Harry Evans Sloan is a consummate entrepreneur; a self-made man who’s the executive chairman of the board of SBS Broadcasting, a publicly traded European media conglomerate. During his career, Sloan has built New World Entertainment, created SBS and is Lions Gate Entertainment’s chair. In the first of a two-part interview, Sloan discusses entrepreneurial success in general. Next week: his advice on achieving success abroad.
Q: Are entrepreneurs made or just born with a risk-taking zeal?
A: I think entrepreneurs are generally born hungry, either financially — which was my case — or something happens in the early formative years that make you hungry.
Q: Do you possess some sort of inner voice or compass that drew you to New World, SBS and Lions Gate? How do you pick the good ones?
A: It’s really a matter of vision. By the way, none of those companies were good ones when I got involved. SBS was a group of bankruptcies and turnarounds and startups of ragtag TV stations in the very beginning stages in Europe. Lions Gate was a stock below $2 that had very modest revenues, had never had any earnings whatsoever. New World was a tiny company with ($7 million) or $8 million in revenues when we bought it in 1983, and it had $400 million in revenues three years later.
Q: An archetypal entrepreneur invents a business but doesn’t have the patience to nurture and grow the enterprise. You’ve done both. How?
A: I wouldn’t know any other way. The businesses that I’ve invented or that I’ve created, I’ve invested my own money in. If you have your own money in, you certainly aren’t going to walk away; you want to see it through. I think the most successful entrepreneurs are people who have something on the line or some skin in the game.
Q: What originally attracted you to Lions Gate?
A: Lions Gate was an SBS investment. In 1999-2000, when things were as hot as they can be in business — the bubble — we’re sitting in Europe creating new TV stations and needing to buy programming. And half of the programming in European television stations is U.S. programming. Those prices were skyrocketing, whether it was a deal with Warner or Disney or Sony. So we partnered up with Tele Munchen, a German company, and invested $30 million in Lions Gate, which had run out of money. We took control of a preferred stock issue with the goal of revamping the company so that SBS would have another source of product, movies and television, other than the major studios. So if things got really too expensive we could say to Warner or we could say to Disney, “You know what? We’re not buying anything for a year or two. We have plenty of programming from our own company, from Lions Gate” until the storm passes. As it turned out, the bubble burst, everything changed, and within a year European television became a buyer’s market, not a seller’s market. The studios were on the run. The studios were looking to make deals for more runs, flat to rollback pricing.
Q: Is it more rewarding to enter into a business or to exit?
A: As they say about sports franchises, “The two happiest days (are) the day you buy the team and the day you sell the team.”
Q: People are always talking about exit strategies. What’s your entrance strategy?
A: The entrance strategy for an entrepreneur starts with a vision. What is this business going to look like in five, 10, 15, 20 years.
Q: How do you maintain the intensity, the interest and the hunger once you’ve enjoyed substantial success? How do you remotivate yourself?
A: For me, hunger and intensity are broader than just business. I have that with regards to wanting to know what’s going on in the world. I’m an avid news junkie. When I’m not doing business, I’m paying attention to what’s going on in the news, looking to debate, looking to talk about it. I just think it is my lifestyle.
Unger is a leading exec recruiter. At various times, he led the media and entertainment practices of the world’s three largest executive search firms. He can be reached at email@example.com.