You’ve seen him on Shark Tank. And in the media, sat on his private jet. Or yelling support at his basketball team the Dallas Mavericks. But I wanted to get to know Mark Cuban better. I was curious to find out what, if anything, scares this 6’3″ entrepreneur. And I wanted to know what kept him motivated when he was broke and sleeping on the floor of his friends apartment. Most of all I wanted to understand the mindset that turns an ordinary, middle class boy into a billionaire….
Angel: So Mark, I want to go back to the beginning. How does a guy who ends up owning the Dallas Mavericks start out. Have you always been a huge sports fan?
Mark: Yeah, I’ve always been into sports, for as long as I can remember. I played baseball and basketball growing up, and in college I took up and played rugby. Then I continued playing rugby pretty much up until I got my hip replaced.
Angel: So you were pretty athletic, does that mean you were one of the cool kids?
Mark: I definitely wasn’t one of the cool kids. I just had my group of friends and we stuck together. We weren’t unique or special in any way. I would say we were confident intellectually, but we definitely weren’t the kids going out on dates or being very social. We kept to ourselves. In class, I did OK with my grades, mostly B’s and A’s. But I wasn’t the class clown or always raising my hand or anything like that. Just pretty normal.
Angel: How did your school life compare to home life. What was the Cuban household like?
Mark: We were middle class, so we never suffered, we never went hungry, but we certainly were never frivolous either. I got yelled out if I left lights on or took too long in the shower. And going out to eat was a special family occasion. We watched what we spent, but we were never uncomfortable.
Angel: How did you feel about that level of family income. Were you content or did you have bigger dreams?
Mark: I really didn’t know one way or the other. I had my own dreams and goals, I wanted to start and run my own businesses. I wanted to be independently wealthy, but it wasn’t in relationship to my parents at all. I knew I would have to take care of myself, I wouldn’t depend on anyone else to support me. I think that motivated me more than anything.
Angel: You mentioned being yelled at when you left the lights on. I’m sure some of these phrases we hear growing up have a profound effect on how we think about money. Can you remember any others?
Mark: Mostly “when you have your own money you can buy whatever you want, but until then you get what you get”.
Angel: Tell me about the young Mark Cuban, how did the empire building begin?
Mark: I started my first business at age 12, selling garbage bags, I made enough money to buy some tennis shoes. I also started a bar, Motley’s Pub, when I wasn’t even of legal drinking age the summer before my senior year at Indiana University. It was great until we got busted for letting a 16-year-old win a wet T-shirt contest. (I swear I checked her ID, and it was good!). Nothing was over the top great or horrible. Everything was just me hustling and working hard.
Angel: What was your motivation back then?
Mark: I liked doing things and taking the lead on ideas and turning them into businesses. Whether it was collecting stamps or baseball cards. If I could find a business angle, I would. If I could make money selling anything, I would try to make money selling.
Angel: What important lessons did those early attempts teach you?
Mark: That if I was fair to people, worked hard, under promised and over delivered, I would be successful.
Angel: I read that you’d drive around looking at big, expensive houses. Telling yourself that one day you’d live in a house like that. Tell me about that. Did it help? Did it give you a clear goal to shoot for?
Mark: Absolutely it helped. I don’t know that it gave me a goal, but I would tell myself that there were a lot of really big houses. If there were a lot of them, that meant there were a lot of people making a lot of money. If there were a lot of people that were successful, then some of them must have worked their way up like I did. That if I worked hard, I could own a house just like this. It was motivation more than anything. If they could do it, I could do it. I just had to stay focused and work hard.
Angel: At the tender age of 23 with no money and no job experience, you set off for Dallas in your clapped out ’77 Fiat. What sparked your decision to move? And what did your family and friends think about that decision?
Mark: I didn’t ask my family. I told them. I had some buddies from college who said the weather was great, the women were hot and so was the economy. I didn’t have a job, so I figured Dallas was as good a place as any.
Angel: So, you arrived in Dallas and moved into a run-down, already over crowded house. You slept on the floor, with nowhere to store your stuff, and little money to live off. What got you through those tough times? Did you ever think about packing it all in and driving home?
Mark: I never thought of packing it up and moving home. Not one single time. I just knew I had to figure it out. The only person I would depend on was me. I wasn’t always optimistic. There were times when I got scared. I was broke. I had no job. But I kept on pushing. I wasn’t going to quit. After all I had nothing to lose. All I had was what I had and it wasn’t much.
Angel: So you’re toughing it out. You’re living off happy hour bar food and you start putting on weight. This doesn’t sound like a period where you’re going to be looking and feeling at your best. But you still have to get out there and face the world. What was the impact of that?
Mark: It didn’t really impact me in business, beyond the fact I probably looked like a fool because I didn’t fit in any of my clothes. But once I got that first job at Your Business Software and could afford some 2 for 99 dollar suits, it allowed me to join a gym and that really helped on the weight front.
Angel: Can you pinpoint a time where you felt like you turned a corner and struggling Mark Cuban became successful Mark Cuban?
Mark: No, there wasn’t a time or inflection point. I don’t think to this day there is. I have more wealth, obviously, but even now, every business is a competition, a challenge and I’m always fearful of whether or not I can continue to excel and that motivates me.
Angel: So the challenge motivates you, but what else have you discovered about yourself along the way. There have to be other skills that place you above and beyond average performers?
Mark: I think I have a few skills that work for me. I can sell. I can understand market places and I’m very good at looking at technology and applying it to businesses and figuring out what direction the technology will go.
I did it with MicroSolutions when we started selling Local Area Networks long before all but 3 or 4 companies. I did it with AudioNet when we immediately went to streaming unique events, whether sports or business and rather than being ad driven we were business services driven.
It was the same with HDNet seeing HDTV when everyone else saw something that could never be in every home. More recently with Magnolia Pictures when we started releasing movies on digital Video On Demand before they were in theaters. It transformed our business. That was 6 years ago. It’s only now that people are realizing they need to copy us. Those types of things.
Angel: So when you started your first business can you remember any significant hurdles you overcame?
Mark: Yes we had an employee who stole 83,000 of the 85,000 dollars we had in the bank. It was gone in one day and we had to recover from that. And we did.
Angel: Did things like that knock your confidence, did you ever doubt your capabilities?
Mark: Of course. I remember counting the number of months that Microsolutions had been open, hoping it would last. But the good thing about Microsolutions was that, after that, we NEVER had a month, let alone a year where we lost money. We might not had made much, but every month was profitable.
Angel: In business there are always going to be times when you’ve got to do things which are scary and uncomfortable, on these occasions most people find themselves procrastinating, do you have a technique you use to move forward to overcome your fear to be more productive more often?
Mark: I think about what happens if I don’t do it.
Angel: In the Shark Tank, most people know you as a fearless entrepreneur. What are the scariest situations you’ve encountered in the real world?
Mark: When big competitors come in to a market, it’s always scary. HDNet may have been first, but we are now one of the few independent networks still in business. We are having to relaunch and revamp our entire strategy. We are moving from being a traditional network to one that is going to focus on being an all live network. That has never been done before outside of sports and news. So we have to create a whole new way of consuming entertainment.
Angel: On the show you have to make pretty quick decisions about whether to invest or not. What’s your formula for making those decisions?
Mark: I try to quickly decide if I’m investing in the business or the person. From there I can determine whether I want to own the business, or whether it’s an inexpensive way to hire someone smart to run the business.
Angel: One of the common mistakes we see people make on the show is not being able to clearly communicate their value. Can you tell me about one of your companies and the value it provides and how you communicate it to your customers?
Mark: MotionLoft.com – they count things. They have sensors that they put on buildings that can tell you how many cars/people/bikes are walking by a sensor in real time. We sell it by letting people try it. It’s intoxicating for a leasing company to be able to tell a potential leaser exactly how many people pass their location. Or to a transit authority to know exactly how many cars are on the road so they know where to send the snow plows. We communicate the value by letting them try it till they get hooked on it.
Angel: I read you’re a an admirer of author and philosopher Ayn Rand’s book The Fountainhead, what have you learned from this book and how have you used that knowledge in your business?
Mark: That you have to depend on yourself first and last. That it doesn’t matter what other people think about you, it’s how you feel about yourself that matters.
Angel: Are there any other books or resources that have really influenced you?
Mark: How to Retire at the Age of 35 and The Only Investment Guide You’ll Ever Need by Andrew Tobias.
Money, Money, Money
Angel: Let’s talk about the money. How did you actually feel when you first started making serious money? Were you comfortable with this new level of wealth?
Mark: I was very, very, very comfortable with it. My goal then and now is to never let the size of my bank account define me and have as much fun as possible with it. That said, of course I worry that I will mess up and lose it. So I try to be conservative in how I invest it.
Angel: I’ve seen a lot of people reach a level of success and then get stuck in a rut, scared and nervous about taking risks and losing it all. What drives you to constantly keep moving forward?
Mark: I love to compete. To me business is the ultimate sport. So I stay engaged with companies I invest in and try to keep making them successful.
Angel: Now you’ve reached Billionaire status, how far ahead do you set your goals?
Mark: I don’t set goals in advance any more. I just try to always be learning and getting better at what I do and who I am.
Angel: So I’ve got one more question. After all the dreams, the struggles, the wins and the losses, what does being financially successful mean to you today?
Mark: It means waking up with a smile on my face and looking forward to the day, without having to worry about how I’m going to pay my bills.
Try Before You Buy
So Mark says that he gets his customers to “try it till they get hooked on it”. So here’s my challenge to you today: Don’t just click through to the next distraction and let his advice get washed away in the endless stream of Internet content. Take action on it, right now. Decide what you can give to your customers for free. Something that will help to demonstrate your value. Then go and set up a test right away. After taking action, tell us in the community of DONE.
If (after taking action) you’re interested in finding out more about Mark check out his website where you can also purchase his book.