Ship of Gold in the Deep Blue Sea (28 page)

For the Search Phase they allocated 25 percent of the partnership, fifty units at $28,000 per unit to raise $1.4 million to complete a probability map and a search map, to mobilize a ship, rent the SeaMARC IA that Mike Williamson had just had built, pay Williamson and his tech crew for forty to sixty days at sea, search about fourteen hundred
square miles of ocean, find targets that could be the
Central America
, and verify that one of them was the ship of gold.

In the final phase, they would send a robot to the bottom of the ocean to study the site and recover the treasure, and for that they allocated another 25 percent of the partnership, fifty units at $72,000 per unit to raise $3.6 million.

That totaled 60 percent of the project. The remaining 40 percent went to Tommy and his associates. Tommy wound up with a rich package for two reasons: First, the potential rewards were substantially higher than in an ordinary oil and gas lease or a real estate deal, so the investors were willing to take less. Second, Tommy was key to the success of the business. If the investors were purchasing a patent, they could hire anyone to run the business. Here, Tommy was everything, and they had to satisfy themselves that he was sufficiently motivated. The lawyers and the CPAs and Tommy talked about the split for months, and in the end everyone was satisfied.

T
HEY PUT OUT
the first offering in March of 1985: twenty units at ten thousand dollars apiece, a half-unit for five thousand dollars. Ashby and Dauterman couldn’t raise the money as partners in an accounting firm, but as individuals they could talk to friends and say, “Here’s a deal you should look at. We’ve talked to the principals, and we think they’re honest. And by the way, we’re going to put our own money into it.”

They drew up a list of people who could afford to lose the money, and when they started down the list, Dauterman’s conversations often went like this: “Bill, this is Fred. Are you sitting down [chuckle]?” Then Fred would give it to Bill in three sentences. Bill would say, “You want me to do what?”

“It took a lot of guts to call people,” said Dauterman, “and you got some crazy reactions.” He told everyone, “If you put your money in, kiss it good-bye, that’s the only way to do it.” Then he would say, “But the rewards, if it’s what Thompson says it is, could be astronomical.”

When Ashby saw friends socially or called a few close clients he thought might be interested, he would tell them, “There’s a little extra-speculative opportunity that I’m sure you’ll want to be part of.” He said
he had a young man with an idea they might find intriguing, and would they meet with him and consider investing a small sum? Sure the idea was a little crazy, and he had never seen anything quite like it before, either, but, yes, he had already anted up his five thousand dollars. As had Fred Dauterman, Bill Arthur, and various other familiar names around Columbus.

One of the first people Dauterman called was Art Cullman, a professor of marketing at Ohio State who consulted all over the country. Dauterman told Cullman the story in the usual three sentences with all of the chuckles and the words like “wild” and “crazy.” Then he added, “Wayne and I think the guy’s pretty good. He comes from Battelle, he’s a scientist, and he’s got an idea that really sounds exciting. He thinks there’s a lot of gold on this ship.”

Cullman signed up for a meeting, and what impressed him most about that meeting was how carefully Tommy spoke. He told Cullman, “We have an idea where it is, but that’s not factual yet. We’re still gathering the material from newspapers to get a better idea.” Cullman asked how he would locate the wreck site, and Tommy told him about the SeaMARC and Mike Williamson’s crew, and Cullman wanted to know if he had these sonar experts already under contract. Tommy said only that he was pretty sure he could get them.

Although Cullman asked a lot of questions, he knew nothing about technology and rarely understood Tommy’s answers. When he asked what happened after they found the wreck, Tommy patiently explained deep-ocean robotics, using far more facts than Cullman wanted to hear. “The idea sounded good,” said Cullman, “but I didn’t know too much about it.”

Cullman called friends at Battelle, who told him that Tommy was solid. He called Bill Arthur, who told him the guy had a hell of an idea. He talked to his own wife, who told him, “Arthur Cullman, you can’t do that kind of thing. You can’t afford that.” Then she met Tommy herself, and she said, “Arthur, you can’t afford not to do that. He’s too reliable.” She told her husband she had never met anyone who seemed so reliable.

Cullman even called friends in New York and Chicago who annually blew more than ten thousand dollars on the Kentucky Derby. “I
was amazed at the number of people who could easily afford to put ten thousand dollars down who had absolutely no interest in it.” He would even remind them how often they threw that much money away, and they would say, “I know, but I don’t want to have anything to do with something that wild.”

But Cullman had talked to Tommy, and he didn’t think the idea was wild. He liked the thought of backing someone qualified, someone determined to conquer a new frontier. He spoke with the other members of his family, and they agreed. Cullman set up a family investment partnership, one-sixth for Cullman and one-sixth for his wife and one-sixth for each of the four kids.

The Cullman family was in for two units.

When Tommy arrived at Buck Patton’s office, Patton had several pages of detailed questions for him. The first page concerned Tommy’s assessment of risk in five primary areas: search, historical research, security, legal, and operational. Patton was particularly concerned about the legal issues and the operational budget. They talked about Tommy’s research methods, the SeaMARC, information leaks, problems with weather. Patton asked questions like, “What happens if a hurricane comes up and you lose your recovery vehicle?”

Patton was also skeptical about having a scientist try to guide a business along a demanding critical path. He had built a small concrete and gravel operation into a multimillion-dollar enterprise, and he had also started other companies. Start-ups were tough. Patton had seen leaders weaken themselves by trying to do too much, or, he said, “Their ego says, ‘Well, shit, I can figure this out,’ and they drop right off the edge of the world into Chapter 11.”

For four hours he grilled Tommy on every fine point his honed business acumen could conjure, and when he finally ran out of questions, Tommy still had answers. He raised issues Patton hadn’t asked about or even thought of. Patton was impressed. He found Tommy to be “refined, accurate, tough, determined, factual. There was a strong will that showed through.” At the end of the four hours, he asked Tommy to give him the probability of being able to locate the wreck, overcome the legal issues, and secure the gold for the investors.

“He thought for a while,” recalled Patton. “Then he looked me square in the eye and said, ‘Sixty percent.’ Nothing could have been more credible.”

Two weeks later, Buck Patton agreed to buy two units and sent a check to the partnership for $20,000.

Many of the people Tommy met with thought he was a poor salesman. They had seen the slick approach, something colorful by someone glib, something almost a sure thing by a packager, a peddler, a promoter. They expected it. By contrast, Tommy was so precise and so careful to avoid overstatement that he made the project seem almost boring. “You could almost see him figuring out how much fuel it was going to take,” said Jim Turner, who bought half a unit for $5,000. Sometimes potential investors even prompted him to sound more optimistic. Others advised him to spice up the presentation, put more pizzazz into it, more flash, print up a full-color, glossy brochure, but Tommy refused.

At only $5,000 a half unit, sometimes the sell was easy; the investors just asked Ashby, “Are you going to do it?” and he said “Yes,” and they said, “Okay,” and a check arrived a short while later.

Although many prominent citizens declined the invitation, and others talked to Tommy and said no thanks, Ashby was amazed at Tommy’s record: Three out of every four people who met with him wrote a check for $5,000 or $10,000 or $20,000. “It was kind of interesting for me to watch Tommy grow,” said Ashby. “He was thirty-three years old when I met him, and one of the first things I did was introduce him to some pretty prominent businessmen one on one or one on two. Those were frightening experiences for him in the beginning. He was nervous beforehand and nervous after, but he always knew what he was talking about, so he was always credible.” Ashby remembered sitting in on one meeting with a particularly important investor, and when they were finished, Ashby said, “Tommy, you really did a great job.” Tommy stood up indignantly, and said, “Well, I hope I never become a salesman,” to which Ashby replied, “Tommy, you are one.”

He just had a way; he could sit face to face with you in landlocked Columbus, Ohio, and never take his eyes off of your eyes and tell you that he had an idea for working on the bottom of the deep ocean, where,
by the way, no one has ever worked before, and recovering a gold shipment from a mid-nineteenth-century sidewheel steamer, and he somehow convinced you he could do it by telling you all of the things that could go wrong.

Don’t know if we can find the ship. Think we can, but don’t know. Don’t know what the site will be like. Think we do, but don’t know. Don’t know if we have the technology to recover the gold. Think we have, but don’t know. We do know the ship sank, that it carried at least three tons of gold, that it rests in about eight thousand feet of water, that no one else has recovered the treasure. And I think I can put together a project to do what no one else has done before: find the remains of a three-hundred-foot, wooden-hulled ship in a stretch of ocean bigger than the state of Rhode Island and go down to the bottom and pluck the treasure from the debris with a robot. Don’t know if we can keep the treasure. Think we can, but don’t know. Don’t know how to market the treasure. We’ll figure that out.

T
OMMY
’
S GREATEST FEAR NOW
was that word of his project to find the
Central America
might leak to someone in the deep-ocean community. Outside of his small group and the partners now stepping up to invest, he wanted not one person to know the project even existed. That was critical. “The ocean community is a very exclusive group of people,” said Tommy, “a very closed community, and it’s hard to keep secrets in that community unless you really put a lot of effort into it.”

At Battelle, Tommy had received his secret clearances early, and he had worked on classified programs for the Department of Defense. Eventually, he had gotten top-secret clearance and then had special access clearances above top secret. He had seen tight security up close, and he understood how it worked and why it was necessary. Part of the reason he had pursued the idea of having a single large investor back the entire project was to reduce the possibility of word leaking out to the deep-ocean community that he was launching a major effort to find the fabled treasure of the
Central America
. Security was his highest priority, “almost to the point of being paranoid,” remembered Fred Dauterman, “but I think it was justified.”

To show to potential investors, Tommy and Bob had drafted a rough document of concepts. Robbie Hoffman had helped them write it, and although it bogged down in detail, it was Tommy’s first attempt to distill between covers his theories on deep-water shipwreck recovery. It didn’t show the reader where to find the
Central America
, but it told the history of the sinking, documented the gold shipment, and in Tommy’s convoluted, technical language outlined the steps anyone would need to find and recover the ship. Stamped all over it were the words “confidential” and “proprietary.”

Investors never even saw the document until they signed a nondisclosure statement, agreeing not to mention what they were about to see and hear to anyone outside the organization. At meeting after meeting, Tommy admonished investors not to talk about the project. When an investor became a partner, he sent them a letter and reiterated the importance of keeping quiet. “The conditions of the offering were, I can answer any questions you want, but we’re not going to release this material, like why this project can work, to anybody, any outside people, anywhere.”

Toward the end of March, one interested investor met with Tommy, signed the nondisclosure, listened to the presentation, and took a copy of Tommy’s concept document. He had served in the navy, and he liked the sea. A week later, he called Ashby and said, “I’ve got Searle coming in with a guy named Kutzleb.” He wanted another meeting with Tommy, and he wanted this Searle and Kutzleb to listen to what Tommy had to say about the
Central America
project. Ashby had never heard of Searle or Kutzleb and thought little of the phone call, but he called Tommy to set up the meeting. Tommy was outraged.

Robert Kutzleb owned Steadfast Oceaneering, located outside Washington, D.C., and was one of the top underwater contractors for the navy. Captain W. F. “Bill” Searle was the former supervisor of salvage for the United States Navy and now consulted all over the world for the deep-ocean community. After the
Thresher
had imploded and crashed into the seafloor at eighty-four hundred feet, he had been put in charge of finding things in the deep ocean. He had been off Palomares, Spain, with the H-bomb and southwest of the Azores looking for the nuclear submarine
Scorpion
when it exploded and went down in two miles of
water. He knew everyone who worked in blue water, and he knew the details of every deep-water recovery ever attempted. He and the investor had been roommates at Cornell, and before the investor gave money to Tommy he wanted his good friend’s opinion on whether the project was feasible.