Thursday, May 30, 2024

Pillars of North Carolina: Marshall Rauch

By Vanessa Infanzon

Photo by Alex Cason

In his 97 years, Marshall Rauch has never lost his Long Island, N.Y., accent, but he’s undoubtedly earned his North Carolinian status after moving to Durham in 1940 to attend Duke University and spending his life making a huge mark on the state.

Several high school friends had told him how much they enjoyed Duke. So he headed south and joined the basketball team as a walk-on and met his future wife, Jeanne Girard of Gastonia. World War II interrupted his college experience, as he enlisted in the Air Corps Reserves but was moved to the Black Panther unit of the 66th Infantry Division.

Upon his return, Rauch joined the Girard family’s textile business in Bessemer City in Gaston County rather than finish at Duke. He then started Pyramid Mills on the side, eventually going out on his own. A big break came in 1963 when the then-powerful Spiegel Catalog Co. placed an order for Christmas ornaments wound with rayon thread. With an $800 investment in a newly designed metal device, Rauch produced 300,000 boxes packed with a dozen ornaments each.

From that start, Rauch Industries was, for a period, the world’s largest Christmas ornament producer, quite an irony given the founder’s Jewish roots. It went public in 1983 and was acquired by East Boston, Mass.-based Syratech for about $50 million in 1996. Business declined following the acquisition, and ownership later changed hands. No ornament manufacturing remains in Gastonia.

Business was a fraction of Rauch’s overall impact. He used leadership posts at both the YMCA and city council to boost inclusion of blacks and Jewish people in Gastonia affairs. A lifelong Democrat, he also served as a state senator for 24 years. He invested in various ventures, including Edgeway Pharmacy, which is now run by his grandson, Julian Rauch.

His best investment may have been in an employment company called One Two Three Hire, which was about to collapse when a new owner, Ric Elias, stepped up. He offered Rauch $1,000 for his stake, which Rauch declined, then followed up two years later with a $3,500 offer. Rauch held on and decided to visit the company, which transformed into Red Ventures, an Indian Land, S.C.-based digital marketing firm with more than 3,000 workers in 12 offices. CEO Elias “is now one of my best friends,” says Rauch, though he no longer owns shares in the company.

He talked about war, business and politics in comments edited for length and clarity.

I was given the Combat Infantry Badge and the Bronze Star medals. I was in France, Italy, Germany [during the war]. I was very fortunate. I was waiting to get on a ship to go to Japan with hundreds of thousands of guys [toward the end of the war]. That’s when Harry Truman had the atom bomb dropped, and then the war with Japan was over. I’ve thought about it many times. It was terrible, but I’m alive.

We docked in New York. I saw my family. My buddies actually picked me up, held me. My mother and father, my grandparents, my aunt, my sister and Jeanne were all there. I don’t think I said two words, and she said, “We’re getting married in 10 days.” I said, “It suits me.” We got married down here in Gastonia.

My wife’s family, they were in a yarn-spinning business. I remember her brother said to me, “We’re so happy you married into the family. You can come and have a job here tomorrow, or you can come and have a job here when you finish college. It’s up to you.” And right at that minute, I wasn’t going to finish college.

The funny thing is I made $60 a week. A year and a half later, our first child was born. I was such a good worker that I immediately got a 33% raise to $80 on the occasion of the baby.

I believe I was just about 28 years old. Some of the guys suggested that I might run for city council. All they [had] to do [was] suggest somebody like me, and I ran, and I got elected. I was the first Jewish person.

I was elected [to the N.C. General Assembly] in 1967, and I served through 1990, 24 years. I guess I enjoyed that as much or more than anything I’ve done. And for the first 10 years, I was just a senator, but I made a lot of friends. In that tenth year, Jimmy Green had been a member of the House of Representatives and house speaker. He wanted to run for lieutenant governor. It just so happened he sat next to me, and we became good friends.

Well, when Jimmy became lieutenant governor, the lieutenant governor appointed all the committee chairman. He knighted me. He made me chairman of finance. No bill that touches money [or] taxation can be sent to the floor without it going through the finance committee.

I wanted to build a business. I really held my salary low for years, 10 or 15 years, and accumulated money in the company. And then we got a tremendous lucky break.

Christmas took us from 40 employees to 1,400. We were the largest Christmas [ornament] manufacturer in the world. We had about a million square feet. We moved from Bessemer City to Gastonia.

I took it public to make money. It was a good experience being public. We were not on the New York Stock Exchange. We were NASDAQ and transferred to the American Stock Exchange. We weren’t the smallest company there, but we weren’t tremendous. Christmas was a tiny industry in this world.

[Gastonia has] a lot of people here who are on their great-grandfather’s farm. They don’t want to sell that land. Just 10 years ago, there was a move to put [in] a big thoroughfare. The only way you can get to Charlotte from here is on I-85 or Wilkinson Boulevard. Those are parking lots at 5 o’clock at night.

I never believed in cutting money from the government, unless you get it [from] somewhere else. Some of these people go in there and they want $5 million for something and just wanted to take it out of the general fund. I don’t believe in that.

I think that the elected officials are more interested in being reelected than anything else, and therefore, they are not their own person.

Don’t miss out on other stories from the Pillars of North Carolina series:

Harvey Gantt

Sheila Ogle

Mitchell Gold

Sherwood Smith

Linda Hudson

For 40 years, sharing the stories of North Carolina's dynamic business community.

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