How Mark Cuban Turned His First Million Dollars Into A Billion Dollars

Hey, GQ, I'm Mark Cuban,

and this is how I made, saved, and spent my first million

and then flipped it into a billion.

[mellow music]

I grew up in Pittsburgh, Pennsylvania.

Just a middle-class kid.

My dad did upholstery on cars.

My mom did odd jobs.

As long as I could remember, I was hustling.

I remember going to my dad

while he was playing poker with his buddies

and saying, Dad, I need some new sneakers.

And he looked at me, he looked at my feet,

and he goes, Those tennis shoes you got on, they work.

When you have a job, you can buy whatever you want.

And one of his buddies, that had to be drunk,

was sitting at the poker table with him,

and he goes, Hey, I got something you can sell.

I got all these boxes of garbage bags.

Why don't you sell 'em in the neighborhood,

and then you can take the money you make

and buy your sneakers.

He had these boxes that he sold to me for three bucks.

I sold 'em for six, but it went like this.

[knocks on table]

Hi.

My name is Mark.

Do you use garbage bags?

I've got a great deal for you,

and every time you need garbage bags,

all you ever have to do is call me

and I'll put 'em in the back of my wagon

and I'll bring 'em right down to your house.

That was my first business,

the world's first, probably only,

garbage bag door-to-door subscription company.

As I started to get older

and got into high school in particular,

I realized that high school wasn't my jam

and that I wanted to learn

as much as I could about business.

I started taking classes at night

at the University of Pittsburgh when I was 16.

And then when I was 17,

I dropped out of high school altogether

and went to Pitt full-time.

That's where things really started to happen for me.

I never, ever thought in terms of money,

Okay, I need to make millions.

I always thought in terms of time.

That's always been my driving motivation.

How can I control my own destiny?

How can I control my own time?

I started a company called MicroSolutions,

and from there we just grew and grew and grew

and ended up selling that,

and that's how I got my first stacks.

So here's the rundown of when I sold MicroSolutions

for $6 million.

So $1 million went to employees.

$2 million to a partner I brought in.

$2 million to me, I live like a student,

but the first thing I did was buy a lifetime pass

on American Airlines, and I just went all around the world,

taking friends and partying like a rock star.

Other than the AirPass, I wasn't just buying shit.

I was saving it.

I could've gone out and bought a bigger house,

bought a nicer car.

I didn't care. What it bought me was freedom.

I never thought I was gonna work again.

I'd made a ton of money in the stock market.

I was worth 20-plus million dollars.

Life was good.

Then one of my buddies from college, Todd Wagner,

sat down with me, and this was in 1995, he was like,

You know, there's this whole new thing called the internet.

There's gotta be a way we can use this

to listen to Indiana basketball.

We set up this website called AudioNet,

and the next thing you know, video comes along

and we turned it into a company called Broadcast.com.

And so we started what turned out to be

the very first streaming company.

On July 18th, 1998, we went public.

And we're guessing, you know,

What's the stock gonna open at?

And I was the high. I'm thinking $33.

Shit goes $62.75.

[cash register chimes]

All of a sudden, I'm worth $300 million-plus.

And I'm sitting there thinking,

Oh, fuck, if this stock price triples, I'm a billionaire.

Well, we took that company

and became the biggest media portal on the internet.

And Yahoo came along and made us an offer,

and all of a sudden, that stock price tripled,

and I was a billionaire.

We sold the company to Yahoo for stock.

And I'd seen stocks go up, and I'd seen stocks go down.

And I told Todd, my partner,

I told everybody who worked for us, There's a good chance,

because this stock market is so highly priced,

that the whole thing could crash.

Don't be greedy.

Todd had the same. Pigs get fat, hogs get slaughtered.

Don't get slaughtered.

So I put together what they call a collar,

and what that is, I sold some of the upside

to that Yahoo stock that they gave me,

and I protected myself by buying puts on the downside.

Three months later, the internet stock market cratered.

It was called one of the top ten

Wall Street trades of all time,

and it taught me a hell of a lesson.

When you just chase dollars, it never works out well.

I was worth a billion motherfucking dollars,

and it was the most insane thing

that I could ever come to realize.

All I had to do was protect it and not get greedy,

and I'd be set for the rest of my life.

We talked about how I made and saved some money.

We don't quite have a billion dollars here,

but let me tell you how I spent it.

[mellow music]

I told you I value time.

First thing I bought? Gulfstream G5.

Now, I didn't just buy it. I'm a tech guy.

I go online and I'm looking up Gulfstream G5.

Emailed a guy, and I'm like, Can I do a test flight?

First time I'd ever been on a private plane. Ah!

Sitting there, and I'm thinking,

Oh, shit, this could be my plane.

So I stacked up some more,

and I sent him an email saying, Done, $40 million.

I'll buy it.

Biggest online purchase in the history of the internet,

still to this day, was my buying that Gulfstream G5.

Why'd I want a plane?

Because the most valuable asset

you can never own is your time.

And the one thing I can do is save time and get to places,

and it was fucking amazing.

[mellow music]

Second purchase?

I paid $285 million for the Dallas Mavericks.

I went to opening night of the '99-2000 season.

First game of the year.

Wasn't sold out, energy wasn't in the building.

I'm a season ticket holder, a huge Mavs fan.

I look around thinking, I can do a better job than this.

Then I realized, I can put my money where my mouth is.

This was early November.

By January 4th, I owned the Dallas Mavericks.

So when I took over the Mavs, I didn't get a big office.

I didn't give a shit about an office.

I didn't get a big desk.

I didn't give a shit about a big desk.

We had a sales bullpen.

We called it the fishbowl 'cause it was in an open office

with all these windows.

And we had eight, nine, whatever salesperson.

I put my desk right in the middle of them,

I put a phone book and a computer printout

of all of our former customers.

And right there next to them, I just started dialing,

trying to sell the Mavericks.

Ma'am, I know you've been to a Mavericks game before,

but do you realize now that it's less expensive

to come to a Mavericks game

than to take your family to McDonald's?

Our tickets start at $8,

and McDonald's and a Coke is more than that.

Why don't you come and try us out?

The first game's free on me.

I wanted everybody that worked with me to see

that if I asked them to do it, I'll do it.

Same thing I did with people in the front office,

I did with players on the court.

We moved into a new arena, American Airlines Center.

I wanted them to, when they go to work,

feel good about going to work.

We put in PlayStations,

we put in TV screens, now to this day.

We upgraded it so that we had aroma,

because different aromas impact you

more before a game when you're trying to get hype

versus after the game.

Light impacts you more.

All these things that try to give our players an edge,

to help us win, but to also help them succeed.

If you're running a company

and if you can align your interests

with those of the people you work with,

things are gonna work for you.

And you know what's really cool about owning a team?

It's not so much owning the team.

There's little perks.

Let's just say that you're down one.

There's three seconds to go in the game.

Your team takes the shot for the chance to win.

The ball is in the air.

Everybody is holding their breath.

And when that ball goes through the hoop,

you see the players go running out

and dogpiling on top of each other,

screaming and yelling and hugging

and you see this big pile of people.

Well, I own the team.

I get to run out with 'em!

No one's gonna arrest me! It's my team.

And that is the most amazing part of owning the team.

There's not enough stacks in the universe

for what that was worth to me.

That was my second big purchase.

Third big purchase.

[mellow music]

I need to set an example here and take the money down,

because there was a lesson in my third big purchase.

So one day, one of my partners from MicroSolutions,

Martin Woodall, comes up to me,

and he goes, There's this amazing house

that's about to go into foreclosure.

The guy who owned it spent three years building it.

This was their dream house,

he and his wife and his whole family.

Spent $25 million building this house.

Only lived there eight months,

and then the stock market crashed.

And he had never sold a share of stock,

and because of that, he had to get rid of his house.

Martin called me and said, You can buy it right now,

but you have to let me know today.

Yes or no, $12.5 million.

I'd never seen the house. I saw some pictures.

I'd never been there.

I was like, Fuck yeah. I'm a billionaire.

That was my one why the fuck not purchase.

And it's an amazing house.

I've raised my three kids there, still live there,

but the lesson is large.

You know, you can't ever take wealth for granted.

You can't ever think it's always gonna be there.

If it's not, you're gonna get busted.

If you want to be a millionaire, you can do it,

but there's a couple things

you have to be able to accomplish.

Rule number one: find something you can be good at,

and then be great at it.

Second: you have to know how to sell.

Whatever it is you're good at,

somebody's gonna need that service,

someone's gonna need that product,

whatever it is that you're creating,

but you have to be able to sell

'cause you don't want to be in a position

where you're dependent on other people.

Number three: be curious and always be learning,

because the one thing that's certain about business

is that it changes every single day.

And then the fourth thing:

when you have that knowledge,

when you have that ability to sell,

when you know that when you walk into a room

you know your shit better than anybody else in the room,

that's when it's time to start a company.

Then you can start to control your own destiny.

Thanks, everybody in GQ land, for tuning in

to see how I earned, saved, and spent my first million

and then turned it into a billion.

I'm gonna see you at the home games. Be there.