Brett Pulley’s The Billion Dollar BET: Robert Johnson and the Inside Story of Black Entertainment Television chronicles Robert “Bob” Johnson’s journey, his highs, and his lows.

Bob wasn’t a well-rounded founder and didn’t have a well-rounded founding team. Bob had deficits, but he shrewdly got around them to navigate unfamiliar waters. Some people work on their weaknesses. Bob took a different approach: he leaned on his strength, relationships (he was a lobbyist). Here are a few examples:

Satellite

After launching, Bob wanted BET’s programming to expand from six hours a week to 24/7. Through his cable relationships, he learned that HBO had unused satellite capacity. It was worth $2–$3 million a year, money Bob didn’t have. Bob negotiated a deal with HBO: it took a 15% stake in BET in exchange for the satellite time. HBO was owned by Time Inc., a major cable system, so Bob was now partnering with two large cable systems, Time Inc. and TCI (i.e., John Malone). And BET was a 24/7 network.

Sales & Marketing

Bob had no sales or marketing staff, so he struggled to sell advertising or convince cable operators to carry BET. His relationship with Time Inc. solved this problem. For $450,000 a year, Time agreed to manage BET’s marketing and affiliate sales using experienced HBO employees. This deal jump-started BET’s charging per-subscriber fees to cable systems, a new revenue stream. BET also leveraged Time Inc.’s lawyers for negotiations and its engineers for developing BET’s technical skills. After several years, BET gained expertise in these areas. The partnership ended in 1988. Bob hired a sales leader and built a sales team. By 1991, BET reached 53% of US homes wired for cable and reported $50 million in annual revenue and $9.3 million in annual profit.

Finance & Capital Markets

Bob knew nothing about raising money or about capital markets, which put him at a resource disadvantage. Luckily, his first investor, John Malone, was a financial engineer and master capital allocator who sold TCI to AT&T for $48 billion. Bob sought his counsel on capital-related issues. Malone was instrumental in Bob using savvy tactics in the early years, such as paying interest on $8 million of debt by issuing additional BET shares while not diluting Bob’s or Malone’s stakes. Malone planted the idea of BET capitalizing on a booming stock market by going public. He coached Bob through the IPO process, and the company’s stock began trading on NYSE in 1991. He helped Bob navigate BET buying Time Warner’s equity for a discounted $58 million (it was worth $191 million two years later). And he advised Bob to take the company private again, which he did in 1998 at a $1 billion valuation. Malone was at Bob’s side for the pinnacle of his career: negotiating and selling BET for $2.3 billion in stock to Sumner Redstone and Viacom.

Bob’s tactic of leaning in to his natural strength—relationships—was masterful. Using the expertise and assets of his partners kept him from wasting time and making mistakes while simultaneously lessening his weaknesses.

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