Bob Johnson’s Second Act

Through a series of spectacular acquisitions and the creation of a new business empire, this billionaire entrepreneur is reinventing himself and reshaping black
business. He tells BE what drives him and what's next on the horizon.

think there are ones that got away. I think I could have invested in radio a long time ago. I lost some money in the record business. Starting out, I was not willing to take on debt because I was concerned about whether or not the growth or earnings of the business would grow fast enough to meet the debt obligations. I think I probably could have leveraged BET in some ways to acquire some really good businesses that I didn’t because I didn’t want to take on the debt.

So you got bolder as you got older.
I got richer as I got older. I realized that there are two things about being in business. Until you’re really comfortable that the business is going to be around until things start to happen, you still kind of reflect back on being poor. Being poor doesn’t ever leave you. I don’t care how rich I might get, there’s a side of me that always thinks poor. So that will cause you to be cautious. But at some point after you know you’ve got all the comforts that you can imagine–you’re taking care of your family, you’re taking care maybe down to two generations–then you can start to take on a little more risk. And taking on debt of the right kind is not a risk. Debt is a very good way to grow a business, if you know how to manage the debt.

You’ve invested in Three Keys Music and RolloverSystems, which were started by young black entrepreneurs, and then made them your partners. Is it part of your grand plan to grow a new generation of entrepreneurs that will embrace your institutional model?
A friend of mine stated jokingly–maybe not jokingly–that if black people owned all the businesses in the world, there would be no need for antitrust laws because we’d never merge or come together. The saddest thing in the 35 years of the BE 100S is that there has not been to date, that I can think of, a significant black merger of any kind that brought two and two together to make five. I’ve attempted a couple of them and not been successful. I tried to merge Radio One with BET. To me that’s a problem. I’m going to find and acquire businesses where I can see a strategic fit and get to a scale where everybody benefits, everybody goes to the beach.

What advice do you give to young entrepreneurs?
Look for a growing sector. Healthcare, information technology represent big growth sectors. Second, try to align yourself with a strategic partner–somebody who can bring something to the deal that you don’t. It could be capital. It could be talent. It could be infrastructure. Don’t worry about the 100% ownership. If you generate value, nobody is going to take you off the field. Third, do not miss the chance to leverage whatever assets you have, in addition to your ability and skill. Leverage your political clout. Leverage your demand that companies address

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