BILLIONAIRE, BUST AND BACK
Starting in the 1970s, Bill Boyd built an empire of budget casinos and established himself as one of Vegas’ original godfathers. But as the city transformed from a desert backwater into a luxury gambling mecca, he tried to reinvent himself and nearly lost it all. Now he is doubling down on his low-stakes roots.
Starting in the 1970s, Bill Boyd built an empire of budget casinos and established himself as one of Vegas’ original godfathers. But as the city transformed from a desert backwater into a luxury gambling mecca, he tried to reinvent himself and nearly lost it all. Now he is doubling down on his low-stakes roots.
Summer usually quiets Las Vegas. But on a 101-degree day in June, gamblers stream into the downtown California Hotel, the original property of publicly traded Boyd Gaming. Bill Boyd, the company’s cofounder and executive chairman, is walking the casino floor, winding up a routine he’s been honing for 40 years.
He passes the blackjack tables, nodding to his veteran dealers, then ambles past the video-poker machines and the Buffalo Stampede slots. Like all Boyd properties, the California caters to budget-conscious gamblers, mostly locals and middle-class out-of-towners. So it packs in slots and low-limit table games. “The atmosphere here is different,” Boyd says. “If I was at the Wynn”—the shard-shaped luxury casino on the Strip created by his former business partner, the billionaire Steve Wynn—“I’d be busy looking around.” The California is not where Diana Ross comes to play. Or where you dine on a $100 steak.
Near the front entrance, Boyd, 87, pauses next to a six-foot koa-wood statue of a grinning, twirling Buddha, a gift several decades ago from a group of happy customers. “That’s for good luck,” he says, rubbing the Buddha’s well-worn belly and completing a long-standing ritual at the California.
A little good fortune goes a long way in Vegas. So do coolheaded decisions when luck runs out. When Boyd took his company public in 1993, it owned six strongly profitable casinos, which generated over $430 million in revenue. All fit the same mold as the California. They were inexpensive places to gamble. Over the next 15 years, a rising stock price made Boyd a billionaire and emboldened him to roll the dice by building higher-end casinos: the Borgata in Atlantic City in 2003 and Echelon Place on the Strip three years later.
The moves suffered from exceptionally poor timing. Both Atlantic City and Las Vegas had become increasingly saturated markets. And then the Great Recession hit. In 17 months, Boyd Gaming’s stock lost 94% of its value, falling to nearly $3 a share in November 2008.
To stave off bankruptcy, Boyd was forced to make a number of humbling decisions. He shelved plans for luxury casinos, instead doubling down on adding budget ones across rural America. And since his actions had gotten the company into this mess, he reasoned, maybe he could use some advice on getting out of it. With that in mind, he elevated the company president, Keith Smith, to CEO, giving himself a partner for the first time since the death of his father—the other cofounder of Boyd Gaming—in 1993. “At the beginning of our existence, my dad and I were risk-takers, and you needed that,” says Boyd, a white-haired man with a gold, diamondstudded pinkie ring. “We didn’t need that anymore. We needed somebody that was more conservative than I was.”
Boyd sinks into a cushioned banquette at the California’s Redwood Steakhouse, positioning himself comfortably to recount the origins of his company, which started here with the California. Tens of thousands of dollars could be won and lost on the California’s blackjack tables in the time it takes Boyd to tell his story, one that dates to the mob-connected Vegas of Bugsy Siegel in the 1940s. “Incidentally,” he says, “the movie Bugsy said the Flamingo was the first hotel on the Strip. It was actually the third.”
Boyd moved to Vegas when he was in elementary school. “As I’m growing up, my mom and dad would always to say me, ‘Billy, you don’t want to grow up to be a dealer like your dad, so get an education.’” After serving in Korea, he received a law degree from the University of Utah and worked as a lawyer for several decades; by that point, his father, Sam, had become an established casino manager. In the early 1970s they pooled their money to buy a piece of land on Fremont Street and then built and opened the California there. All told, it probably cost them $11 million (over $50 million in current dollars), the funds coming from the Boyds, outside investors (many of them the California’s employees) and a Bank of Las Vegas loan. In 1979 they opened Sam’s Town on a 13-acre lot on Boulder Highway, far from downtown and designed to lure gamblers coming to or leaving the city. The Stardust, an aging gem on the Strip whose mob history would inspire Martin Scorsese’s Casino, was bought for $115 million (about $280 million today) in 1985.
His father’s death left Boyd to guide the company alone, and he took it in a different direction: Atlantic City, which was already long into a boom. The number of casinos there had grown from zero in 1976, the year gambling became legal, to a dozen 20 years later. And before legalized gambling spread throughout the East Coast, the so-called “casino win”—the revenue generated from gambling—across Atlantic City casinos neared $4 billion.