Serial wealth creator Lassonde nonetheless having enjoyable

Franco-Nevada (TSX, NYSE: FNV) co-founder Pierre Lassonde hasn’t let retirement from the C-suite dim his love for the yellow metallic. 

Think $4,000 gold is excessive? Lassonde, the previous Newmont (NYSE: NEM, TSX: NGT) president, has information for you. He predicts the yellow metallic will hit $17,250 an oz. inside three years. 

“People are buying gold because they want to have something else than the U.S. dollar,” Lassonde instructed MINING.COM’s sister publication The Northern Miner in an interview. “All the major developed countries have a budget deficit problem and none of them want to address it.” 

If anybody can discuss gold with authority, it’s Lassonde. More than 5 many years into his storied profession, the Quebec-born analyst, entrepreneur, financier and philanthropist – a 2013 inductee into the Canadian Mining Hall of Fame – can now add one other laurel to his assortment. He is this year’s recipient of The Northern Miner’s Lifetime Achievement award.  

Gold’s lure for traders lies in its finite provide, Lassonde says. Only 216,265 tonnes of gold have been mined all through historical past, World Gold Council information present. And whereas demand – together with from central banks – retains rising, gold miners are struggling to elevate output as ore grades decline and new deposits are deeper than ever earlier than. 

“If you take just 1% of the money that’s in other asset classes and you move it into gold, gold is going to go way up,” he argues. “Gold is a small asset class. Every year there are only 3,600 tonnes produced and a third goes into central bank coffers. It’s not a whole lot.” 

Store of worth

In the eyes of some traders, gold can also be beginning to rival the U.S. greenback as a retailer of worth. The U.S. forex made up 58% of disclosed international official international reserves in 2024, down from a peak of 72% of reserves in 2001, U.S. Federal Reserve Board information present. 

“Gold is being remonetized within the architecture of global reserves,” Lassonde says. “Whether it’s central banks, family offices or sovereign wealth funds, they are all hedging their investment bets against an increasingly politicized and fragmented world. On top of that, there are cyclical factors such as a lowering of interest rates” that gasoline urge for food for gold, he says.  

Lassonde’s love story with mining virtually by no means took off. As an adolescent, he says, he had his coronary heart set on a profession in development.

Bechtel

After acquiring his bachelor’s diploma in engineering at Montreal’s Ecole Polytechnique, he left for the United States to do a grasp’s in enterprise administration on the University of Utah. Upon commencement, he acquired employed by engineering big Bechtel. Six months in, the firm despatched him on a job in Arizona constructing the Pinto Valley mine.  

“When I got there, I met a geologist and we started speculating on junior mining stocks,” he says. “I made five times my money on the first stock I bought over a three-month period. That’s where I got the bug. I thought I was God’s gift to finance! Of course, the second time I lost all my money.” 

After a couple of years with Bechtel, he moved to Toronto to work for mining and metals distribution firm Rio Algom. There, he met Keith Winckworth, an business veteran from South Africa generally known as Winky, who labored because the assistant to the president and shortly took him beneath his wing. 

“I grew up fast because I had a great mentor,” Lassonde remembers. “Every time he would go on a mine visit, he would take me with him.” 

Analyst

After transferring to Toronto-based funding agency Beutel Goodman as a junior mining analyst, Lassonde produced sizeable returns for a brand new gold fund and was named president of the agency’s gold division. 

It was there he met Seymour Schulich, the Canadian govt who would later turn into Lassonde’s enterprise accomplice and Franco’s co-founder. They began Franco in 1982 with a mere $2 million of capital. 

“The reality is that we raised the money so that we could go skiing in Nevada, play poker and deduct it against taxes,” Lassonde says with amusing. “Neither of us are geologists and we didn’t know what we were doing. We knew we had to find a better way to do business.” 

Royalty mannequin

That manner, it turned out, revolved round an idea popularized by the oil and fuel business: royalties.  

It was Schulich, a former Shell Oil worker, who discovered Franco’s maiden funding, a small heap-leach mine on the Carlin Trend subsequent to a Newmont property. Lassonde quickly realized the buy would far exceed his modest funds. 

“The owner had a bank loan for $2 million and he had 90 days to repay or they would put him in bankruptcy,” Lassonde says. “Nothing less than $2 million would solve his problem.” 

Eventually, a deal was struck. Lassonde giggles when he remembers breaking the information to Schulich. 

“I told him there was good and bad news. The good news was, we had bought our first royalty and we were going to make five times our money. The bad news was that we had no money left in the bank. He went berserk.” 

Schulich finally forgave Lassonde – particularly when Barrick ended up growing the challenge behind Franco’s first asset into the flagship Goldstrike mine. 

“Goldstrike has already paid out over $1 billion in royalties, and there’s probably another $500 million coming,” Lassonde says. 

$36B worth

That wouldn’t be Franco’s final success. In the 20 years between Franco’s basis and its 2002 acquisition by Newmont, the corporate posted a 36% annualized fee of return. Now Franco has a market worth of about $36 billion. 

“For 10 years, we had no competition because nobody thought you would build a business based on royalties. There was a huge first mover advantage. We were buying properties that were not in production for one-year cash flow,” he mentioned. “Today, anything in production is worth 12 to 14 times cash flow. There is so much competition. If you’re a startup company today, it’s a hard life.” 

When Newmont acquired Franco in 2002 as a part of a three-way merger with Australia’s Normandy Mining, Lassonde turned the post-merger president of what nonetheless is the world’s largest gold producer. Five years later, he led a bunch of traders that acquired a royalty portfolio again from Newmont and spun it off right into a revived, publicly traded Franco. 

“A new president came in and after one year, called me to say he wanted to sell Franco Nevada. I said: ‘I’ll buy it back.’ I raised $1.2 billion in four days,” he mentioned. “By 2007, gold was around $750 and it went up to $1,200 before having a bit of trouble with the financial crisis.” 

Philanthropy alongside mining

Besides his storied enterprise profession, Lassonde has gained prominence as a beneficiant philanthropist in Canadian mining schooling, analysis and institutional capability. He has endowed mining chairs and examine packages, together with the University of Utah’s entrepreneurship institute, supported scholarships and led fundraising campaigns for establishments such because the Musée nationwide des beaux-arts du Québec, whose latest wing bears his identify. 

He stays as passionate as ever about mining. 

One of the enterprise tasks closest to his coronary heart today is Fuerte Metals (TSX-V: FMT), a Canadian junior that just lately acquired Newmont’s Coffee challenge within the Yukon with Lassonde’s backing. Fuerte reminds him of an early-stage Orla Mining (TSX: OLA). 

“It’s a fantastic project in the Yukon,” Lassonde says. “It could do very well. Fuerte is Orla 2.0. It’s the same sheet music.” 

As he approaches his 79^th birthday, Lassonde insists he’s nonetheless having enjoyable. 

“Think of the money that Franco’s made for pension funds and people,” he says.

“Yes, I’ve made money but I’ve made a lot more for Canadians and others. I’ve got more than enough for whatever time I’ve got left and I love giving it away. Almost every day I get letters of thanks, whether it’s from artists or students, and it fills me with joy. That’s what we’re here for: Leave a better world at the end.”