Over 1100 entrepreneurs and small business owners attended the Brazzlebox SMB Summit to hear Daymond John, Founder of FUBU clothing, and star of ABC’s Shark Tank, speak at the OnCenter in Syracuse, NY. During the discussion John shared his top five “Shark Points” for starting and maintaining a successful business.
“It takes the same energy to think small,” said John. You must think big!”
Born in Queens, NY, John started his career as an entrepreneur surrounded by a community that embraced hip-hop as a culture. Attracted to the music industry, and starved for mentorship, John connected with producer and promoter, Russell Simmons, known today as the godfather of hip-hop and founder of Def Jam Records.
Now rubbing elbows with artists including LL Cool J, RUN DMC and the Beastie Boys, John saw a market for urban apparel. At the time, top brands like Timberland shied away from the hip-hop scene as to not be associated with drugs and gangs. John recognized a change was needed. FUBU (For Us, By Us) was born to meet the demand.
“Hip-hop disrupted technology. This was our version of a social network – something you did. I wanted to be apart of it, but I couldn’t dance. So I started selling hip-hop, making money doing something I loved,” said John.
SHARK POINT 2: Set a goal
While holding down a job at Red Lobster, John’s mother showed him how to make urban-style hats. It was 1989, and in one hour standing outside the Coliseum Mall, John sold $800 worth of product.
“My goals started unfolding before my eyes,” said John.
Hats soon evolved into t-shirts. Harnessing his connections in the music industry, John started using rappers to promote his brand and began searching for a FUBU spokesperson. LL Cool J suggested John and his partners “stalk” their favorite musicians until LL’s advice backfired and the crew landed at his doorstep. Bags packed and enroute to LA to start his film career, John knew he had one shot to capture LL in FUBU gear. Snap! Another goal met.
SHARK POINT 3: Do your homework
Making mistakes is part of any entrepreneur’s journey. John is no different. Now FUBU, the original name of John’s urban apparel company was BUFU (By Us, For Us). Unfortunately for John, and according to the Urban Dictionary, these four letters mean something entirely different in the gay community. This is why John can’t stress enough – study the analytics! Know your product, know your customer, know your competitors, know yourself.
Already embedded in hip-hop culture and the music industry, John heard of a trade show in LA. Using buddy passes to afford the flight, John and team snuck into the show, and sold over $300,000 worth of clothes from their hotel room.
“If I wasn’t part of this network, of this system, I wouldn’t be here today,” said John.
Doing their homework is something the GAP now wishes they paid more attention to after hiring LL Cool J to produce and star in a commercial for their line of urban apparel. Here’s the video. Listen closely to the words…”For Us, By Us on the low” That’s FUBU baby!
SHARK POINT 4: Brand yourself & learn to pitch
After John left that trade show in LA with $300k worth of orders, he now needed to make $300k worth of clothes. Trapped by a lack of funds to purchase materials, equipment and hire employees, John shared his story with bank after bank in pursuit of a loan. The result? 27 rejections.
John believes this outcome was due to him not representing himself correctly. He confessed his pitch was poor, specifically because it failed to share how FUBU was helping his customers or what return an investor would look forward to through a partnership.
“When you pitch, aren’t you suppose to pitch what the people need? What’s in it for the person you’re pitching?” asked John. “Put yourself in 2-5 words. Shark Tank doesn’t invest in companies. We invest in people. The one’s that know they’re never going to stop. You are the brand. Not only when you walk into the room, but online. Are you in control?”
SHARK POINT 5: Keep swimming
So with his back against the fire his mother took out a second equity loan on her house to keep John’s passion alive. Fueled by her trust and love, John’s mother moved out and the FUBU team moved in, creating a factory in the living room, while sleeping on the floor in sleeping bags.
The team worked hard and had fun doing it. Everything seemed to be going good, until John found out he was three months late on the mortgage with only $500 left to his name. At the risk of losing the house, the FUBU mark, everything they had accomplished so far, John’s mother forced him to pivot and take a different perspective. She suggested John seek out a strategic partner. She called this OPM – Other People’s Mind Power / Money / Manufacturing / Mistakes.
John went back to Red Lobster to afford placing an ad in the newspaper in search for his very own shark. The ad was short, it was simple, and it caught the attention of Samsung who offered a deal to underwrite and distribute FUBU…if John could sell up to $5 million in product over three years. John took that deal, but instead, he sold $30 million in three months!
Now with millions in advertising backing his brand, FUBU was catapulted into the global spotlight. From conferences and mass marketing to department store deals, John had built FUBU into a multi-million dollar company. But with this attention and success, John lost focus on why he built the company to begin with.
“Don’t get stuck on what you do, when it’s really all about the customer,” said John.
Fame and fortune also had damaging effects on his family life as John lost sight of what matters most – his wife and two little girls.
“If you’ve ever done anything for money, you lost something or someone for it,” said John.
However, despite their difference and just before he was about to lose it all, it was John’s ex-wife who reminded him to love what he does, set goals, and do his homework because he is his own brand, so as long as he kept swimming, he would once again conquer the world.
This is when John pivoted in his career for the second time, turning from the fashion industry to an entrepreneur who pays it forward. John began accepting television appearances to speak about entrepreneurship. Then ABC called, and @TheSharkDaymond was born.