Sponsored By

These Billionaires Owe It All to the Channel

Billions of dollars in opportunity await everyone in this business.

Robert DeMarzo

December 1, 2023

6 Min Read
billionaires
G. Tbov/Shutterstock

There was a news explosion recently concerning billionaire businessman and investor Mark Cuban’s decision to sell a majority stake in the Dallas Mavericks basketball franchise to Miriam Adelson. She’s one of the wealthiest women in America with a reported net worth of some $32.8 billion.

What’s most interesting about this story is it could not have happened without the channel that we all call home. And everyone in today’s technology channel should take note of this story. Not from the perspective of a trip down memory lane, but as an example of the billions of dollars in opportunity that await everyone in this business.

It’s not an overstatement that both Cuban and Adelson owe their billionaire statuses and subsequent fame to the channel either directly or indirectly — a point I will explain in a moment. But the channel’s role in both their lives and how their lives have intersected at times is something that most business stories and social media posts will not mention or even realize. It’s a fascinating testament to how anyone in this channel — with some hard work, a little luck and innovative thinking — could one day own a major Las Vegas casino or sports franchise.

Mark Cuban headshot

Let’s start with Mark Cuban. He was your ordinary, run-of-the-mill value-added reseller (VAR) a few decades ago. He ran a company that went by the geeky name of MicroSolutions. There are no doubt a few such companies still around.  Cuban became the poster child of the channel after he decided to focus on services and software a time when many partner organizations labeled as resellers sold PC hardware based on the biggest brands of the day. Do you see how that parallels today’s great channel debate about how agents need to be more than circuit slingers and how MSPs must move higher margin cloud, AI and security offerings?

Whether by accident or design, Cuban started writing a newspaper column (modern day blog) of his experiences as a channel partner. He doled out advice to tech providers and vendors. Let’s call this early-day efforts at peer-to-peer sharing of best practices. Again, look at the parallels. Sharing of best practices by partners is at an all-time high as evidenced by our recent work with New Charter Technologies Front-Runner workshops, online content designed to help optimize the MSP model and our collaboration with Len DiCostanzo who drives our MSP Mentor platform.

Cuban sold his solution provider business for a reported $6 million which gave him, at age 32, the financial leverage and wherewithal to make some other bets. He then went to work on new ventures including co-founding the website broadcast.com which was sold to Yahoo in the late 1990s, giving Cuban a $1 billion payday. That was more than enough money to buy a majority share in the Dallas Mavericks for a reported $285 million. Adelso is said to be purchasing that share for $2 billion. It makes you wonder just who on the Channel Futures MSP 501 list or the Channel Futures Technology Advisor 101 is the next billionaire in the making.

But let’s circle back to the Cuban-Adelson connection. Back in the day, guess where Cuban used to hang out once a year? In Las Vegas at the COMDEX trade show. Some of you may remember that amazing event where hundreds of thousands of channel-focused IT professionals would gather to see the latest in tech and connect. Shelly Adelson was the owner and CEO of the Interface Group, which operated COMDEX (an acronym for computer dealers exposition). But it was the channel that built COMDEX into a dominant tech event with high growth and highly profitability. It also had deep ties to Las Vegas including the convention center and Sands Hotel which Adelson bought after selling the Interface Group. At this time, when reporters like me would interview Adelson at the Las Vegas event, he would open the curtains on the windows overlooking the enormous show floor and proclaim, “Look at what I have brought together.” He was the ultimate showman and event organizer. There will never be another like him.

Adelson, no doubt sold the Interface at its peak and invested his money in Las Vegas. Along the way, he met and married Miriam. She inherited his fortune when he died in 2021 and today is making moves of her own. If and when Adelson’s deal with Cuban comes to fruition, you should take note of a few things. First, that the channel is a place where many people have made their fortunes building amazing businesses. Share the Cuban-Adelson story with industry leaders and they will tell you that over the next several years this channel and industry will produce many more millionaires and billionaires thanks to companies and leaders savvy enough to bet to AI, next-gen cybersecurity offerings and cloud solutions. As this week’s AWS re:Invent 2023 conference showed, these technologies are just in their infancy.

Second, Mark Cuban is a savvy investor with a great instinct for when to sell and how to make money. The fact that he is selling his stake in a basketball franchise he no doubt loves could be a signal that valuations may have peaked in sports and he is headed in a new direction we should all be watching. And we should all be watching to see where that is. Every channel leader needs to take stock periodically and take a page from Cuban’s playbook. As this column was coming together, SADA Systems’ Tony Safaoian agreed to sell his cloud-based company to Insight. Perhaps he’s the next Cuban or New Charter’s Mitch Morgan. Who knows?

There’s not much more to say except to give thanks to the channel that many of us call home and to which I have dedicated my career. And thanks to those who commented on this article when it was originally posted on LinkedIn after the news first broke of the Cuban-Adelson sale.

Brand strategist Arthur Germain commented, “General reporting often overlooks the importance and power of the channel. The intersection of the rise of the channel and its importance to Vegas via COMDEX, INTEROP and other shows which led to much of the newer ‘family friendly’ Vegas can't be minimized. And I too recall Mark Cuban promoting the channel, the nascent internet and the combination of both during an interview in 1999.”

Global leadership and innovation expert, speaker and author Gal Wright, said, “Brilliant back story. Thank you for sharing it and giving others much inspiration as to what is possible through the power of a strong community.”

Finally, Canalys Chief Analyst Jay McBain (Informa owns both Channel Futures and Canalys) put this fine point on it all: “Our MSP community has created a couple more billionaires in the past few years as it has rocketed to a half-trillion-dollar industry globally.”

Read more about:

MSPsAgents

About the Author(s)

Robert DeMarzo

VP of Content, Channel Futures

Robert DeMarzo is the vice president of content for Informa Tech Channels.

Free Newsletters for the Channel
Register for Your Free Newsletter Now

You May Also Like