In late January, former Tennessee Supreme Court Chief Justice Gary Wade sat with Pete DeBusk, founder of DeRoyal Industries and Chairman of the Board of Trustees at Lincoln Memorial University. He came from humble beginnings in southwest Virginia, but went on to on a productive and lucrative career, eventually returning to foster education for the people of Appalachia.
Gary Wade: Pete, where is Lee County, Virginia?
Pete DeBusk: Lee County Virginia is the farthest county west in the state of Virginia. You’ve got Tennessee on one side and Kentucky on the other.
W: Times were tough in those days. How did you and your family make a living during those years?
D: You cannot really make a living farming, so my father got a job in Harlan, Kentucky with a construction company that worked on coal tipples. We moved to Harlan when I was four or five.
W: And you moved around a little bit while you were in school, did you not?
D: I was in 13 schools before I got out of high school, ending up in Rose Hill at Thomas Walker High School.
W: So Lincoln Memorial University was not too far away.
D: 17 and a half miles.
W: And you enrolled in Lincoln Memorial University in Harrogate, Tennessee.
W: What was your course of study?
D: Biology. I thought I wanted to be a veterinarian.
W: You played both baseball and basketball in college, but basketball was your major sport. You were not only a leading scorer at LMU but a leading rebounder for the team.
D: I had a good career in a small pond. I left after my junior year, when I took the boards and went to the University of Georgia for veterinary medicine school.
W: After a year and a half in Athens in vet school, you decided to go in a different direction with your career.
D: Yes I did. I thought I would like human medicine better. I was flat broke and I had gotten married in the meantime. I thought I’d work a little while, then go to medical school.
W: What kind of work did you do during that time?
D: I took a job with a pharmaceutical, and it paid well.
W: How long were you with that company?
D: Four years.
W: But you never made it to medical school, however.
D: I didn’t want to take a PCAT.
W: By then you were married, and I suspect you were talking about starting a family.
D: We had Brian when I was 25. The president of the company left to start a new company in California, and he asked me to become the Mid-Atlantic regional manager, so I took the job. Then they had some financial problems, and a big drug company eventually came in and bought them out. I was out of a job. I thought instead that I’d go on my own as an independent manufacturer’s rep.
W: What was the name of your company when you started?
D: The first company I started with was Stat Medical. Of course, it eventually became DeRoyal Industries. I started by representing other manufacturers, and, having done well with that, I began to get ideas of what I could do myself. And I said if I’m gonna do this, I’m not staying in Roanoke; I’m going home to Knoxville.
W: Knoxville has always been special to you.
D: It really has.
W: How many years did it take for Stat Medical to evolve into DeRoyal Industries?
D: I started Stat in 1973. I started DeRoyal Industires in 1976 or 77.
W: And what did DeRoyal do and how did it grow?
D: I went into different fields in medicine and medical devices, building divisions of Deroyal like orthopedics, surgical items, and skincare items. But finally it got to the point where I started buying little companies. And I think to date we have bought 34 companies and rolled them into DeRoyal.
W: It’s been fascinating for you to tell me about how you became an inventor of sorts. Basically this was through sales and talking with doctors and hospital administrators.
D: Really, with nurses a great deal.
W: You listened to what they wanted.
W: Based on those conversations, you started trying to satisfy your customers with new products. Is that the secret of the success of Deroyal industries over the years?
D: Yes it is. You’ve got to know enough about the industry and know the direction it is going. Therein lies the opportunity.
W: At some point you became so successful in DeRoyal that you decided to come back to your roots there in the Harrogate area, where Kentucky, Virginia, and Tennessee come together as one. What brought you back to Lincoln Memorial University?
D: Gary Burchett, one of the guys I had played ball against in high school and went to college with, was president of the university, and he asked me to be on the board.
W: How big was the school in those years? What was its mission and what courses of study did it offer?
D: It was a typical liberal arts college, with a little over a thousand students. What happened is that the chairman of the board got hit by a car and killed, and I had given LMU some money to try to help out….
W: They probably needed it at the time.
D: I guess it was always a problem keeping the doors open, financially. And they asked me to chair the board.
W: What year was this?
D: It was 2002 or 2003 when I became chairman of the board. I was used to being successful, so if I was going to do be chairman, I wanted to really change the school.
W: Your chief financial officer says that you bet the farm on the medical school. Is that a fair statement?
D: We had a little endowment, and it turned out we had to put up about $22 million dollars. That’s about what our endowment was. I thought “well, goodbye endowment! Let’s roll the dice. Let’s make this thing go.” We got got the school started.
W: You’re talking about the DeBusk College of Medicine now, aren’t you?
D: Yes, the DeBusk College of Osteopathic Medicine.
W: By this time, I bet you were spending as much or more time with the university as you were with DeRoyal.
D: I was. Brian was picking it up. It was a success, a super success. There’s so many kids all through these mountains who could never get into medical school, and here was a medical school in the mountains. We get 6,000 applications a year for the 243 spots available.
W: Is it fair to say that your medical school is on par with the top medical schools in the state?
D: We’re way better. I’ve lived up there for the last 15 years traveling back and forth and rebuilding LMU. I think we’ve just about got the grass polished. We’re by far the largest medical school in the state of Tennessee.
W: Is the facility designed to take care of the demand that you have?
D: We’ve maxed out in Harrogate, but as you know we decided to add an additional site to LMU’s medical school in West Knoxville.
W: Talk about that property and how you came to purchase it for the school.
D: We knew we needed an additional site because there’s lots of applications and a tremendous shortage of primary care doctors in the Appalachians. We found some property: 17 acres and 170,000 square feet of building. We were trying to shoot for a class of fall of 2019. We were doing quite well with it when an unusual situation developed. The storms and hurricanes wiped a couple of island medical schools that Ross Medical School owned. One of their board members knew quite a bit about LMU and he knew that we were rebuilding this facility. He called our attorney and asked if we would be able to place their medical students.
W: So they’re a medical school wiped out by a hurricane, and they are looking for a place for their 1,000+ students to continue their education.
D: Yes. We thought, “can we kick it in high gear and build this thing out enough in three or four months in order to start taking these students?” We decided we would do it.
W: You welcomed all of those students to Knoxville Tennessee in early January, and they now have a place to finish their medical school careers.
D: True, but you don’t do this without the city’s help. We called Mayor Rogero and she bought in. I’ll never forget that because it could not have happened otherwise. We worked day and night, and last week we opened up and 1100 kids made it here. They will be here for a period of approximately a year.
W: Some of the people associated with LMU call you not only the board chair but also the general contractor. What have you learned about construction during the last 20 years?
D: I grew up that way and learned my way around the building trade. At LMU, we don’t waste money. We’re very conscientious of quality and cost. We always said we wanted to be a little Duke. We are run differently from state universities. We’re run like a business. Performance means everything. Quality means everything.
W: Does being a private school offer some advantages to you over our public universities?
D: Absolutely. We do not have tenure; we are based on performance. When you’re dean of a college at LMU, you have financial responsibilities because we do activity-based accounting. We look at how well you perform. We’re interested in the students getting a good education and graduating.
W: You have a solid faculty as well at all of your schools who work on contract, rather than on a tenured basis. Has that worked out well for your faculty and administration?
D: Really well. You’ve got to hire the right people and you can’t retire on the job at LMU.
W: Coming from Lee County have you viewed yourself basically as underdog all of your life. Is that part of the driving force inside of you?
D: I think I can win, and I think whoever I’m playing against is the underdog. I don’t go down easy.
W: Looking back on your career you have had a number of huge challenges and many people would be satisfied with just one. What is in the future?
D: We’ll continue our growth, especially in health science. We would like to be equivalent to a good ivy league school and have about 6500-7000 students.
W: You were at an event in Knoxville this past year where your mother stole the show. Can you talk about your mother and what she’s meant to you?
D: The kids and I have talked about how to keep a mind like she does at the age of 95. She worked me to death as a boy. They say I’m a whole lot like her, and I’ve got a child too who works all the time. I guess it’s just something in the genes: we’re aggressive, and we work hard.
W: I’ve known you for twenty years, and I don’t see any decline on your part at all. Do have big plans for the future?
D: I would like to get a little more done before I leave this life. I’ve always said about the people of Appalachia that you can feed them, and keep them alive, and do these things, but the only way you really ever help someone is to give them an education to where they can exist in today’s society and contribute to mankind.
W: Well, if you’ve got your mother’s genes you’ve got another 20 years.
You have done so much for so many and that gift will continue long after all of us are gone.
Thank you Pete