Daymond John is on a mission to breed sharks.
The founder, president, and chief executive officer of FUBU (For Us, By Us) and one of the stars of ABC’s Shark Tank spoke at the Urban League of Chattanooga’s 1st Annual Entreprenuer Power Luncheon Tuesday, March 26 about how to succeed in business.
John did his homework before coming to Chattanooga. As he opened the sold out event at the Chattanoogan Hotel, he said, “I’m here to do two things. One, pack my suitcase full of Little Debbies and Jack Daniels; and two, to give you my five Shark Points.”
For the next hour, John delivered an dynamic, humorous, and sometimes emotional account of his life and his part in helping to revolutionize the sportswear industry in the 1990s. With each anecdote came a lesson about becoming a shark.
“There’s blood in the water in Chattanooga,” he said as he looked over the packed ballroom. “I’m here to help you become a shark or remain a shark.”
John was born in the New York City borough of Brooklyn but spent his childhood in the Hollis neighborhood of Queens during the 1970s. An only child, he grew up in a single-parent household headed by his mother, a stewardess for American Airlines who often held down more than one job.
“Life happened when I was ten. My parents divorced and I became the man of the house. I shoveled snow, I raked leaves, I did what I had to do,” John said.
John’s first foray into the apparel market came when he wanted a tie-top hat and the price put him off. He asked his mother to teach him how to use a sewing machine and began making the unique hats in the morning and then selling them on the streets of Queens in the evening.
Through his connections, John became a roadie on hip hop tours. As he watched the crowds at the concerts swell from 100 to 15,000, he did his first Shark Point: he set a goal.
“One night, I watched Run DMC take the stage. Prior to that, I didn’t know what I wanted to do. My life was black and white. The moment they started to perform and I saw the crowd moving in unison, my life turned to technicolor. I had to live and die in ... [the hip hop] industry. I didn’t know how I was going to do it, but I set a goal,” he said.
While working as a roadie and a waiter at Red Lobster, John learned to do his second Shark Point: his homework.
Boot maker Timberland’s products had become popular in the hip hop community. But the company didn’t understand the market, and made a grevious error by publicly stating “We don’t sell our boots to drug dealers.” The statement stunned John.
“When you loved hip hop, you bought several boots of different colors, and if you scuffed a pair, you threw it out. I was buying three pairs of Timberland boots a month, and they essentially called me a drug dealer. They ticked off a kid who loved their brand,” he said.
In response, John studied the market and then came up with the four letters that would make people proud to wear his clothes, created the distinctive FUBU logo, and began to sew it on hockey jerseys, sweatshirts, and t-shirts. One day in 1992, John and a friend sold $800 worth of hats, and realized their idea had potential.
“I remember counting the money on the way home. As an entrepreneur, I’d taken the next affordable step. I’d made a product with my own hands, and I’d sold it with my own hands. I was on to something,” John said.
John lured additional friends into the business and asked an old neighborhood friend, L.L. Cool J, to wear a t-shirt in a photograph for a FUBU promotional campaign in 1993. “He said our clothes didn’t match his sneakers, but he agreed to give us a shot because someone had given him a shot,” John said. “I took that picture and showed it to every clothing designer and retailer in the magazines.”
FUBU officially emerged in 1994 when John and his partners traveled to an industry trade show in Las Vegas. Buyers liked the distinctive cut and vibrantly colored sportswear, and John and his friends returned to Queens with $350,000 worth of orders. There was just one problem.
“I had no access to capital. Twenty-seven banks turned me down. Actually, I was turned down at 25 banks, and two other banks heard I was looking for money and told me to not come by,” John said.
To acquire start-up capital, John and his mother mortgaged the home they collectively owned for $100,000. Even more remarkably, she moved out so John and his friends could use the home as a factory.
As he recalled this time, John offered his third Shark Point: Amore. “We loved what we were doing,” he said.
FUBU soon had a contract with New York City-based department store chain Macy’s, and expanded its line to include jeans and outerwear. A distribution deal with Korean Electronics manufacturer Samsung allowed FUBU’s designs to be manufacturered and delivered on a massive scale. By 1998, John guided the company to a staggering $350 million in revenues, placing it in the same stratosphere as Donna Karan New York and Tommy Hilfiger.
Then life happened again.
“I had two baby girls that meant the world to me and a young wife. And they started to see me more on TV than at home. So, I lost them. As entrepreneurs, why do we do what we do? To take care of our families,” John said.
The experience changed John’s perspective. Over the last 16 years, John has evolved into more than a fashion mogul.
“I started to give back. I wanted to teach people not just about being an entrepreneur, but about knowing why you’re one. If you’re not happy, and the people you love aren’t happy, your business will fail,” he said.
In 2007, John penned his first book, Display of Power, which Library Journal named one of the best books of 2007. He then wrote a second book, The Brand Within, the message of which sums up his fourth Shark Point: Remember you are the brand.
“We need to be able to boil ourselves down to two to five words: White Castle – What you crave; Apple – Think different; Nike – Just do it; TNT – We know drama; TBS – Very funny. If you don’t know what your words stand for, then you leave it up to other people to figure it out,” he said.
John also appeared on any show, large or small, that would let him to talk about his methods for achieving financial success and share his tips for negotiating, boosting sales, improving employee morale, increasing productivity, and optimizing staff talents.
“Everyone asks me about the art of pitching. You’ve got to figure out what’s in it for the person you’re pitching to. When someone says, ‘I want to start a company, and I’m going to make a million dollars and help kids in Africa,’ there’s nothing in it for me. I have companies I want to start. I have charities I want to support,” John said.
While John was on the television show circuit, he caught the eye of Mark Burnett, creator of Survivor, Celebrity Apprentice, The Voice, and an upcoming show called Shark Tank. Burnett offered him one of the chairs on the latter series. John initially turned down the opportunity because the producers wouldn’t let him make good on his promise to appear in a cameo on another show, but things eventually worked out, allowing John to join the cast.
“You know why they asked me to be on Shark Tank?” John asked. “Because they needed a token smart person.”
In closing, John shared his final Shark Point: Keep swimming. “It’s simple, but complicated,” he said. “The end of every race is the beginning of you.”