Billy Wilkerson Part 2: How Addiction Almost Derailed the Big Vision

By the end of 1944, William Richard “Billy” Wilkerson sought ways to gamble legally without incurring personal losses. He looked hard at Las Vegas because Nevada was the only state with legal gambling at the time. The extreme desert heat and seclusion initially turned him off, but he realized the location was perfect for limiting distractions to gamblers. In December 1944, he leased the El Rancho Vegas for six months for $50,000, but he had bigger plans. He wanted gambling to be an elegant experience as it was in Europe, not a rustic experience as it was in the few casinos in Las Vegas at that time.

In January 1945, Billy purchased thirty-three acres several miles outside the city for $84,000. People thought he’d made a mistake, but Billy knew he couldn’t get that much land in the town and wanted to avoid competing with existing casinos.

In February, Billy started putting his vision on paper and hired architects. He wanted to build an oasis that would be heaven for gamblers and a relaxing spot for non-gamblers. He envisioned it as a luxurious vacation destination with a casino, showroom, nightclub, hotel, restaurants, health club, and more. He wanted his project to resemble European luxury and rival a Monte Carlo casino, with black-tie evening attire. Billy leaned on his gambling addiction to create the perfect gambling environment—including no windows so gamblers wouldn’t be distracted by sunlight. Most importantly, his project would be the first hotel in the United States to offer air conditioning, making the desert comfortable for the rich and famous patrons he wanted to target. Billy loved birds, so he named his project the Flamingo Hotel after the beautiful pink birds he’d seen on a trip to Florida.

Billy didn’t know how to run a gambling operation, so he hired Gus Greenbaum and Moe Sedway, who were overseeing lucrative gaming operations at the El Cortez Hotel. Both got good at running gambling operations by doing it illegally as bookmakers. They became silent partners and assumed responsibility for gaming, including staffing and permits.

With plans complete, the project was budgeted at $1.2 million, money Billy didn’t have. Bank of America reluctantly agreed to finance $600,000, and Howard Hughes loaned Billy $200,000. Billy decided to gamble with $200,000 to get the rest but lost it all. Frustrated by this and his continuing gambling losses of up to $10,000 a day, Billy erratically bowed out of the project and signed the land deed over to Sedway in September 1945 to settle a debt.

After seeing what Billy had done with Arrowhead Springs, Joseph Schenck believed in his vision for The Flamingo and convinced Billy to keep pursuing the project. Billy listened and bought the land back from Sedway. In November 1945, construction started, but post-war, materials were scarce and expensive, so the inflated costs exceeded Billy’s budget. The project was 33% complete and Billy had $300,000 invested and not enough to finish. He bet $150,000 of his last $200,000 to make quick money to keep the project going. He lost it all. In January 1946, construction was halted.

In February, a well-dressed businessman from the East Coast named G. Harry Rothberg offered Billy a $1 million investment for a 66% stake in his project. Billy would remain the operator and manager, and Rothberg’s investment group would be silent partners. Billy wouldn’t have to put any more of his own money into the project. Billy was intrigued. He didn’t like having partners, but investors who stayed out of the way he could live with. He negotiated to retain 100% ownership of the land and closed the deal.

After Billy received the funds, Sedway and Greenbaum introduced Billy to his new partner, Ben Siegel, better known as Bugsy Siegel. Billy didn’t know it then, but things would never be the same.

Prefer listening? Catch audio versions of these blog posts, with more context added, on Apple Podcasts here or Spotify here!

+ COMMENT

Billy Wilkerson Part 1: Carrying on the Family Addiction

William Richard "Billy" Wilkerson founded The Hollywood Reporter and the Flamingo Hotel in Las Vegas. I learned about Billy when I read the biography of Kirk Kerkorian. Though I hadn’t heard of Billy, I had heard of The Hollywood Reporter. I did some quick research aiming to find out more about his publishing career and learned that he was a serial entrepreneur who also started several upscale restaurants and nightclubs. I was intrigued, so I bought a biography of him, The Man Who Invented Las Vegas, by his son, W.R. Wilkerson III.

Billy was born in 1890 in Tennessee. His father, William “Big Dick” Wilkerson, was an alcoholic and “obsessive” gambler by trade. He bet heavily and won and lost big. His mother was overbearing, which, combined with his father’s gambling, led to an unstable and unhappy childhood.

In 1916, Billy was in medical school when his father unexpectedly died. Billy was forced to find a job to support himself and his mother. A friend from medical school won a nickelodeon, and Billy agreed to manage it for a share of the profits. This was Billy’s gateway into the theatre business, and between 1918 and 1929 he had various jobs in the industry, including selling films to theatres. In 1929, when he was 39, he acquired a partnership in a trade paper focused on the film industry—but promptly lost control of the paper in a lousy bet.

Billy wanted to start the first trade publication for the motion picture business, so he moved to Hollywood in 1930. He started Wilkerson Daily Corporation, and the first Hollywood Reporter issue was issued that year. Billy was outspoken in his publication—simultaneously a champion and critic of the industry and its players. Studio bosses had all the power, and they didn’t appreciate his tone. For six years, Billy struggled and battled the studio heads. He got loans from friends, including Howard Hughes and Joseph Schenck, to stay afloat. By 1936, his publication was a hit. Everyone read it daily, including President Roosevelt, who had it airmailed to him. Billy’s large audience gave him as much power as the studio bosses who hated him had, if not more.

Around this time, Billy opened several cafes, nightclubs, and restaurants. The depression was underway, but Hollywood had plenty of cash, and Billy’s establishments were wildly successful. As Billy became more successful, he leaned more into gambling and began structuring his days so he could work and gamble—and he began using business funds to gamble, risking funds dedicated to payroll.

By the late 1930s, California outlawed gambling, and Billy had to figure out another way to gamble. Schenck asked him to manage a failing investment, the Arrowhead Springs Hotel in the mountains three hours outside Hollywood. In 1940, Billy agreed. He quickly turned the money-losing hotel into a profitable hot spot for Hollywood celebrities. Eventually, he started running backroom card games. This escalated to full-blown gambling, and the US Marshals raided the hotel and shut it down.

Four years later, Billy was having an awful year. By the end of 1944, he’d gambled away over $1 million. He realized he had an out-of-control problem and sought help, but none existed then.

As he thought about how to address his problem, an idea from Schenck, also a prolific gambler, stuck with Billy: “Be on the other side of the table if you are going to suffer those kinds of losses. . . . Build a casino. Own the house.” Billy reflected on the Arrowhead Springs experience and wondered: what if he could create a legal place to gamble and not owe other people money? This idea would be the catalyst that changed Billy’s life.

Prefer listening? Catch audio versions of these blog posts, with more context added, on Apple Podcasts here or Spotify here!

+ COMMENT

Thoughts on Workflow Changes

I spent the last week making significant changes—which I shared two days ago—to how I work on my personal project. The first was to my recording frequency. I decided to test recording an entire series in a single day instead of one part every day for five consecutive days. And I spent an additional day editing. The second change was in how I determine what content will be included in each audio podcast episode. I was reading my blog post and eyeballing what extra context I’d add to the recording. Now I’ve begun adding (to drafts of my blog posts) bullet points of the context I want to add to my audio recordings..

Today I finished publishing the audio podcast series on John H. Johnson using this new approach. A few thoughts:

  • Adding recording context by enhancing the blog posts was a positive move. This series sounds more concise, and the value per minute to the listener feels high (I’m biased, though). It took longer this week, and it was annoying having to manage various versions of the blog post, but I think with time I’ll see how the time is reduced.
  • The editing time for parts 1 and 2 was still high. Parts 3 and 4 took less time, and part 5 significantly less. I’m not sure if this is a function of my getting progressively better during recording. I need to do more to confirm this. I want to reduce the length of the raw recordings by 40% to 50% and the editing time by 50% to 75%.
  • I didn’t like recording an entire series in a single day and then editing it the next day. That was draining. It did help make the overall story of the series flow better and be more cohesive, though.
  • I like the idea of recording, editing, and publishing daily. Maybe I’ll end up doing something that’s a hybrid. Record daily, edit every other day, and publish once per week. I’m not sure if that’s feasible or not, but I do know that what I did this past week doesn’t work for my personality long term.

Overall, this is directionally accurate, but I’ll need to keep tweaking until I nail my content format and the process of creating it.

I was encouraged this week when I realized I’m close to the 100-episode goal! That will be a milestone I’ll definitely celebrate. It’s been a challenging journey, and when I started this in April, 100 episodes seemed like an audacious goal. But here I am, not far from it. As I marched, the path got clearer.

Prefer listening? Catch audio versions of these blog posts, with more context added, on Apple Podcasts here or Spotify here!

+ COMMENT

Weekly Update: Week Two Hundred Twenty-Four

Weekly Update: Week Two Hundred Twenty-Four

Current Project: Reading books about entrepreneurs and sharing what I learned from them via blog posts and audio podcasts

Mission: Create a library of wisdom from notable entrepreneurs that current entrepreneurs can leverage to increase their chances of success

Metrics (since 4/1/24):

  • Total audio recordings published: 85 (+9)
  • Total blog posts published: 105 (+7)
  • Average recording: roughly 16 minutes (+0) for a biography or autobiography

What I completed this week (link to last week’s commitments):

Content:

  • Audio content changes: I changed the intro to explain what problems it solves for entrepreneurs.

What I’ll do next week:

  • Read one biography or autobiography
  • Write seven blog posts and record seven audio posts
  • Continue reading one of the books about storytelling that I purchased; this is a carryover from last week
  • Complete three feedback sessions

Asks:

  • Listen to my most recent series on John H. Johnson and provide feedback on how I can improve.

Week two hundred twenty-four was another week of learning. Looking forward to next week!

Prefer listening? Catch audio versions of these blog posts, with more context added, on Apple Podcasts here or Spotify here!

+ COMMENT

Last Week’s Struggles and Lessons (Week Ending 7/14/24)

Current Project: Reading books about entrepreneurs and sharing what I learned from them via blog posts and audio podcasts

Mission: Create a library of wisdom from notable entrepreneurs that current entrepreneurs can leverage to increase their chances of success

What I struggled with:

  • Blog posts – I write my blog posts, and when I create each audio podcast episode, I read them and add context. I changed how I write my blog posts and add context to my recordings. These were two separate steps, but this week I combined them into a single step. Instead of loosely eyeballing context points to add during recordings, I started adding these points to my blog post drafts. This change slowed me down since I had to adjust to doing something different, but I’m hoping it will make my recordings more concise.  
  • Recording frequency – Instead of publishing both a blog post and audio podcast daily, this week I published a blog post daily and will publish the audio versions of all five parts of the most recent series in one day. This was a big change in workflow: I’ll be doing heavy days of recording and editing multiple episodes. Before, it was a little bit of everything every day.

What I learned:

  • I’ve been complaining about editing taking too much time. A big part of this issue is likely that I’m not being as concise as I could be. Before I get assistance editing, I want to make my recordings more concise. This is what drove the recording frequency change I mentioned above. This pain is forcing me to constantly think about ways to communicate more concisely, which is good. If I offload editing to someone too early, I’ll miss the opportunity to improve this.
  • Sharing a founder’s journey via a compelling and distilled story resonates with people in my feedback sessions. Jumping from lesson to lesson in their journey without knowing the founder’s complete journey makes it harder for the lessons to stick with people.
  • Many entrepreneurs fail to maintain healthy personal relationships while building their companies. This problem isn’t talked about enough, and I want to highlight it more in the stories I share about entrepreneurs. If the most notable entrepreneurs couldn’t figure it out, then countless current entrepreneurs are likely seeking wisdom to help them navigate it.

Those are my struggles and learnings from the week!

Prefer listening? Catch audio versions of these blog posts, with more context added, on Apple Podcasts here or Spotify here!

+ COMMENT

John H. Johnson Part 5: My Takeaways from a Stellar Journey

I finished reading about John H. Johnson’s journey. John’s autobiography details his life through 1988 or so. When John published this book in 1989, he was 71. He passed away in 2005 at age 87.

How Did John’s Early Years Impact His Trajectory?

John’s family didn’t have money. The two years they were on welfare in Chicago was a low point in John’s life. It put a fear in John that drove him for the rest of his life. He was constantly worried about having to go back on welfare. John decided that wasn’t an option. He was going to make it or die trying.

Chicago also put John in an environment where he was in proximity to success. He could see people he could relate to who’d become successful. Talking with and learning from them helped John realize that he too could become successful. And he noticed that these successful people had more control over their destiny than most, which was something he sought.

John’s mother, Gertrude, set a good example. She was an action-oriented person who refused to accept the status quo in Arkansas City: she believed that she and her family deserved better. Her work ethic and willingness to take risks inspired John. She was also a supportive mother who thought her son could do anything.

John’s experience of being teased in high school put a chip on his shoulder. He found that he could read and learn his way out of any problem.

How Did John Become So Successful?

John’s marriage to Eunice was pivotal. She helped him launch Johnson Publishing Company and helped him think through big company decisions. She also turned Ebony Fashion Fair into a huge success. Eunice was John’s life and business partner. Her support allowed John to thrive.

John was comfortable experimenting. He experimented until his understanding improved. This approach led to JET and Ebony Fashion Fair.

Because John bootstrapped his company, he became a master at resource allocation. He learned to get the most out of the resources he had. And his capital allocation skills allowed him to maintain 100% ownership of his company.

John was a masterful salesman. He studied people and figured out how to tug on his targets’ emotions. He persistently pursued some people for years until he won their business.

Johnson Publishing, the conduit between white America and Black America, elevated his status in both networks. He gained access to elite business and political circles, which opened doors for his company.

John was a risk taker. He embraced being uncomfortable and living life on the edge.

What Kind of Entrepreneur Was John?

John was a founder. He spent his career providing publications to Black Americans. As his resources grew, he diversified and became proficient at investing and deal making.

As a bootstrapped founder, John was operationally oriented. With little room for error, he was adamant that everyone, including himself, double-check their work, and he checked on his direct reports’ progress daily.

What Did I Learn from John’s Journey?

John’s strategy to launch by having customers prepay for his magazine was genius. He avoided any need for the approval of investors or banks, getting it directly from customers instead. He gauged how much authentic demand there was before launching. John realized that customer revenue was the cheapest and best form of growth capital.

John built an audience with magazines. He then built businesses that sold products his audience wanted. His companies advertised in his magazines, which directed his audience to purchase his products. Most companies build and then find customers by marketing to them. John did the opposite and had low to no marketing costs for his product businesses.

Content companies can scale quickly because their cost to reproduce and distribute content can be significantly lower than the cost of reproducing and distributing physical products.

John’s strategy of openly confessing his ignorance to entice people to share everything they knew was a smart way to fill his industry knowledge gaps and build relationships.

John was an amazing entrepreneur. His autobiography details his business journey, involvement in the civil rights movement, service as a director on the boards of numerous large corporations, and candid thoughts about the four US presidents he was close with. Anyone interested in bootstrapping, media or publishing, or American history may benefit from reading this book.

Prefer listening? Catch audio versions of these blog posts, with more context added, on Apple Podcasts here or Spotify here!

+ COMMENT

John H. Johnson Part 4: Professional Success and Personal Tragedy

In 1949, John H. Johnson was doing well. He was a millionaire at 31, and his magazines, Ebony and Negro Digest, were thriving. That wasn’t good enough for John; he feared losing it all. He launched two magazines in 1950 and two in 1951, including JET. JET was a breakout success, selling out its first issue and reaching 300,000 weekly circulation in six months.

According to his autobiography, JET’s and Ebony’s success reduced the circulation of Negro Digest, and John discontinued it in 1951 so he could focus on strengthening his company’s foundation. Cash flow issues, dealing with recessions, expanding the advertising team, and building a solid accounting and finance team all had to be done simultaneously. John recruited talented workers who lacked growth opportunities at large publishing houses. And he set up a system where everyone continuously grew by mastering several skills. Specialists weren’t allowed.

In the 1950s, John created a four-point plan to make Ebony and the Black consumer market integral parts of corporate America’s marketing and advertising plans. He wrote articles in trade publications and provided data to ad agencies and corporations to confirm the spending power of the Black consumer. His strategy worked: advertising dollars increased. However, these new believers, needing staff who understood Black consumers, poached John’s team members.

In 1954, John faced twin headwinds: a series of recessions and a shift away from newsstand sales for magazines. In one month, Ebony’s circulation dropped by 100,000. If Ebony failed, his company would collapse. John shifted the revenue mix to half subscriptions, half newsstand sales and changed the content to reflect the seriousness of what his readers were facing.

After thirteen years of fighting to survive and ten years of publishing Ebony, things finally stabilized. John’s first thirteen years had been hell, but he’d made it. He had 145 employees and a monthly circulation of 2.6 million copies across four magazines. Johnson Publishing was healthy and on solid footing.

With his company running smoothly, John lifted his head and focused outside Johnson Publishing. John and Eunice were ready to start a family but encountered infertility issues. They were rich and successful but couldn’t obtain what they both craved: children and a family. They endured embarrassing and painful exams at the Mayo Clinic, only to learn they both had healthy reproductive systems. Not being able to have children can be a blow to a man’s ego, but John and Eunice investigated adoption for a year and decided it was the best option for them. In June 1965, they adopted a two-week-old son and named him John Harold Johnson Jr. Two years later they adopted a two-week-old girl and named her Linda Eunice Johnson.

The family’s happy times didn’t last. John Jr. began having long bouts of sickness. John and Eunice learned that their son had sickle-cell anemia. They discovered that there was no cure and John Jr. would endure pain and likely die early from the disease. To make matters worse, the adoption agency had forgotten to test John Jr. when he was a baby. The situation changed John. Knowing he had limited time, he traveled less and made being home daily for dinner a priority. He dedicated Sundays to doing fun things with his family. John Jr. lived life to the fullest and was fearless. Sadly, he died in 1981 at 25. John and Eunice were devastated. John kept his son’s office at Johnson Publishing, setting it aside in his memory. And he and Eunice left John Jr.’s bedroom as it was the day he died.

John went on to do many more amazing things. He created Ebony Fashion Fair, which became the largest traveling fashion show in the world. He launched a best-selling cosmetics company and entered the cable, radio, and TV production business. He dabbled in commercial real estate and acquired Supreme Life Insurance Company. And he accomplished all these things in business while serving on numerous corporate boards and having direct relationships with and working with four US presidents.

John’s journey was incredible, and he was a remarkable entrepreneur. His companies had an enormous impact on Black Americans and changed how Blacks and the rest of the United States viewed Black America. That he bootstrapped Johnson Publishing to almost $200 million in annual revenue in the 1980s while owning 100% of the company shows how special the poor boy from Arkansas City was.

I couldn’t cover everything in John’s autobiography. I picked the things that interested me most, but it contains other great stories and details about his life and journey. It’s worth reading. He shares valuable wisdom he learned along the way.

In my next post, I’ll share my takeaways and insights from his journey and what specific traits made him so successful.

Prefer listening? Catch audio versions of these blog posts, with more context added, on Apple Podcasts here or Spotify here!

+ COMMENT

John H. Johnson Part 3: The Brink of Financial Ruin

When John H. Johnson published Negro Digest on November 1, 1942, his printer realized it wasn’t for John’s employer, Supreme Life Insurance, and that it had unknowingly subsidized the magazine. To pay the printer, John had to sell the remaining 2,000 copies quickly.

According to his autobiography, John called the biggest magazine distributor in Chicago and was told that “colored books don’t sell.” John sent thirty Supreme coworkers to buy his magazine at the distributor’s newsstands using money he gave them. This prompted the distributor to buy John’s remaining inventory and then some. The distributor started pushing the magazine aggressively and introduced John to other distributors in major cities. Within eight months, he was selling 50,000 copies a month. In July 1943, he took a leave of absence from Supreme and hired a secretary.

John couldn’t crack 50,000 in circulation, so he wrote First Lady Eleanor Roosevelt a letter asking her to write an article in his “If I Was a Negro” column. John was persistent, and she agreed. National media picked up the article, and circulation soared to 100,000 copies. John bought a building for $4,000 and hired a permanent staff in 1944.

John realized he had knowledge gaps in the publishing business, so he cold-called top executives at prominent magazines. He quickly learned that people will tell you everything they know when you confess your ignorance. Gaining wisdom from credible insiders provided John with the blueprints for what he wanted to build and how to build it.

John didn’t have loans or investors, so he faced cash flow issues that forced him to learn cash flow management and to do some questionable things with checks and bank accounts.

In 1945, World War II was raging, and wartime rationing meant that John’s fast-growing company was using more paper than the law allowed. The U.S. government issued him a violation. He had to reduce the number of copies he printed and send the company into bankruptcy or keep printing and go to jail. John claimed ignorance of the law and passionately appealed to the War Production Board. Twenty-four other people, with their lawyers, also appeared before the board that day. John, who by design didn’t have a lawyer, was the only one who got a hardship exemption.

John refocused on the business, and two of his freelancers approached him with an idea for a new photograph-based magazine named Jive. John didn’t like the idea, but he respected their contributions to his magazine and agreed to partner with them three ways on the idea. Each would put up $1,000. After working on the concept, the freelancers didn’t put up their share of the money, so John funded the entire project and took ownership. This ended up being the turning point in his life.

Even though he was skeptical, he kept working on the idea. He eventually realized that America was shifting from reading and wanted to see themselves and the people they admired in pictures. John slowly saw that the shift to photographs could be a way to emphasize the positive aspects of Black life, highlight the significant achievements of Blacks, make Blacks proud of themselves, and recharge Black people using positivity. This became his philosophy for the new concept. John hated the name Jive, and when Eunice suggested Ebony, John ran with it.

The first issue was published November 1, 1945, by John, then 27, and a team of two other people. John initially ran Ebony with no ads to ensure that it was high quality. Ebony was a breakout success and instantly surpassed Negro Digest as the top Black publication. However, as more copies were sold, John lost more money. People praised him in public, but John hid from creditors. The high-quality magazine was expensive to produce compared to Negro Digest, which was backed by ad revenue. By the end of 1946, John was in a tough spot. He couldn’t cut Ebony’s circulation because that would reduce potential future ad revenue. But he was losing a fortune every month.

John devised a twofold strategy. He launched five mail-order businesses that he could advertise in his magazines. The revenue from product sales from the mail-order companies would offset the cash burn from Ebony. He then started personally selling ads to executives of ad agencies and then large companies. He was relentless. He called one CEO 400 times and stalked another on a train weekly for three weeks.

After two years on the verge of collapse, Ebony turned around when the ad dollars started flowing regularly. John hired the best ad person he could find and built a team of ad salespeople. He’d run the gauntlet. Seven years after launching Negro Digest, John was 31 and a millionaire. But he was still insecure and scared of failure. His fears would be a key factor driving John’s next bold bet.

Prefer listening? Catch audio versions of these blog posts, with more context added, on Apple Podcasts here or Spotify here!

+ COMMENT

John H. Johnson Part 2: From College Dropout to Publishing Solopreneur

According to his autobiography, after graduating high school in 1936, John H. Johnson attended an Urban League luncheon where Harry H. Pace spoke. Pace was the CEO of Supreme Liberty Life Insurance, which provided insurance to the Black community. John rushed Pace after his speech. Pace had heard about John’s commencement speech and asked about his plans. John shared that he couldn’t afford college, and Pace offered him a part-time job at Supreme.

In September 1936, John started working part-time for $25 per month and eventually quit school to work at Supreme full-time. Supreme was the perfect environment for John and became the university where he would learn all things business over five years. Watching and learning as Pace navigated a million-dollar business gave John a thrill.

Journalism was John’s passion, and Pace assigned John to work on Supreme’s monthly newsletter. Pace was the editor, so John worked closely with him. In 1939, John was named editor. John learned as much as he could from Pace about business, life, success, and Black America as he chauffeured him to the bank every day. Lessons about focus, computerizing your mind, business being an art, and others stuck with John; he used them throughout his career.  

John eventually moved to selling insurance in the field and even supported Supreme’s general counsel running for local office. By then, Supreme wasn’t just a job for John; it was the place where he was learning how to navigate life and achieve his goals.

In 1940, John met Eunice Walker, who came from a prominent southern family. Eunice’s friends told her John’s background wasn’t encouraging and he wasn’t one of the Black professionals who were likely to succeed. Eunice saw something else in John, and John relished how she listened to his dreams and made him feel that he could be somebody one day. They married in June 1942.

Pace didn’t want to take Black newspapers home. He asked John to read magazines and newspapers and prepare digests of what was happening in the Black world, which John did on Mondays. Pace used them to stay abreast of race relations and guide his conversations. John became one of the most knowledgeable people in Black Chicago. At social gatherings, he became the center of attention when he began sharing what he’d learned. People kept asking, “Where can I find that article?” and offered to pay him to find specific articles.

After several weeks, John realized he was “looking at a black gold mine.” Readers Digest and Time were popular, but there wasn’t a successful, Black, commercial magazine. But after two months of going from office to office in Black Chicago, John realized that nobody wanted to give a twenty-four-year-old insurance worker a cent toward this idea.

John was running the machine that mailed invoices to 20,000 Supreme customers. He looked around and asked himself what he could do by himself with what he had to get what he wanted. Then it hit him: he could send a letter to each of Supreme’s customers asking if they wanted to prepay for a $2 subscription to a new, Black magazine. Pace blessed the idea. John just needed one last thing: $500 to buy stamps. Desperate, he tried to get a bank loan but was turned down. Eventually, he found a bank that loaned to Blacks, but he needed collateral. He didn’t know what that meant, and he didn’t have it anyway.

After much prayer and pestering by John, his mother put up her furniture as collateral. John wrote his letter, pitching his magazine as something that appealed to what Black customers craved at the time: respect and recognition. He mailed it and crossed his fingers. It worked. Three thousand people sent John $6,000. Negro Digest Publishing was born in June 1942.

John worked by day at Supreme and by night on the magazine. Eunice helped him at night too. By October he was ready to print but needed a printer who would extend credit. John ran the duplicating machine at Supreme and managed Supreme’s relationship with Progress Printing Company. When John said to the printer, “We are publishing a magazine,” the printer assumed the magazine was for or backed by Supreme and started working without worrying about being paid.

On Sunday, November 1, 1942, Negro Digest was officially published. John realized the true potential of what he’d created when he held the first magazine.

John had successfully launched Negro Publishing, but it was a one-man company, and he wasn’t out of the woods yet. He printed 5,000 magazines and sent 3,000 to prepaid subscribers. Now, he needed to find a way to pay for the remaining 2,000 copies and cover the mailing costs for the 3,000 copies already sent to subscribers. If he didn’t figure it out fast, he’d be in jail. This led to what he would do next.

Prefer listening? Catch audio versions of these blog posts, with more context added, on Apple Podcasts here or Spotify here!

+ COMMENT

John H. Johnson Part 1: An Arkansas Boy with Something to Prove

John H. Johnson founded Johnson Publishing Company, which published JET and Ebony magazines for decades. I learned about John when I read the biography of Robert “Bob” Johnson (no relation to John). Doing some research, I discovered that John started his company with $500 and grew it to over $174 million in annual revenue by 1987—almost $481 million in 2024 dollars. He grew without bank loans or investors (i.e., customer revenue only) for over a decade. This blew my mind, so I bought John’s autobiography, Succeeding Against the Odds: The Autobiography of a Great American Businessman, initially published in 1989.

Life started out rough for John. He grew up dirt poor in segregated Arkansas City, Arkansas. When he was eight years old, his father was killed in a sawmill accident. When he was nine, the Great Mississippi Flood of 1927 ravaged his city, and his family became homeless. As a child, John was forced to work to help his family make ends meet. He grew up feeling that his family wasn’t in control of their destiny. “[A} word or frown from a White person could change our plans and our lives,” he wrote. This feeling unnerved him.

There was no radio then, so information didn’t flow freely. What people believed was possible was based on what they saw. John’s mother, Gertrude Johnson Williams, who remarried, was a “dominant force” in the family and didn’t subscribe to this way of thinking. She believed that just because she hadn’t seen something, that didn’t mean it wasn’t possible, and that John could be more than what they saw in Arkansas City. Education was the key, but Arkansas City didn’t have a high school for Black students. She devised a plan to move to Chicago for more economic opportunities and better educational opportunities for John. The plan was to leave in the summer of 1932 when John finished eighth grade, but she didn’t have enough money. By the summer of 1933, she’d saved enough money to leave. John was 15 years old.

When they arrived, they found Chicago to be a “Black metropolis.” Seeing Black entrepreneurs, politicians, doctors, and lawyers made a lasting impression on young John. And his high school had more students than the entire population of Arkansas City. The primarily Black educators and administrators were a daily reminder of what was possible.

John’s classmates were poor, but John was a level below them. He had to wear clothes his mother made for him. During the Great Depression, his mother and stepfather lost their jobs, and the family went on welfare for two years. The shame of this experience left a lasting impression on John. Poverty and his deep southern accent made John the target of ridicule.

Determined to get even with classmates, he threw himself into excelling at his schoolwork. He became a voracious reader of self-help books, Black literature, and Black history. John spent significant time in the public library reading books about Blacks who had succeeded against the odds, which energized him. He also became an avid reader of Dale Carnegie’s books, especially How to Win Friends and Influence People. John took Carnegie’s principles to heart. He practiced in the mirror for hours daily and forced himself to speak up in class. The hard work paid off. His classmates didn’t just stop teasing him; they elected John class president in his junior and senior years. And John was invited to give a commencement speech at his high school graduation, which was highlighted in local newspapers.

John was a good student and received a partial scholarship to the University of Chicago, but it wasn’t enough, and his family couldn’t help. It was the depths of the Great Depression, and John was desperate to find a way to pay for college; this, plus the confidence he’d gained from practicing Carnegie’s methods, would lead to what John would do next.  

Prefer listening? Catch audio versions of these blog posts, with more context added, on Apple Podcasts here or Spotify here!

+ COMMENT

Subscribe to receive new posts via email.

Submitted successfully!
Oops! Something went wrong while submitting the form. Try again?