Bob Johnson

ventures across the United States. I sat down with him in Palm Beach to talk about his career and what he sees next for himself. So, when you became the first African American to be a billionaire, what was that like people calling you up telling you how great you are, or people calling up asking for money all the time. No, there's nothing like that, David. You know, I had run Black Entertainment Television b ET over twenty years until I

sold it to Viacom. So b ET at sort to become a business success story, and as a result of that, people begin to see me as sort of uh as an entrepreneur. It was doing something pretty pretty good at that time. And so by the time I got to where it was sold to Viacom, it was sort of expected that it would be worth something. So when you sold it to Viacom. After that, you then bought the Charlotte Bobcats, an NBA team, and you became the first African American to be an owner of a major sports

team in our country. So what was that like. Was that thrilling to own an NBA team or did you really just see it as a business venture. Well, I first saw it as the idea of being first. Uh, there's been throughout the black business history. If you were the first black to do something, you gained visibility, you gained notoriety, and you gained access to other people's particularly white business people who knew you by your reputation. So when there was a team coming up for sale in Charlotte,

I said, you know, why not be first? I had the capital from the sale of b E T to Viacom, so I said why not? And UM I decided to um make a bid and got a call from some of the business people in Charlotte to said we'd like you to be the majority owner of the team. Will be the minority owners and work with you. And so it just seemed to be the right place at the right time to do something I thought would be part

of a strategic approach to being first. So you owned the team for about eleven years, and then you sold it to a person named Michael Jordan's so, and after that you began an effort to build i'll call a small business empire. You have investments in many different areas private equity, financial services, fashion, lodging, hotels, real estate, and my own firm did something with you in private equity for a while. So is that what you're trying to do now is build a many empire if different areas

and what are your most important parts of that empire? Well, what I did when I sold b ET, I decide I wasn't going to just sit around and do nothing, and I decided that one way to sort of build value for yourself was to take your own knowledge, your own strategic vision, and deploy your capital and your brand to acquire assets that you could run with very talented people to help you do it, obviously, and align yourself with people who shared your vision and your culture about

creating what I call wealth in the black community, uh and demonstrating to the broader market that African American talent with capital and strategic partners like I did with John Malone when I started b ET, could be successful and create create value for yourself and create value for the investors. So, Um, you've been very involved in dealing with black entrepreneurship and

black business owners. Do you think today it's easier for a black entrepreneur to start a company or No, No, more easy than it was twenty years ago or thirty years ago. David, I don't think it's necessarily easier. I think there's a mindset within the white business community and to some extent in the country at large, is that this definition of equity and diversity ought to see money flowing, capital flowing into black entrepreneurs for investment and operating startups

of business. It's just not easy. It's just that there's a theory that it ought to happen. And I think if if it were easy, you would see more Bob Johnson's more, Michael George, more Magic Johnson's and Oprah Winfreys in the light. So I think it's a little bit of a misnomer to say it's easy. It is correct to say people think about it more, but do they

do more that's the problem. So in for the George Floyd murder, I thought that many people in the white business community said, Okay, we've got to do much more in getting blacks and as on the boards senior positions in corporate memory. Has that really happened or has you just talk about that? Well, David, the sad secret of that is companies, white companies have announced that they're gonna put millions of dollars into diversity in terms of black

investment business. But among the people I know, and I know a lot of people who would say, hey, I just got money from here there in other other places, it's really not happening. I saw something in the in the media that said there has been something like fifty billion dollars of pledges made, but less than five percent of that has ever been implemented. And to me, it's a real sad story because it's not happening. And I would know because no one has called me. Now, I've

been pretty successful, as you you know. The only thing I've done that with, David, and I am most proud of is the partnership I've created with Vanguard Fidelity and a Light to create a four oh one k auto portability business called uh part Portability Network whose sole purpose is to keep Black Americans reduced cash out of four oh one k account by Black Americans and low wage workers and whim I mean as Hispanic workers when they

change jobs. That those two companies, those three companies put their commitment to diversity and opportunity and closing the wealth gap in a relationship with me. And that's what I like in respect. But I can tell you the black community entrepreneurs I know are very disappointed with these what I call press release announcements with no results. So let's talk about your background. Uh, where did you grow up?

I grew up born in hippy Mississippi. If you Mississippi is a real small town, you know, one stop signing kind of town. What did your parents do? My well, they were workers. My father all his life was a worker in Mississippi. He was a lumber cutting down timber in Mississippi and a little bit of farming where he lived. And my mother was a school teacher at the you know, the small school system in Mississippi. When they migrated up north to a small town freeport A hunt them out

northwest of Chicago, they became factory workers. So you went to college where University of Illinois, Champaign, Debanda, And what did you study? History? I was a history major throughout my home. So what did you want to be. I want to be a diplomat. I want to be an ambassador diplomat. But what year did you graduate? I graduated in sixty eight. And then you went to Woodrow Wilson School at Princeton, and that's to do further diplomatic knowledge.

Had got a degree master's degree in the national affairs and again the fascination was was was history and global affairs. So you get a degree from Princeton, a graduate degree from Princeton, and all of a sudden, the US government says we're ready for you to be a diplomat. Or what happened? Well, all of a sudden they asked you, if you want to go to the Foreign Service, you have to take a test, and the test requires you to be literate and things that a kid from Hipcuem

Mississippi through Freeport, Illinois I didn't really knew about. So when they had a question, I never get this. They asked me a question. One of the questions what is Wedgewood? And they said addresser of this, I thought it was what it was addressing. It was actually you weren't familiar with Wedgwood. So ultimately you came to Washington, though, And

what did you do when you came to Washington? I came to d C with the Princeton Imperor Mater and the connections of people who had who are who are former Princeton Widgard Wilson graduates, uh, including a good friend of Jim Johnson, And so I started making the rounds people refer me to this person. I went to Senator Mondale's office, I went to Senator Kennedy's office, and everything

else that this prince prince the mafia sauspeak. And finally, somebody after I went to one of the officers referred me to CPB, the Corporation Public Broadcasting. Got a job of Corporation for Public Broadcasting for a while, changed jobs from there and went and worked for the local Urban League in Washington, d C. And from there became a lobbyist for the Cable Television Trade Association. And that's where I met all the guys in the cable industry, Ted Turner,

but most importantly John Malone. John Malone was your principal backer when you wanted to start black entertainment television. Absolutely, John, I'll never get this. I was a lobbyist. We were trying to deregulate cable. Cable was heavily regulated to protect broadcast television on the theory that broadcasts free cable was paying and if we didn't protect free television, then everybody would have to pay, which was supposedly not good for people. Well,

so my job was to go up on capital. He'll argue for the deregulation of cable so it could compete with over the air television. And so I met John Malone and he said, Bob, if you ever have an idea, why don't you come out to Denver and talk to me. I said, yeah, John, I'll do it. And that's where my idea starting black entertainment television came from. And I took John up on his invitation and went out to Denver and made my pitch about getting me financing for

b ET. So John said to me, Bob, here's what I'll do. How much you need to start this? I said, I need half a million dollars five. He said, Bob, here's what I'm gonna do. I'm gonna buy of your company for a hundred and eighty uh and I'm a lone, you a three twenty. That's your five thousand and John said, under that deal, Bob, you will be eighty percent on it and I'll be twenty. Is that a deal? I said, John,

that's a deal. What Malone didn't know David if he reversed to them and said I'll be eighty and Bob you will be twenty. I said, John, that's a go. He didn't say that. So he kept putting money into b et E while I was growing, never put it in his equity, put it in his debt, and the dad got paid back. And I did asked him, say, John, why did you put it in his debt when you could have put his equen you all more BT? He said, Bob, I always knew you would work harder for yourself than

you would for me. So John never sold a share b et. So when I sold BT to buy account for approximately three apes seven three almost three billion dollars, John's one eight of equity, of course got paid back, netted him over seven hundred million dollars in biacount paper because we did a stock for stock deep Well, what was the theory behind b ET that African Americans should have a cable channel devoted to programs that would be appealing to them in particular. Was that what you were

trying to do? Yeah, Well, the theory was what cable was offering to the community, basically diversity because once you just put it once, our c A put a satellite in the sky that could orbit on a geosynchronous orbit that allowed him to send signals all around to every cable head in Cable became a competitor for television in the big markets, and in order to do that, they had to get some big cities who by that time in the eighties had black city council members wanted to

and maybe a black mayor. So while they were offering programming to everybody else, you know, whether it's MTV or CNN or ESPN, the black city council member was saying, you want this franchise, what are you offering from my community? And that's where b ET became sort of a must carry product to get into cable and the diversity part of it grow. But b ET was really an extension of what John Johnson did with E any magazine, except

his was printed and I was video. So how many years did you operate p e T before your sold to bicom years you sold for roughly three billion dollars holding me so, in hindsight, had you held on longer, would it be worth more today or were worth less today? Because the cable world has changed so much, it would be, in my opinion less today because once streaming came along and the technology allowed people to have streaming wherever, they could carry content on your phone, on your laptop, in

your home, wherever you go. It changed the paradigm of cable and it allowed people to sort of pick and choose and then olive carte way what they wanted to watch. If you only wanted to watch Netflix, you just get Netflix cable. You were paying for a bundle even though you didn't watch all the channels, so some people were paying for If you were in a sports fan, you're paying thirty cents thirty cents whatever it is now for ESPN. But if you never watch the Infant, you had to

pay for it because it's part of a bundle. So you then bought as we mentioned earlier, the Charlotte Bobcats a new team. Um, you didn't know much about running a basketball team, I assume. So you've brought in a guy named Michael Joe. How do you tell Michael Jordan he doesn't know much about basketball? If the thing isn't working out perfectly? Can you say, Michael, I played in

grade school and I know something about basketball. How do you tell Michael Jordan's things aren't working perfectly when it If it doesn't work perfectly, you don't, okay, So just let him run the team, and you basically owned it. He more or less was the manager of it. He was he was the general manager of it. And he decided on who he's gonna hire his coach, He decided on what players here going to draft, and he decided on you know, how the team would be be run.

I was the pay and the payer in this game. So when you sold your NBA team, the Charlotte Bobcats, the price of NBA teams had not risen to the billion dollar range. Any regrets about selling it when you sold it, Oh, definitely regrets. I tell Michael about that all the time. But nobody could have predicted that Don Sterling would say what he said about black people, and the led to the NBA commissioner to say we've got

a huge racial problem. If we're gonna keep down Sterling as an owner, and he basically forced Downald Sterling out. But being forced out and you walk away with a two billion dollars, you know a lot of people would like to be forced out a team for that price, you know. So that was it. But uh, Michael was

always my first choice to sell the team. He and I have been friends, see, you know, fifteen years before I even owned the team really, so you know, I wanted if anybody I wanted to sell the team too, if I was forced to sell with me to Michael. As we talked today, there's rumors that the Washington football team now called the Commanders might be sold. And h

NFL teams are pretty expensive. But any interest in getting back into sports, you're a native of Washington or non native, but you've lived there for a long time, that's probably a check too far. I mean, because these these teams are so rich, and I mean, if you could get one, it's a little bit I would call an NFL saying about the closest thing to a license to print money that you can think of, But you gotta really pay up for it because it's a it's a great sport asset.

It's one of the best, I would say in the world, maybe maybe better than some of the hockey teams, although pretty close. To a young black entrepreneur who says, I want to be the next Bob Johnson, what advice would you give to that person about how to build a business, empire and be successful. I do this. I give this answer all the time. The first and foremost thing, you gotta believe in yourself. You gotta believe in yourself that

you deserve the opportunity to be successful. And the second thing, you gotta understand that nobody does anything alone. You've got to find talented people that you can convince to go on that voyage with your order to share your vision. And you gotta make sure that they participate in your upside. You gotta give them a stake in the game to make sure make them feel like you have their interests and the interests of their family close at heart. And if you believe that and you work hard, they will

work hard with you. And today, do you think for a young Bob Johnson, they're starting out once to build a company. It's easier for an African American to get capital or no easier honestly than it was years ago. Easier in the sense that there's a belief that there's should be more diversity of opportunity, whether it's diversity opportunity is sponsored by the government or diversity of opportunity in the form of e s g. That corporations some of

them give lip service too. So the theory is if you go and ask someone to be your partner, who they're more inclined to give you a hearing. But the ability to get the right person in the right amount of capital is still very hard. My relationship with John Malone, and we still have it today, was extremely unique. I and imagine that one out of a thousand black entrepreneurs kids today could find them a John Malone. You've been

involved advising presidential candidates, I presume presidents as well. Um, do you ever have any interest in serving in a senior position in the federal government or running for office? Absolutely, unequivocally no. The aggravation factor isn't worth it. It's the aggravation factor. But it's more importantly is I don't believe there's any integrity in it. So you do give money to politicians though, because that's the system, but you it's

a part of the game. I think, to be honest, I think there's a need for a multi party system in the US to give more people a choice about where they can throw their voter support and their political support, but also to cause the country to try to come together by having everybody have a role in deciding what is in the long term best interest of the country.

I've often believe that Black Americans as a people and as a voting block should adopt the same position that the original founders of the Congressional Black Caucus had in nineteen early seven nineteen seventy. Their philosophy was enunciated like this, Black Americans should have no permanent friends, no permanent enemies,

just permanent interests. And if we voted like that, we would be able to leverage that block because it's a consistent block in our long term best interests, rather than be addicted to one party and ignored by the other party. Do you have government officials, members of Congress, or people

in the White House ever asking you for advice these days? Well, I don't think they asked so much as I try to go to them to suggest to them what they should consider particularly as it relates to what I call I have a formula a belief I called their business illusions to social problems. I'm not a big proponent of government handouts. I've never been in favor of government subsidies.

I like the idea of government providing a pathway through regulatory freedom and balance to allow companies to create it. But they got to be some focus on economic benefits to in my opinion, to the black community. And for example, real quickly, I've got members of the Congressional Black Caucus to support something I call the Boostack. The Boostack very

simple was this. It would give investors in black businesses a tax preference if they would invest in these business I called in legislation I was introduced by a Congressman and food made from Baltimore. Would put thirty billion of treasury money aside for preferences for myself. For you who would go to a company and say I'm gonna invest in your business X number of dollars. When you exit that business or do a sale of that business, I will get a preference on my capital gains and the

whole idea. It was not a mandate then require it was only voluntarily to me, that's better than all of these pledges that are going around there are not being fact implemented. And and that's the kind of way I got the same way I did that with the auto portability. So you're one of the best known black entrepreneurs and business leaders in the United States and one of the wealthiest. Do you face discrimination today in your daily lives or in your your business career? Do you still think you're

being discriminated against? You think you're not in that situation others are, but you're so well known you don't face that discrimination. Uh. No, you face discrimination in terms of what I call uh bias discrimination where they people just don't they recognize you as black first, Bob Johnson second, and wealthy Bob Johnson third. So when you get in

that situation, you'll find cases like this. A clear example. Uh, I could be going I could go to a restaurant and if I'm standing outside waiting to to go in, after I'm giving my car to be park, someone will come up to me and asked me to get their car. What do you say when that happens? Can I take it and keep it? But no, I mean the thing is they see a black man standing by parking valet parking. Their intellectual bias assumes one, you can't afford to be

at that restaurant. To you're standing next to valet of parking, you must be a parking lottitides. So today, Um, as you look at the United States economy, are you worried that we're heading into a recession of some type and that we're hurt not only black businesses but all businesses. I think the economy has to have a recession in front of it until we stopped the huge amount of fiscal spending that comes out of the government. And I see nothing in the government that will change that trajectory

on spending. Uh. And and that's the part where I think we've got the faces a recession because as you keep dumping money and chasing fewer goods, it's probably the textbook description of your headed towards the recession, and or worse than that, you headed to something called the variation that called stagflation, where you got you got spending going up and you've got productivity going down. Because it puts you in a problem. So yeah, I think until something

changes on that equation. Yeah, did your parents live to see your success as a business leader. They did. In terms of b et, they didn't. I still owned that I hadn't sold it, and I hadn't done all the other things that they tell you you're terrific. We knew you were going to be successful, or they said, uh, you know, you're just the same as our other nine children. That one my mother always used to say. Somebody say, oh, aren't you proud of your son, Bob, she'd say, I

love all my children. That was her thing. Thanks for listening to hear more of my interviews. You can subscribe and download my podcast on Spotify, Apple, or wherever you listen.