I had a chance to discuss franchising with Daymond John, the recognized TV personality and investor on ABC’s award-winning Shark Tank, the founder and CEO of international hip-hop fashion brand FUBU, Inc., and the NYT and WSJ bestselling author of The Power of Broke.
John talked about how to succeed as a franchise entrepreneur and said that he’s looking forward to serving as a guest judge at the NextGen Global Franchising Competition at the IFA’s Annual Convention in Phoenix on February 10-13, 2018. Applications are still open until Sept. 15, 2017 and can be submitted at www.nextgenfranchising.org.
Why experienced hustlers make the best investments
John hopes to see entrepreneurs present a strong proof of concept, scalability of the business, and a response from the experts in the live audience.
“The ones who are successful at franchises are the ones who’ve failed in the past,” said John. “They’re the hustlers at 5am. They’ve seen what not to do, and so they’ve found something that fits their life.”
“I have people tell me, ‘Running your own business is tough, and I didn’t know what I was doing.’ So these franchisees don’t have a problem paying the 5-10% to have a lot of the details figured out already.”
There’s freedom in spending other people’s money
John is no fish out of water when it comes to evaluating pitches off the top-rated ABC reality show.
“I’m looking forward to the fact that I can actually judge and not spend my own money,” he laughed. “When it’s your own money you get opinionated, like sharks. But I’m going to be objective and straightforward because I don’t have to hide my shortcomings as an investor.”
A next franchise act
In addition to licensing his $6 billion FUBU brand to open five FUBU Mobile stores in Brooklyn, a concept similar to MetroPCS and Cricket, John disclosed that he’s rolling out a new franchise company and plans to launch it at the IFA Convention in February 2018.
“It’s too early to give out details,” said John. “We’re working on the name right now.”
He didn’t say which industry it’s in, but he did say some industries perform better than others as franchises. For example, John pointed out that “lifestyle experiences” are a great fit.
“I don’t see enough dance studios. That’s something you can’t do on your phone,” he chuckled. “Something that offers a community with a physical element is good for franchising, like the Flywheels of the world, or anything related to fitness. I have ownership in a couple crossfit gyms.”
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