Ubben Posse Fellow Interview: José E. Feliciano
The Jeff Ubben Posse Fellows Program awards five exceptional Posse Scholars $10,000 each and the chance to spend 4-6 weeks during the summer shadowing and learning from a major industry leader. The interview below with José E. Feliciano, Clearlake Capital Co-Founder and Managing Partner, was conducted by Posse Scholar Vincent Vergara, now in his junior year at Pepperdine University, who worked with José E. Feliciano as a 2024 Jeff Ubben Posse Fellow. The conversation has been edited and condensed.
VINCENT: What were key moments during your formative years that shaped your identity and the way you viewed the world prior to going to college?
JOSÉ E. FELICIANO: I grew up in Puerto Rico in a family that emphasized the importance of education, both for the sake of acquiring knowledge and as a catalyst to build a better life. So, from an early age, I valued the gift of learning and the privilege of having access to a good education.
The way I viewed the world, however, was influenced by my dad, a civil engineer who often worked with his hands. Growing up, I was surrounded by a form of technicality and craftsmanship. As I got older, the emphasis on education that my family had established within me evolved into a desire to understand how the world worked.
I would often pick up copies of Popular Mechanics to see how and why things worked the way they did, and I approached those discoveries with a thirst to grasp the deeper levels of applied science and engineering surrounding them. That intellectual curiosity was so integral to my identity. To me, the world was something to be figured out and explored.
In hindsight, it was excellent preparation for what we do in private equity: asking questions to understand, dissect, and deeply learn about industries, sectors, and companies to improve them. And so, asking the right questions and learning for the sake of knowledge was something I have been doing from a very early age.
Despite studying engineering, you pursued a career in finance.
Can you elaborate on how this transition came about, and what key factors should someone consider when evaluating different career paths?
One of the things that I always tell young people is that life is surprisingly nonlinear, and it’s oftentimes the little ripples that have the most significant impacts on our experiences. In my case, even though I graduated as a mechanical and aerospace engineer, I was led to finance by the same intellectual curiosity we talked about earlier. I had a roommate who was a year older than me and went to work on Wall Street.
His experience fascinated me because it seemed like an excellent opportunity to achieve two things: to learn extensively about a new subject and to do that learning with top industry leaders early on in my career. I found that incredibly valuable. Yes, it was a career switch, but in many respects, it was driven by the same motivation– the pursuit of knowledge. Instead of learning how things worked scientifically, I began understanding a significant part of the US economy, why it worked a certain way, and what behaviors contributed to those outcomes, while working under the best practitioners and experts in the field. Even now, one of the things that I’m always grateful for is that I got paid to learn from the best experts in their respective industries and sectors. And that is an incredible privilege that I am very cognizant of and appreciate. This unique learning opportunity first presented itself back in college, and although I thought it would be a short-term thing, here I am 30 years later making a career in finance.
Looking back on your journey, you’ve shown resilience in overcoming challenges. However, you made the bold decision to step back into the entrepreneurial space and start Clearlake Capital from scratch. What gave you the confidence to take that leap, and how did you navigate the risks associated with that decision?
All those elements of decision-making and risk are a part of the entrepreneurial journey. I always tell people that to be an entrepreneur, you have to have a bit of an irrational belief that you have an idea about a new product, service, or strategy that is different and better than anything else that is out there. But that belief doesn’t happen by coincidence. Often, that conviction comes from prior knowledge and experience, where you understand a segment of the market, or you understand a certain product family, or you understand a certain need out there better than most people. In the case of Clearlake, we began by analyzing various successful businesses within our investment sector, aiming to identify what set them apart. From that, we formed the conviction that we could develop a more effective approach to investing.
Did everyone believe in your vision? What challenges did you face, how did you overcome those challenges?
In the early days, many people didn’t believe in our vision. When we started to go out a year after Clearlake’s inception to raise our first institutional fund, it was also a tough time in the economy due to the great financial crisis. And more investors said “no” than “yes.” We also had a lot of people explaining to us why Clearlake would not be successful. It would have been very easy to listen to them and give up. But that’s what differentiates successful entrepreneurs. People are always going to tell you why your idea won’t work, but it’s how you deal with that feedback that differentiates you. For us, the more we studied the market and the difficult economic environment, the more conviction we gained. Our conviction was solidified at a time when it went against conventional wisdom and at a time when the market feedback was pointing in a different direction than where the so-called experts predicted.
But we had a belief with evidence to back it up, we persevered, and look where we are now.
I think that’s incredibly important to highlight, especially since many people find themselves doubting their own abilities and ideas. You had an idea that was different than everyone else and it separated you to do things that other investors couldn’t. What do you think are some other experiences and attributes that have separated you from the pack as a leader, investor, and learner?
To your point, yes, I had an idea, and yes, I had conviction, but I don’t want to make that process sound simplistic and easy. At the end of the day, we all experience moments of self-doubt. We all experience moments where we question if we are doing the right things in the right ways. If you had looked at Clearlake in March 2009, we struggled to raise that first institutional fund. Of course, we thought our idea was great, but at the same time, we had a lot of doubts about whether we would be able to make it through and be successful. However, what separates a great entrepreneur or a great leader is that they can channel that fear, anxiety, and doubt into providing energy in the process of finding conviction. And conviction doesn’t simply mean believing in something; conviction is doing all the work necessary and going that extra mile to truly understand your idea so that those feelings of fear and doubt can’t compete with the reality of what you know. There’s nobody out there who’s successful and who hasn’t, at some point or another, looked in the mirror and had a little bit of fear or a little bit of doubt. However, what you do with those feelings matters and that’s what leads to success.
From my observations while shadowing you, I’ve noticed that a significant portion of your time is spent engaging with people, which is different from what I initially expected a founder of an investment firm would be doing. How do you balance the quantitative aspects of this role with the need to understand and manage people? How has this focus on people shaped your approach to leadership and success at Clearlake?
That’s a great observation. One of the biggest realizations I’ve had, especially in private equity, is that a significant part of our work revolves around evaluating, hiring, mentoring, and motivating people. My unique position allows me to see companies navigate various operational and economic challenges, and through this, I’ve learned a critical lesson: as a leader, especially one overseeing large teams, it’s essential to accurately assess people’s strengths and weaknesses. The key is aligning those strengths with the right projects, teams, and situations. What works well in one scenario might not be effective in another. Leadership involves continuously observing these dynamics and finding the best fit to optimize both team and individual performance. Sometimes, it even means reshaping teams around individuals to support their weaknesses and leverage their strengths. Asking ‘How can we build a team that enhances this leader’s capabilities?’ or ‘How can we ensure that we are not only matching people to the right situations but also encouraging their growth within those roles?’ is crucial to creating growth-oriented teams.
My role now focuses heavily on evaluating, motivating, hiring, and retaining talent. We’re constantly making judgments about the best path to success for different people across various industries and companies. So yes, I now find myself in the people business. Our people are Clearlake’s most valuable assets, and I aim to ensure we maximize that talent. But that’s only possible because we’ve built an environment where talented individuals can flourish and often exceed their own expectations. These are the elements that make a company great, and they’re not always the first things that come to mind when thinking about leading an investment firm.
If you could go back and talk to your 20-year-old self, what advice would you give? And in a broader sense, what would you tell young entrepreneurs or emerging leaders who are starting to transition from the academic to the real world?
Something I learned later in life, which would have been helpful to my 20-year-old self, is that plans constantly change, and there’s no single path to success. We often spend so much time stressing over the "perfect" path to achieve our goals, which creates a lot of anxiety. Yes, it’s important to have a general idea of what you want to achieve, but you also need to accept that those objectives may shift as you gain new skills and experiences.
It took me a while to really grasp those ideas. There were so many moments when I felt like my world came crashing down because things didn’t go how I imagined. When my first startup failed during the dot com bubble, it felt like my world had collapsed. I could have easily thought, ‘I’m in my thirties, and I’ve just failed at the biggest thing I’ve ever tried—what a waste of time.’ But looking back, without that failure, Clearlake probably would not exist, and it certainly wouldn’t be at the level it is today. You never know when or how you’ll gain the knowledge that changes the trajectory of your life. It’s hard to go back and say, ‘If I could just change that one moment, everything would be better.’ The reality is that changing even one episode in your life could alter everything in ways you wouldn’t expect. Your identity and worldview are shaped by all your experiences. So, when things change, recognize that those changes might bring new opportunities.
I also would say that it’s important to recognize that although your path may not be as direct as you would like it to be, that doesn’t mean it is the wrong one; in fact, those twists and turns are often the ones that lead us to the most impactful experiences. It can seem at timed as though everyone else has it all figured out, but I can assure you that there was a point in time when they also thought they might have been on the wrong path. I often say that one of our purposes in life is to find what we’re truly passionate about, but the interesting thing is that there are endless ways to do that. The Olympics is a great example. You see many different people excel in completely different ways— some are the fastest sprinters, others the strongest powerlifters or the best swimmers—but they’re all excellent at what they do, and they all have ended up in the same place. Just because your journey isn’t straight or doesn’t look like the path others have taken doesn’t mean it’s wrong. We are all trying to find the sport, the modality, the role where we can be a gold medalist. If you recognize that life is about learning, that failure is a part of the process, and that everyone has unique paths, you will be able to find your purpose. And if you have a passion for it, not only will you be successful, but you will be very happy.
