Paul Orfalea Goes for Big Impact

After a six-year hiatus, Paul Orfalea is returning to public life with a very big splash, investing large quantities of legal tender on an 11,000-square-foot State Street property ​that he’s betting will morph into a fecund spawning ground for socially minded and eco-conscious new enterprises. The project ​— ​known as the Impact Hub ​— ​will provide table space, meeting rooms, and a large performance area for entrepreneurially minded creative types who, if all goes according to plan, will achieve a great synergistic buzz by working in close proximity to one another. Space can be secured in this high-octane petri dish for as little as $5-$10 daily.

Orfalea famously started the first Kinko’s in Isla Vista in 1970, sold what became an intergalactic empire of copy shops to Federal Express many years later, and bought 20 rental properties in Isla Vista. In Santa Barbara, Orfalea created and operated a veritable philanthropic juggernaut ​— ​the Orfalea Foundation ​— ​in partnership with his ex-wife, Natalie. In 15 years, the Orfaleas reportedly donated a staggering $175 million, mostly to foundations and nonprofits operating in Santa Barbara County.

Orfalea was lightning personified, a brilliant slave to an always careening curiosity. Natalie ​— ​and a team of get-stuff-done assistants ​— ​helped harness, channel, and direct that energy and wealth. The foundation was scheduled to begin sunsetting in 2009, the couples’ divorce perhaps hastening its final curtain call. The question buzzing around local philanthropic circles has been, “What’s Paul doing?”

This Monday, Paul Orfalea went public with his role as primary investor in the Impact Hub. He met with Independent reporter Nick Welsh at the Hub itself ​— ​still under construction but scheduled to open this summer and join 77 Hubs throughout the planet. As always, Orfalea defied any and all efforts to direct his conversational flow, which like a river goes where it wants. The following is an edited transcription of that conversation.

You must have people come up to you all the time with great ideas. Why this one? I haven’t done one investment in five or six years. This is the first one I’ve done. It made sense. If you’ve got the right culture and the right attitude with your customers and workers, the money takes care of itself. We want to make sure our members are compatible and have a similar sense of purpose.

Is there something you’re really hoping to get out of this? I guess if someone invented the Salk vaccine with the help of what we did here, cured polio.

Why haven’t you been investing? I’m 68. You know when you’re young, responsibilities are kind of fun? Well, when you get older, they become a burden. I don’t want more phone calls. I like this business, as long as I don’t get too many phone calls.

Isla Vista is where you started with Kinko’s. Are you involved in I.V.’s current self-governance effort? No.

Do you have any interest in that? Yes. Do I have interest in getting the cars out of the street? Getting rid of automobiles in Isla Vista? Making us a more bike-friendly community? Yes. Pedestrian friendly? Why would we allow a large “farting” motorcycle down the street interrupt the serenity of this meeting? Europeans look at us like we’re nuts. We have sold our souls to automobiles.

I heard you were collaborating with Santa Barbara school superintendent David Cash to help get more kids on their bikes. I don’t want to comment on the bicycle thing or Cash, but is it a sin that we have children in Santa Barbara who have never seen the ocean? Go to the Westside Community Center, go to Franklin School, talk to the principals; children have never been to the ocean in Santa Barbara. Is it a sin that as wealthy as we are, children that graduated from grade school do not know how to ride a bike or swim? Thirty percent of our Hispanic community don’t know how to do either.

You’ve been working on that? I can’t comment on that, because I’m doing everything anonymously now.

Going back to your interest in kids, you were the poster child of somebody with dyslexia and attention-deficit disorder who made great. Do you worry we’re getting a little liberal with these diagnoses? Well, I remember my mom talking to someone about me; they didn’t even have these words back then. My mother would say, “I guess you would describe him as a problem child.” To my older brother and sister and everybody, I was just “dumb shit.”

What do you think would have happened differently if you had been diagnosed as a kid? I probably would have been good in school and had a job. I think not knowing how to spell and read and the mechanical restlessness kind of played to my benefit. So I probably would have had more skills and been seduced by the educational system.

You’ve spent a lot of time trying to make the educational system more invigorating. I’m gonna say this for the record: What George Bush and Ted Kennedy did to education is going to live long after them. This “No Child Left Behind” concept has taken curiosity out of education. We have a bunch of sleep-deprived children because we are overdoing school. I don’t see how any parent can look at a child and say, “five hours of sleep is enough for a teenager.” What we have done to take curiosity out of school is a sin.

In 2008 you gave Obama money. Who are you supporting now? I like Hillary.

Any reason in particular? Or is it more she’s not Ted Cruz or Donald Trump? Probably that. When I was younger, I went to Europe when Nixon was president, and I almost got into a fight because I was American and Nixon was the president. Can you imagine if Donald Trump is our president? People will probably spit at you. You know, when Donald Trump says we’re not a great country and he’s going to make America great again, nothing could piss me off more. We are a great country! We take for granted that people stop on red lights and go on green lights. We have a code of behavior, a civility. We have an unbelievable civil society.

Is there any part of you as an entrepreneur that says, “I’m an entrepreneur and Donald Trump is, too?” No. No, I can assure you that as a businessperson, business is not a training ground for government. Anybody who thinks business skills can translate to government skills is totally wrong. You know, President Eisenhower used to say, “When I was a general, I would just tell somebody to do something, and they would do it. When I became president and I’d say do something, they just wouldn’t do it.” That’s politics. You can’t use the same autocratic behavior you use in business; you’ve got to use delicate behavior.

Why do you think he’s gotten so far? I think that there are a lot of folks who are angry. Look at the middle class. How could they ever get their head above water? The only thing I’ve seen since the Reagan Revolution is the wealthier getting wealthier, perfectly good homes in Montecito, kitchens, being remodeled for no purpose, just because they’re yellow or green, or “I want the trash compactor here.” I think that we are too top-heavy. Throughout the whole history of mankind, the poor have come and beat the shit out of the rich and wiped them out. We’re exacerbating these social tensions. A lot.

And you think that’s gonna happen? If we continue to lose the middle class, we’re gonna have real problems.

To get back to the Impact Hub, so how do you see this making a difference? Well, that’s a very good lead-in, because we are going to solve a lot of our problems with individuals solving individual problems through entrepreneurship. I don’t know if it will be a grandiose government solution, but I think that something will come out of the Impact Hub that will solve a lot of our issues in society.

In other Impact Hubs, has anything big or notable emerged? If you looked back in history, it’s always the thinkers who’ve had the impact. Who had more influence in the 19th century? Was it Napoleon or Lincoln? No, it was Darwin. Darwin has had much more impact on who I am today and on modern medicine than any of the political leaders ever. I probably wouldn’t be alive. The thought-leaders are the leaders of society. We’re just a bunch of thought-leaders here.

What do you do for fun? I teach school. I teach at USC and Loyola. I go to lunch; I take a nap; I go to breakfast with my friends; I have no pressure. I’ll tell you what’s really nice about my life right now: I get to think about what I want to think about. When I was in business, I was thinking about what my employees wanted and what my customers wanted … . It’s nice not thinking and being on recess.