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BLACK ENTERPRISE celebrates the 45th anniversary of its roster of the nation’s most successful black businesses—The BE 100s. To commemorate the significance of this collective’s widespread impact on black business and economic development as well as American industry over four decades, we have presented 45 milestone moments. As part of this tribute, we continue our yearlong countdown.
1991: BET Holdings, the parent company of Black Entertainment Television, raises $72.3 million in an initial public offering, making it the first company controlled by African Americans on the New York Stock Exchange.
BET Holdings Inc. President Robert Johnson displayed his prowess as a cable industry pioneer and disruptor when the parent of Black Entertainment Television (BET) went public.
Johnson led the victorious completion of BET Holding’s initial public offering in 1991, a transaction that brought $72.3 million for Johnson and his investors. The iconic business move marked the first time a company controlled by African Americans was traded on the New York Stock Exchange.
The transaction for the Washington, D.C-based entertainment and media company Johnson founded in 1980 helped pave the way for other black-owned companies to access the capital markets and consider tapping into Wall Street to take their companies public.
The BET Holdings stock was alluring to investors. BET was America’s only black-oriented cable TV network, reaching millions of African Americans “There is a tremendous market for quality minority companies in the capital markets,” says Bernard Dorshow, head of research for The Chapman Co., a black-owned Baltimore brokerage that helped sell the stock to Black Enterprise magazine in 1992.
Black Enterprise Magazine, Jan 1992 where the BET Holdings IPO was reported.
Expansion and good fortune coincided with BET’s initial public offering. And the company became more attractive to cable operators competing in the urban markets. Reaching over 30 million households at the time, advertisers saw BET as a potent channel to reaching black consumers whose purchasing power had grown greatly from the 1980s.
BET’s expansion included buying a controlling interest in Emerge magazine and launching YSB, a youth magazine. In 1993, with revenues topping $71 million, BET launched BET Direct, a direct marketing firm developed with the Home Shopping Channel, and began featuring its own home shopping program on its BET network.
By 1995, BET’s number of subscribers exceeded 43 million households, ringing up over $115 million in revenues and earnings of about $20 million. BET gained a big boost in 1996 grabbing the first post-trial O.J. Simpson interview. With three million viewers tuned in, BET had its largest audience ever.
Black Enterprise Magazine, June 1997
Johnson kept beefing up BET by branching into new areas. This included launching BET on Jazz in 1996. BET also formed joint ventures to offer family-oriented films and expanded into the movie business to name a few other endeavors. While around that time 94% of BET’s revenues and all of its profits came from BET’s TV network, Johnson stayed focus on building BET into a multimedia powerhouse.
The amazing ride of the black-owned entity ended in 2001 when BET reaching over 60 million households and was acquired by media conglomerate Viacom for roughly $3 billion. The deal made Johnson a billionaire and household name.
Though now chairman of The RLJ Cos., a portfolio of companies with holdings in many industries, Johnson is good with always being linked to BET. “No, I have no desire to eclipse BET as the brand under which I fly. It is, it was at the time, and still is one of the greatest financial achievements by anybody African American in this country.”
Jeffrey McKinney
Jeffrey McKinney is a long-time freelance business writer and reporter, contributing to Black Enterprise magazine for several years on broad range of business and financial topics. He also writes regularly for Franchise Times, a highly regarded publication covering the franchise industry.
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