Seven famous founders share money mistakes, smart moves

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Seven famous founders share money mistakes, smart moves
By Laura Petrecca

The crumbling of Wally Amos’ cookie empire taught him how to be a better man, and a better business leader.
The creator of Famous Amos Cookie Co. opened his first cookie shop in 1975. A decade later, the once-growing company faced severe financial trouble, forcing him to sell the company in pieces to outside investors.

USA TODAY reached out to successful business people to hear about their financial foibles, their best business decisions and their lessons learned.

Daymond John: FUBU

John’s apparel prowess began on the streets of Queens, N.Y. Shocked by the expensive prices of “tie-top” hats, he asked his mother to teach him how to sew so he could make his own hats and sell them. A banner sales day in 1992 — $800 in sales — further spurred his entrepreneurial drive.

He worked with a friend to create the FUBU logo (which stands for For Us, By Us) and began to produce sportswear from his home. FUBU is now an international clothing brand, and John is a celebrity judge on the TV show Shark Tank.

•Money mistake. John says he spent years “not understanding how little things financially make a big difference down the line.” Only about six years ago did he first begin to really grasp financial concepts. He made flubs such as not putting more company money in the bank to take advantage of compounding interest. And personally, he learned not to spend his money on “frivolous things,” such as high-end watches.

“I was always told, ‘Jewelry is an investment,’ but it’s not,” he says. He says he spent about a million dollars on watches that are worth only about $50,000 now.

His advice for new entrepreneurs: glean financial and business knowledge by taking classes or finding an internship in the field in which they want to work.

Savvy move. John realized early on that there are many legal issues that go with starting a business such as making sure patents and trademarks are in order.

“The first important thing to do is legally structure the company,” he says. Building a company “is like building a building. If you have a weak base, it will crumble.”

» Read the full article on USA Today 

 

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  • http://www.accountingtips4you.com Mike Harmon

    You know, I have to tell you, I really enjoy this blog and the insight from everyone who participates. I find it to be refreshing and very informative. I wish there were more blogs like it. Anyway, I felt it was about time I posted, I

  • http://FineHomesofNorthAmerica.com Keith Allen

    Superb! Damon I hope to meet you at the top. While on my journey I promise you I won’t get blinded by the shiny things.

    Thank you and have a superb week,

    Keith

  • Linwood M Williams Jr

    I have to salute all the does and dont’s of this blog.There all worth while reading and very mindful.To think that starting a business is a walk in the park is a blind mans dream.Thanks for giving entrepruners more drives as risk takers and money makers.

  • http://www.designerteez.com Mike M.

    This is a great article and blog and as an entrepreneur in the clothing industry, it is refreshing to find people such as Damon who will share their successes and failures for others to learn from. Damon’s book Display of Power is a must have for any budding entrepreneur. It is insightful and riveting and the first time I sat down with it I read it from cover to cover in one sitting. The next time I went through and highlighted important points and use them everyday in my business. I hope to someday not only be as successful as Damon, but to make my mark on the business world as well. Thanks for your insight.

    Mike

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  • http://hhaggins.fatcow.com/ Hazel Haggins

    It is great to read about the 7 founders money mistakes. In reading them, I definitely know what not to do. It is great that they took the time to share such valuable information. I was really sadden by Famos Amos story. Those are some good cookies. I always enjoyed them. I hope and pray for his success in life. I am in the process of trying to get a book published, and this information and ideas will definitely be taken into consideration. Thanks to all who shared their story and you to Daymond.

  • Lisa Blair

    Congratulations on more Shark Tank! We all love this show!! Keep it coming!

  • http://www.nickevery.com Nick Every

    As a start up clothing company trying to go in a similar path that Daymond went in, this is very insightful! Knowledge is power!!! Check out Nick Every everyone!

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