In 1959, before becoming a U.S. citizen, Jack Kent Cooke purchased an AM radio station in Pasadena, California, for $900,000 in his brother’s name.  In 1960, a contest the station ran caused an FCC investigation that uncovered Jack’s majority ownership. His biography states that in 1962, the FCC ordered the station shut down, and Jack lost the license. It was a major financial blow. While he was licking his wounds, Jack stayed in a remote California hotel. He was surprised to get clear television reception. He learned the hotel was wired for CATV—cable TV—and that people were paying $5 a month for the service. Jack immediately recognized the potential of cable TV and jumped into action.

Cable was simple then, just a way to bring six or so channels to a community from broadcast networks that didn’t have strong enough signals. In the fall of 1964, Jack made his first cable TV antenna system investment for $4.6 million. The profit potential of a protected cable franchise was obvious and reminded him of the early days in northern Ontario when Roy Thomson had a license to print money in broadcast radio. The formula was simple to Jack. Current customers plus projected growth of a cable system’s coverage combined with current and future subscriber rates told you how much each system could generate in revenue. Having calculated these figures, Jack paid $300 per cable subscriber when he purchased a cable system. With customers paying $5 monthly, one deal was netting Jack $80,000 in monthly cash flow. Jack named his company American Cablevision.

Jack’s broadcasting and publishing background gave him an advantage in understanding the potential of the cable market. He moved fast and, in 1965, added tons of communities to his coverage area by buying existing franchises in rural areas. He created two subsidiaries, too—one that “engineered other CATV systems” and one that sold cable equipment. Jack built American Cablevision to 85,000 subscribers and, in 1968, merged it with H&B Communications in a stock deal valued at $30.8 million. In 1970, H&B was bought by TelePrompTer Corporation, then the largest cable system in America, in a stock deal. After the acquisition, Jack owned almost 12% of TelePrompTer’s publicly traded stock, meaning Jack’s shares were worth roughly $40 million. In about five years, Jack had created a $40 million cable fortune.

Cable wasn’t enough for Jack, and in 1965, he purchased the NBA’s Los Angeles Lakers basketball team for $5,175,000, a record price. Jack viewed a team in Los Angeles as one of the three most valuable NBA properties, teams in Boston and New York being the other two. Jack was also gunning for the rights to start an NHL expansion team and thought owning the Lakers and having partial ownership of an NFL team legitimized him as a sports mogul. He was right. Less than a year after purchasing the Lakers, he was granted rights to Los Angeles’ expansion NHL team for a $2 million fee and a promise to play in an arena that seated at least 12,500 people. Jack also paid $250,000 for the right to have a team in the United Soccer Association.

Jack kept pushing and, in 1966, added real estate to the mix. He started building the Forum, a modern, roughly $17 million sports arena in Los Angeles that his basketball and hockey teams could play in. The arena opened in 1967 and was unlike anything anyone had ever seen. It was a huge success.

While Jack was thriving as a sports entrepreneur and also running other enterprises, his health and home life were suffering. In 1965, his wife Jean was unhappy and attempted suicide for the first time. And Jack’s brutal work schedule led to him having a heart attack in 1973. This slowed Jack down, but it didn’t stop him. He was just getting started and was focused on his teams becoming champions.

Jack Kent Cooke’s Toronto radio station was doing well, so he started and acquired businesses that provided services to it. For instance, he purchased a small ad agency and started a service that syndicated radio shows in Toronto. According to his biography, owning these companies decreased expenses for his station and allowed Jack to profit when other stations needed the same services.

Jack was also doing deals with his partner Roy Thomson. They bought a drive-in movie chain, two national radio sales agencies, and other businesses. But one of their deals landed Jack in legal trouble: the 1947 purchase of an edgy and unprofitable magazine, Liberty. Roy and Jack bought it for $400,000, each owning 45%. But the magazine’s content got Jack sued for libel and led to criminal charges against him for “conspiring to publish defamatory libel.” Jack was acquitted, but the magazine was a financial drag, losing more than $300,000 over the years before finally turning a small profit. Jack’s experience with Liberty led to his 1952 purchase of a publishing empire, which included Saturday Night and other national and trade magazines owned by Consolidated Press. Jack had added publishing entrepreneur to his resume.

The Consolidated Press deal was significant but didn’t include Roy. The partnership between the two soured when Jack cut Roy out of a lucrative consulting deal to manage an Ottawa radio station. Roy felt Jack broke their agreement to share in each other’s deals and opted not to partner with him on deals anymore, although they remained business associates. Jack didn’t need Roy as a partner anymore. He was financially successful and started doing deals on his own. He had six offices in Toronto for his various businesses, which he bounced between daily.

Jack wanted to own more businesses in leisure industries, so in 1951 he bought the Toronto Maple Leafs, a minor league baseball team, for $200,000. With his knack for promotions and flair, Jack turned the games into must-attend events in Toronto. He also used the games as content for his radio station and did play-by-play calling of each game. He tried to do the same with local hockey team games, but because he didn’t own the team or the rights to broadcast the games, he was charged with radio piracy by the Canadian government.

Jack kept buying businesses. In 1956, he bought a company that owned two plastics factories and an aluminum foundry. Jack saw plastics as the future and a growth industry he wanted to be part of. His ownership got off to a rocky start when he sued the seller for misrepresenting the value of the inventory he’d bought.  

Jack’s dream was to start Toronto’s first TV station, and he’d been working it for years. He needed to be awarded the first license to turn that dream into reality. When Jack submitted his application to the Broadcasting Board of Governors (BBG) in 1960, his past tussles with regulators and his reputation for stuffing too many ads per hour into his radio broadcasts worked against him. In a crushing defeat, the license was awarded to another group.

After his television broadcasting license application was rejected, Jack made a major move. He uprooted his family and moved to California. He didn’t just move; he pulled off political wizardry to make it happen. Jack and his high-powered lawyers convinced the U.S. Congress to create a special bill for Jack. It allowed him to become a U.S. citizen immediately, bypassing the normal five-year waiting period, and backdated his citizenship by a decade. It passed the House and Senate and was swiftly signed into law by President Dwight D. Eisenhower. Jack had become powerful and connected not just in his home country but in the United States too. As a U.S. citizen, Jack couldn’t own certain Canadian companies, so he sold his radio stations, publishing business, and baseball team.

Having friends in high places paid off again for Jack. That same year, his well-connected lawyer, Bill Shea, shared an opportunity to buy into an NFL franchise. Jack jumped at the chance and paid $350,000 in 1961 to purchase 25% of the Washington Redskins (now the Washington Commanders).

This deal kickstarted Jack’s life as a U.S. citizen and launched what would become a professional sports team empire for him.

The biography about Roy Thomson described a critical partnership with a young man who helped propel Roy’s empire: Jack Kent Cooke. I did some research and learned that Cooke went on to have a prolific career in radio broadcasting, owning cable systems, and owning the NBA’s Los Angeles Lakers, the NHL’s Los Angeles Kings, and the NFL’s Washington Redskins. I wanted to learn more about Jack, so I read The Last Mogul: The Unauthorized Biography of Jack Kent Cooke by Adrian Havill.

Jack was born in 1912 and raised in Toronto, Canada. His parents had immigrated from South Africa and Australia. He grew up in a lower-middle-class family that sometimes struggled financially. Jack wasn’t into school and skipped it for weeks at a time. He finished only three of the five years needed to graduate high school before dropping out. More interested in making money, he tried various things, including forming a band that performed at local school dances. The “high school hustler” lived by his own rules.

In 1934, the Depression profoundly affected North America. Twenty-five percent of Canadians were unemployed. Twenty-one-year-old Jack had eloped with seventeen-year-old Barbara Jean Carnegie and begun traveling door to door to sell encyclopedias. Selling books failed, and Jack went broke. He and Jean moved in with his parents, and he took a traveling salesman job selling Colgate-Palmolive products to stores in remote northern Ontario. During one of these trips, Jack walked into a radio station to ask for a job. Roy Thomson owned that station.

Forty-three-year-old Roy was intrigued by twenty-five-year-old Jack’s persistence and hired him to manage station CJCS in Ontario. With Jean pregnant with their first child, Roy was anxious to prove himself. Jack started at CJCS in January 1937 and worked from when his eyes opened to when they closed. By June, the once-troubled station’s profits were so substantial that Roy sold the station for a handsome profit. Jack had quickly proven himself to Roy while learning the ins and outs of radio broadcasting.

Roy liked working with Jack so much that he offered him the opportunity to become partners by buying in to his next deal: purchasing a Quebec radio station for $21,000. Roy and Jack each put up $1,000, and they financed the remaining $19,000 with a bank loan. A year later, they sold that station for $105,000. Jack was in his late twenties, and this deal was his first big financial win.

Jack started looking for his own radio deals and negotiated to buy a Toronto station for $500,000. He didn’t have $500,000 liquid, so he agreed to put down a deposit, which he would lose if he didn’t close the deal in thirty days. Jack raised the money from wealthy people in Toronto. Interestingly, Roy declined to invest. After taking over, Jack immediately broke unwritten radio rules by broadcasting twenty-four hours a day and introducing other changes. Within a year, Jack had a 35% market share and his was the leading station in Toronto. Within a year or two, Jack repaid each investor $69,000, almost three times their $25,000 investment.

Jack was eager to continue expanding and wanted to buy an Ottawa radio station, but regulators blocked him. To get around the regulators, he signed a consulting contract with the station’s owner: he would manage the station and get 40% of the gross profits before taxes and depreciation, an extremely lucrative deal. In the 1950s, the station generated $1,600,000 in gross profits, of which Jack received $640,000. Jack got what he wanted, but his wheeling and dealing didn’t sit well with regulators. He was developing a reputation as a cowboy who wouldn’t follow the rules.

Jack was hitting his stride as a radio broadcasting entrepreneur and becoming well known in Toronto. He was having professional and financial success, but it didn’t come easy. Jack’s typical workday at a radio station was from 7 a.m. to midnight. It got so bad sometimes that his wife had to go to the station and drag him home. Jack’s employees viewed him as a hard-charging workaholic, notoriously cheap and prone to outbursts when something didn’t meet his standards. One newspaper article in 1949 described him as ruthless, tough, and working every waking moment.

Jack’s style helped him get early wins but also ruffled feathers and got him in trouble with the law.

Happy Labor Day!

I hope everyone had a great holiday!

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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

Cumulative metrics (since 4/1/24):

• Total books read: 27
• Total book digests created: 11
• Total blog posts published: 147
• Total audio recordings published: 97
• Average digest length: 5.56% of the book’s length
• Average recording length: TBD

This week’s metrics:

• Books read: 1
• Book digests created: 1
• Blog posts published: 7
• Audio recordings published: 0
• This week’s digest length: 9% of the book’s length
• This week’s recording length: no recordings this past week

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

• Solidified what product I want to build related to this project—very excited about this!
• Read the biography of Jack Kent Cooke
• Finished creating the digest for Michael Bloomberg’s autobiography
• Had one additional feedback session
• Recorded audio podcast series about Ted Turner’s autobiography

Content changes:

• No recordings this past week

What I’ll do next week:

• Read Roy Thomson’s autobiography
• Create a digest of a biography of Jack Kent Cooke
• Write and publish blog posts about the biography of Jack Kent Cooke
• Edit and publish the audio podcast series about Ted Turner’s autobiography
• Complete two feedback sessions

Asks:

• Introductions to developers with deep experience in AI large language models (LLMs)

Week two hundred thirty-one was another week of learning. Looking forward to next week!

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:

• No material struggles this past week

What I learned:

• Michael Bloomberg’s strategy is fascinating. His mission is to provide accurate data and analysis of that data to help people do their jobs. The various media platforms are distribution methods that make people aware of Bloomberg and point them back to his main product, the Terminal. Bloomberg’s data and analysis make Bloomberg’s media content unique. This strategy has me looking at my project from a different perspective.

Those are my struggles and learnings from the week!

I finished reading Mike Bloomberg’s updated autobiography, published in 2019.It details Mike’s journey from a Wall Street firm to entrepreneur, mayor, and philanthropist. It’s a mix of his journey, the principles he lived by, and thoughts on society.

How Did Mike’s Early Years Affect His Trajectory?

Mike was raised in a middle-class family in a blue-collar community. His father worked six or seven days a week until he died. His father’s and his community’s work ethic left an impression on Mike. Now, decades later, in his seventies and with a net worth reportedly exceeding $100 billion at the time of this writing, Mike’s idea of a perfect day is one that starts with exercise and being at his desk by 7 a.m., is jam-packed until into the evening, and ends with falling into bed exhausted. Mike believes in grinding daily, even though he doesn’t have to at this stage of his life.

Mike benefited from serendipity in his youth and early in his career. A coworker at his after-school job put Johns Hopkins on his radar. He went to graduate school because that’s what everyone else in his class was doing. He didn’t know that institutional sales and equity trading was a job, but a Harvard classmate told him to apply to Salomon Brothers for the role anyway. Salomon was acquired, and Mike’s interest in the partnership was bought for $10 million. At a glance, it looks like Mike got a lot of lucky breaks. But digging deeper, it’s apparent that his work ethic put him in environments that increased his chances of getting lucky. He did everything to the best of his ability, which led to more and better opportunities.

What Strategy Did Mike Employ to Achieve Success?

Mike learned how inefficient and difficult accessing data was while he was working on Wall Street. He wasn’t technical, but he solved this problem for his firm using computers, while still doing his day job. After this experience, he was able to do the same for other Wall Street firms, and this led to him founding his company and creating his Terminal product.

The genius in Mike’s strategy was his embrace of media. Bloomberg’s core goal is to gather accurate data and help people analyze it via their Terminal. Mike recognized that each medium was a unique way to distribute his data and analysis to people who could be potential Terminal customers. Leveraging media was a way for Mike to increase awareness about Bloomberg and pull people interested in financial data to Bloomberg. He created a magnet using media that pulled customers to him and made it easier to sell Terminals to them.

Mike also understood supply-and-demand dynamics and their impact on company longevity and margins. Providing something that’s not unique means that others can provide something similar. The supply of that thing is high, and the price you can charge for it goes down. Mike wrote about the example of reporting the news—everyone can do it, so the supply is high.

Providing something that isn’t beneficial doesn’t add value and often means there are alternatives. There isn’t a great need, which can result in low demand. Michael uses the example of entertainment content. It’s nice but not necessary, and many alternatives exist, so demand can be low.

High supply and low demand equal low prices and low margins. Mike understood this and aimed for the opposite: low supply and high demand. Bloomberg was the only company able to provide accurate data and a superior analysis tool that helped financial professionals do a better job. The supply of products like the Terminal was limited and demand was high, allowing Bloomberg to charge a sky-high rate of up to $2,000 per month to rent a Terminal. Customers happily paid it.

What I Learned from Mike’s Journey

Building a media company and selling attention is a proven and lucrative business model that scales well because of the low cost of marginal replication. However, it leaves you dependent on advertising revenue, which can be unpredictable. If you can create a unique product or service with high demand, creating media related to it is a great way to attract an audience, make that audience aware of your product or service, and increase sales of your product or service. Ad revenue can be gravy, not the primary revenue source.

Mike has had tremendous success with Bloomberg and materially affected how finance professionals work. I’m glad I got to learn about his strategy for building Bloomberg. It got me thinking about media differently. Anyone interested in learning about data, media, politics, or philanthropy may benefit from reading his updated autobiography.

To Mike Bloomberg, every problem is an opportunity. According to his autobiography, when Bloomberg News tried to become an accredited news organization to gain access to government data that impacts markets, such as the Consumer Price Index (CPI), it was denied. Bloomberg News’s credibility was questioned because its stories weren’t published in a traditional newspaper.

Around the same time, the New York Times wanted access to a Terminal. Recognizing an opportunity, Bloomberg bartered Terminal access for an agreement that worthy stories from Bloomberg News would be published in the New York Times (at the latter’s discretion). Within a year, every major newspaper in the United States wanted the same deal. By 1995, Bloomberg News was American newspapers’ second-most-published news service, bested only by the Associated Press. That same year, the New York Times newspaper syndicate, comprising 700 newspapers globally, included Bloomberg News. The credibility issue was solved, and accreditation was granted. Newspapers and distribution via print media weren’t part of Bloomberg’s strategy, but solving a problem helped unlock the power of distributing through print media.  

In 1991, Mike received a call from Jon Fram about buying the bankrupt television channel Financial News Network (FNN), which later became CNBC. Mike declined, but Fram convinced him that Bloomberg’s financial data and analysis were ideal for broadcasting, especially on TV. Mike liked the broadcasting strategy but started with radio when he acquired New York AM station WNEW for $13.5 million. Bloomberg built technology to streamline audio content creation, production, and publishing, which was unheard of at the time but made reporters more productive.

From there, Bloomberg moved into television, a technology Mike says is as powerful and impactful as Gutenberg’s printing press. It began with a daily, thirty-minute show aired on Maryland Public Television and syndicated through the United States The show was an instant hit and led to what is now Bloomberg Television, a subscription television channel distributed globally.

Since then, Mike says, Bloomberg has become the first true multimedia company available on every medium: Terminal, television, print, radio, telephones, web, social media, and podcasts. Bloomberg can deliver accurate data and analysis to customers wherever they need it and however they want to consume it.

Today, according to Bloomberg’s website, it has over 21,000 employees in 159 offices in 69 countries. Mike believes that “answering to essentially no one is the ultimate situation” and has opted against listing the company on a public stock exchange. Bloomberg even bought back Merrill’s 30% ownership stake (10% in 1996 for $200 million and the remaining 20% for $4.5 billion in 2008 during the Great Financial Crisis).

I’ve focused on Mike’s entrepreneurial journey, but his autobiography also details his time as mayor of New York City, his philanthropic initiatives, and his near-death experiences as a helicopter and airplane pilot.

Mike Bloomberg had built the most accurate bond data and superior technology to analyze it (and, later, stocks too). His autobiography says his Market Master product, later called the Terminal, was renting briskly. The company had about 150 employees and was growing. But Mike wanted more people to benefit from Bloomberg’s data and analysis capabilities. Matt Winkler would help Mike take the first step in this direction.

Matt was a Wall Street Journal reporter who, in September 1988, wrote a front-page story on Mike’s company. He highlighted how the Terminal was becoming a vital tool in helping institutions make bond-purchasing decisions. Matt also helped Mike realize that adding text news to existing Terminal capabilities would create something that didn’t exist on Wall Street. Mike decided to launch a newswire business and compete against the Wall Street Journal’s parent company, Dow Jones, and Europe’s financial news leader, Reuters. Mike hired Matt, and they were off to the races.

Mike’s goals for the newswire business were clear:

• Collect and relay the news
• Advertise the analytical and computational powers of Bloomberg Terminals by highlighting their capabilities in each news story, which would increase Terminal subscriptions
• Include Terminal functions (links to datasets) in news stories to give more information to Terminal subscribers and encourage them to subscribe—the more people read news that included Terminal functions, the more people would subscribe to Terminals

Mike took a different approach in launching the new business in 1990. His terminals generated significant revenue, so the newswire business didn’t have to pay for itself as a stand-alone product. He wasn’t beholden to advertising revenue and didn’t have to run after eyeballs. He approached creating news stories with a technology-first mindset and leveraged computers to produce and deliver financial news. This computer-driven approach got news out faster and cost less to produce. Mike’s timing was significant because the looming 1990 recession meant reporters were looking for jobs, which allowed him to hire great talent.

Mike’s strategy worked, and the newswire became popular. The service stood out because it combined traditional text news with calculations and graphs from the Terminal. The illustrations and data complemented the words, enhancing the experience for readers.

Dow Jones and Reuters didn’t take Bloomberg seriously until the newswire service was already a breakout success. By then, it was too late. Bloomberg could replicate what the established financial news companies offered, but they couldn’t replicate what Bloomberg offered. Going up against slow-moving incumbents had worked to Mike’s advantage. Being flexible and offering more for less allowed Bloomberg to become a credible competitor before the big boys realized what was happening. By the end of 1990, the New York Stock Exchange had three official news organizations: Dow Jones and Reuters, both over 100 years old, and Bloomberg News.

With his newswire successfully distributing information and analysis, Mike set his sights on the next distribution method: broadcasting.

Mike Bloomberg was in a fortunate but uncertain situation. He had $10 million but didn’t have a job. He figured he had three options: look for a job, remain unemployed, or start a company. No one was calling and offering him a job, and he was too young to retire. He decided to start his own company.

According to the autobiography I’m reading, Mike asked himself what he had the resources, ability, interest, and contacts to do. In the 1960s, Wall Street was drowning in paperwork. In the late ’60s, Mike read that computers were good at storing data. He convinced the Salomon leaders to let him work on a project, nights and weekends, to automate data collection and retrieval. In 1972, he and a programmer launched B Page at Salomon. It was an internal system to access historical trading records and available data on public securities. It was also a messaging system for internal communication. When fixed trading commissions ended, Wall Street firms began making money using math-heavy arbitrage and trading strategies. B Page gave Salomon an edge over other firms.

Mike had money and knew smart people at Salomon, so resources weren’t an issue. He’d figured out how to create a data system for Wall Street investors, was interested in data and financial markets, and had contacts all over Wall Street. He started a company offering software that let non-mathematicians analyze bond information. In 1981, he put $300,000 in a business checking account and recruited four coworkers from Salomon.

Mike needed credibility and revenue for his start-up, so he did a six-month consulting project with Merrill Lynch and was paid $100,000. He used that project to get introduced to Merrill’s leader of capital markets. He pitched a nonexistent product to the leader and told him he didn’t have to pay unless it was delivered on time. Merrill Lynch liked the product and agreed to the no-risk deal. Mike hired salespeople and operators, even though the product was still being built and they had only one customer. He blew through $4 million and ultimately hired almost two dozen people. He began to wonder if he was jeopardizing his wealth and reputation.

In July 1983, Mike’s firm, Innovative Market Systems, delivered its Market Master product to Merrill. A computer terminal with a keyboard allowed users to access bond market data and analyze whether a bond was cheap or expensive. The product was delivered on time and worked well enough for Merrill to commit to purchasing. Merrill paid a $600,000 one-time custom development fee and $1,000 monthly for each terminal under a two-year agreement. Merrill initially took delivery of twenty-two terminals, which resulted in $240,000 in subscription revenue over two years, bringing the total deal value to $840,000.

The Merrill deal led to credibility and other clients, such as the Bank of England, signing on—and to a critical acqui-hire. Michael met data entrepreneur John Aubert in Merrill’s cafeteria in 1984. John’s three-person firm was skilled at gathering and structuring data. The day they met, Mike agreed to absorb John’s company. John went on to start Bloomberg’s data-collection facility and devised Bloomberg’s data-collection process, which included a crucial analytical component. Data was the backbone of Mike’s company, and John’s skills laid the foundation for the company’s data edge over competitors.  

Things were starting to click for Mike. The more he thought about his data and analysis business, the more he realized he needed to find different ways to distribute his product.