MARIJUANA STOCK HUCKSTERS • WRESTLING’S BILLIONAIRE BETS IT ALL APRIL 14 • 2014 EDITION ! 2014 E MI IV D S A U RANKING S L THE WORLD’S L C I BEST VENTURE S X T E CAPITALISTS KEVIN SYSTROM Instagram ELON MUSK REID HOFFMAN Tesla LinkedIn DOUG LEONE Sequoia INNOVATION FACTORY THE INSIDE STORY OF HOW SEQUOIA CAPITAL FINDS, FUNDS AND FLIPS THE GREATEST TECH STARTUPS OF ALL TIME Introducing the K900, from Kia. Challenge the luxury you know.™ They say that tradition is what makes a luxury sedan, but is that truly the case? Or can luxury simply be defined by the way something looks? The way it feels? The way it makes you feel? Perhaps it’s the way it makes others feel about you? While some will cling to the notion that heritage is what makes a luxury sedan, the open-minded will form an opinion of their own. 2015 K900 V8 expected Spring 2014. Initially available in certain markets with limited availability. K900 V8 with VIP package shown. Not all optional features are available on all trims. Some features may vary. THE MATRIX, THE MATRIX RELOADED, THE MATRIX REVOLUTIONS: TM & © Warner Bros. Entertainment Inc. (s14) kia.com/K900 A NDREW L AUREN F ILMMAKER FOR PRIVATE APPOINTMENTS AND MADE TO MEASURE INQUIRIES: 888.475.7674 R ALPHLAUREN.COM Read the story behind our performance. 100% of T. Rowe Price Retirement Funds beat their 5-year Lipper average as of 12/31/13*. Request a prospectus or summary prospectus; each includes investment objectives, risks, fees, expenses, and other information that you should read and consider carefully before investing. The principal value of the Retirement Funds is not guaranteed at any time, including at or after the target date, which is the approximate year an investor plans to retire (assumed to be age 65) and likely stop making new investments in the fund. If an investor plans to retire significantly earlier or later than age 65, the funds may not be an appropriate investment even if the investor is retiring on or near the target date. The funds’ allocations among a broad range of underlying T. Rowe Price stock and bond funds will change over time. The funds emphasize potential capital appreciation during the early phases of retirement asset accumulation, balance the need for appreciation with the need for income as retirement approaches, and focus How our Retirement Funds are designed to work harder for your IRA. With investors now enjoying longer retirements, it’s more important than ever to make sure your savings last. T. Rowe Price Retirement Funds are managed to balance the risks that can most impact your retirement savings, providing you with the best chance possible of meeting your goals. Our Retirement Funds’ allocation strategies are carefully designed to combat infl ation and ensure your savings last throughout retirement, while their diverse selection of underlying T. Rowe Price funds are chosen to minimize market volatility. Our commitment to providing the solutions our retirement investors need is just one reason 100% of our Retirement Funds beat their Lipper average for the 5-year period ended 12/31/13*. Past performance cannot guarantee future results. Results will vary for other time periods. Visit our website or contact a T. Rowe Price Specialist to see if our Retirement Funds are right for your IRA. Or call your advisor to learn more about investing with T. Rowe Price. T. Rowe Price funds are low cost, so your investment goes further. troweprice.com/openira 1.866.575.9647 on supporting an income stream over a long-term postretirement withdrawal horizon. The funds are not designed for a lump-sum redemption at the target date and do not guarantee a particular level of income. The funds maintain a substantial allocation to equities both prior to and after the target date, which can result in greater volatility over shorter time horizons. *Based on cumulative total return, 12 of 12, 12 of 12, 12 of 12, 5 of 5, and 6 of 7 (86%) of the Retirement Funds for individual investors outperformed their Lipper average for the 1-, 3-, 5-, and 10-year and since-inception periods ended 12/31/13, respectively. The Retirement 2010, 2020, 2030, 2040, and Income Funds began operations on 9/30/02; the 2005, 2015, 2025, and 2035 Funds began operations on 2/29/04; the 2045 Fund began operations on 5/31/05; and the 2050 and 2055 Funds began operations on 12/31/06. (Source for data: Lipper Inc.) T. Rowe Price Investment Services, Inc., Distributor. IRA082148 THE MOST PLANES IN THE CLOUD. MORE WI-FI THAN ANY OTHER AIRLINE. DELTA.COM/WIFI contents — APRIL 14, 2014 40 | GENE THERAPY GURUS Firms like Nick Leschly’s Bluebird Bio are tackling rare diseases with next-gen treatments—and attracting big investor interest. 44 | TODAY BOSTON, TOMORROW THE WORLD Major League Baseball was just the start of the Fenway Sports Group’s ambitions. 50 | M&A MISCHIEF How to dress up a loser as a winner. STRATEGIES 40 | BIOTECH’S NEXT BIG THING After decades of experimentation and failure is gene therapy fnally ready for prime time? Investors certainly think so. BY MATTHEW HERPER 44 | THE GREEN MONSTER Winning the World Series was nice, but John Henry and his Fenway Sports Group have plans to build a global sports juggernaut. BY KURT BADENHAUSEN TECHNOLOGY 46 | HOW MUCH DID YOU PAY FOR THAT LIPSTICK? 66 | BOBAMACARE 46 | PERSONAL Big data is helping customers price goods Pet insurance: PRICING according to a customer’s willingness to pay. marginal product, FreshPlum’s BY ADAM TANNER great business. dierential- pricing INVESTING algorithm turns reluctant 50 | MERGER MIRAGE shoppers into Acquisitions are on the rise and winning eager buyers. investors’ favor. But loose accounting rules can make even a bad deal look good. BY DANIEL FISHER 54 | BETTING ON BILLIONAIRES, NOT BUBBLES Kinetics Internet Fund crashed when the dot-com bubble burst. Now it’s killing it by avoiding future dot-bombs. BY BRIAN SOLOMON 57 | GET YOUR MONEY MANAGED FOR FREE Some ETFs have negative expenses. The trick: securities lending. 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Harry Stine has revolutionized BY KARSTEN STRAUSS American agriculture. Twice. His corn could do it again. FEATURES 70 | THE INNOVATION FACTORY Sequoia Capital is Silicon Valley’s search engine 82 | CABLE for disruption—and billionaires. CUTTER BY GEORGE ANDERS WITH ALEX KONRAD Pro wrestling’s Plus: The Midas List billionaire is streaming his act 82 | MONSTER MOVE directly to his fans. Vince McMahon sucker punched his traditional TV partners when he launched the WWE Network earlier this year. The unorthodox maneuver could transform his business—or he could fall fat on his face. BY MICHAEL SOLOMON AND DANIEL FISHER 90 | HIGH TIMES! Meet the shady band of ex-cons, ganja-preneurs and multilevel marketers behind the great pot penny stock boom of 2014. Don’t say we didn’t warn you. BY NATHAN VARDI 90 | MARIJUANA MADNESS Michael Mona’s high-fying 96 | CAN THIS MAN FEED investors could see everything THE WORLD? go up in smoke. Harry Stine built an obscure $3 billion empire by breeding a better soybean seed. Now the richest man in Iowa thinks he has revolution- ized corn, the Earth’s most popular crop. BY ALEX MORRELL BrandVoice BY SAMSUNG Launching Students Into Science: How a Middle School Touched Outer Space 99 LIFE 106 | THE BALLAD OF BALCONES Want to fnd the best single malt whiskey in the world? Look under a bridge in Waco. 106 | THE WHISKEY FROM WACO BY ABRAM BROWN The fnest brown liquor comes not from a glen in Scotland but from an 112 | THOUGHTS underpass in Texas. On taxes. 10 | FORBES APRIL 14, 2014 PITCH. BUSINESS, MEET PLEASURE. BOOK NOW AT FOURPOINTS.COM Best rates guaranteed at 200+ hotels around the globe. ©2014 Starwood Hotels & Resorts Worldwide, Inc. All Rights Reserved. Preferred Guest, SPG, Four Points and their logos are the trademarks of Starwood Hotels & Resorts Worldwide, Inc., or its affi liates. FORBES EDITOR-IN-CHIEF IN BRIEF Steve Forbes CHIEF PRODUCT OFFICER Lewis D’Vorkin FORBES MAGAZINE Native Advertising EDITOR Randall Lane Catches On EXECUTIVE EDITOR Michael Noer By lEWIs D’vORKIN ART & DESIGN DIRECTOR Robert Mansfeld My frst sales trip for FORBES was a stop in Detroit in Au- FORBES DIGITAL gust 2010, memorable for the heat, the humidity and a chilly VP, INVESTING EDITOR Matt Schifrin reception. I was pitching BrandVoice, then called AdVoice. MANAGING EDITORS The ad agencies and clients we visited didn’t get it. Still, we Dan Bigman – Business, Tom Post – Entrepreneurs, Bruce Upbin – Technology pressed on with a product for advertisers that few other pub- SENIOR VP, PRODUCT DEVELOPMENT AND VIDEO Andrea Spiegel lishers ofered.