Thrill-seeker extraordinaire Jared Isaacman flies MiGs to relax, but he just pulled his wildest maneuver yet: taking his restaurantand hotel-payments company public while his clients are flaming out. And he just broke the billionaire barrier.
likes to say that everyone has a “useful fatigue life,” to use Air Force jargon. That’s literally the number of flight hours left in a fighter jet before it outlives its usefulness and needs to be retired from service. But Isaacman views the concept as a metaphor for how to live his life. “YOU ONLY
get so many flight hours,” he says during a call from his Shift4 Payments office in Allentown, Pennsylvania, at 5 p.m. the day before a morning trip to his home in Montana. “It’s not a whole lot of time, so it really just comes down to maximizing it while you can.”
Adds Isaacman’s older brother Michael, “He’s a big believer that we all have a limited fatigue life, so let’s do the most amazing things that we can while we’re alive.”
At age 37, Isaacman appears to be using his time to the fullest. He started his first business at 15, a year before dropping out of high school to hawk credit-card terminals out of his parents’ basement. At age 28, he started what would become the world’s largest private air force, Draken International, and then sold it to Blackstone for a nine-figure sum eight years later. And as of June he is a billionaire, after taking his restaurantand hotel-payments firm public.
While much more famous billionaire Jack Dorsey’s Square targets neighborhood coffee shops, Isaacman’s Shift4 Payments handles more than $200 billion in payments every year for a third of the country’s restaurants and hotels, including giants like Hilton, Four Seasons, KFC and Arby’s, which rely on it to complete complex payments across dozens of properties and locations. Even after Covid-19 lockdowns threw restaurants across the country into chaos and temporarily tabled his much-anticipated IPO roadshow, Isaacman pressed ahead. “People still have to eat, right?” he says.
Isaacman is now worth $1.4 billion, thanks almost entirely to his
38% stake in Shift4 Payments. He retains a small stake in Draken as part of an estimated $100 million worth of additional assets, including a MiG jet and nine other planes.
For fun, Isaacman bullets the MiG faster than the speed of sound and climbs mountains to unwind from nonstop, intense 80-plus-hour weeks. He spent New Year’s Day in Antarctica scaling Mt. Vinson, a 16,000-foot wall of snow and ice 800 miles from the South Pole. He had to turn back 500 feet from the summit due to dehydration, but he vows to try again.
has been chasing an adrenaline rush since childhood. When he was still in high school in the quiet suburb of Far Hills, New Jersey, his brother Michael, eight years older, was buying his first house. Tiffany and Marc, the eldest of the four Isaacman siblings, were 27 and 30, respectively, and both working. The only one still stuck at home with Mom and Dad, Isaacman wanted out. “I was always very motivated to get to their lifestyle and not very motivated about high school life,” he says.
In 1998, along with his friend Brendan Lauber, who was two years older, he set up a small company called Decho Systems to design websites for local businesses. One of their first clients was Merchant Services Inc. (MSI), a payment processor based in nearby New Providence, New Jersey. In addition to the website work, MSI needed help with computer security, so Isaacman offered himself as an in-house consultant. When that gig turned into a full-time job offer, he jumped at the chance to drop out of high school at age 16 and got his GED instead.
MSI’s main business was selling the clunky terminals that swipe credit cards with magnetic strips. Banks issued cards to consumers and expected small businesses to accept them without any help, outsourcing the process to third parties like MSI. Even from his perch in the IT department, Isaacman could see that the process was cumbersome and expensive. If a local pizza joint wanted to start accepting credit cards, it would take two weeks and mountains of forms and fees before it could start swiping.
“To sign up to take credit cards 21 years ago, it was the same amount of paperwork as getting a commercial mortgage,” Isaacman says. “It was very intense, it was burdensome, it was entirely unnecessary.”
Six months into his job at MSI, he decided he could make the process faster, easier and cheaper. So he quit to start United Bank Card, the progenitor of Shift4, in his parents’ basement. His first hire was his father, Don, who would soon leave his sales job as vice president of a home-security company. Using his connections from MSI and a $10,000 loan from his grandfather, Isaacman convinced a bank to give him an identification number, which he needed to sell the credit-card terminals. Next he hired Lauber, his buddy from Decho, who dropped out of the Rochester Institute of Technology to join the new business.
“It didn’t take a whole lot of arm-twisting,” says Lauber, who now runs Shift4’s “Harbortouch” touchscreen software division. “I’m no oracle, but at the time I knew that this kid’s the real deal.”
It was the apex of the first internet boom, and the two friends built web applications to simplify the process of getting a terminal and accepting cards. Don used his skills as a salesman to convince local businesses to take a chance on the upstart, led by a kid who was barely old enough to drive.
“I didn’t really come out and expose my age,” Isaacman recalls. “I hid in the basement.”
By 2003, he still wasn’t old enough to drink, but he had made enough money to pay back his grandfather’s loan and expand beyond the Garden State. The four-year-old startup, bringing in thousands of new customers, opened an office in Arizona. The next big break came in 2008, when it launched Harbortouch, a then-futuristic touchscreen that combined a cash register and a credit-card terminal in one device. “It was years before Square,” Isaacman says, rattling off a list of competitors that he beat to the punch. “We were way ahead of everybody else, and this was wildly successful.”
At the same time, he was burning out from years of work building the company from scratch. So he decided to take up a hobby: aviation. He started out flying prop planes, but within two years he wanted more—so he put in hundreds of flight hours to move up to flying jets. In 2009, at age 26, on his second attempt, he completed the fastest around-theworld flight in a light jet, flying from—and to—Morristown, New Jersey, via the Azores and Alaska, in 61 hours and 51 minutes, shattering the previous record by 21 hours; between the two flights, he raised more than $100,000 for the Make-A-Wish Foundation. (His first effort, in 2008, failed when he was
“THAT WAS A PRETTY BIG LIFE-ALTERING MOMENT. A LOT OF THOUGHTS WERE GOING THROUGH MY MIND: ‘ARE PEOPLE EVER COMING BACK TO THE OFFICE? IS THIS COMPANY EVEN GOING TO BE HERE?’ ”
delayed by officials in India.)
He soon discovered that civilians could fly military aircraft if they put in enough flight hours and met FAA qualifications—so he started learning how to fly fighter jets. In 2010, his increasingly extreme hobby became a part-time job when Isaacman met Sean Gustafson, then a member of the Thunderbirds, the famous Air Force stunt squadron, whose pilot call sign is “Stroker.” (Isaacman’s is “Rook,” for rookie.) Together they set up an air-show squadron called the Black Diamond Jet Team with other retired pilots and skilled civilians, performing aerial acrobatics at NFL games and the Indy 500.
“There are very few people who get that chance to fly a fighter as a civilian, and to get checked out and certified by the FAA is extremely rare,” Gustafson says. “It’s just a testament to his desire and passion to make that happen.”
A year later, the two came up with an even better idea. In the wake of the financial crisis, the U.S. military was in costcutting mode. At Nellis Air Force Base just outside Las Vegas, home of the Air Force equivalent of the Navy’s Top Gun flight school, the military was spending billions of dollars to train pilots in war games against mock opponents. Taking F-16s and experienced pilots out of combat to have them conduct drills at home was becoming unsustainable. The two air-show friends saw an opening: If they could persuade the Air Force to outsource that training to them—using exmilitary aircraft from foreign allies that cost much less to operate, manned with retired airmen not on the military payroll—it would save billions and enable the Air Force’s best pilots to fight overseas rather than train newbies in the Nevada desert. With most of the air-show team onboard, they founded Draken International to make that plan a reality.
Isaacman sunk money into Draken to buy dozens of fighter jets from around the world, with minimal investment from friends and former colleagues. Douglas A-4 Skyhawks from New Zealand. Atlas Cheetahs from South Africa. Aero L-159s from the Czech Republic. They eventually assembled 100 jets, the world’s largest private fleet of military aircraft.
The Navy had a similar program already in place, but it would prove more difficult to break in to the notoriously insular culture of the Air Force. It took four years for Draken to get its first contract in 2015, and even that was just a small proofof-concept trial. Scott “Kidd” Poteet, who spent seven years as a commander and test pilot at Nellis before eventually joining Draken to head business development, was skeptical at first.
“I thought it was a long shot . . . but [Isaacman] recognized there was a need,” Poteet says. “Once he got his foot in the door, he provided a service the Air Force just couldn’t get enough of.”
While he was flying in air shows and jetting around the globe to buy more planes, Isaacman was still running the payments company. He was putting in his signature 16-hour days, roughly 15% of which he spent on Draken. “All I needed to focus on [at Draken] was buying more fighter jets before others could get their hands on them,” he says. “Shift4 has always been the greater portion of my time commitment.”
In 2014, an opportunity emerged that was too good to pass up: His old employer, MSI, was looking for a buyer. Isaacman, who had bootstrapped his payments company for 15 years, sold a 53.5% stake in the business to private equity firm Prospect Capital for $279 million in equity and debt. He then used the cash to buy MSI for around $250 million.
That was the first of seven acquisitions. In 2017, a year after Prospect sold its stake to another private equity shop, New York–based Searchlight Capital, for $328 million, Isaacman went on a buying spree. He picked up three software rivals in the restaurant space and took their nearly 100,000 clients with them, including national chains such as Outback Steakhouse and Denny’s. In November 2017, in its biggest acquisition to date, it purchased Shift4 Payments, headquartered in Las Vegas. Isaacman took its name, along with its blue-chip roster of customers, including Caesars Palace and the PGA Tour.
Acquiring Shift4 more than doubled the payment volume Isaacman was processing to over $100 billion a year. Margins are thin in the industry, with providers earning a few cents on the
dollar for each transaction they process. With hundreds of software versions and multiple payment devices under one roof, Isaacman could now target larger, more lucrative clients. “That was the single most transformative acquisition we’ve ever done,” he says. “It brought us a large portion of the entire hospitality market.”
Isaacman was already flying high when he won his biggest deal yet for Draken. Seven months after the Shift4 deal, he signed a first-of-its-kind $280 million contract to train Air Force pilots at Nellis over five years.
His old high school friend wasn’t surprised. “He’s the best at what he does, and he’s proven it in totally different industries, starting from zero,” Lauber says. “His personality is ‘see it, conquer it and be the best at it.’ ”
went into 2020 with a nine-digit net worth and grand visions of an IPO. The company had reported record revenues of $731 million, though it was still losing money. Then came major, unexpected turbulence.
On March 18, Isaacman was cooped up in a conference room at Shift4’s headquarters in Allentown with senior management. Two days earlier, the S&P 500 had collapsed on the way to its worst day since 1987, triggering a halt in trading for the third time in two weeks.
Shift4’s investor roadshow, planned for the following week, began to look less likely by the minute. Midway through a crisis meeting on how to gradually transition employees to working from home, someone in the room broke the news: Pennsylvania Governor Tom Wolf was about to impose a stricter stay-at-home order the next day that would effectively shut Shift4’s offices down.
“That was a pretty big life-altering moment,” Isaacman says. “A lot of thoughts were going through my mind: ‘Are people ever coming back to the office? Is this company even going to be here?’ ” By the last week of March, transactions at Shift4’s 125,000 restaurant customers were down 74% compared to the first week of February, while its 21,000 hotels were down 86%.
Everyone went home except for Isaacman. Surrounded by rows of empty cubicles at Shift4’s 80,000-squarefoot headquarters, he worked 16-hour weekdays and 9-to5 weekends. To help keep struggling clients afloat, he waived fees for three months and launched a site where shoppers could buy gift cards; Shift4 matched 5% of all money raised. He rolled out QR codes for contactless payments and debuted a new service to help restaurants switch to online orders.
Soon enough, Shift4 roared back to life. Restaurant industry transactions rebounded by 45% by May from their low point in March, though hotels continued to lag. The company went public in June on the New York Stock Exchange before recording its best month ever in July—handling 25% more payments than during the same period in 2019.
Since the IPO, Isaacman’s workdays have gotten even longer. Despite recording a net loss of $75 million on sales of $67 million in the second quarter—due largely to the pandemic—Shift4 is now adding customers again. (The NFL’s Las Vegas Raiders and their new home, Allegiant Stadium, signed on in July.) Shift4’s low fees relative to its main rivals Elavon and FreedomPay are even more attractive now as restaurants and hotels look for ways to cut costs. Isaacman is plotting overseas expansion and plans to move beyond his home turf of hospitality payments.
When he needs a break from his nonstop schedule, he heads to his home in southern Montana, where he keeps his MiG. He then trades his Shift4 shirt for a flight suit and takes to the skies. “It’s still therapy,” he says. “It’s still an escape.”
A second wave of Covid-19 cases this winter could still put everything in jeopardy, but Isaacman isn’t worried. “This is a long game,” he says. “The world will come back to life.”
“THERE ARE VERY FEW PEOPLE WHO GET THAT CHANCE TO FLY A FIGHTER JET AS A CIVILIAN. IT IS EXTREMELY RARE. IT’S JUST A TESTAMENT TO HIS DESIRE AND PASSION.”