This is where I may lose some fans. My answer to this question is: "It depends." Don't get me wrong, I am all for Black entrepreneurship and empowerment within the community. I fully understand that ownership is everything to a race that virtually has nothing. However, there are some scenarios when selling your company to a non-black company makes perfect sense.
You should "sell out" to a white company when...
A) Your business is in serious trouble, and no Black-owned company is offering to buy you out. The only one making bids is a white company.
B) A Black-owned company is offering you $100,000 for your business (what you make in a year), and a white-owned company is offering you $5 million.
C) When the same white company that wants to buy you out, is also powerful enough to duplicate your services, and put you out of business.
D) When a white company makes you a very reasonable offer, and you have shareholders who deserve to finally reap financial rewards.
E) When the white company that acquires your business, can actually enhance your business like no other Black company can.
Clearly, these are reasons where one should be excused from "selling out". Many people have criticized Bob Johnson for selling BET to Viacom for $3 billion. However, when you look at it from the business angle - it made perfect sense for him to do that.
Viacom was a bigger and more powerful media company that has sense turned BET from an African-American brand to an American brand. The channel still features Black content, but now with a global appeal. Believe it or not, but the value of BET has actually increased since the Viacom acquisition.
In addition, BET was a public company and Bob Johnson had to ethically and sensibly do what was best for his investors.
At the end of the day, business is business! You have to do what is best for your company. Not making a smart business decision because you may be labeled a "sell out" may cause a financial disaster for you and your shareholders (if you have any).
And who said that every Black entrepreneur is out to save Black America?
Dante, you are wise beyond your years. As an older person, I made these same points to many of my colleagues.
ReplyDeleteThere is one other point: Bob Johnson has leveraged the financial rewards of this transaction to enhance his presence as a Black business leader in the marketplace. so, when a "sale to a white company" can help the Black Entrepreneur reposition themselves as a stronger participant, the end justifies the means.
I thinks when a white company wants to buy or buys a black company it says alot about the company especially when it would be easier for the white company to just steal the the executive/employees from the black company. It really does not matter the color of the aquiring company since this is what happens everyday in business. "Business is Business"! It's really a compliment since these companies see "value" in our business where we sometimes do not. We don't buy stock in these companies and it's really about the shareholders. Case in point: Rocawear sold out, PhatFarm & BabyPhat sold out, Steve Stoute's Translation Branding and Marketing sold out...etc etc...An entreprenueur knows that at the end of the day, it's better to sell when the time is right then to be stuck. Dante you have a fan for life. Keep feeding us....love this blog...
ReplyDeleteBET was never owned by Bob Johnson if what I heard was correct. He never owned majority shares in the compnay as I understand it . He borrowed majoriy of the money from a white friend I believe . My be I am wrong but this is what I was made to believe .So it made perfect sence to sell it for the bigger pie it did. Only Bob Johnson
ReplyDeleteknows the actual truth. Now see what happens with BET programming
IT'S WORSE. ABSOLUTELY BAD.
IMHO a company is not what is valuable to the community. It is the person who created that company that holds the most value for our community. By selling BET, Bob Johnson has been able to further invest in new companies that has created new opportunities for others in our community. Business is all about making money, so you should sell to the person who presents you with the best offer regardless of race, sex, religion, smell, etc.
ReplyDelete