Marc Mills and David Mirsky have worked together since 1984.
In 1990, they formed their own company, Pacific Rim Capital, which leases forklifts, cranes and other material-handling equipment for large companies in the manufacturing and transportation industries. The company provides operating leases in the U.S., Mexico and Canada.
They’ve since grown the Irvine-based firm into one of Orange County’s largest private companies, as well as one of the country’s more prominent independent lessors.
It posted revenue of about $195 million last year, and has nearly $850 million in assets under management.
“I can say that as a team, Marc and I have been close friends for a long time,” Chief Executive Mirsky said.
Now after almost 40 years together, the pair is splitting up.
“I’ll be 65 years old in November,” Mirsky said. “Nobody lives forever. I wanted to have some fun.”
Mills, who is president, will become CEO when Mirsky retires at the end of the year.
It’s the second big change to Pacific Rim operations in the past 20 months. The pair sold a 49% voting stake in the company last year to a Japanese leasing firm looking to expand its reach in the U.S.
Mills said the changes won’t result in a winding down of local operations; in fact, it’s looking to expand.
The company has grown to 75 employees with plans to grow about 10% to 15% in the coming year, he said. It is looking for employees in its sales, finance and customer service departments.
“I have no plans to retire,” the 59-year-old Mills told the Business Journal. “We’ve really refined the strategy over time, and I feel confident in the strategic direction of the company.”
The pair began working together in 1984 in a variety of management positions at another firm.
“We were both really young and dark haired,” Mirsky quipped.
At the time, they worked at a company that followed an old-line expensive strategy of opening offices around the country, flying to different locations and wooing potential clients through expensive meals, he said.
“People were making over $1 million a year,” Mirsky recalled.
They saw a 1986 change in the tax law made the leasing industry much less profitable. The pair tried to pitch their bosses to make changes by moving to a telemarketing model.
“We developed this technique that worked really well,” Mirsky said. “The board was older guys who didn’t want to change. We quit to show our idea was better and it was.”
They started Pacific Rim Capital in 1990 when Mirsky was 34 and Mills was 29.
“In the first quarter, we lost $6,000 and have been profitable ever since,” Mirsky said.
Pacific Capital is one of the nation’s largest independent lessors that is not part of a bank.
Its industry metric is origination volume, which last year was about $250 million—a company record. Products made by manufacturers like John Deere, Volvo and CAT are leased to its clients.
“Our clients are large,” Mirsky said. “One of the biggest advantages of our company is we can create extremely customized products.
“If you are part of a bank or large volume manufacturer, you won’t [offer] as customized a product.”
In 2018, Pacific Rim won Honda’s top indirect diverse supplier award.
“Considering a single plant can have more than 100 vehicles in operation, managing the fleet can be quite a burden,” Honda said in a statement. “One innovative idea led by the supplier was an online signature process to decrease the lease contract processing time. Departments were spending too much time chasing down approvers to sign the lease paperwork, causing tight equipment deliveries and unnecessary follow up.”
In January 2019, Pacific Rim sold a 49% voting interest in the company to Japanese lessor Fuyo General Lease Co. Mills is still majority owner with 51%; Mirsky said he kept a 10% non-voting ownership stake.
“Our new partnership with Fuyo will help PRC to continue to aggressively expand its customer base and to build on our successful relationships,” Mills said.
Back to the Office
Last year, the company moved into a newly built building at the Discovery Park office campus near Sand Canyon Avenue and the Santa Ana (5) Freeway. Pacific Capital’s 20,161-square-foot office there can accommodate more than 100 people.
Since the coronavirus hit, about 10 people have been using the office.
Mills said it’s time for employees to start coming back in, perhaps starting in shifts of 25 workers and with the appropriate social distancing and hand sanitizers.
“Our business operates better when we have the cohesiveness,” Mills said. “We want our people back.”
Like everywhere nationwide, business is off, particularly depending on the segment. They are expecting company revenue to drop about 10% year-over-year.
“We’re pretty pleased given all things considered,” Mirsky said.
The recent national unrest over racial tensions have provided opportunities for Pacific Rim, which since the early 1990s has been certified as a “corporate plus” minority-owned business by the National Minority Supplier Development Council.
“As a certified minority-owned supplier, many Fortune 500s are looking to provide opportunities to companies like ours,” Mills said.
Mills, an African American who was born in Baltimore, said he has long followed the debate on racial injustice. The Harvard graduate is a supporter of the Black Lives Matter movement, saying he prefers actions such as donations to the minority supplier group and support of organizations such CEO Action, a group of more than 1,000 companies who have made a commitment to advance diversity and inclusion in the workplace.
“I certainly see injustice out there,” Mills said. “Things need to be addressed, not with talk but with action.”
The executives said their workforce is a blend of a variety of ethnicities based on meritocracy.
“I can say that as a team, Marc and I have been close friends for a long time,” Mirsky said. “If you walked into our office, you’d see an absolute mélange of people. As a company, we’ve always felt we walked the walk and talked the talk.”
“Dave and I have always seen eye to eye about building a company based on meritocracy,” Mills added. “We tend to judge people based on that.”