Here's What Shark Tank Star Daymond John Thinks About Chicago Startups
"I've always had a really special place in my heart for this city and the people here," he told Chicago Inno.
Daymond John, Shark Tank star and FUBU founder, talks entrepreneurship at Future Founders UPitch.
When Shark Tank star and FUBU founder Daymond John comes to Chicago, he is sure to check in on one place.
"I love visiting 1871," he said. "Looking at all the amazing things they're doing with the startup community, everything from empowering women, men and women of color, then having venture capitalists and universities on site."
"I've been watching the startup scene here for quite some time, and I've been very impressed," he added.
Chicago Inno sat down with John on Monday as he prepared to judge the Future Founders UPitch competition, talking his past Chicago investments, advice for aspiring entrepreneurs, and how Shark Tank has evolved over time.
Since starting FUBU in 1992, a streetwear apparel label made famous by rising hip hop stars who wore the brand, John has rode the ups and downs of the entrepreneurship game all the way to a seat as one of the original Sharks on ABC's "Shark Tank." He's invested in startups dealing in everything from energy drinks to workout videos, including Chicago startups Spikeball, Resultly and most recently Rockford accessory company sockTABs. Aside from his own business and investments, he was named a global entrepreneurship ambassador by the White House, wrote two books, and launched an entrepreneurship academy.
Though John now works every day as a mentor and investor to companies just getting their start, he wouldn't necessarily suggest student founders today follow exactly in his footsteps.
"I would never tell them to do what I did," he said. "I thought I was going to be so smart, take one year off from going from high school to college. That one year became... six, seven years and I didn't have a lot of the basics, the fundamentals under my belt, such as financial intelligence and working with a team. I think that is something critical for the students to learn."
That being said, he knows the hustle. John launched his FUBU brand out of Queens, New York, by selling beanies and t-shirts in his neighborhood and at clothing expos (all while keeping a day job at Red Lobster). He convinced rising hip hop and rap stars, including his LL Cool J, to wear their apparel in music videos, which helped the brand catch on with trendsetters.
It wasn't always a quick rise to the top--John said he ran out of money three times when first launching FUBU. But he said tapping resources and mentors helped keep him on track.
"It is hard to make money, but it is ten times harder to keep it, so if you don't have financial intelligence that is going to be a bigger challenge," he added. "When you're getting higher education, or any education, there are things that are very important [that] you maybe overlooked. Teachers are mentors, they've gone out there and done it, and decided to dedicate themselves the education of our future."
What other advice does he have for young entrepreneurs?
First, put in a little bit of work at a time so your business is always growing: "Put in two or seven or fifteen hours a week, and as you see it grow in six months or a year, the business will start calling you."
Second, take advantage of startup competitions: "That is crucial startup money. The best thing about that is, it's not an angel investor or a Series A where you have to give up a percentage of your company. And that is really important."
Finally, never stop learning. He pointed out that when they first launched Shark Tank the casting agents didn't know as much about the business side, which meant fewer deals actually closed once they started talking off-screen.
"The Sharks are learning every day. Don't think that as you get to one side of the stage…you stop learning."
"The casting agents were just casting agents. They never witnessed [Shark Tank], so they didn't know the red flags. Now if someone walks up to you in a room and they say 'we're doing $30 million in business and we got two employees,' they're selling drugs," he joked. "It's just a red flag."
"We're at a stage where casting agents know, they really understand," he said. "The Sharks [are] learning every day as well. What works for us, surrounding ourselves with the right staff, distribution, the right attorneys. So don't think that as you get to one side of the stage…you stop learning. It's our job to learn every day."
Entrepreneurship has changed dramatically since he started selling t-shirts and beanies in Queens, and John said he's constantly surrounding himself with "younger, smarter" people to ensure that his investments and business stay ahead of the game.
"When you look at why all of us do the show, it's the same reason why I'm here [at this competition]: we're investing in the future," he said. "It's amazing to see how these young kids' minds start to unfold, they start to work things out, and hopefully we have the next Bill Gates in the room…who is going to learn from these vital assets we give them. And that's exactly why we do Shark Tank."
