FUBU: Daymond John (2018)

Hey everyone, so before we start the show, I just want to let you know that we are very, very close to selling out our live show in Denver, Colorado. It's happening November 13th at the Paramount Theater, and I'll be interviewing Kurt Richardson, creator of the Otterbox phone cases. This show is supported by American Express. It's our last live show of the year, so please. Come see us in Denver on November thirteenth. If you want to get tickets, go to nprpresents.org and I hope to see you there. So Damon John's story starts with forty dollars worth of fabric

And a four letter word. Fu. for us, by us. He wanted to make hats and jerseys and jackets for hip hop artists and their fans. And even as his brand began to explode, Damon held on to his day job. Yeah.

And if you haven't heard this episode, or even if you have, it is one of the funniest and most inspiring episodes of how I built this. It first ran back in April of last year. Take a listen. Um You come back to New York. With three hundred thousand dollars worth of orders.

How are you gonna finance that? That was a big question right there. I didn't know what I didn't know. I didn't have any financial education Um, I didn't even have an accountant at the time. So I I went to All the banks I could and I got turned down my twenty seven of'em.

Twenty seven banks. Yeah. It was so bad loansharks were turning me down. R

That's how I built this. show about innovators, entrepreneurs, idealists, and the stories behind the movements. There you go. Guy Roz, and on today's show, how Damon John went from waiting tables at red lobster to building FUBU.

One of the biggest hip hop clothing brands ever created. As with any history, there's some disagreement over what I'm about to tell you, but By and large. Lots of people will say that hip hop was born in the Bronx, probably in 1973.

And the Bronx was the center of hip hop culture for most of the rest of the decade. But By the early eighties. Hip hop's center of gravity started to shift to Queens, specifically a neighborhood in Queens called Hollis. This is the neighborhood where some of the most influential names in hip hop grew up.

Russell Simmons, LL Cool J, and of course, all three members of Run DMC. You might even remember their song Christmas in Hollis Hero. Do you the favor. Seventy See the man chillin with his dog. Whip my heart full of fear, look at his dog Okay, so Hollis is kind of crucial to understanding how Damon John

was able to build a global brand of hip hop apparel. A brand he started from the trunk of his car. Because as hip hop culture started to explode, So too did Damon's little clothing label called Foo. It's a brand that to date

has sold over six billion dollars in apparel. Now today you might know Damon as one of the sharks on Shark Tank. He's confident and smart and always well dressed, but you might not know about his backstory, his childhood in Hollis, and the challenges he faced from a very early age. Right around my uh about eleven years old, or twelve years old, my parents separated, got a divorce, and I would never see her speak to my father er ever again. So my mother's dreams of getting a further education just didn't happen at the moment. So you haven't seen your dad since you were twelve? I did not. And so it was just you and your mom at that point? Just just me and my mom struggling, trying to work it out.

Uh-huh. And and how did she make a living? Well mom was an executive assistant, so she worked for Lehman Brothers. uh American Express. Then she would have her little side hustles. She would probably, you know, sew clothes try to sell them. Uh she would go and open up uh you know maybe a little kiosk at a flea market and buy goods and resell them. Uh so mom would do a whole bunch of uh things such as that to make some extra ends meet, but she would also just mainly be a secretary or executive assistant for people.

Hm. So So you're you're growing up in Hollis in the late seventies, um, early eighties. And And it it was kind of a tough neighborhood, right? I mean, did did it did you feel

Safe as a kid? Like did you feel like you had a pretty normal Childhood? I felt safe. It was a great time. It was uh what I think is the last of those old school neighborhoods where everybody knew each other and you know, all the kids had to go inside before the the lights came on on the on the street lights. I mean my mother used to always say I had to be either faster than the Concord or faster than the the lights on the Empire State Building and and the reason was that The Concorde would land.

approximately I think seven fifty or seven thirty, uh in uh you know, during the night. Wow, yeah at J F at J F so when you we all the kids heard the ground rumble because the Concord was landing, you had the you had to be in the house by the time that rumbling stopped. But during the winter months when you know it was still landing that late at night, but yet it was getting dark at five o'clock parents will say you need to be home by the time you see the lights come on on the Empire State building. So um it was a very great community, you know, um a lot of barbecues and cookouts and and fun stuff like that. But that would all change around eighty six, uh eighty seven.

Or we stop feeling safe when crack started to devastate, you know, our neighborhoods and we would start hearing of deaths and and things of that nature. Now maybe that's because I'm at sixteen or eighteen years old and I'm m you know, and I'm driving and I'm seeing more of the world, but also crack was starting to devastate Every neighborhood across the country. Yeah.

So how were you living um, you know, in a in a neighborhood environment where You had the crack epidemic, you had friends who were kinda getting caught up in it and selling drugs and and and how were you able to How do you avoid it? I've always been somewhat analytical and um

I remember doing the math one day about uh, you know, if I were to work at McDonalds and if I were to sell drugs over the course of five years, where when I make more money and it looked like I would make more money in McDonald's. Yeah. Uh, because if you look at the drug dealer who has to pay for all the the attorney fees and everything else every once in a while and they get caught and if they out of five years if they had to stay in jail two and a half or three of those years and it wouldn't really and then you have to look over your shoulder and you end up dead maybe dead, then how And they have no medical, how much really would they bringing home? How much are they netting? So I looked at that and I said, Well, I'd rather work at McDonald's.

Yeah. You um as as a kid did you Did you sort of dream about the things that you wanted to do? The the kind of person you wanted to become? Earlier on in life I I really dreamed that I wanted to be maybe a pilot. Mm.

I really didn't know what else I wanted to be in life, you know, I had no idea, uh, until rap music really started coming around and I figured I wanted to be Working in rap music and but I didn't know how to do that. If I couldn't rap, sing, dance or produce. I really didn't know how to do that. I tried well, I could dance a little bit. I I actually did do some kind of dancing hoping that run DMC or Or L L Cool J or Russell Simmons would discover me. Um At one point I did get an offer.

Two dance for a group named Houdini. Uh, they were going on tour. Yeah, we got I got an offer to break dance for them and my mother said, No way in the world are you going on tour. It's it sounds like you were a pretty good kid, like you didn't really fight with her that much. You didn't rebel. No, I pr I think I may have one or two arguments with my mother. during the court. Maybe I may be maybe now I'm forty nine. I've had three arguments with her in forty nine years. Probably yeah, probably two of them were when I was in my twenties.

Did you um Was college ever something that you You considered. When do you finish high school?

I did. I did consider it now, but I'm dyslexic and uh reading always presented a challenge. Science and math, no problem, I could do in my sleep, you know Uh that was a challenge and I said to myself, I'm gonna take off one year. You know, getting out of s out of school. I said I was gonna take off one year. Uh and that one year became five years, ten years. What were you doing in that in that year off that you take from that? In that time I was working here and there, but I also was partying, you know, dating as many girls as I could, you know, the normal Kid thing, you know, eighteen to twenty. Um, and I turned around again and I looked and I said, I don't have anything.

And not only do I not have anything, I um I don't even have an education to fall back on. So again, looking at all the friends I lost, uh, and then talking about all the all the kids that I thought were not so bright, but yet they were coming back from college and I was a waiter in red lobster serving them, and I said, Maybe I'm the idiot here. Sure. You were a waiter at at Red Lobster? I was a waiter, yeah. I was having a great time as a waiter. Um but I was also learning from Red Lobster. You know, they would issue these quarterly books on, you know, their P L's basically and what was working, what wasn't working. I was You know, learning how to service. You were reading their quarterly P L'or a waiter. I mean how many waiters at at at Red Lobshore or any company will take the time to do that?

Uh I I don't know, but that's not my problem. I was reading them. So all right, so you are clearly um thinking about bigger things. If you are waiting tables of red lobster, And you're reading their quarterly reports and their P L's, like You're doing this because you have a plan. Did did you have a plan? I didn't know what the plan was going to be, but I knew that just like working out every single day and just like uh anything else, trying to educate myself, I had the uh ability to put

various different things in my body or my mind, you know, drugs and rock and roll and rap music and drinking all the time, I can put that in and so how productive I was gonna be later on, or I can put in Okay. P L statements and listen to Tony Robbins and listen to Jay Abraham and Think and Grow Rich and Seven Highly Effective Habits of Uh whatever people And you were reading that stuff you were listening to Tony Robbins and reading Stephen Covey? All day. All day, every day. No, I was I was listening to that stuff when I was sixteen. Um And often I'd question myself and say did I

Am I doing the right thing? Am I on the right path? Cause at the end of the day I started to set my goals pretty low that I just wanted to be somebody who can take care of their family and have a decent house and I wasn't sure what kind of business I was gonna have, if it was gonna business be a business at all, but I wanted to have a steady income. I didn't want it just you know, just be roaming the streets. Yeah. And

W how does this idea of making Apparel. Fubu, how does it even begin? What's What's the story? Well,

So The funny story is that I would talk about that with my girlfriend at the time. I was living with uh Oh my she's a little bit older than me, she was thirty, I think I was twenty. think she worked for American Express or one of them and very supportive, but I would give her my ideas all the time and You know, I remember

She would laugh at some of them. And then one day I asked her to borrow eight hundred dollars. No, I I asked her to borrow five hundred dollars for this ID I had called Fubu. And uh she said no. I would leave her after that, of course. I left her after that. Well funny story, I left her after that and I remember maybe about fifteen years ago or something, she she she's still my friend, but she came into my office and she

She heard my secretary talking about my houses and all this type of stuff that w we have to take care of from a financial standpoint, like the wire of the money. She was like You still want that five hundred dollars for Fuba? Well, God bless her, she's a great person. Okay, so how how how

How did you come up with the idea for Fubu? Yeah. So You know, we was I was spending so much money going out and buying clothes that that that the hip hop community love to buy and they could be

ski jackets, Timberland boots, and whatever the case is. And uh we start to hear rumors that, you know clothing companies or power companies just didn't want rappers, African Americans, inner city kids, whoever. They didn't want people wearing their clothes. But w I started to get fed up to hear about all these type of uh brands and I wanted to create a brand that loved and respected the people who loved and respected hip hop. And I called it Fubu, for us bias. For us bias. And and and you so what it what was the first article of clothing you made. Well I didn't make anything at first to be very honest. What I first did is I got a bunch of labels and I just went and bought champion shirts and I just put

Uhhuh. And I just wore'em on top of my champion shirts just because I wanted somebody to s I didn't want anybody to even know it was mine because it was just one shirt. It couldn't it's not like I could resell it to somebody'cause let's say a sweatshirt's thirty dollars. Well I bought the champion shirt for shirt for thirty dollars. So what are we gonna sell it to you for four? You know? So I just tagged all the clothes I have. Um and then I I started see this hat that was uh on on a lot of these wrappers and it didn't look like it was made by a major clothing company and it looked like a a ski cap not with a ball on the top but with a little tie like a shoestring on the top. Yeah. And I I knew how to make those. My mother showed me how to make those, um, because the first one I bought was about twenty dollars. I went all up town Manhattan. I couldn't find it anywhere. And when I finally found it, if you add up the gas, the tolls, I pay thirty dollars for this thing. And I showed my mother the hat and she said, You know, you can't afford to just You pay that kinda money for something you can make for two dollars. And and she's told me to go to the store and get some fabric. I went to the store, I got four y'all's worth of fabric, I came back, I sewed a bunch of hats and now all of a sudden

I wasn't thinking from a commercial standpoint. Yeah. But I bought the same roll of fabric. So I have now this big roll of striped fabric. And I made eighty hats, so I decided to go s So you brought this roll of Hebricom and And what, you like cut out patterns and sew them together?

They were really easy. You know, the the pat it wasn't even a pat it was a just a straight square. Okay. You take the square, you fold it over, you you sew one side and then you you flip it in and out. So and then you sew it on the top and you tie the string on the top. You're done. You just had those sew a straight line. It was one square with one straight line. Mm. And then you just tied it on top and there you go, you had the same exact look. It was like making it's like taking a sleeve. Right, and folding it in half and using the part, you know, and then putting on your head and the top that's open.

You just tie with a string. Wow. And those just like Those are really popular. Like lots of Like lots of hip hop artists and kids were wearing those kinds of hats. Yes, and nobody and no major corporations were making'em, so there's no place to find'em. So where'd you find'em? With guys like me selling'em on the street corner.

So I made eighty of'em. Um it took me probably about three hours. I made eighty of them and I hit that I hit that street corner and I sold all of them. You know, and a lot of people go, What are you talking about sitting on the corner?'Cause I know a lot of people may be listening to this and they may not live in a uh in a condensed area, but trust me, you it's not that I sit on the corner outside my house. I went to the shopping area and there's a place called Coliseum Mall where people were actually going into shop. So I caught people while they were walking in that mall and out of that mall by standing on the corner. And did you did the hats have I did. I put the Fubu logo on on the front of the hats, yeah.

And uh people will buy'em and how much do you remember how much you sold those hats for? I sold them for twenty, but if you didn't have twenty, it would be seventeen. You didn't have seventeen, they were fifteen. If you didn't have fifteen, they were ten. Yeah. If it if it was my last two hats, they were three dollars. And they were costing you like two, three dollars, right? Two, three dollars, I don't think so, because I bought I bought four y'all's worth of fabric and created eighty hats, so that means they were fifty cents. Wow. So you come home that night and you must be thinking. Wait a minute. I've got something here.

Well, I was on my way home and I remember counting that money and I was so excited counting that money. I just couldn't believe that I actually came up with the concept and I sold it and I was uh it was dependent on whether I I could sell it or not and then I just looked up And bang I hit a car. And I remember that guy getting out and it was a nice car. And I remember him going getting out and I said, Man, I don't have any insurance, I'm sorry. He said, All right. H you know, he how much cash you got on you, I said, I don't know, eight hundred dollars.

He said, All right, give me it, I'll take it. And he took the money and left. Oh no Just a moment. Had Damon earned that$800 back and then some. And then some more.

Stay with us, I'm Guy Raz, and you're listening to how I built this. From NPR. Hey welcome back to How I Built This from NPR. I'm Guy Raz. So it's 1992 and Damon John has made and lost his first$800 selling Fubu hats.

But the word about his brand is spreading around town, so he keeps making more hats. And then He decides to branch out to T shirts as well. I started really, you know, refine the way I made the hats, get better quality hats, you know, get better fuels on them, and then start to put T-shirts there, and then start to say, Okay, well I can't just hang out here in the mall and and sell these T shirts, so Where can I get a booth at or where can I go to? So I started to look at other places and outlets. Then I started walking over to stores that were outside that mall saying, Hey, I'm usually outside this mall on the weekends, but if I can't be here, can I put some shirts in your place or hats in your place on consignment.

Um, so I just started trying to figure any and every way out that I can increase my sales and my exposure of the product. How did you find uh the the stuff did you were just going to like shops and buying a bunch of T shirts? Yeah, I was going to physical shops down on the D Lancet Street area where people knew they can go and buy shirts and then I was starting to order as many catalogs as I could of people that were selling sweatshirts. So like C Cm, the jersey company, would sell C Cm jerseys that were blank. Or I would go to Boulder the Boulder Company in Boulder, Colorado. They would sell sweatshirts. So I would just start to source as many places as I could, find something of high quality that was that had no name on it. And and they were using it for that purpose. They were premium companies. They were the same pre company that would sell it to any You know, large large company so you can put your company name or logo on it. And you were d literally sewing the labels on? I was ripping the old labels out. I was sewing these labels in. I would then start going to screen printers and start putting screen printing on the shirts.

Then the next step up after that was to go to embroidery places to start embroidering the shirt to get a higher quality. I was I I kept improving the product, improving the quality, and to basically see the resistance or the acceptance of customers, what level would they buy it at, how much would they pay thirty, would they pay sixty, ninety. Did they like extra large, large, red, I wanted to just really start to understand the customers, so I had to keep going back and improving whatever I was doing. And I mean this is like pre internet. So it's like today you can just type up, you know, in Google uh screen printing, uh silk screen printers or whatever. I mean how did you find it how did you locate All these that were willing to do this for you.

yellow pages, coal calling, if you drive into New York City you'll see some sign on a bridge that'll say New Jersey, the embroidery capital of the embroidery capital of the world. So what do I do? I take a train to New Jersey. I start walking around. Wow. I start walking around saying, You know embroidery places, you know embroidery places. I mean just not stopping, getting up at six o'clock in the morning and just hitting the subway. All the while working at Red Lobster at night, right? all the while working at Red Lobster at night and sewing the hats and delivering the hats at the same time and trying to source the the goods. Um yeah, I mean just uh but enjoying and loving what I was doing. It was kinda like this this new discovery, this path that I was going down that I was just so excited about. And To say that, I also had to say that through eighty nine and ninety two, I closed the business three times because I ran out of money.

Um, because all these development costs, all the gas, all this going on those trains and cars to go in these places, I would run out of money. Um but I would I would only run out of like a five hundred dollars, a thousand dollars and before you know it, you know, I'm walking down the block, somebody would say, Hey Aren't you the little kid that sells food? I say yeah. They were like, I need some more, I've been looking for you. What do you mean you've been looking for me? I need some more. And I would keep opening the business back up because the business started to call me instead of me calling the business.

Did you ever get like uh were you ever in a situation where you were selling stuff on a on a street corner and like I don't know, city officials came up and asked for a permit or or anything like that? Yeah, I mean that had happened once or twice, but the the best permit ever when you're selling s uh stuff on the streets is being able to run faster than them. That was a great permit. So okay. So okay, there's there's clearly a demand, you know, on on the street for your clothes at this point, but When did you decide it was it was time to take it to the next level?

So when I finally got to the level of nineteen ninety two and my friend um Jay Alexander came back from fighting Desert Storm and he had had a couple of dollars, he said, I wanna put in some money and I want you to take this thing serious. And my plan at that time in the neighborhood was Yeah. The big black guys in the neighborhood, they had little um options on w what they can have to be very stylish. So they had to go to Rochester Big and Tall. Or and get a big white shirt or a black shirt, or

They had to pay a lot of money to get their stuff custom made for them, right?'Cause nobody was really making it. If somebody was really tall or heavy, basically, right. You're right. Okay. Right. So what we did was we just found a place that made four X, five X, six X, six X shirts, and we made twenty of those shirts because we made twenty of them because we knew that if we gave these guys these shirts, these guys were normally bodyguards. Not all of'em of course, right? But the ones we did give were the bodyguards. They were in front of the clubs, they were bouncers or something like that. And we knew that they would not just wear it once. And do some and wear something else like the more stylish kids who don't want to be seen as something twice. We knew that these guys would wear it forever. Wow. So that was our first plan of attack for the first six months get these same twenty shirts out to these guys, and that's what we did. And we just would do that and before you know it.

These guys were walking billboards and the artists started to say What am I, chopped liver? Yeah. Why are you giving it to, you know, this guy over here and I can't get in like, Well, I don't know, we don't really make it your size. You're not gonna really wear it. No, I'll wear it. Uh, I don't know. Are you sure? Yeah, I'm sure. You know, that was our that was our strategy when we first start to really launch it.

And did people I mean, at that point were people like did they know what Fubu was, or were people still saying, What what is this Fobo thing? Well. they started to know a little bit about it in the tight community we're at. And then um this one thing that just put me on the map was we would dress these two or three bodyguards that work for a guy in New York named Ralph McDaniels. And uh Ralph McDaniels show Video Music Box is probably um It's probably been on longer than MTV or came out the same year. And Ralph is really known for breaking most of the music artists uh from I would say eighty five all the way to ninety eight. They all had to really, really beg him to go on his show. And um we put on the bodyguards around Ralph and we found out That Ralph was going to

to Teddy Riley's um concert or Teddy Riley had a weekend that he used to throw in Virginia. So we said all right, we're gonna take the train down there because we know he's not gonna know as many people in Virginia, so we'll be able to get to Ralph easier. And we got to Ralph and he said I won't look into your stuff. I know who you are. I wanna put you on my show. Wow and um He did this interview with us and I was so s we were so scared to death, but he told everybody that, you know, fool was the next best thing. Wow. I think we had I think we have fifty shirts and I owe Ralph so much as being one of my mentors and somebody who's a mentor of the c to the community that he he really put us out there and after that all the rappers, all of'em, were ready to wear our stuff because Ralph uh gave us the the the thumbs up. So I guess I mean around this time ninety two, Fubu

This is becoming bigger. I mean you you you start to realize that This has potential to become something More than just a side project, obviously. Yeah. Um, so what was your next move? How how did how were you able to Get it more exposure. Well now it was about time to put my game face on and it was about time to start looking at the numbers and being a real businessman even though I wasn't. So I started to put this plan together on how many retail stores would take my product, how many we can ship and start taking out ads, such as write on and black beat magazine, and how can we start shipping these

shirts across the country and also how many street corners can we sell'em on with the in in regards to fleets of street corners and I started to do that. I started to reduce my hours at Red Lobster and I started to put in more hours here and then I then I started to bring in two and three other partners to help with the man hours that we needed. Except all that would require a lot of money. That would require a lot of money at first, so of of course, you know, like like many businesses, I leverage my credit cards uh, you know, up until I think my partners and I, all of us leverage our credit cards up to baby about fifty thousand dollars. um with a very high interest rate, which is not the smartest thing to do. And then it all culminated to when I decided to go out to the Magic Trade Show in Las Vegas. This is a famous like industry trade show where Like apparel and stuff.

Yeah, so it's the Magic Trade Show. The magic stands for Men's Apparel Guild in California. It's held in Nevada. I I I know. I'm a little confused at it myself. Um, but that's where all the stores go twice a year and they basically say, you know, they they'll go and see your Ralph Lorenz, your Nike's your food was of the world and they'll say, Okay, this is what we want to come in for spring, this is what we want to come in for fall. And as I would go out to that show, uh, my friends and I would scrape up our money and we would all go on buddy passes and standby. My mother happened to work for American Airlines at that time, so we all flew into Las Vegas w flew into California and flew into Nevada and took the buses over because it was too busy to go into Vegas being on standby. Yeah And we got a small hotel room a couple of miles away from the the the trade show and we put our clothes all in the corner of the hotel room, sleep on the beds and on the On the floor.

And we would sneak into the Magic Trade Show. No, we didn't have a booth. We didn't even have passes to go into those passes we probably had, you know We probably each one of us had on us maybe thirty dollars apiece by the time we got there. So we'd sneak into the trade show. Wait, you would just go so you you snuck into the trade show. You didn't have a booth there, but you would just go around and talk to people about your shirt. I would have the Fubu on and I would see brands that I felt were like ours, so if I would see Timberland or whatever the case is, I'd stand outside their booth and say, Hey how you doing? Hey, I got this new brand named Fubu and some people would be like would say

Fool. The Forest Bio stuff? You you're here? Where are you? Where's your booth? Come on, I'll walk over your booth. Um Alright, well well, instead of walking over my booth, you wanna hop in a cab or a bus,'cause my booth is over at the Mirage Hotel. Oh, they're showing at the Mirage Hotel? No, no. No. No, they're not really supporting the room. So um

It worked it out and you know, we we would write three hundred thousand dollars in orders and that's when I would realize How much capital I really needed. You walk away from that show without even a booth with three hundred thousand dollars in orders. How are you gonna finance that? Yes. That was a big question right there. I didn't know what I didn't know. I and I wasn't part at that time, knowing all the things I know now, I wasn't part of the chamber of commerce. I didn't have a financial education. Um, I didn't even have an accountant at the time. So I I went to All the banks I could and I got turned down by twenty seven of'em. You you said, Hey, I've got this business and and can I get a loan?

Yeah, I didn't know how to fill out a loan application. I didn't know how to You know, as much as I was reading PLs, how can I write a P L on a business that I never have grown past, you know, two thousand two hundred shirts at a time or five thousand shirts at a time, right? I didn't know how to s project what three uh hundred thousand dollars would would turn to. Um and I kept getting turned down by banks. Twenty seven banks. Yeah. It was so bad loan sharks were turning me down. My God. Because you were I mean, you were uh I guess in your sort of mid twenties, uh still living at home with your mom. Yeah. And and banks are looking at you. You had no sort of history of having a business, so they're thinking, you know, why are we gonna take this risk? Why would they take the risk? I had I had no history in this business. I had uh, you know

I had really I could collateralize the home. I c I didn't do it at the time'cause my mother wasn't allowing me to go and put that up at risk. So um You know, I I don't blame them. I wouldn't have gave myself the money. You know? And then my mother I remember coming home and she came home, she said You know, you've been working on this house as long as I have. You put as much money as you could into this house, and we have some equity in this house, and we need to go out.

And I wouldn't do this if you didn't have three hundred thousand dollars in orders,'cause this is all we have. Let's go out and let's take out as much equity as we can on this house. Wow. And once you sell the clothes, you put the money right back in. And you know, hopefully you'll have a nice profit. So she goes out and she gets a hundred thousand dollar loan on our house. So your mom really I mean that's a kind of a

Kind of a crazy risk that she took on you. I mean she she really believed it. She must have really believed this was gonna work. It was a really big risk. So um I I don't know anything about manufacturing. I may know m stuff about, you know, putting an embroidery on a T shirt, stuff like that, but as far as I know, I've only heard about manufacturing is over in China. But I'm not going to risk my money over in China. So What happens is my mother moves out. My friends all move in my house, uh, so we start they they start all paying seventy five dollars a week for the room that they would rent out of my house. So I have now six

Six friends all living in my home. And All the furniture I couldn't sell. I took out in the backyard and we all chopped it up and we burned it all. In the back yard because we wanted to make room in the house.

for sewing machines because we weren't gonna trust a hundred thousand dollars of our money overseas with somebody we don't know.'Cause we knew that we We just weren't sharp in that area. Wow. So we Get all these sewing machines, we get a cutting room, we hire we hire a bunch of seamstresses and we hire somebody to cut the fabrics and trim the fabrics and we create a factory in the middle of uh in the middle of Hollows Queens. My house is a house. You decide that you are you are gonna be the factory to fulfill these these orders of three hundred thousand dollars. My house is a big version of Airbnb meets a factory. How how hard were you did you have to work to

It was hard. I think we we feel about seventy five thousand dollars worth of those orders until I turned around and I only had Five hundred dollars left in the bank. And I was about four months late on the mortgage. Wow.

Again, I didn't have financial intelligence at the time and what was happening was I was paying for the setup of the machines and bringing all the raw goods here, so I had to pay for all that in advance. Then I was paying for the salaries of the people that were working there for me and that money was going out. The stores, when they receive the goods, they want to pay you for fifteen, thirty, sixty, ninety days. And my lack of financial intelligence was starting to just uh underline how this company was never gonna go anywhere. And now I made seventy thousand dollars worth of the goods that I have a three hundred thousand dollar order on and the stores are starting to say You're not delivering this in time. We're gonna start canceling the orders. Wow.

So this is like What like ninety five, ninety six? Yeah, this is right around ninety five, yep. It sounds like you're you're you're close to like Going bankrupt.

I'm close going bankrupt and losing the house and losing all the orders that I had, those stores are not gonna trust me again because if they're waiting six months for something to come in, the the when they give you these orders, it's it's the orders that they're not giving somebody else that they could be turning other goods. So now they're losing faith in me. Um and uh it it got to be uh it was a really, really dark time and I see this a lot now in entrepreneurs who don't realize what they don't know. So were you Were you panicking? Yeah, I w I was panicking. I was panicking for sure. I figured I didn't know how to get out of it. And then my mother comes over to me and says, I have a I have an idea and I said, What? She said, You need a strategic partner. Huh.

And I said, What the what the hell's a strategic part? And She said it's OPM, Damon, you know, um you know Opium doesn't have to be other people's money. It could be other people's manufacturing mind power, manpower. Uh marketing.

I said, All right, well what do you mean? She said, I need two thousand dollars. So I didn't have two thousand dollars. I go back to Red Lobster and I I work for a month. And I come back home and I give her two thousand dollars and say, What are you gonna do with the money? She said, I'm gonna take a ad in the newspaper.

And I said that's that could be the stupidest thing I've ever heard in my life. Like asking people if they want to fund your company, like taking an add out in the paper. Classified ad. And what did the ad say? million dollars in orders need financing.

And what happened? Did people start calling the number? Yeah, so thirty three people call that ad. Mm. Thirty of them. Hundred and twenty five percent interest had to live in their attic for collateral. Pictures of loved ones in case I got lost. You know, offers I can't refuse.

Yeah. But three of them are real, and one is uh one was Samsung. Samsung like the Korean Uh Korean conglomerate. The two hundred billion dollar privately held congl Korean conglomerate. Somebody at Samsung saw that classified ad and was interested. Samsung the head of Samsung's textile division.

Because Samsung makes everything from nuclear reactors to cars to phones. And the textile division saw it and said Hey, why don't you come in? I like this opportunity here. We we finance textiles. And the deal with us was that they would finance the manufacturer and manufacturing and distribution of our product, but we had to sell five million dollars worth of clothes in three years to keep the deal. Wow. And and so you went there to meet with them and they w was the person that you met with in New York?

Yeah, of course. I was nervous. I wanted to present it. Um you know, I brought my mother with me. So later on, you know, my partners at Samsung uh would say, you know, first meeting we ever had for a potential investment or whatever structure that somebody brings their mom I'm like, hey well mom's pretty smart so I'm gonna bring her with me. And uh, you know, I didn't think I was gonna hit five million dollars worth of clothes in three years. I barely even sold the first three hundred thousand dollars worth of clothes. But I had known my customers so well because of all those things that I was doing, that as we started to put the brand out there, we did about thirty million dollars in three months. So Samsung, um, this huge textile manufacturer, all of a sudden is pr is making your clothes and distributing it. A tiny little

Mom, pa, shop to working with the biggest textile maker, one of the biggest in the world. Yeah, but I mean the work was still up to us. They were just financing, uh, we still had the market. Even though they had to manufacture, they manufacture in the in the source of funding the manufacturing. We would have to find the Yeah, we'd have to find the factory. The factory would have to be up to par and we'd say, Okay, wire the money over here, here's who we're working with, the I mean, all of it still landed on us. The only area where I felt that obviously it was giving us the ability to scale is number one, the stores knew they were gonna get their goods in time. Yeah. How did you get uh you know, entree into the big

retailers to to carry your products. Well, that really wasn't hard at that point because we had already had six or seven years full of uh, you know, really servicing um Specialty stores really well. And uh retailers it actually we'd have to we would have to stop the retailers. We'd have to not allow them to purchase because some of the kids would look at some of these big retailers and say, Well now food was not cool anymore because it's in these big retailers. Ten years before

Fubu starts to really take off. Um Adidas Struck a h like a really famous deal with Run D M C after after my Adidas, which was the one of the first times

a major company did a branding deal with um with with any musical artist. And and I wonder if a lot of these big box stores like Macy's or the other companies that wanted carry Fubu, were they trying to jump on that on the hip hop band bandwagon? Did they see this as a hugely potentially profitable market that they want it in on? They so they first of all they they were scared. I I actually did hear many stories say we don't want you know, a lot of uh those type of people in the store'cause they're gonna have shoot outs and or shoplift. Um, I saw a a a large retailer did ask me to take the picture of myself and my f my three other partners off the hang tag'cause it said we look like a gang. Wow. Um so you gotta understand the ignorance of some of them. W were you when you were running up against that kind of racism and and bias, um and people kinda judge you even before you walk the door.

Did that Did that anger you? No, not at all. Um I don't know where these people I don't know it when somebody's biased or something like that. I don't know what they've been exposed to in their life. You know, maybe they weren't around certain other people and maybe they just need that one person or that other person their life to come into their life to hopefully show them the difference that people are people. I also felt that I wouldn't be here if everybody knew what I knew.

So if they all were that smart then there would be no place for Damon John. Uh, so I can't I can't spend my life being worried about what other people think or the ignorance or the challenges they may have had growing up. They may just had the wrong the wrong family members in their life who telling them the wrong things, but Uh you know, I I I'm I'm I'm listening, the glass is half full and I believe love doesn't come in a color or a gender and we have a we there's so many beautiful people in this world that the people who don't understand that are suffering. So nineteen ninety six Damon, you get this This.

Deal. You do this deal with Samsung. Within two years. Fubu is doing. Three hundred and fifty million dollars. And revenue. I mean that's the thing.

That's insane. I mean how do you Wha what happened? I don't know, it's all a fog. Sometimes, you know, is this rocket ship. Um, but it was having really great partners uh and mentors all around and being able to have these systems put in place where we can start scaling. But if you want to simplify it,

You know, if the men's division of what we were doing, we would do on approximate let's say argument's sake, we were doing a hundred million dollars. Um by that time, by three years, what happens is after year one you get You get a license. comes aboard. George Ash was our first license and they came aboard and they started doing ladies clothes. So now we're doing a hundred, say a hundred and fifty million in men's, they're doing a hundred million alone in ladies. Wow. And you start to put other licenses on. So bags, shoes, boots, um fragrants suits bedding and each one of those are doing fifteen or ten or five million a piece socks and things of that nature and that's how the scalability got to three hundred and fifty but

You know, three hundred and fifty million dollars in the fashion business is great, but it's it's not, you know, listen, Underarm is doing three billion or four billion, Puma's doing twelve billion, you know? Th there's real numbers that that that that are out there, um, even though I'm extremely proud of of what happened, but that's how we started to scale. And who was buying who was buying foodball? Who were your customers? It so many people so Um in America primarily, you know, African American and or people who love rap music uh of all colors. Um, I remember, you know, we first put in sync in one of our ads, the you know, we started getting so many calls from stores in Nebraska and Ohio, like, hey, you know, this is not just a black thing.

And then When you start to have too many goods or overruns of goods, you then you sell it to the places such as Burlington and TJ Maxx. And those customers come in and they're price conscious customers. They're just not looking for a brand. They're looking for some good old draws. The Good old socks, good old jeans and they bri and and a lot of us I see so many parents and grandparents with with my stuff on going, I didn't know this was Fubu until until I looked at the label. I had it for ten years. My son bought it for me. Uh so so Fubu just has its own interpretation from various different people.

Okay, so you had this like several years of this incredible expansion and growth, and at some point uh like at a certain point Fubu was everywhere. Then I guess you did something interesting, which is s sort of euphemistic way to describe this, um You s in two thousand three you semi retired the brand. At least at least in the US. Was that I mean, was that because Fubu was like

More importantly, we we would reduce all the logos as we could. So because people, you know, they already had ten years of food in their closet. They already thought that You know, it may not have been for them at the moment, because we you know, it goes through cycles, you know, and a hot brand lasts five or maybe six years, maybe seven years. Um so we kinda just slowed the brand down. And and were you I mean, was Fubu did it seem at that point that it was kinda time to I don't know, wasn't making as much money. Well I think it was you didn't want to force it on the consumer. Yeah. Um that's how I felt. And I think that you know, if if the stores weren't like oh my god I have to have it

Then you know, we needed to find something else to give to them and just put, you know, full not on a back burner, but kinda just slow it down. So it was just really adjusting the way the the the visibility of the product. You you had a like a completely just a just a total change of career path in some ways. Um in in like late two thousands, uh two thousand eight, I guess, when you became a T V star.'Cause I I mean a lot of these other labels were run by um by people who were kind of well known in the hip hop community alike.

Like Russell Simmons and Puffy and and Jay Z, and you were kinda quiet. I mean people didn't necessarily know you as well. They knew the brand, right? All of a sudden, you become a T V star by becoming a shark on Shark Tank. How did that happen? Yeah, so I wanted to start paying it forward and educating people on what I went through and trying to again show them where the landmines were. So I started writing books and I wrote a first book called Display of Power, and it talked about the fact that we all have the same engine underneath our hoods, but are you gonna tap into what drives you and what can make you a rock star, make you proficient? Yeah um and and and bring you success. And I I started going to uh stations like uh MSNBC, Donny Deutsch, CNBC talking about the book and Mark Burnett's um you know, Mark Burnett's uh, you know, crew saw me and he had show called Dragons then that was already popular in Europe and Japan coming over to America and he said he wanted me to be a shark and I said

Yeah, whatever, why not? Let's try it. So it sounds like the show sucks, it doesn't matter, but I'll I'll I'll go on anyway. I went for an audition and they ended up using the the uh pilot as the first couple of episodes, Shark Tank, and um before I know it, the show that I thought would never get anywhere and sucked with these f you know, five business people just talking business all the time. Who wants to see that? Before I know it, you know, we're going into our tenth year. Do you ever when you're in the sh when you're in the shark tank and and those you know, those like Entrepreneurs come out. Do you ever go back to you? trying to pitch your company to Samsung, like do you ever think about how you felt?

No. Um, I don't because I remember I was so i I was so unprepared. I don't even I I I give those people that walk in front of us way more respect than I give myself for when I was pitching because those people are night and day comparison to Damon John, so I value what they're doing. And I do though, I I care for them because, you know I love to see the people up there that they put all the work in and they just need a little extra step. And so I value their their guts and I value their their entrepreneurial spirit.

So last question for you, Damon. How much of your success do you think is because of Just your hard work and your your intelligence and your skill and how much because of luck. Very hard. I always contradict myself because I don't believe that there is anything such as luck. I just believe it's determination and drive. uh meets opportunity. Um, but when I look back and I sit there and I and I say see who I am, you know, on this national platform, able to change lives, father of three and a Pisces, I say to myself, Wait a minute.

You know, some things God has had to bless me in a various different ways, and that's why I work so hard to try to pay it forward to other people because it's gotta be some kind of luck. I've I don't know why I was chosen. I have no idea, but a lot of it is determination drive. But I I think there is a bit of luck on what's going on in my life. Damon John, founder of Fubu, since those early days selling Fubu shirts on street corners in Queens, he's grown his net worth to an estimated$300 million. As for Shark Tank, he's put about$12 million of his own dollars into companies featured on the show. No word on how much money he's made. or lost from those investments. And please do stick around because in just a moment. We're gonna hear from you about the things you're building.

In nineteen eighty seven, dozens of federal agents surrounded a trailer park in Ozark, Missouri. Their target. White supremacist threatening violent revolution. I have eight teams of freedom fighters prepared to start a race war nationwide. The agents fired tear gas, arrested him, and found a massive arsenal. C4 plastic explosives, hand grenades, thousands of rounds of ammunition. So years later, why did the FBI stop watching him? That story unembedded. From NPR.

Hey thanks so much for sticking around because it's time now for how you built that. And today we're updating a story that first ran about a year ago. It comes from Marin County, California, and it actually starts more than 120 years ago. Yeah, my great grandfather immigrated from Italy in 1897 and we have been farming and ranching here since then. That's Lauren Pancha from Tomales, California, where he runs Stemple Creek Cattle Ranch. Oh yeah, you can see cows all over our ranch. We have a few with white faces or speckled faces, but most of them are all black. All black Angus beef cattle, the same kind his parents raised when Lauren was growing up. And even though he loved the ranch, he eventually moved to Sacramento to work in pharmaceutical sales. But about thirteen years ago, Loren realized he wanted to get back to those cows in Marin.

I felt Like it's either now or never. I'm thirty. You know, it's totally okay if we try and fail, but if I don't even try I'm not gonna be fulfilled as a person. So Lauren talked about it with his wife, Lisa.

I mean I knew obviously since I met him how passionate Lauren was about agriculture and I was up for the adventure. So Lisa quit a good paying job at a law firm and they moved back to Marin to join Lauren's parents on the ranch. But we were still ranching the way that my great grandpa had ranched at the time, and we needed to change some things up and actually make it a profitable business, otherwise we weren't gonna be able to survive. And We essentially asked Lauren's parents If we could take over

The running of the ranch. Thankfully, they had the vision and they were brave enough to say okay. So Lisa and Lauren started to make some changes. For starters, they no longer wanted to auction off their cattle to a feedlot. They wanted to raise them until they were slaughtered and then sell the beef directly to customers. And because they saw that more people were demanding healthier food. They decided to raise the cows organically on grass instead of grain. But all of that took a lot of time and a lot.

Of money. We invested a lot of our, you know, personal assets in the business. Like we didn't have an investor, we didn't have You know, seed money, we were the seed. I remember having this conversation with Lisa multiple times and Lisa saying, Well, when are we actually gonna pay ourselves? to do this. Both Lauren and Lisa kept day jobs that paid the bills while they certified the pasture and the cattle. There was many people in our lives that just thought we were completely insane because we had two children during these years. And we were running around, you know, seven days a week juggling all of these balls.

It took them three years to fully convert to being an organic ranch and to build up a base of customers, first at farmers markets, then at local stores, and they kept working on different ways to go easier on the environment. In fact, they've become one of the first farms in the US to actually measure their carbon levels, and now They're not only carbon neutral, they are actually what's known as carbon positive. Managing the operation in the property the way that we do, applying compost and rotational grazing. we're actually sequestering more carbon than we're emitting. It's just Incredible. Anyway, a few years ago, Loran was able to quit his day job in sales to work full time on the ranch.

And this year, they're projecting gross revenue of over$4 million. And that money doesn't just come from beef sales, but from tours and an Airbnb on the site. Plus, since we last checked in with them, they've renovated a 150-year-old barn for weddings and conferences. And all of that On the same ranch started by Loren's great grandfather. I think my parents are like Totally proud to see us back. and our business thriving and they're always talking about us and they're always uh they're our our our biggest fans. To hear more about Stemple Creek Ranch or hear previous episodes, head to our podcast page, how Ibuilthis.npr.org. And of course, if you want to tell us your story,

Go to build.nr. dot org. And thanks so much for listening to our show this week. You can subscribe at Apple Podcasts or wherever you get your podcasts. And while you're there, please do give us a review. You can also write to us at hibtnpr.org and if you want to send a tweet, it's at how I built this or at guy.

Our show was produced this week by Ramteen Arablui, who also composed the music. Thanks also to Candace Lim, Julia Carney, Sanas Meshkinpur, Neva Grant, and Jeff Rogers. Our intern is Sequoia Carrillo. I'm Guy Raz and you've been listening to How I Built This.

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