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2014 Horatio Alger Award Winner

Lee R. Anderson, Sr.

Owner and Chairman

APi Group, Inc.

“It’s better to hire a fast nickel than a slow dime.”

Lee Anderson, an only child, was born in 1939 in Minneapolis, Minnesota. His mother, Lucille—orphaned at seven—went to an orphanage and eventually became a saleswoman in a department store. His father, Reuben, was orphaned at 14. “My father was of Swedish descent,” says Anderson. “He moved in with a Swedish neighbor, following the death of his mother. At that time my father left school—he was in the eighth grade—and became an apprentice plumber to the man who had taken him in. He would get up at three in the morning and harness the horse to a cart that was loaded with their plumbing tools. My dad was one of the smartest men I have ever known, even though his education was limited. He really wanted to succeed in life. When he was 22, he went out on his own and opened a small plumbing shop.”

Anderson describes a happy childhood even though the household income was quite modest. His hard-working parents taught him to value what they had and to make do without extras. For entertainment, they gathered at the kitchen table after dinner and listened to the radio. On weekends, they took trips in the country. “In the days during World War II, gas was rationed,” Anderson says, “and we could only go for drives when my father had enough gas coupons. We led simple lives, but I felt loved and cared for. I had all that was necessary.”

Though Anderson’s father lacked a good education, he was determined his son would get a solid education. Each day on his way to work in St. Paul, Anderson’s father would pass by a building under construction. One day, he stopped and was surprised to learn it was a school, but that construction had ceased due to lack of funds. Anderson’s father offered to do the plumbing at no cost in exchange for his son’s tuition to the school once it opened. The Breck School was a small military school for boys that Anderson started attending at age seven.

As a boy, Anderson caught frogs and sold them to the local bait store. He also smoked bullhead fish and sold them for 25 cents each. At age 14, he worked in warehouses on Saturdays and throughout the summers. His father told him warehouses were invented to give boys a place to work. Anderson’s duties included cleaning and moving equipment. On Friday paydays, he put his earnings directly into his savings account.

“Working hard was important to my father,” Anderson says. “He worked six days a week his whole life, and I really admired him and wanted to please him. He was very reasonable and rational. He taught me to trust my intuition, which I think was helpful later in my business life. He knew right from wrong, and I tried to pattern my philosophy of life after his. He had a lot of rules for good behavior, and when I became a father, I enforced the same rules with my children. We call it ‘growing up Anderson.’ My mother was also an important role model for me. I’m not sure she even went to high school, but education was important to her, and she taught me to take it seriously.”

Anderson graduated from high school with honors in academics and athletics. His six-foot-seven athletic build earned him scholarships to play football and basketball at numerous universities. Yet his father advised his son to attend the U.S. Military Academy at West Point. “It was a free education for one thing,” Anderson says, “and my father told me I would never regret going there. Once again, he was right.”

At West Point, Anderson played football for two years and was a center on the U.S. Army basketball team for four years. “I enjoyed West Point,” he says. “My time there formed the basis for everything I believe in today about duty, honor, and country. It was a challenging time both mentally and physically, but I was determined to make it. When I graduated in 1961, I was excited about my military career. Things didn’t work out exactly as I’d planned, but I think it went the way it was meant to be.”

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In 1963 Anderson’s father suffered a severe heart attack. Reuben Anderson’s long-term plan had included his son’s military career before he returned home to run the plumbing business. While recovering, Reuben Anderson asked his son to come back immediately to learn “the ropes of running a business” while he was still able to teach.

“That had always been our ultimate plan,” says Anderson. “I was going to have a 20-year military career and then return home to be a plumber. But my father’s health scare changed the military part of things. I was reluctant at first to leave, but I thought my dad knew best. I could never think of a time when he misled me.”

In addition to his plumbing shop, Anderson’s father had an interest in a small, 13-employee company, Asbestos Products, Inc. (API). When Anderson returned home, his father sent him to the company to “look around for a week or two.” Within about 10 days, the company’s manager quit. He stated that Anderson asked too many questions. “I called my dad to tell him what happened, and he asked me to go ahead and run the company, so that was my start in business. I never did go to work in my dad’s plumbing shop even though I did get my plumbing license.”

That small company eventually became APi Group, Inc. Without capital, the company inched its way forward until 1972 when Anderson was able to invest in several acquisitions. He looked for troubled situations, which by their nature best fit his budget. He took risks and on several occasions, nearly lost his parent company by over-leveraging debt to equity. He clearly recalls many sleepless nights then, but his drive and intuition paid off.

“Today, I’m asked if I had a master plan about acquiring companies and building a big business,” Anderson says, “but there was no plan. I simply saw value in failing companies and felt if I could make a few corrections in the way they were run, they would become profitable again. I’m not sure where I got my business acumen. Over time, I developed a business model of what works, and I have never strayed from it. Fifty years later, my company has more than $2 billion in sales and over 10,000 employees.”

APi Group is the holding company for more than 40 independent fire protection, energy, and industrial and specialty construction companies located throughout North America and the United Kingdom. In 2012, Engineering