Speaker 1: The first African American in the United States to become
Speaker 1: a billionaire was Bob Johnson. He did that by building
Speaker 1: Black Entertainment Television and subsequently selling the Viacom. He used
Speaker 1: some of those proceeds to buy the Charlotte Bobcats, becoming
Speaker 1: the first African American to be a major sporting team owner.
Speaker 1: He later sold that basketball team to Michael Jordan's. Today,
Speaker 1: Bob Johnson is involved in a wide variety of business
Speaker 1: ventures across the United States. I sat down with him
Speaker 1: in Palm Beach to talk about his career and what
Speaker 1: he sees next for himself. So, when you became the
Speaker 1: first African American to be a billionaire, what was that
Speaker 1: like people calling you up telling you how great you are,
Speaker 1: or people calling up asking for money all the time. No,
Speaker 1: there's nothing like that, David. You know, I had run
Speaker 1: Black Entertainment Television b ET over twenty years until I
Speaker 1: sold it to Viacom. So b ET at sort to
Speaker 1: become a business success story, and as a result of that,
Speaker 1: people begin to see me as sort of uh as
Speaker 1: an entrepreneur. It was doing something pretty pretty good at
Speaker 1: that time. And so by the time I got to
Speaker 1: where it was sold to Viacom, it was sort of
Speaker 1: expected that it would be worth something. So when you
Speaker 1: sold it to Viacom. After that, you then bought the
Speaker 1: Charlotte Bobcats, an NBA team, and you became the first
Speaker 1: African American to be an owner of a major sports
Speaker 1: team in our country. So what was that like. Was
Speaker 1: that thrilling to own an NBA team or did you
Speaker 1: really just see it as a business venture. Well, I
Speaker 1: first saw it as the idea of being first. Uh,
Speaker 1: there's been throughout the black business history. If you were
Speaker 1: the first black to do something, you gained visibility, you
Speaker 1: gained notoriety, and you gained access to other people's particularly
Speaker 1: white business people who knew you by your reputation. So
Speaker 1: when there was a team coming up for sale in Charlotte,
Speaker 1: I said, you know, why not be first? I had
Speaker 1: the capital from the sale of b E T to Viacom,
Speaker 1: so I said why not? And UM I decided to
Speaker 1: um make a bid and got a call from some
Speaker 1: of the business people in Charlotte to said we'd like
Speaker 1: you to be the majority owner of the team. Will
Speaker 1: be the minority owners and work with you. And so
Speaker 1: it just seemed to be the right place at the
Speaker 1: right time to do something I thought would be part
Speaker 1: of a strategic approach to being first. So you owned
Speaker 1: the team for about eleven years, and then you sold
Speaker 1: it to a person named Michael Jordan's so, and after
Speaker 1: that you began an effort to build i'll call a
Speaker 1: small business empire. You have investments in many different areas
Speaker 1: private equity, financial services, fashion, lodging, hotels, real estate, and
Speaker 1: my own firm did something with you in private equity
Speaker 1: for a while. So is that what you're trying to
Speaker 1: do now is build a many empire if different areas
Speaker 1: and what are your most important parts of that empire? Well,
Speaker 1: what I did when I sold b ET, I decide
Speaker 1: I wasn't going to just sit around and do nothing,
Speaker 1: and I decided that one way to sort of build
Speaker 1: value for yourself was to take your own knowledge, your
Speaker 1: own strategic vision, and deploy your capital and your brand
Speaker 1: to acquire assets that you could run with very talented
Speaker 1: people to help you do it, obviously, and align yourself
Speaker 1: with people who shared your vision and your culture about
Speaker 1: creating what I call wealth in the black community, uh
Speaker 1: and demonstrating to the broader market that African American talent
Speaker 1: with capital and strategic partners like I did with John
Speaker 1: Malone when I started b ET, could be successful and
Speaker 1: create create value for yourself and create value for the investors. So, Um,
Speaker 1: you've been very involved in dealing with black entrepreneurship and
Speaker 1: black business owners. Do you think today it's easier for
Speaker 1: a black entrepreneur to start a company or No, No,
Speaker 1: more easy than it was twenty years ago or thirty
Speaker 1: years ago. David, I don't think it's necessarily easier. I
Speaker 1: think there's a mindset within the white business community and
Speaker 1: to some extent in the country at large, is that
Speaker 1: this definition of equity and diversity ought to see money flowing,
Speaker 1: capital flowing into black entrepreneurs for investment and operating startups
Speaker 1: of business. It's just not easy. It's just that there's
Speaker 1: a theory that it ought to happen. And I think
Speaker 1: if if it were easy, you would see more Bob
Speaker 1: Johnson's more, Michael George, more Magic Johnson's and Oprah Winfreys
Speaker 1: in the light. So I think it's a little bit
Speaker 1: of a misnomer to say it's easy. It is correct
Speaker 1: to say people think about it more, but do they
Speaker 1: do more that's the problem. So in for the George
Speaker 1: Floyd murder, I thought that many people in the white
Speaker 1: business community said, Okay, we've got to do much more
Speaker 1: in getting blacks and as on the boards senior positions
Speaker 1: in corporate memory. Has that really happened or has you
Speaker 1: just talk about that? Well, David, the sad secret of
Speaker 1: that is companies, white companies have announced that they're gonna
Speaker 1: put millions of dollars into diversity in terms of black
Speaker 1: investment business. But among the people I know, and I
Speaker 1: know a lot of people who would say, hey, I
Speaker 1: just got money from here there in other other places,
Speaker 1: it's really not happening. I saw something in the in
Speaker 1: the media that said there has been something like fifty
Speaker 1: billion dollars of pledges made, but less than five percent
Speaker 1: of that has ever been implemented. And to me, it's
Speaker 1: a real sad story because it's not happening. And I
Speaker 1: would know because no one has called me. Now, I've
Speaker 1: been pretty successful, as you you know. The only thing
Speaker 1: I've done that with, David, and I am most proud
Speaker 1: of is the partnership I've created with Vanguard Fidelity and
Speaker 1: a Light to create a four oh one k auto
Speaker 1: portability business called uh part Portability Network whose sole purpose
Speaker 1: is to keep Black Americans reduced cash out of four
Speaker 1: oh one k account by Black Americans and low wage
Speaker 1: workers and whim I mean as Hispanic workers when they
Speaker 1: change jobs. That those two companies, those three companies put
Speaker 1: their commitment to diversity and opportunity and closing the wealth
Speaker 1: gap in a relationship with me. And that's what I
Speaker 1: like in respect. But I can tell you the black
Speaker 1: community entrepreneurs I know are very disappointed with these what
Speaker 1: I call press release announcements with no results. So let's
Speaker 1: talk about your background. Uh, where did you grow up?
Speaker 1: I grew up born in hippy Mississippi. If you Mississippi
Speaker 1: is a real small town, you know, one stop signing
Speaker 1: kind of town. What did your parents do? My well,
Speaker 1: they were workers. My father all his life was a
Speaker 1: worker in Mississippi. He was a lumber cutting down timber
Speaker 1: in Mississippi and a little bit of farming where he lived.
Speaker 1: And my mother was a school teacher at the you know,
Speaker 1: the small school system in Mississippi. When they migrated up
Speaker 1: north to a small town freeport A hunt them out
Speaker 1: northwest of Chicago, they became factory workers. So you went
Speaker 1: to college where University of Illinois, Champaign, Debanda, And what
Speaker 1: did you study? History? I was a history major throughout
Speaker 1: my home. So what did you want to be. I
Speaker 1: want to be a diplomat. I want to be an
Speaker 1: ambassador diplomat. But what year did you graduate? I graduated
Speaker 1: in sixty eight. And then you went to Woodrow Wilson
Speaker 1: School at Princeton, and that's to do further diplomatic knowledge.
Speaker 1: Had got a degree master's degree in the national affairs
Speaker 1: and again the fascination was was was history and global affairs.
Speaker 1: So you get a degree from Princeton, a graduate degree
Speaker 1: from Princeton, and all of a sudden, the US government
Speaker 1: says we're ready for you to be a diplomat. Or
Speaker 1: what happened? Well, all of a sudden they asked you,
Speaker 1: if you want to go to the Foreign Service, you
Speaker 1: have to take a test, and the test requires you
Speaker 1: to be literate and things that a kid from Hipcuem
Speaker 1: Mississippi through Freeport, Illinois I didn't really knew about. So
Speaker 1: when they had a question, I never get this. They
Speaker 1: asked me a question. One of the questions what is Wedgewood?
Speaker 1: And they said addresser of this, I thought it was
Speaker 1: what it was addressing. It was actually you weren't familiar
Speaker 1: with Wedgwood. So ultimately you came to Washington, though, And
Speaker 1: what did you do when you came to Washington? I
Speaker 1: came to d C with the Princeton Imperor Mater and
Speaker 1: the connections of people who had who are who are
Speaker 1: former Princeton Widgard Wilson graduates, uh, including a good friend
Speaker 1: of Jim Johnson, And so I started making the rounds
Speaker 1: people refer me to this person. I went to Senator
Speaker 1: Mondale's office, I went to Senator Kennedy's office, and everything
Speaker 1: else that this prince prince the mafia sauspeak. And finally,
Speaker 1: somebody after I went to one of the officers referred
Speaker 1: me to CPB, the Corporation Public Broadcasting. Got a job
Speaker 1: of Corporation for Public Broadcasting for a while, changed jobs
Speaker 1: from there and went and worked for the local Urban
Speaker 1: League in Washington, d C. And from there became a
Speaker 1: lobbyist for the Cable Television Trade Association. And that's where
Speaker 1: I met all the guys in the cable industry, Ted Turner,
Speaker 1: but most importantly John Malone. John Malone was your principal
Speaker 1: backer when you wanted to start black entertainment television. Absolutely, John,
Speaker 1: I'll never get this. I was a lobbyist. We were
Speaker 1: trying to deregulate cable. Cable was heavily regulated to protect
Speaker 1: broadcast television on the theory that broadcasts free cable was
Speaker 1: paying and if we didn't protect free television, then everybody
Speaker 1: would have to pay, which was supposedly not good for people. Well,
Speaker 1: so my job was to go up on capital. He'll
Speaker 1: argue for the deregulation of cable so it could compete
Speaker 1: with over the air television. And so I met John
Speaker 1: Malone and he said, Bob, if you ever have an idea,
Speaker 1: why don't you come out to Denver and talk to me.
Speaker 1: I said, yeah, John, I'll do it. And that's where
Speaker 1: my idea starting black entertainment television came from. And I
Speaker 1: took John up on his invitation and went out to
Speaker 1: Denver and made my pitch about getting me financing for
Speaker 1: b ET. So John said to me, Bob, here's what
Speaker 1: I'll do. How much you need to start this? I said,
Speaker 1: I need half a million dollars five. He said, Bob,
Speaker 1: here's what I'm gonna do. I'm gonna buy of your
Speaker 1: company for a hundred and eighty uh and I'm a lone,
Speaker 1: you a three twenty. That's your five thousand and John said,
Speaker 1: under that deal, Bob, you will be eighty percent on
Speaker 1: it and I'll be twenty. Is that a deal? I said, John,
Speaker 1: that's a deal. What Malone didn't know David if he
Speaker 1: reversed to them and said I'll be eighty and Bob
Speaker 1: you will be twenty. I said, John, that's a go.
Speaker 1: He didn't say that. So he kept putting money into
Speaker 1: b et E while I was growing, never put it
Speaker 1: in his equity, put it in his debt, and the
Speaker 1: dad got paid back. And I did asked him, say, John,
Speaker 1: why did you put it in his debt when you
Speaker 1: could have put his equen you all more BT? He said, Bob,
Speaker 1: I always knew you would work harder for yourself than
Speaker 1: you would for me. So John never sold a share
Speaker 1: b et. So when I sold BT to buy account
Speaker 1: for approximately three apes seven three almost three billion dollars,
Speaker 1: John's one eight of equity, of course got paid back,
Speaker 1: netted him over seven hundred million dollars in biacount paper
Speaker 1: because we did a stock for stock deep Well, what
Speaker 1: was the theory behind b ET that African Americans should
Speaker 1: have a cable channel devoted to programs that would be
Speaker 1: appealing to them in particular. Was that what you were
Speaker 1: trying to do? Yeah, Well, the theory was what cable
Speaker 1: was offering to the community, basically diversity because once you
Speaker 1: just put it once, our c A put a satellite
Speaker 1: in the sky that could orbit on a geosynchronous orbit
Speaker 1: that allowed him to send signals all around to every
Speaker 1: cable head in Cable became a competitor for television in
Speaker 1: the big markets, and in order to do that, they
Speaker 1: had to get some big cities who by that time
Speaker 1: in the eighties had black city council members wanted to
Speaker 1: and maybe a black mayor. So while they were offering
Speaker 1: programming to everybody else, you know, whether it's MTV or
Speaker 1: CNN or ESPN, the black city council member was saying,
Speaker 1: you want this franchise, what are you offering from my community?
Speaker 1: And that's where b ET became sort of a must
Speaker 1: carry product to get into cable and the diversity part
Speaker 1: of it grow. But b ET was really an extension
Speaker 1: of what John Johnson did with E any magazine, except
Speaker 1: his was printed and I was video. So how many
Speaker 1: years did you operate p e T before your sold
Speaker 1: to bicom years you sold for roughly three billion dollars
Speaker 1: holding me so, in hindsight, had you held on longer,
Speaker 1: would it be worth more today or were worth less today?
Speaker 1: Because the cable world has changed so much, it would be,
Speaker 1: in my opinion less today because once streaming came along
Speaker 1: and the technology allowed people to have streaming wherever, they
Speaker 1: could carry content on your phone, on your laptop, in
Speaker 1: your home, wherever you go. It changed the paradigm of
Speaker 1: cable and it allowed people to sort of pick and
Speaker 1: choose and then olive carte way what they wanted to watch.
Speaker 1: If you only wanted to watch Netflix, you just get
Speaker 1: Netflix cable. You were paying for a bundle even though
Speaker 1: you didn't watch all the channels, so some people were
Speaker 1: paying for If you were in a sports fan, you're
Speaker 1: paying thirty cents thirty cents whatever it is now for ESPN.
Speaker 1: But if you never watch the Infant, you had to
Speaker 1: pay for it because it's part of a bundle. So
Speaker 1: you then bought as we mentioned earlier, the Charlotte Bobcats
Speaker 1: a new team. Um, you didn't know much about running
Speaker 1: a basketball team, I assume. So you've brought in a
Speaker 1: guy named Michael Joe. How do you tell Michael Jordan
Speaker 1: he doesn't know much about basketball? If the thing isn't
Speaker 1: working out perfectly? Can you say, Michael, I played in
Speaker 1: grade school and I know something about basketball. How do
Speaker 1: you tell Michael Jordan's things aren't working perfectly when it
Speaker 1: If it doesn't work perfectly, you don't, okay, So just
Speaker 1: let him run the team, and you basically owned it.
Speaker 1: He more or less was the manager of it. He
Speaker 1: was he was the general manager of it. And he
Speaker 1: decided on who he's gonna hire his coach, He decided
Speaker 1: on what players here going to draft, and he decided
Speaker 1: on you know, how the team would be be run.
Speaker 1: I was the pay and the payer in this game.
Speaker 1: So when you sold your NBA team, the Charlotte Bobcats,
Speaker 1: the price of NBA teams had not risen to the
Speaker 1: billion dollar range. Any regrets about selling it when you
Speaker 1: sold it, Oh, definitely regrets. I tell Michael about that
Speaker 1: all the time. But nobody could have predicted that Don
Speaker 1: Sterling would say what he said about black people, and
Speaker 1: the led to the NBA commissioner to say we've got
Speaker 1: a huge racial problem. If we're gonna keep down Sterling
Speaker 1: as an owner, and he basically forced Downald Sterling out.
Speaker 1: But being forced out and you walk away with a
Speaker 1: two billion dollars, you know a lot of people would
Speaker 1: like to be forced out a team for that price,
Speaker 1: you know. So that was it. But uh, Michael was
Speaker 1: always my first choice to sell the team. He and
Speaker 1: I have been friends, see, you know, fifteen years before
Speaker 1: I even owned the team really, so you know, I
Speaker 1: wanted if anybody I wanted to sell the team too,
Speaker 1: if I was forced to sell with me to Michael.
Speaker 1: As we talked today, there's rumors that the Washington football
Speaker 1: team now called the Commanders might be sold. And h
Speaker 1: NFL teams are pretty expensive. But any interest in getting
Speaker 1: back into sports, you're a native of Washington or non native,
Speaker 1: but you've lived there for a long time, that's probably
Speaker 1: a check too far. I mean, because these these teams
Speaker 1: are so rich, and I mean, if you could get one,
Speaker 1: it's a little bit I would call an NFL saying
Speaker 1: about the closest thing to a license to print money
Speaker 1: that you can think of, But you gotta really pay
Speaker 1: up for it because it's a it's a great sport asset.
Speaker 1: It's one of the best, I would say in the world,
Speaker 1: maybe maybe better than some of the hockey teams, although
Speaker 1: pretty close. To a young black entrepreneur who says, I
Speaker 1: want to be the next Bob Johnson, what advice would
Speaker 1: you give to that person about how to build a business,
Speaker 1: empire and be successful. I do this. I give this
Speaker 1: answer all the time. The first and foremost thing, you
Speaker 1: gotta believe in yourself. You gotta believe in yourself that
Speaker 1: you deserve the opportunity to be successful. And the second thing,
Speaker 1: you gotta understand that nobody does anything alone. You've got
Speaker 1: to find talented people that you can convince to go
Speaker 1: on that voyage with your order to share your vision.
Speaker 1: And you gotta make sure that they participate in your upside.
Speaker 1: You gotta give them a stake in the game to
Speaker 1: make sure make them feel like you have their interests
Speaker 1: and the interests of their family close at heart. And
Speaker 1: if you believe that and you work hard, they will
Speaker 1: work hard with you. And today, do you think for
Speaker 1: a young Bob Johnson, they're starting out once to build
Speaker 1: a company. It's easier for an African American to get
Speaker 1: capital or no easier honestly than it was years ago.
Speaker 1: Easier in the sense that there's a belief that there's
Speaker 1: should be more diversity of opportunity, whether it's diversity opportunity
Speaker 1: is sponsored by the government or diversity of opportunity in
Speaker 1: the form of e s g. That corporations some of
Speaker 1: them give lip service too. So the theory is if
Speaker 1: you go and ask someone to be your partner, who
Speaker 1: they're more inclined to give you a hearing. But the
Speaker 1: ability to get the right person in the right amount
Speaker 1: of capital is still very hard. My relationship with John Malone,
Speaker 1: and we still have it today, was extremely unique. I
Speaker 1: and imagine that one out of a thousand black entrepreneurs
Speaker 1: kids today could find them a John Malone. You've been
Speaker 1: involved advising presidential candidates, I presume presidents as well. Um,
Speaker 1: do you ever have any interest in serving in a
Speaker 1: senior position in the federal government or running for office? Absolutely,
Speaker 1: unequivocally no. The aggravation factor isn't worth it. It's the
Speaker 1: aggravation factor. But it's more importantly is I don't believe
Speaker 1: there's any integrity in it. So you do give money
Speaker 1: to politicians though, because that's the system, but you it's
Speaker 1: a part of the game. I think, to be honest,
Speaker 1: I think there's a need for a multi party system
Speaker 1: in the US to give more people a choice about
Speaker 1: where they can throw their voter support and their political support,
Speaker 1: but also to cause the country to try to come
Speaker 1: together by having everybody have a role in deciding what
Speaker 1: is in the long term best interest of the country.
Speaker 1: I've often believe that Black Americans as a people and
Speaker 1: as a voting block should adopt the same position that
Speaker 1: the original founders of the Congressional Black Caucus had in
Speaker 1: nineteen early seven nineteen seventy. Their philosophy was enunciated like this,
Speaker 1: Black Americans should have no permanent friends, no permanent enemies,
Speaker 1: just permanent interests. And if we voted like that, we
Speaker 1: would be able to leverage that block because it's a
Speaker 1: consistent block in our long term best interests, rather than
Speaker 1: be addicted to one party and ignored by the other party.
Speaker 1: Do you have government officials, members of Congress, or people
Speaker 1: in the White House ever asking you for advice these days? Well,
Speaker 1: I don't think they asked so much as I try
Speaker 1: to go to them to suggest to them what they
Speaker 1: should consider particularly as it relates to what I call
Speaker 1: I have a formula a belief I called their business
Speaker 1: illusions to social problems. I'm not a big proponent of
Speaker 1: government handouts. I've never been in favor of government subsidies.
Speaker 1: I like the idea of government providing a pathway through
Speaker 1: regulatory freedom and balance to allow companies to create it.
Speaker 1: But they got to be some focus on economic benefits
Speaker 1: to in my opinion, to the black community. And for example,
Speaker 1: real quickly, I've got members of the Congressional Black Caucus
Speaker 1: to support something I call the Boostack. The Boostack very
Speaker 1: simple was this. It would give investors in black businesses
Speaker 1: a tax preference if they would invest in these business
Speaker 1: I called in legislation I was introduced by a Congressman
Speaker 1: and food made from Baltimore. Would put thirty billion of
Speaker 1: treasury money aside for preferences for myself. For you who
Speaker 1: would go to a company and say I'm gonna invest
Speaker 1: in your business X number of dollars. When you exit
Speaker 1: that business or do a sale of that business, I
Speaker 1: will get a preference on my capital gains and the
Speaker 1: whole idea. It was not a mandate then require it
Speaker 1: was only voluntarily to me, that's better than all of
Speaker 1: these pledges that are going around there are not being
Speaker 1: fact implemented. And and that's the kind of way I
Speaker 1: got the same way I did that with the auto portability.
Speaker 1: So you're one of the best known black entrepreneurs and
Speaker 1: business leaders in the United States and one of the wealthiest.
Speaker 1: Do you face discrimination today in your daily lives or
Speaker 1: in your your business career? Do you still think you're
Speaker 1: being discriminated against? You think you're not in that situation
Speaker 1: others are, but you're so well known you don't face
Speaker 1: that discrimination. Uh. No, you face discrimination in terms of
Speaker 1: what I call uh bias discrimination where they people just
Speaker 1: don't they recognize you as black first, Bob Johnson second,
Speaker 1: and wealthy Bob Johnson third. So when you get in
Speaker 1: that situation, you'll find cases like this. A clear example. Uh,
Speaker 1: I could be going I could go to a restaurant
Speaker 1: and if I'm standing outside waiting to to go in,
Speaker 1: after I'm giving my car to be park, someone will
Speaker 1: come up to me and asked me to get their car.
Speaker 1: What do you say when that happens? Can I take
Speaker 1: it and keep it? But no, I mean the thing
Speaker 1: is they see a black man standing by parking valet parking.
Speaker 1: Their intellectual bias assumes one, you can't afford to be
Speaker 1: at that restaurant. To you're standing next to valet of parking,
Speaker 1: you must be a parking lottitides. So today, Um, as
Speaker 1: you look at the United States economy, are you worried
Speaker 1: that we're heading into a recession of some type and
Speaker 1: that we're hurt not only black businesses but all businesses.
Speaker 1: I think the economy has to have a recession in
Speaker 1: front of it until we stopped the huge amount of
Speaker 1: fiscal spending that comes out of the government. And I
Speaker 1: see nothing in the government that will change that trajectory
Speaker 1: on spending. Uh. And and that's the part where I
Speaker 1: think we've got the faces a recession because as you
Speaker 1: keep dumping money and chasing fewer goods, it's probably the
Speaker 1: textbook description of your headed towards the recession, and or
Speaker 1: worse than that, you headed to something called the variation
Speaker 1: that called stagflation, where you got you got spending going
Speaker 1: up and you've got productivity going down. Because it puts
Speaker 1: you in a problem. So yeah, I think until something
Speaker 1: changes on that equation. Yeah, did your parents live to
Speaker 1: see your success as a business leader. They did. In
Speaker 1: terms of b et, they didn't. I still owned that
Speaker 1: I hadn't sold it, and I hadn't done all the
Speaker 1: other things that they tell you you're terrific. We knew
Speaker 1: you were going to be successful, or they said, uh,
Speaker 1: you know, you're just the same as our other nine children.
Speaker 1: That one my mother always used to say. Somebody say, oh,
Speaker 1: aren't you proud of your son, Bob, she'd say, I
Speaker 1: love all my children. That was her thing. Thanks for
Speaker 1: listening to hear more of my interviews. You can subscribe
Speaker 1: and download my podcast on Spotify, Apple, or wherever you listen.