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Daymond John, the renowned entrepreneur, investor, and judge on Shark Tank, highlighted that success does not necessarily require an initial financial boost or industry connections, in an interview with Fortune on December 14. John’s insights challenge the common belief that wealth is primarily built through financial capital or networks, offering an alternative approach to building success from scratch.
"You don't need money to make money. You do not… And that's how you really simply look at things," John emphasized.
The Shark Tank investor, known for his investments in businesses such as Bombas socks and Ring doorbells, underscored that wealth-building is more about creativity, resourcefulness, and the ability to build a community.
Shark Tank investor Daymond John’s insights on achieving success without financial backing or industry ties
The misconception of money as the primary driver
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The idea that wealth is a result of money or connections is often reinforced by societal views of success. Daymond John explained that the idea of having a large capital or knowing the right people is necessary to thrive in business is a misconception.
He pointed out that many individuals who have received large sums of money, such as professional athletes or lottery winners, often lose it.
“Why would 65% of athletes and lotto winners go bankrupt three years after leaving the league or winning the lotto?” John asked.
He used these examples to illustrate that sudden wealth does not necessarily lead to long-term financial stability or success. John further emphasized that many of the wealthiest individuals in the world are self-made.
“Why are the top 1000 wealthiest people in the world self-made men and women?” he remarked.
The Shark Tank investor explained that self-sufficiency and ingenuity are more reliable routes to success than relying on inherited wealth or powerful connections.
Creativity and community building as key to wealth
John explained that his success can be attributed to creativity and community-building, rather than large financial investments. He emphasized that being able to think outside the box, creating something unique, and fostering a loyal customer base or community can lead to significant achievements.
Despite starting with limited funds, FUBU— the streetwear brand founded by Daymond John in 1992— grew into a business that grossed $350 million in sales by 1998. The brand's success was driven by innovation and a strong connection with its audience, rather than by significant initial financial capital.
The Shark Tank investor further underscored that large, established businesses do not always retain their wealth. Referencing companies that once thrived but eventually faced decline, he remarked,
“If you needed money to make money, well then, we can call Kodak and Blockbuster and Blackberry and Red Lobster and Friday’s to see how that’s working out for them.”
John’s approach to investing and financial growth
John’s approach to investing aligns with his belief in financial prudence and long-term thinking. During his Fortune interview, he explained a simple yet effective strategy for handling money.
“If you have $3, $3 million, or $3 trillion, the first dollar goes for what you have to pay for,” he stated.
The second dollar, according to the Shark Tank investor, should be invested in personal growth or business ventures— anything from purchasing a book to investing in a public market. The final dollar can go toward discretionary spending, on things that are enjoyable but not necessary.
John emphasized that, over time, the second dollar—those funds invested—can generate returns, which then lead to further financial growth.
“And over the years, number two will start flowing into bucket number three and number one,” he concluded.
This framework, according to John, can lead to long-term wealth accumulation.
New episodes of Shark Tank air on ABC every Friday at 8 PM ET, and can also be streamed on Hulu.
