By RODNEY HO/ email@example.com, originally filed March 28, 2012
I just spoke with Daymond John, founder of lifestyle brand FUBU and investor on ABC’s “Shark Tank” today before his talk this evening with students of Kennesaw State University’s Michael J. Coles College of Business. (It’s open to the public at 7 p.m. at the KSU Convocation Center, 1000 Chastain Road, Kennesaw, GA 30144)
John, a true home-grown entrepreneur who sewed and sold his own tie-top hats on the streets of Queens more than 20 years ago, is now a coveted branding expert and motivational speaker who still oversees his internationally known FUBU brand.
Atlanta, he said, was one of his biggest early supporting markets. “It’s a very dear place to me,” he said. “I directed my first video with Gucci Mane. I’m very close to Ludacris. It’s like my second home.”
But he chose not to buy a home here. “I just know it’s such a great city, it would be a distraction.” In his younger days, he said he spent many a night at the Velvet Room.
To a broader audience, he is now known as one of the investors on “Shark Tank” along with Dallas Mavericks owner Mark Cuban, technology maven Richard Herjavec and real estate expert Barbara Corcoran, who has invested in a couple of successful Atlanta ventures, too. (The Ride On, Carry On folks from last season showed up for an update this past Friday and said sales have gone from $40,000 to $500,000. “It has been a whirlwind,” said Darryl Lenz, a flight attendant from Peachtree City. “We could not have done it without Barbara.”)
John can be tough and blunt on the show, though venture capitalist Kevin O’Leary, the King of Evisceration, could melt a person’s ego with a glare and choice word.
“It’s a fun show, a great platform,” John said. “But after the lights go down, the real work goes down. Some of these entrepreneurs are really great. Some are green. Some need a lot of training. And I have constraints on my time.”
So far, John said he has made bids on 20 businesses on the show over 40 episodes. Only seven actually closed. He said the entrepreneurs show up and he is given minimal information about them going in. Sometimes after the fact, once he vets a business, he realizes what they said on the show may not be quite as rosy as reality. “I’m there to make a real deal, to make money with them,” he said.
Of the seven he did close, he said three individuals took the money and he has not heard from them again. Two of them are doing okay. Two or three are fairly new, he said, but still have plenty of upside.
He is glad the show has burnished his image, too. The stereotype of the fashion hip-hop guy, he said, is he’d be wearing gold teeth and baggy pants with dreads. But he is well spoken and wears a suit. “I have started working with great corporations” thanks to the show, he said. The trade off, he said, is a loss of privacy, especially with social media. He has to be more careful in public.
What peeves John the most on the show are wannabes who show up not for his money but to get free publicity for their businesses. “We sit there 12 hours a day, five days a week. You can only hold back so much,” he said. “As the season wears on, I get nastier. My tolerance levels change. If someone comes in not serious about a deal, they’re taking opportunities away from people who are truly desperate for our help. I will curse people out and call them a scumbag.”
On last Friday’s episode, one entrepreneur (The Ace Venice) who places prints on sneakers tried to seal a deal with John. But John was turned off when the man seemed to care more about building a “six figure” lifestyle than building his business.
“I’ve lost so many millions of dollars with the cool kids,” John said. ” ‘I’m living the L.A. life. I need six figures.’ That means the money I invest may go into smoking weed. I’ve given enough of my money that way.”
And if a person has, say, only a “patent pending” on an idea, by exposing the concept to five million viewers, John said, “400 other guys will be doing the same thing. Trust me.”
John said if he were a green entrepreneur, watching “Shark Tank” would be edifying. “You see what millionaires and billionaires want to hear to back companies. You actually hear the types of questions they ask. It’s amazing to me three seasons in and some people come in here and don’t know their numbers.”
In other words, anybody stepping into the “Shark Tank” better have a handle on their financials inside and out. Three guys peddling a beer ice cream (Brewer’s Cow) had trouble spitting out the simplest numbers last Friday. John jokingly dubbed them “Moe, Larry and Curly.” Nobody gave them a penny. “I’ve seen a 16 year old who knew her numbers better than these grown-a** men with big beards!”
He did end up investing in two female entrepreneurs selling motorcycle garb called GoGo Gear.Though these women also had trouble at times grasping numbers in front of the potential investors, John took a chance with them because he loved the idea. In the end, he said they’ve been great to work with. “They know their market. They call me and tell me about opportunities. They are very very sharp. I’ve been pleasantly surprised.”