Mark Cuban’s latest recipe for success

Multibillionaire Mark Cuban, always looking to unlock hidden assets, apparently finds none in either “shy” or “retired.” The owner of the NBA’s Dallas Mavericks, whose rampant dress-downs of league referees have cost him millions in fines; a panelist on “Shark Tank” for the past 13 years; the kind of guy who loved playing himself on HBO’s “Entourage,” Cuban is a high-functioning multitasker.

Axelrod asked, “Is it impossible to stay in touch with what most people think of as a ‘normal’ life?”

“Yes and no. It’s not like my friends are rich; they’re not. At the same time, if you hop on a plane, it’s your fly.”

But these days, if you want to know what’s catching his eye, check out his latest venture: the Mark Cuban Cost Plus Drug Company, which aims to change the way we fill our prescriptions—as big a potential disruption as the industry has seen .

Asked how much of his head is being eaten up by Cost Plus right now, Cuban replied, “About 99.99%. Financially, emotionally, intellectually, all that bandwidth goes to Cost Plus.”

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Entrepreneur Mark Cuban, who now aims to disrupt the half-trillion dollar prescription drug market.

CBS News


Prescription drugs are a half trillion dollar market in the United States. Cuban wants more transparency about how prices are set – an opaque and complicated process, he says, which is largely controlled by middlemen.

Cost Plus deals directly with manufacturers and consumers, offering more profits for those who make drugs, and lower prices for those who take them. His prescription for pricing = drug price, plus 15% for Cost Plus, plus a $3 pharmacy fee, plus $5 shipping.

Cost Plus offers 1,100 medications right now, mostly but not all generic drugs, such as atorvastatin (generic of the cholesterol drug Lipitor), which retails for $55.08 for 30 pills. Cost Plus? $3.60 for the same amount.

Cuban said, “When I was in my 20s and 30s and early 40s, it was, ‘How much money could I make?’ But at this point in my life, where the next dollar I bring in isn’t going to change my life, my kids’ lives, my kids’ lives, the capitalist reward comes from having an impact.”

At age 64, Cuban has been focused on the next dollar for close to 50 years, since he was a kid in Pittsburgh. “Selling trash bags door-to-door, selling magazines, selling candy door-to-door. ‘Hi, I’m Mark. Do you use trash bags? If you just call me every time you need trash bags, they’re only $6 per hundred, I come and I’ll just deliver them at home. Once you’re a salesperson and know how to sell, there’s nothing you can’t do.”

That sales job developed along with a certain toughness in his working-class Jewish home. “The first time I got into a fight, a boy came up and hit me and started calling me a kike. And of course I had to beat the hell out of him! But I go in to my dad and say, “What’s a kike ?” Every generation has a reason to have fear. But every generation has a reason to have hope.”

He brought these qualities with him to Indiana University, along with a penchant for taking risks and thinking outside the box. He bought a bar, Motley’s Pub, before he was old enough to drink. “It was the first time I had to try to get things organized and actually run a real business. And I realized I wasn’t very good at it; there were a lot of mistakes I made.”

After graduation, he worked in a bank; which lasted 9 months. Cuban had too many other things to try, like acting, grabbing parts in a bunch of B movies.

His first big money came at the age of 30, selling a software company he had built called MicroSolutions, still not ready to settle down. “I got about $2 million after taxes,” he said. “I bought a lifetime pass on American Airlines and I’m not going to work, I’m just going to party like a rock star in as many countries as I can.”

His constant anger was focused on and invested in the emerging sector of technology and computers. “My net worth just kept going bam, bam, bam, bam, bam, bam, bam, bam, bam along with it. By the time I was 35, I was worth, you know, $15, $20 million. Life was good.”

Millions turned into billions. When he and his college roommate Todd Wagner, also now a Dallas resident, wanted to listen to Indiana University basketball games on their old campus 900 miles away, they came up with a solution: AudioNet, which later became Broadcast.com.

Cuban said, “I go buy a computer, upgrade my phone line, download Netscape software for the server and start looking at different options to try to put audio and eventually video on the Internet. Nobody was doing that at the time. We was first.”

“I feel like I’m listening to the origin story of streaming,” Axelrod said.

“It is the origin story of streaming, for sure. No one did. No. People thought I was an idiot!”

He wasn’t. The company will be sold to Yahoo for $5.7 billion in stock. “It was the craziest thing ever. Never in my wildest dreams did I think I could be worth a billion. I was ready to retire when I had $2 million, you know?”

Axelrod asked, “If you were worth a tenth of what you’re worth, would you be as happy?”

“Yes.”

“One percent of what you’re worth?”

“Yeah. If I had the same family and everything, sure.”

“And to people who say, ‘It’s easy for him to say’?”

“Yes, of course. But if you talk to my friends from back then who are still my friends, they will tell you that I have things. But hopefully I haven’t changed that much.”

“Sunday Morning” took him up on his idea, and went to talk to some of Cuban’s oldest friends at a lunch spot in Pittsburgh. They all agreed, Cuban is still the same guy. One, Jerry Katz (nicknamed Big Man), expanded: “A little more drunk on it, but not that much more drunk on it! But still the same guy!”

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Mark Cuban and correspondent Jim Axelrod sit down with some of Cuban’s childhood friends (clockwise from left): Stu Chaban, Steve Rosen, Jerry Katz and Todd Reidbord.

CBS News


What the world sees of Mark Cuban now, they only saw then. As Steve Rosen (aka Toe the Pro) recalled, “We got into stamps. I like to collect stamps, and Mark expressed an interest in stamps. We’d go to a stamp show. We’d go in with $20 each. I’d come out with stamps; Mark would come out with $100! It was amazing!”

“Inefficient markets, you look for inefficient markets,” Cuban smiled.

“He would buy them on the second floor and sell them on the first floor, wouldn’t he?” Katz asked.

“More or less!”

That’s how he got to shoot baskets on a full court in the backyard of his $20 million mansion, where he lives with his wife and three kids — a guy who’s been draining them from the deep for decades now.

Axelrod asked, “What did you know about running a professional sports team when you bought the Mavs?”

“Nothing. Absolutely nothing.”

The Dallas Mavericks he paid $285 million for 23 years ago are now estimated to be worth more than $3 billion. But remember this is a guy looking for “hidden value”. “The connection to your customer is stronger than anywhere else,” he said. “You know, you don’t get requests from Make-a-Wish to sit down with a software programmer.”

A man who understands the role of luck in creating his great fortune.

Axelrod asked, “Do you walk around every day feeling, ‘Man, did I get dealt a good deal?’

“Yeah. How the hell is this happening to me?” he answered.

“How do you explain that?”

“I can’t. Life is half random. It’s half you have some control over, and half it is what it is,” Cuban said. “If I was born five years earlier, not during the early days of the internet, you might not know my name. And I’m never going to take it for granted, and enjoy every stinking moment of it!”


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Story produced by Gabriel Falcon. Editor: Ed Givnish.

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