Mark Cuban

didn't care if he overpaid for it. And David Rubinstein, host of the David Rubinstein Show Peer to Peer Conversations, begins here by kind of going through all of Cubans successes. Let's listen in Mark, let me ask you this um you have at an early age made some money, and then you made an enormous amount of money when you sold broadcast dot Com to Yahoo, made you know, over a billion dollars, and then you bought a basketball team. Then you have a Shark Tank series that's very successful,

one Emmy award. You're well regarded by entrepreneurs all over the world. Presidents the United States call you for advice. What is wrong with this life? I mean, there's something about your life. It isn't perfect. I have kids. I have a sixteen year old daughter and a fourteen year old daughter. That's all any parent needs to hear it doesn't matter what you have or what you don't have.

The minute my oldest daughter turned fifteen, my wife and I got really stupid, lost half our brain capacity and are beholden to our kids for their with It's you know, being a parent is a challenge and um it's very humbling as ever as everybody knows. Well. I have three children as well, and I agree. So you grew up in Pittsburgh, but not from a wealthy and a wealthy family, is that right? No? My my dad did a poultry on cars, my mom did our jobs. He went to

University of Pittsburgh. I was always into business, just how I've been since as long as I can remember. And my high school wouldn't let me take business classes, and so as a as a junior, as a sophomore junior, there were only senior level economics classes, and so just despite them, I started taking classes at night and my junior year and then dropped out of high school for my senior year, went to the University of Pittsburgh and took classes there. But then you went to Indiana University.

Why didn't you go to Indiana Because pitt didn't have a full undergrad business program. And I saw a list of the top ten undergrad programs and picked out the cheapest one, and it was Indiana and I went there site unseen. Now. When you were there, you started a bar and it was a very successful bar, well kind of successful. So my I always like my parents to pay for my school. My dad sent me twenty bucks a month, and I had to figure out how to

pay for things one way or the other. Um. Sometimes I was able to get scholarships, other times, you know, just saving money from jobs I had. Other times it was a hustle. So when you graduated, you moved to Dallas. Why did you move to Dallas. I had a bunch of buddies down there that we're living that had gone to Indiana and moved to Dallas. And I was talking to one, my buddy, Greg Shipper, on the phone and he's like, Mark, the weather is great, the women are beautiful,

the economy is good. And I'm like, wait, back up, I'm coming. But you ultimately start today kind of technology consulting firm. Is that what it was? Well, what happened was when I first got there and I was sleeping in the what we called at the hill hotel with

my five roommates. Um, I got a job at night working as a bartender slash far back, and then during the day I applied for jobs and finally got a job selling software at this company called Your Business Software, which I did for nine months until I got fired, and so I started my own company, micro Solutions, which at the time was when we started, was just a PC consulting company. And you ultimately sold that for a

couple of million dollars or or so well. I sold it seven years later for six million dollars, of which a million went to all the employees, two million went to a partner that I brought in, and two million came to me and then some Texas. All right, so you've got two million dollars, which is a king's ransom in those days for somebody your age. Right, Yeah, I was,

you know, twenty nine. Actually by the time I closed, I was thirty and so I just thought I was the luckiest guy and the richest guy in the world. This is ninety nine. In my mind, I was just gonna take time off my driving force was. I wanted to retire by the time I was thirty five, because you know, one thing that my dad had always really you know, taught me and and really emphasized me is the one asset you can never own or get back his time, and so, you know, enjoy the time while

you're young, take advantage of it. You know, his job was backbreaking. He lost an eye in an accident at work. You know, he did upholstery, and a stable broke and and and destroyed his his right eye, and and so, you know, and he would take me to work sometimes and make me sweep the floor because he wanted me to see the type of work he did not want me to do. And so when I you know, my goal was to retire so I can just enjoy my life.

And so we sold microsolutions, and I literally retired by the lifetime pass and American Airlines just traveled the world and partied like a rock star, um, you know, for the next few years. So after you retired at the age of thirty or so, he ultimately came up with an idea which was to listen to Indiana University basketball games on I guess a kind of streaming process is that. Right by the time I sold micro solutions, you know, I was really tech heavy. I mean, I we were

one of the largest systems integrators. I taught myself the program. We did local and wide area network, so I got to understand networking and technology really well. I made a lot of money actually afterwards, just trading technology stocks because

back then it was so much easier, you know. I'd call up Rick Sherlan who had Goldman Sachs or you know Lee Ainsley before he was even at Maverick Capital, and we would just swap ideas and I knew more about all the details of tech and what worked and what did work, and what companies were doing well, and ended up making tens of millions of dollars doing that. I then got together with my buddy Todd Wagner, who I knew from Indiana. He actually came to me with

the idea. He was like, this new internet thing. You understand technology? Is there any way that we can listen to Indiana basketball um using the Internet? And I was like, that's a cool idea. And this was early, and I'm like, let's try to figure it out. And literally starting with a Packard Bell PC that I bought for like four grand, three or four grand at best Buy or something or comp Usa in the second bedroom in my house. I just sat there and tried to figure out how we

would do this. And it went from you know, ten people the first week to a hundred to a thousand, to thousands, and we knew we had something within thirty days. But you took the company public, Is that right? Yeah? July eighteenth and n and the stock zoomed. Uh. I hate to use the word zoom, but uh, it went up a lot. Yeah, the largest one day, largest first day I p O bump in the history of the

stock market at the time. Right. So, did you say I'm gonna build this company forever and just keep growing or does somebody come along and say I'll buy it from you? Well, the goal was to dominate because you know, we called it netcasting at the time, and this was pre YouTube, and literally we were the dominant force and streaming. You know, we had rights to all the major sports leagues.

We had you know, hundreds of radio stations, um by We were doing video as well, and we bought ten percent of what turned out to be lions Gate Studios. We bought you know, video rights to all these libraries and so you know, we're making acquisitions. We really were on the path to dominate UM, and we had UM. Yahoo had invested in us the previous year and came to us and said, you know, we want to buy you. We need to get into multimedia, and you're the leader.

Let's combined forces. And they made us an offer we couldn't refuse. They offered I think roughly fire or you ultimately the five point seven billion dollars in points. So you didn't own all five point seven billion yourself. I guess you had some outside investors and other people, but you have with about thirty of it. It was taxable the way it was structured ended up being taxable on the on the games. But um, yeah, it turned out

to it turned out well. Yeah, here's the question I've always had, and uh, why is it that you had the foresight or how did you have the foresight to sell the Yahoo stock at a time when the markets were going up, people thought, yeah, who would be going up forever? You sold your Yahoo stock and cashed out before yeah who went down? By Well I actually hedged

it right. So remember I mentioned that I had traded stocks between the time I saw my first company did really, really, really well, and I watched complete industries just skyrocket and then collapse. You know, there were there were companies when Dell Computer went public, there there were ten other PC companies that crashed and burn. I've seen it multiple times. And I made money going up, and I made money shorting them on the way down. And so I was very clear to Golden Sacks at the time that I

wanted to to do a hedge. And so the first thing I did because I had a six month moratorium where I couldn't do anything, and so I took literally almost every penny. I had twenty some million dollars um and but um puts on an index and Internet index, and I lost all my money on that on that hedge, literally just all gone. Which was good because that got me to the point where Yahoo was still a high flyer and I sold covered calls and bought puts over the next three years, and that hedge saved me and

actually made me money. But you you lost the first twenty million. Yep, what did your wife say? Oh No, I wasn't married at the time, and it was it was, you know, but the whole it was timed out right. So I got through the six months, even though I

lost the money on that hedge. We already knew approximately, you know, based off of where the Yahoo stock was, how I'd be able to and what the volatility levels were, how I was gonna be able to sell calls on my Yahoo stock and use that money to buy UM buy puts on UM the Yahoo stock, and when the stock apps, my poots were worth a fortune. You bought the Dallas basketball team, the Mavericks, for roughly two million dollars, which at the time was thought to be a lot

of money. Today it's a fraction of what it's worth. Why what propelled you to buy a basketball team? So I've always been a basketball junkie as long as I can remember, And so I was the Dallas Mavericks season ticket holder. And during that time that I owned season tickets, they were awful. I mean all of the nineties. They were voted the worst professional sports franchise of the nineties.

And I'll never forget. It was the thousand season open opener and we're undefeated, right, I mean, I'm a season ticket holder, I'm decided to go to the game. It wasn't a sell out. There was no energy in the crowd. And you know, I just sold broadcast dot Com and I thought I can do better than this, and then it donned to meet. Wait, I can put my money where my mouth is. Finally, and you know, not just

say it, but enquire about buying it. And from late October when it first the concept first him up um, it took till January four to close the deal. And honestly, I didn't even care about price. They told me here's the price. I said yes because realized that I still had my hedge on for Yahoo and I still benefited when Yahoo stock went up. So there were days still

then when this is before the Internet bubble collapse. I remember being on the team bus um in January talking to the coaches and I'm like, why did you spend so much money? This is the worst franchise in all the NBA. The you know, the revenues are lower than everybody else. I'm like, let me, you know, let me just show you the price of y'allho It went up a hundred dollars or two hundred dollars today and that

paid for the whole team. So when you when you buy a basketball team and get to play with the players, can you work out with them or they don't? Really I like you to do that up until obviously the changes with this season. Before every home game, I would go,

I go on the court and get shots up. There's nothing, you know, crazier and to me as a basketball a junkie, exciting that to have, you know, an arena and you're out there shooting, and you know, there were a lot of times over the years where I play one on one with the players, or I shoot for money with the players and shoot threes, and they don't. They don't ease up when you're when you're playing with them, they don't ease up a little bit to let you win

because you're the owner. No, hell no, these are you know, because realize the other side of it. If I beat them, they'll never hear the end of it. And then you know, there's just no way, no way. Now in your early the years as an owner, you're owning team now for twenty years, and the early years of the owner and maybe even recently, you've been um find a lot by the league, maybe more than any other owner for criticizing the referees, criticizing the league. Um, what was all that about?

Did you do that on purpose because you wanted attention or did you just couldn't constrain yourself. No, it was because I wanted to approve the league. I mean when I first got to the NBA, they didn't know what product, what their product was. They always thought that we sold basketball, and I was very clear to them that we don't

sell basketball. We sell experiences. You know, if you think about the sporting events that you've gone to, you know, you don't remember the score, the touchdowns, the dunks, the jumpers. You you remember who you were with, you know, the first time a parent took you, the first time you went with you know, your friends, or you know the time you know you had your your buddy's bachelor party or the first date there. They didn't realize that's what

we sold. And so you know, it took a lot of you know, aggression, I guess from both sides, you know, a lot of a lot of going back and forth with then Commissioner David Stern, you know. But to his credit, um, while he had to find me, you know, privately, he would agree with me on a lot of those things, you know, And so to me, I was just being a good partner, even though a lot of my partners didn't really appreciate it. Well, in the early days, you

were a very young owner. Now you have an owner for twenty years, you may be one of the more experienced owners. Do you get people now listening to you more than they did twenty years ago? Yeah, they're used to me. Like you said, I'm one of the longer term term owners, and so you know, I'll still raise hell and and and speak up. But now they're kind

of used to me, and they've changed a lot. A lot of things have changed, you know, whether how we approach officiating, to how we market our games, to what we do for broadcasts. Um, there's just so much that has changed over the twenty years for the better. Now, the NBA is playing in bubble in Orlando. How is that working out? And are you, um surprised and it's worked out reasonably well or you think it can be done better or what what your view? I mean, it's

it's shocking how well it's gone. I mean, there's so much risk, you know, just bringing such a large group of people, thousands of people together in one area, um, and you know, and to have zero cases, that's stunning, stunning.

I mean literally were you know, we were concerned about what might happen you know, because primarily you're talking about population and the twenty somethings, and as you can see outside the bubble, just you know, people twenty somethings in any city, they're not the most conscientious when it comes to wearing masks and so following social distancing and other protocols.

And so you know, to to our players and staff and Disney and the n b A, to their credit, everybody has been really, really careful and it's paid off. Dirk Nawinski was one of your star players for want a long time of European. You have a couple of other Europeans now who are stars as well. Um, one of them, like you traded you got from the New York Uh next I think uh in a trade that President Trump UH commended you on that I recall. So, um, let me ask you this, So, when are you going

to recruit more Jewish basketball players in the NBA. Yeah, I don't care if they're from Mars, right, you know, if they wear a kimba during the game, I'm fine with that too. I don't care. You know, just what ever ever ever works, I just want to win. You know, you have a very much of an every man image where you're like an average Joe. You're a basketball fan, so worth. But the truth is you have a lot of technology background a lot of uh sophisticated financial backgrounds.

So you haven't kind of portrayed that the way. You know, Bill Gates as seen as a technology guy, and maybe Jeff Bezos is. But you have a lot of technology knowledge which you don't kind of advertise as much, but clearly you you know the technology work at the time. Right when I worked at your business software before I got fired, it became very clear to me that when it came to technology, there were two people, two types of people. There are the people who created the technology,

and then there was everybody else. And I was tied for with everybody else in terms of knowledge of any new technology that came out. And if I put in the time and you know, put in the effort to learn about that technology, no matter what it was, I was going to move ahead of the maybe never catch the person or the people who created the tech, but I'd be ahead of everybody else. And that's always been my mantra and I tried to stick to that today as you are talking to us today, you you have

many different businesses. But you have a big investment business, and you've said publicly that you're a gigantic investor in Amazon and Netflix and other companies. And do you just have advisors that help advise you on these or you just make your own decisions? Pretty much make my own decisions. Yeah, I mean I used to trade, as mentioned, Um, I used to trade a lot. I used to be very

very active as a trader. And you know back you know, back in the nineties and early two thousands, there was a lot less money chasing more stocks, and now there's a lot more money chasing fewer stocks. So, um, it's harder to trade and be successful. So I just stick to the companies I believe in. You know, I've owned Netflix since it was fifty and and Amazon I was mine between five hundred and seven hundred and actually bought

some more in the high thousands, just under two thousand. UM. But I've got some scattered things, you know, beyond that that I've owned over the years that I've held on too. But I don't. I no longer trade. You know that fed put is strong that that you know that fed um inflation of financial assets kind of gives us a tail wind now COVID you have said has changed the world in terms of opportunities. Uh, it's obviously hurt people,

but it's obviously helped people who are entrepreneurial. So you've said, this is a good time to actually figure out new businesses, new areas of business. Is that fair statement? Yeah, you know, it's so unfortunate, but it's true. I mean, you know, we've heard Warren Buffett say, you know, by when there's blood in the streets, and it's almost analogous here. So many small businesses are closing, so many you know, retail stores are closing malls or are you know, going bankrupt um.

Companies that are unable to transition to to selling digitally or or really taking a full advantage of e commerce are struggling. Big companies don't understand, don't really aren't sure about how to protect our legacy businesses. That type of uncertainty creates a lot of opportunity, and combine that with people becoming far more comfortable with purchasing online and living

a digital lifestyle. I think there's a lot of unique opportunities that are available to people who who who are creative, who have a vision for the future, I think, you know, ten years, we'll look back and they'll be ten thirty world class companies that were created by people who we probably think are thinking are crazy right about now. So you had a relationship with President Trump at one point,

I think when he was first thinking and running. This was after he announced and thinking he had no chance to win whatsoever. Um, I'm made a public statement saying I think Donald Trump is the best thing to ever

happen to politics. He's not a traditional politician, and he says what's on his mind, and that got picked up everywhere, and I became his new best friend, and so he would call me all the time, all the time, um, and just you know, that's who he is until I said one day that I didn't think he was qualified, and then it was all downhill from the So he never invited you to the White House. No, actually he did recently, but you know, everything Donald Trump touches, you know,

turns into a mess. So I didn't accept the offer. Now you've said you might consider running for president. In fact, you had a poster, look at it. Why did you decide not to run for president this time? Primarily because my family said no, I mean, you can't you know, given the nastiness of politics um right now and just the hate and the social media destructiveness, you know, your family has got to really be up for it. Um.

And so that was the primary reason. And the secondary reason was in in the polling that I did do, I couldn't get more than of the boats. I could dominate with independence, but I couldn't, you know, pull enough Republicans or Democrats from Biden or Trump. Would you consider running in the future for president? I hope not. You know. The only reason I considered it now is just because things are so partisan and people are putting party over country.

And I thought, as an independent and somebody who you know, was not dogmatic about anything for that matter, except trying to serve the American people, that the timing might have been good, um, but it's not my ultimate dream job. So if somebody's watching this and says, all right, I want to be like Mark Cuban, I want to be a leader in many different areas, be successful. What would you say are that one or two or three traits

that are necessary to be a successful leader. Find something that you love to do and be great at it. You know, most people the one thing in life, you can control was your effort. And most people don't put in the effort. They think it comes to them and it doesn't. As you know, you know, there there's lots of competition on no matter what you choose, and you have just got to put in the effort behind you. It looks like it's one of a replica of a

basketball championship trophy, not a replica. That's that's the real deal. That's the that's the real deal, all right. So you look like you need another one to match it up? Here? Are you hopeful and of getting another one someday? Oh? Absolutely, you know, hopefully this year. Um, but yeah, that's the goal. With the MAVs. You knows, there's one winner and twenty nine people tied for last place in the NBA and this one is almost ten years old. So Larry O'Brien

back there, needs some needs some friends. And that was billionaire Mark Cuban with David Rubinstein, host of The David Rubinstein Show, Peer to Peer Conversations. And that's it for Bloomberg Best. I'm at Baxter and Dime, Denise Spelly Green and this is Bloomberg