you to make that boast?

It was a flippant comment. You say things you don’t really think about. It was a reactive type of comment when he said, “My company owns that hotel.”

Were you feeling really good about yourself in that moment?

I’ve always had self-confidence, self-esteem, you might say. And that comes from your upbringing and the DNA in your genes. I had no self-doubt. I’m not considered an arrogant person. I’m very low-key. Always a good sport. I’m a likeable guy.

Coming here, I met somebody who said you’re the nicest person they’ve ever known.

A big part of my success is my ability to build relationships of trust. I’ll give you an example. In the pandemic, we were all locked up, all of a sudden we’ve got more time on our hands, just being home. So, I decided I would do a self-analysis. I’ve never been to a psychiatrist. I’ve never had therapy. So, I sat down and thought, How did I get to where I am, and why? So, I made these bullet points, going back as far as I could remember. The first one was my grandmother, who lived with us when I was three, four years old. And my notes about school, friends. It came to over 200 bullet points. One of the things that came through all these points is that I make a very good first impression. That’s my nature. But more important, as I continue that relationship, it gets reinforced. You’re authentic. You’re consistent in the way you deal with people.

The very best example was when I met my wife. It was at a wedding. She was a young bridesmaid. I was 20 years old. So, I asked her to dance. Had a few conversations. The next day, she wrote in her diary to her best friend, Merle: “Merle, I’ve met the man of my life, I know I will never love anybody else.” So, obviously I made a good first impression. As she did on me.

In 1976, you had seven hotels and two under construction. Ten years later, you had 18 hotels. And you’d expanded despite the recession that hit in the early ‘80s. How did you do it?

Well, initially, you’re gaining relationships with financiers, bankers, etc. And you borrow a lot of money. And at that time, we were building a hotel, you own the hotel, you own the real estate. And we were successful.

You were doing all that borrowing at a time when interest rates were extraordinarily high. The prime rate got as high as 21%.

That’s right. Fortunately our hotel in London was enormously successful, as was the Inn on the Park in Toronto. They had good cash flow. So, I was able to leverage on those successful properties to show that I could borrow money. But when that rate hit 21% in 1981, I mean, nobody can support that kind of thing. The banks, of course, said, “How are you gonna pay this back?” And I said, “Look, this is a temporary situation. The world can’t live at 21%. What I need you to do is to lend me more money, and let the interest compound and grow.” They said, “Forget it. Your collateral doesn’t even support the loan you’ve already got.” So, that’s when they said, “If you believe this is gonna go and you’ll correct the problem, then pledge your stock, your personal assets, your house.”

Wow.

My accountants and lawyers told me not to do it. But I said to the bank, “If I do this, will you guarantee that you will continue to lend me this money as long as we need it?” They said yes. So, I pledged everything. It was a good lesson, because they did live up to it. They gave me more money, the interest rates did go back down, business did flourish, and I could pay it back. That was the Bank of Nova Scotia. They lent me my first dollar going into the hotel business and have never, ever said no.

You made a couple of momentous decisions I want to touch on. One was buying the Regent International Hotel business in 1992. How important was that deal?

It changed the dynamics of Four Seasons. Before then, we were in North America and one hotel in Europe. The Regent deal elevated us into a more international company. Regent was owned by the Japanese banks at that time, and the banks were running into trouble. We weren’t the only ones trying to buy the company. So, I put together a concept of a business deal: We pay them what everybody else was offering—I didn’t bargain the price—but we would let the banks participate in our real estate ownership. They could keep the asset value of their ownership of Regent, without having to write down the product. ‘Cause now they owned some of our real estate. So, they gave us the deal. We didn’t buy the real estate; we bought the management contracts. And it changed the scale and the perception of Four Seasons.

You made another big decision in 1995, to sell a quarter of your shares to Saudi Prince Al-Waleed bin Talal. And then 12 years later, that same prince joined with Bill Gates to buy most of Four Seasons. Given everything we know now, would you still do a deal with the Saudis?

Oh, yeah. That, going private, and then the last transaction giving Bill Gates’s company major control, is probably the most important decision made for the company. It’s in the hands of a company now that will probably never change control, and has a clear understanding of what this company is and what it can do. This gives our people a clear look at the future. They know the company’s gonna keep doing what it’s doing.

But do you understand why some people have qualms about doing business with the Saudis?

I guess because of the perception—you’re dealing with a country that is controlled by a dictator. But there are many countries that are controlled. We’ve had a good experience. I mean, Prince Waleed has been a personal friend and a very valuable business partner.

You don’t have any regrets around those deals. Are you somebody who entertains the idea of regret, or do you dismiss it?

Along the way, there are mistakes made, but you can’t do anything about those. That’s the past. You can use the past to help you think about the future. People ask, “If you put everything together in a basket, would you change anything?” I say, in the business world, absolutely not. Because whatever’s happened has got you where you are today.

What about luck? Are you a believer in luck, or do you think that people make their own luck?

Chance events occur, and that opens up opportunities. That’s the way you think of luck. How I met my wife—I was forced to go to that wedding by my mother. When she said, “You go,” you go. Had I not gone to that wedding, I never would have met my wife. We were four years apart in age. My lifestyle and hers were poles apart. She was an academic. My life to her was a nonsense life. Chance event.

What’s the most important quality in an entrepreneur, courage or imagination?

I guess courage. A lot of times you’re not recreating things. It’s your willingness to take whatever risks you might encounter. You can’t go to school to learn to be an entrepreneur. You can learn to be a doctor, an engineer. I think entrepreneurs come out of necessity. Got no choice, gotta take this chance. If it works, okay. If it doesn’t, I’ll get through it.

You’ve talked many times about the wonderful staff you had on the way to making Four Seasons great, but you did have to fire a lot of people to get there. What was your firing technique?

I was very straightforward and tried to help in their next step. You tell people, “Look, we’re just not made to work together. But this is not the end. This is the beginning of something else. How can I help? Anything I can do that makes this change a little easier for you? My door’s always open.” Many times in the course of our history we’ve had to downsize. If you reduce your workforce by 10%, that’s a lot of people. But you must deal with each one personally. They must know that you care. Because if 10% are leaving the company, 90% are still with you. And they are seeing how you deal with their peers.

How involved are you in the company these days?

I’m an ambassador. I make speeches. The role I play is a contractual one that I arranged with my partners. Because I controlled the company, I could organize what I wanted to do when I left. I go into the office; I’ll be in there next week. But the CEO is centre stage, and today we have a CEO who is the perfect fit for Four Seasons. It was a fortunate stroke of serendipity. John Davison was stepping down, and Alejandro was looking for a change. The stars were aligned. He’s young, he’s a great communicator, he has international experience, and he ran his companies under the same principles that Four Seasons runs. So, we’re in good hands.

The first guy you tried to get financing from, Max Tanenbaum, said he wouldn’t touch the hotel business with a 10-foot pole. All these years later, do you understand why he said that?

Oh yeah. Hotel ownership is a volatile business, and you have to have deep pockets. Because it deteriorates, it’s constantly needing more refreshing and more investments. So, my fortunate experience was running into that problem at an early time in the company’s history, so I could change the business model to become a management company. I knew that I couldn’t continue to build and own these properties. Today, our business model keeps us going.

Looking back, if you could choose one day to live over again, as often as you wanted, what would it be?

It would have to be the day I met my wife. Because that’s been everything. I am where I am today because I married Rosalie. She has been so supportive, unconditionally. Not once was she ever negative about anything that I talked about doing. To have a partner to make sure that you’re gonna do the right thing, who’s in your corner, nothing has been as valuable as that. She’s got an insatiable curiosity. She doesn’t just walk down the street, she sees everything. When you live with somebody like that, they bring out the best of you. So, that’s the day I would relive.