When 90% Tax Rates Were the Norm, Apache Slashed Oil Investment Costs to Pennies on the Dollar

Source: Founders Podcast | Published: 2026-08-01T23:04:34Z

Apache's early fundraising edge came from a clever tax structure: investors committing $200K only needed to write a check for $56K, with marginal rates above 90% covering the rest.

This is the man who founded Apache Corporation. He started with $250,000 in 1954. By 2008, the company had grown into $50 billion in assets. At ninety, Plank sat down and compressed seventy years of building something into a single book. By the end, what stays with you isn't the corporate history. It's the person who lived it.

Eggs, Firewood, and Maple Syrup — A Farm Kid's Business Ledger

Plank grew up on a farm near Minneapolis. He later said that farm life taught him early that "privilege is earned, not assumed."

Around age twelve, he started raising chickens and selling eggs — getting his first taste of sales and markets. By high school, he was using a handsaw — no chainsaws in those days — to fell trees, split the wood, and sell it. Then he noticed that some trees bled sap. He took it one step further: collect the sap, boil it down, bottle it as maple syrup, and sell it to the neighborhood grocers and butchers.

By graduation, he was running two businesses simultaneously. His father was his biggest supporter — in Plank's words, "lavishing praise and enthusiastic encouragement on all my entrepreneurial attempts." But the most important thing his father ever taught him came during a walk when Plank was around ten. Mid-stride, his father let go of the boy's hand and placed it on his shoulder instead. "Son," he said, "I've found one thing very useful in life — to try to make a small difference for others." Then he added, "Mother will be calling us in for dinner soon." They never brought it up again. But the words echoed in Plank's head for nearly eighty years.

Forty Missions, Nineteen Times Hit

In his early twenties, Plank became a combat pilot flying four-engine bombers, responsible for the lives of ten crew members.

His squadron flew forty combat missions. They were hit nineteen times. Many of his fellow airmen didn't make it home. He wrote later: "At twenty-two, I was flying a bomber, responsible for the life and death of ten crewmen, while helping to kill the Japanese who were trying to kill us."

He filled his diary with wartime quotes. His favorite from Winston Churchill: "Courage is rightly esteemed the first of human qualities, because it is the quality which guarantees all others." His own take: courage isn't the absence of fear — it's acting in spite of it.

When the war ended and he came home, he said it was the first time in his life he truly controlled his own fate. And having watched so many young men die, the risks he would later take in business probably never felt all that significant by comparison.

You can see that same tenacity in how he pursued the woman who would become his wife. He met someone named Elizabeth McCabe at a party and left without getting her number. Determined to ask her out, he opened the phone book and called every McCabe in Minneapolis — over twenty households — until he found her.

The Bookkeeping Job That Led to Oil

After the war, Plank concluded that America was about to enter a massive economic expansion. Years of pent-up consumer demand from the Depression and the war, new industries emerging from technological innovation, and government debt repayment pressuring the bond market — all of it would be released at once. His logic was simple: a wave of new businesses would form, and every one of them would need accounting and tax services.

So he and a partner started a bookkeeping firm called Northwest Business Service, catering to small businesses. They joined a business referral group called the One Two Club, where each industry sector allowed only one member — one bank, one accounting firm, one insurance company — and members referred clients to each other. Through that network, he began working with oil industry investors.

While doing their books, he found a problem. He personally discovered kickback checks — dishonest middlemen skimming money and betraying the investors. He reported what he'd found to a group of those investors. Their response was nearly immediate and unanimous: "You have to take over managing our assets."

The problem was he knew nothing about oil extraction. "We felt completely unqualified," he wrote later. "But we did it anyway."

In 1954, Apache Corporation was incorporated with $250,000 in capital. He hired a geologist, an administrative assistant, and a land surveyor.

Using the Tax Code to Solve a Fundraising Problem

Apache's core product in the early days wasn't oil. It was a tax-advantaged investment structure for the wealthy.

After World War II, the top marginal income tax rate in the United States exceeded 90%. At the same time, the government had designed generous tax incentives for domestic energy exploration. Plank's background in tax gave him an angle others missed: put these two things together, and you could build an extraordinarily attractive investment product.

The book gives a concrete example. An investor puts $200,000 into an Apache drilling project. Eighty percent — $160,000 — could be written off immediately as a tax deduction. At a 90%-plus tax rate, that meant the government effectively absorbed nearly $144,000 of the cost. A $200,000 investment only cost the investor about $56,000 out of pocket.

And if the well struck oil, 27.5% of the income was exempt from tax through the "depletion allowance." So investors faced minimal downside upfront, and a favorable tax rate on the upside.

For Plank, this structure solved a more fundamental problem: fundraising. Apache was a small company with little collateral, and banks wouldn't lend. But now he could walk into a wealthy investor's office and say: even if we don't find oil, the tax benefits alone have already made you money. If we do find oil, that's upside on top. That pitch let him continuously attract capital, acquire land rights, and drill more wells.

He later summed it up: "My technical knowledge of oil and gas was virtually zero. But in the tax and finance domain, I had almost no competition." His approach was to hire people with technical expertise and then follow them into the field — "learning naturally through interest and osmosis in the middle of conversations about geology and engineering."

The Co-Founder Who Bugged the Conference Room

The conflict between Plank and co-founder Truman Anderson eventually became a fight for control of the company.

Their fundamental disagreement was over time horizon. Plank wanted to build something for the long term. Anderson wanted to accumulate personal wealth and status quickly. Arguments escalated to the point where they were throwing trash cans and ashtrays in the office, with employees scattering to avoid them.

What finally ended it was something Anderson did: he planted listening devices in the offices, the boardroom, and the conference rooms. Plank called it "a Watergate-style blunder." Anderson was pushed out.

Plank's annotation on the episode was a single line: "Arrogance quickly outpaces a person's abilities. The arrogant get flattened."

He didn't spare the epilogue. Anderson later opened a car wash, which quickly failed. He went bankrupt, sold his house, moved to Denver, then to California, pulled his son into a few oil projects — all of which failed. He had a heart attack and died. Plank said he didn't attend the funeral.

Like a Pig Following a Cattle Herd Through a Cornfield

Apache navigated decades of turbulence that followed. During the oil industry's downturn, it transformed into a small diversified conglomerate, acquiring 58 companies across agriculture, plastics, telephones, steel, auto parts, ranches, and lumber. When oil prices recovered, it sold all of them and refocused on energy.

During one telephone company acquisition, CEO Phil Lucier and Plank had agreed on price and terms. Just before closing, Phil started his car in a St. Louis restaurant parking lot. The car exploded, killing him instantly. The perpetrator was never identified; police believed the bomb may have been intended for someone else. The deal died with him.

Back in oil and gas, Apache developed a clear competitive thesis: specialize in acquiring small, older wells that major oil companies couldn't be bothered to run seriously. The big players were incentivized to chase large discoveries and massive projects. They had no patience for assets with modest reserves and low returns. Apache was the opposite — willing to pour operational attention into these leftovers.

A journalist once asked him why Apache could make money from old assets bought from companies like Texaco. His answer: "We're a bit like pigs following cattle through a cornfield. For a company with our strategy, the scraps left behind are pretty good."

Ray Kroc explained McDonald's edge over other burger joints the same way: "We just take the hamburger more seriously than they do." What Plank did in oil and gas was the same thing.

Stay in the Game Long Enough

In 2011, Apache received a report on a batch of wells it had acquired between 1970 and 1977. At the time of purchase, everyone assumed those assets had been mostly played out. But someone outside the company — unrelated to Apache — had invented new drilling technology that brought those dormant wells back to life after forty years.

Plank cites Rockefeller and Steve Jobs to make the same point. Rockefeller retained his equity when he retired from Standard Oil. Then Ford invented the mass-produced automobile, demand for oil exploded, and Rockefeller sat back and collected. Jobs, while at Pixar, noticed the value buried in Disney's film library: Snow White, shot forty years earlier, generated nearly zero-cost profit every time a new format emerged — VHS, DVD, streaming — pulling in roughly $250 million per release.

Stay in the game long enough, and someone else will invent the technology that makes your assets worth more. It was validated more than once across his seventy years.

The Wounded Road Is for the Wounded

The back half of the book is dense with aphorisms and judgments accumulated over decades. It reads more like a diary than a business memoir.

He writes that "the satisfaction of learning in practice is proportional to the depth of teaching." He found that at ninety, he was learning faster than at any other point in his life. He believed analogy was the most effective tool for persuasion — "weaving analogies into conversation carries my ideas further" — and for decades he spoke without notes.

He is candid about his failures. Three marriages, several children. He acknowledges choosing work over family. "One cost of my pursuits was my family — they deserved more of my time, love, attention, and support." But he also says he was never the kind of person to torture himself with "if only." "Life is to be lived, learned from, and grown through. For me, it's been a rich feast, and the core of personal happiness."

At the end, he quotes Roosevelt — and leaves one line of his own:

"Looking back over these decades, I'm surprised to find that what I didn't know turned out to be a vast advantage, not a burden. I was never captured by someone else's way of learning or path of practice. We were free to develop Apache's own way. After all, the wounded road is for the wounded."

His son writes a short letter at the close of the book, naming what his father taught him: be passionate about everything; treat everyone the same — kings and paupers alike; create opportunities for people not yet born. It ends on the book's title: make the world a little different.