Entrepreneur returns to troubled past Millionaire was delinquent youth, now assists them

April 16, 1995|By Alec Matthew Klein | Alec Matthew Klein,Sun Staff Writer

Jim Hindman was an orphan, hustler and petty thief before he turned 8 years old.

By 35, he was a millionaire. Today, at 59, W. James Hindman has returned -- inevitably it seems -- to a world of juvenile delinquents.

Only now, he's running the show, overseeing more than 1,000 troubled teens in seven states in 11 residential treatment centers, including two in Maryland.

For at least the third time in Mr. Hindman's life, lightning has struck. He made his first fortune in nursing homes in the 1970s, then multiplied his wealth by building Jiffy Lube, the quick-oil-change franchise, in the 1980s. This decade belongs to his latest incarnation -- as chairman and CEO of Owings Mills-based Youth Services International Inc.

Yet even as he extends his hold over foster and rehabilitation centers, Mr. Hindman is still, in his own way, an orphan. His mother won't speak to him, his brother doesn't like him, and he remains restless in the pursuit of profit. But even more, his closest friends say, he is driven by the need to show again and again his own worth.

"I don't know if he'd appreciate me saying this," said boyhood chum J. Donnie Black, a Youth Services board member. "But probably deep down, Jim is an insecure throwaway kid who has to prove himself."

For all the millions he has made and lost, Mr. Hindman still possesses the hard edge and rough hands of a once pugnacious kid who ran the streets of Sioux City, Iowa, in secondhand knickers, high socks, black canvas sneakers, a denim jacket and stocking cap. "I was shining shoes when I was 4 years old," Mr. Hindman said, spitting out an unseen speck, as if it reminded him of his grimy youth.

Circa 1940, he was a rag-tag man-child with a gift for gab in a gritty blue-collar cattle town, already wise to the ways of bars and bordellos, sailors and prostitutes. He learned about the shoeshine shakedown, too, when a 10-year-old ruffian named Indian Joe and his two henchmen stepped out of an alley and demanded his shoeshine money.

Frightened, the youthful Jim Hindman didn't put up a fight, but as the three thugs left him in tears, a stranger standing nearby admonished, "Til you learn to fight for what's yours, you won't have anything."

Mr. Hindman never got the man's name, but he got the message. The next time he saw Indian Joe, Mr. Hindman whacked him on the head with his wooden shoeshine box so hard that the bully never bothered him again.

"He was a tough kid," said Mayer Kanter, a Sioux City lawyer who ran with Mr. Hindman in grade school. "Hell, he still swaggers."

And for good reason: His brainchild, Youth Services, began to flex its own muscle as it broke into the black for the first time last fiscal year, earning $2.1 million on revenue of $34.9 million -- the same year the company first sold stock to the public.

The bottom line: Juvenile crime pays.

About $3.2 billion is spent annually at the local, state and federal levels on youth rehabilitation programs. "It's unfortunate, but it's safe to say it's a growing market," said Alex C. Hart, an analyst with Ferris, Baker Watts Inc.

In 1991, studies show, one juvenile was arrested in the United States every 27 seconds. Reported juvenile crime climbed 68 percent between 1988 and 1992.

Rape -- up 27 percent.

Robbery -- up 52 percent.

Homicide -- up 55 percent.

"I believed the demographics," Mr. Hindman said of the seeds of Youth Services.

As a former delinquent himself, he also knew the life behind the statistics. While neighborhood children were riding their bicycles, he was stealing them. Or shoplifting candy, clothing or food. Later, as a teen-ager, he barely escaped jail when he and his friends tried to steal a pavement steamroller. He was too quick for the converging police officers.

"Listen," he said, "I come from a criminal background, I cannot put it any other way."

Even then, however, Mr. Hindman's life of crime foreshadowed an entrepreneurial spirit.

Not yet 7 years old, he and his cabal of friends would slip into a neighbor's yard and grab whatever wasn't tied down -- pipes, motors, bikes -- and sell it to a salvager. That night, they would climb over the fence, steal the same items again and re-sell them.

The tykes were doubling their profit.

In time, Mr. Hindman sharpened his financial skills with a master's degree in hospital administration from the University of Minnesota, but the profit concept remained the same as he and a wealthy partner bought and sold nursing homes in the 1970s.

He was making money -- lots of it. On paper, he was once worth more than $100 million before Jiffy Lube buckled under debt in 1989. Still, after Pennzoil Co. bought the company a year later, Mr. Hindman emerged from the deal with $2.3 million, enough to quietly lick his wounds.

Instead, he created Youth Services in 1991.

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