Everyone and their mother has a business idea. But not everyone knows how to turn the random thoughts in their head into a successful (and profitable) operation. According to 2024 data from the U.S. Bureau of Labor Statistics, just over 20 percent of new businesses fail in the first year and 49 percent fail in the first five years.
One person who knows a thing or two about getting a business off the ground is entrepreneur and FUBU co-creator Daymond John, who turned a $40 budget into a multi-billion dollar clothing brand. He’s been sharing the love with other aspiring entrepreneurs on the hit reality business competition series “Shark Tank” for 15 years.
For the past five years, he’s curated Black Entrepreneur’s Day, a star-studded event designed to give Black business owners advice and networking opportunities that will help them learn and grow their companies – and a chance to earn a portion of the $100,000 in grant money dedicated to the event.
This year, the event will be held on November 22 at the Fox Theatre in Atlanta. And the lineup is better than ever, including appearances by Charlamagne Tha God, 2Chainz and Kelly Rowland.
The Root spoke with the businessman ahead of the announcement of the lineup for the 2024 Black Entrepreneurs Day to learn more about what it takes to launch a successful business.
Start Small
John says one of the biggest mistakes new entrepreneurs make is trying to go too big, too fast, particularly when it comes to funding. Taking out massive loans for office space and slick marketing materials can be costly when you’re trying to get your business off the ground. Instead, he suggests finding ways to make the biggest impact using the least resources.
“The first thing you should do is think about whether or not you need money,” he said. “Don’t borrow $50,000 when you really need to start with $5,000. You don’t need a store, you need a kiosk. You don’t need a website, you need to just put a little money behind your Facebook page. Once you start thinking about it like that, even the person with the most money in the world can’t compete with you because you’re being creative.”
Find Free Money
After 15 seasons on “Shark Tank,” John knows everyone comes into the tank hoping to get a deal. But he suggests looking for grants and new business pitch competitions that give you access to funding for your business without giving up equity. He says there are funds available for Women and Minority-owned businesses. You just have to be willing to do the research.
“Try to find ways to get money and funds before you go out and risk it all by borrowing or getting investors involved. Didn’t you start a business so you can make your own decisions? Why do you want to listen to someone else?” he said.
Perfect Your Pitch
If you are planning to come into the tank – or pitch any potential investor – John says you need to have your sales game tight and be able to explain what’s in the deal for the investor and the customer.
“Before you come into the tank, you need to be able to articulate how your product is going to either solve someone’s problem or bring them joy. Then you need to be able to tell why you’re the person who is going to champion that and why now is the time to do it.”