A Shark’s Tale, by Angeline Lawrence
Finding the words to describe a man that transformed a part-time hustle of selling hats and t-shirts on the streets of Hollis, Queens in New York to a billion dollar empire is a daunting task. However, my first encounter with “The Shark,” Daymond John began before the day I interviewed him this past July.
Honestly, I was not interested in watching the hit ABC reality TV show, “Shark Tank,” produced by Mark Burnett creator of “Survivor,” that airs on Fridays at 8 pm eastern standard time. I thought, “Do I really want to watch multi-millionaires grilling entrepreneurs and fighting each other for a stake in these companies?” So, reluctantly I watched it with my family one night because it kept the house quite for an hour.
As I watched the show, I was intrigued by the only African-American male on the panel of Shark investors. He was laid back and even-tempered. He seemed to study each entrepreneur as they made their pitch. I noticed he only made an offer if he believed he could use his expertise to help make a difference in the company, as well as obtain the required ownership percentage he desired.
To my surprise, I did not realize that I was staring at the founder and CEO of the global clothing brand FUBU, “For Us By Us” that topped $350 million in sales in 1998. Back in the day, I was a huge fan of the company and was excited to see them succeed as African-American owners of a major clothing company. Once described by President Barak Obama as, “One of the greatest entrepreneurs of our time;” Daymond John is the master mind behind the $5 billion dollar clothing company.
Daymond John, along with his partners, is credited for creating the $20 billion dollar urban appeal market that other fashion designers ignored. He has re-launched FUBU as FUBU Legacy. Among his other companies, Daymond John acquired and revamped the Coogi clothing brand to dominate its current fashion space as well.
His dominance in the fashion industry scratches the surface to the depth and breadth of his business acumen. As a Shark, on “Shark Tank,” Daymond John displays his branding knowledge and street-savvy business sense by using what he calls, “mental judo” on fellow Sharks beating them out to make deals on products ranging from hand-free umbrellas to scrape and sweep brooms. Just so you know Detroit is Shark Tank’s #1 market for ratings. The new season will premier this fall on September 23rd.
He has multiple “irons in the fire” since he’s a motivational speaker and branding consultant for “Fortune 500” companies. As an author, he’s released two books in the “Display of Power Series” that gives his insights and personal experiences in fashion, branding and business.
Display of Power, How FUBU Changed the World of Fashion, Branding and Lifestyle, was released in 2008. The Brand Within, Branding Yourself from Birth to the Boardroom, was released in 2010.
I caught up with Daymond John in between the taping of the third season of “Shark Tank.” The following is a snapshot of the interview I conducted to explore the mind of “The Shark”:
Q. You were recently appointed as “An Entrepreneur in Residence” with the prestigious Babson College of Business in Wellesley, MA. You will teach a Management Consulting Field Experience (MCFE) team of graduate students who will be selected as your product launch team for one of your Shark Tank Businesses from the show. What type of Sharks will you teach them to be?
1. I never went to college, so I want to teach them the hands on training as well as the technical training. I will make sure the students understand that they need to have a team around them. You can do the technical stuff and analyze it, but you also have to go out and do it.
Reports need to be done, but don’t get analysis paralysis, go out, make a move, and fall on your face. Then, you must come back, reconfigure your approach and try again. The head of Babson College once said, “An Entrepreneur acts, learns and then repeats.”
Q. Some of the Sharks on “Shark Tank” seem to be more concerned about making a profit as opposed to helping the entrepreneur. How are you different from your fellow Sharks?
A. There is no difference in Sharks. Just like a physical shark, if you stop moving you die; so it is the hunt that we love. “Sharks” are always looking for the next kill or the next deal. Some are pure venture capitalist. They are out to make money, but it does not mean that they will not go and donate to charity.
On the show, the Sharks are perceived as people who beat up on the entrepreneur. I don’t want to beat up the entrepreneur. I do not want to beat up on a potential partner. I’d rather fight with the other sharks to get the right deal. My course is I want to see change while doing it. I want to have fun, and make money but I also want to help change people’s lives.
Q. Last season, how did you out maneuver two of your fellow Sharks to seal the deal with the stay at home dad that invented the scrap and sweep broom? You never overacted. You talked to the entrepreneur calmly to get him to take the deal with you and another shark instead of with Kevin O’Leary, who had gotten out of his seat to persuade him.
A. I used “Mental Judo.” I live by two theories. Do not react, respond. Second, I look at the deal from all angles and then I respond and mentally out maneuver the other Sharks.
Q. How would you prepare an entrepreneur to obtain funding?
A. It depends on the phase of that company and the business model. Are you going after an investor or a partner? First understand what you are going after. Where does the money cost you the least, i.e. grants, banks, investors and strategic partners. Money cost more as you go up the ladder.
What information do you need for a grant? For Banks, how do you get a co-signer or collateral? What is the interest rate you will have to pay? An investor, which is more expensive, may not be stringent on credit, but wants a return on the investment. On the higher end of money, the requirement may be 50% of the company and a return on the investment.
You must know answers to questions [about your business] such as, what are the operational costs, what is the monthly burn, what is the return on the money, what is the gross income, how much is the acquisition cost per customer, what level of customers are you attracting…..? Once you have answered all those questions, then you go after funding.
Q. In The Brand Within, you talked about the need to have others invest in your company as promoters and not only as customers. Explain the importance for a company in its early stages to have someone like “Uncle Ralph,” who had a music video television show in New York that regularly promoted FUBU.
A. Again, you need a team to help open doors for you. It is very important because you cannot do it yourself. You will always need someone with you. You need a team no matter what.
Q. With all the success you have enjoyed what keeps you motivated?
A. There are 3 stages in life; make it, master it and matter. When you are young you try to make it; then, you try to master it; then you want to matter. I am at a point in my life where I want to matter. I like the challenge to help change lives and help corporations change the way they perceive their customers. You can’t take the hustler out of me. This is just the beginning.
“The Shark,” Daymond John will be in our midst as a keynote speaker at the “Detroit: Creating Own Future” event with four other multi-millionaires sharing their expertise and insights. The media sponsor is Detroit ABC affiliate, WXYZ Chanel 7, and the event will take place on Thursday, October 20th, at the Detroit Renaissance Marriott Hotel at 6:00 p.m. in the Ambassador Ballroom. Visit the website: http://www.creatingourownfuture.com for more information.
Category: Cover Stories
