Robert L. Johnson

Entrepreneur

• Born: April 8, 1946
• Birthplace: Hickory, Mississippi

Entrepreneur

The first Black billionaire in the United States, Johnson created Black Entertainment Television (BET). After selling the successful cable network to Viacom, he purchased the National Basketball Association’s Charlotte Bobcats, becoming the first African American owner of a major sports franchise. After selling the team, he diversified his business interests to include luxury hotels in tourist and resort areas.

Areas of achievement: Business; Radio and television; Sports: basketball

Early Life

Robert "Bob" Louis Johnson was born on April 8, 1946, the seventh child of Edna and Archie Johnson. His hometown, Hickory, Mississippi, had fewer than seven hundred inhabitants. Johnson’s great-grandfather had been enslaved. Johnson grew up on the family farm, land passed down from the great-grandfather. The family earned a modest living, but poor harvests during the 1950s forced them to relocate to Freeport, Illinois, around 1963. There, Archie and Edna found work in factories. After thirty-six years of marriage, Johnson’s parents divorced.

Johnson was always enterprising, even as a teenager. He worked in his mother’s factory sweeping floors, delivered a daily newspaper, and cleaned animal pens on local farms. While his older brothers excelled in football and two played professionally, Johnson tried high school basketball but failed. He turned his attention instead to academics. When he completed high school, Johnson became the first of his siblings to attend college. He went to the University of Illinois and paid his way by cleaning science laboratories at night. A history major, Johnson graduated with honors in four years. He also met Sheila Crump, a cheerleader at the university.

While Sheila finished her degree at Illinois, Johnson was accepted into Princeton University’s graduate program in international relations. He received a full fellowship. Nearly halfway through his degree, Johnson dropped out and found a teaching job in Chicago to be near Sheila. They married in 1969. Johnson returned to Princeton and earned a master’s degree in public administration in 1972.

Life’s Work

Johnson and his wife settled in Washington, DC, where she worked as a research analyst and he found a position at the National Urban League, a moderate civil rights organization. The Urban League focused on economic empowerment; through his work, Johnson honed his skills as a communicator. He envisioned becoming an entrepreneur.

Making contacts and learning the inner workings of Washington facilitated his ambitions. Johnson left the National Urban League in 1976 to work for the National Cable Television Association. Although cable companies were expanding during the 1970s, African Americans were left out. Johnson recognized a niche opportunity to serve Black cable viewers. To many, Johnson’s idea of an African American–owned cable company seemed far-fetched. Johnson was not deterred. He approached Bob Rosencrans about purchasing satellite time on Friday nights. Instead of selling Johnson time, Rosencrans gave him a two-hour slot. Johnson used the gift, a bank loan, and friends’ investment money to found Black Entertainment Television (BET) on August 8, 1979. However, he still needed capital. Johnson approached John Malone, a powerful executive with cable company TeleCommunications, who purchased 20 percent of the company for $320,000 and lent Johnson $180,000. Johnson also sought Malone’s advice. The latter told Johnson to keep costs for personnel and programming low.

Initially, Johnson filled his programming slots with African American gospel music, Black college football games, and later music videos. BET grew slowly during the 1980s and became profitable in 1986. As it added time slots, Johnson developed news programs, infomercials, and more videos. Meanwhile, he borrowed from larger cable companies, including HBO, Time (later Time Warner), and TeleCommunications.

Eventually, Johnson’s ownership stake declined to just 51 percent, spurring criticism from some in the African American community that he was merely a minority figurehead for the major corporations. Despite the criticism, Johnson persevered. In addition, he took BET’s stock public on November 1, 1991. Shortly after going public, however, BET stock declined. Another cable franchise stepped in and purchased several thousand shares, stabilizing the stock’s value.

The company endured several more setbacks. Johnson’s sister Paulette was dismissed for embezzling funds from the company. She and two other former female employees filed lawsuits claiming that they were owed millions of dollars’ worth of BET stock. One of the women revealed that she and Johnson had carried on a three-year affair. Johnson settled the lawsuits out of court for $4 million. Another executive was found to be embezzling large sums. The company, however, stayed profitable.

BET also faced controversy for filling its growing air time with music videos. In 1991, competition from MTV, which also showed Black music videos, drove Johnson to begin showing videos for hip-hop and gangsta rap songs. Within five years, music videos made up about two-thirds of all programming on BET. The sexually suggestive content of many videos drew criticism from members of Congress, Black clergymen, and even major television networks. Johnson withstood the criticism and even increased the air time given to music videos, which appealed to young African American viewers and thus drew more advertisers.

By 2000, Johnson also had faced problems with the Internal Revenue Service and attempted unionization by BET’s hundreds of employees. He began to look for another business opportunity. Johnson attempted to purchase the Washington Bullets (later renamed the Wizards) of the National Basketball Association (NBA). The team’s owner, Abe Pollin, refused to sell. Two years later, Johnson tried to purchase the NBA’s Charlotte Hornets from George Shinn, but his offer was rejected. When Shinn moved the Hornets to New Orleans and the NBA promised to give Charlotte another team, Johnson fought to win the ownership rights to that team. On December 18, 2002, he purchased the expansion team later named the Bobcats for $300 million.

Six months earlier, however, Johnson's wife had filed for divorce. She eventually received a settlement reportedly close to $1 billion. Soon afterward, Johnson sold BET to the powerful media conglomerate Viacom for $3 billion. After the sale, Johnson made the Forbes magazine list of the world’s richest people.

After selling BET, Johnson founded RLJ Companies, a holding company with subsidiary businesses in a variety of fields. Some of the most successful include RLJ McLarty Landers Automotive Holdings, RLJ Equity Partners, and RLJ Lodging Trust; within about a decade, RLJ Lodging Trust was one of the largest real estate investment trusts traded on the New York Stock Exchange.

Although the Charlotte Bobcats enjoyed strong early attendance, their lack of success and star players led to a financial swoon. Despite Johnson’s efforts, the team could not turn a profit. In 2009, he put the team on the market. In March 2010, the NBA Board of Governors approved the team’s sale to Michael Jordan. Johnson sold the Bobcats for $275 million and retained a minority ownership stake; he lost nearly $180 million on the team during his last few years as owner.

Johnson announced plans to launch a subscription streaming service dedicated to content aimed at an African American audience, the Urban Movie Channel (UMC), in 2015. UMC was eventually rebranded ALLBLK.

In 2013 Bob Johnson was given the A. G. Gaston Lifetime Achievement Award by Black Enterprise Magazine. He has served as a member of the board of directors for KB Home, Lowe's Companies Inc., Strayer Education, Think Finance Inc., the NBA Board of Governors, the Business Council, the Smithsonian Institution's National Museum of African American History and Culture, Elevate Credit Inc., G-III Apparel Group, and Discovery Inc., along with several RLJ companies.

In 2016 Johnson advised Donald Trump, then president-elect, on market-based economic policy proposals that could improve African Americans' finances. A few years later, in 2019, Johnson began publicly calling for $14 trillion in reparations to African Americans for centuries of enslavement and systemic racism; he argued that reparations should be seen as damages, an ordinary facet of capitalism, and would reduce the vast wealth inequality between Black and White Americans.

Significance

Johnson was a successful entrepreneur who prided himself on becoming the first African American to break into the previously all-White world of major corporate executives. He built a powerful Black-owned and Black-operated cable network by tapping into the underserved audience of African American viewers.

Bibliography

Belvedere, Matthew J. “BET Founder Robert Johnson Calls for $14 Trillion of Reparations for Slavery.” CNBC, NBCUniversal, 1 June 2020, www.cnbc.com/2020/06/01/bets-robert-johnson-calls-for-14-trillion-of-reparations-for-slavery.html. Accessed 26 July 2021.‌

Bennett, Anita. "BET Founder Bob Johnson Fires Back at Critics of His Decades-Long Diversity Push." The Wrap, 1 May 2015, www.thewrap.com/bet-founder-bob-johnson-fires-back-at-critics-of-his-decades-long-diversity-push/. Accessed 26 Apr. 2016.

Dingle, Derek. “Robert L. Johnson, BET Holdings, Inc.: The Brand Master.” Black Enterprise Titans of the B.E. 100s: Black CEOs Who Redefined and Conquered American Business. Wiley, 1999.

Johnson, Robert L. "The Curtain Never Falls on Bob Johnson." Interview by Caroline Clarke. Black Enterprise, 16 July 2013. RLJ Companies, rljcompanies.com/wp-content/uploads/2020/07/The-Curtain-Never-Falls-On-Bob-Johnson-published-by-Black-Enterprise6.pdf. Accessed 26 July 2021.

Pulley, Brett. The Billion Dollar BET: Robert Johnson and the Inside Story of Black Entertainment Television. Wiley, 2004.

Rainey, James. "BET Founder Offers Solution to Fix Oscar Diversity Problem." Variety, 19 Jan. 2016, variety.com/2016/film/awards/oscar-diversity-bet-robert-l-johnson-1201683395/. Accessed 26 Apr. 2016.

Smith-Shomade, Beretta E. Pimpin’ Ain’t Easy: Selling Black Entertainment Television. Routledge, 2008.