What struggles did John Hendricks overcome when launching Discovery Channel?
Typically when you have a new idea or are starting a business, it’s expensive. And it’s hard to find an entrepreneur who was lucky enough to be born into a family who had lots of wealth — someone whose family said, “Oh, you need $10 million to start a new business? Here it is.” That seldom happens, so whether it’s Bill Gates, Steve Jobs, Michael Dell, Reed Hastings, myself or others, that first challenge is raising the money and convincing people that your idea has value.
When I finished college at the University of Alabama in Huntsville, I took a job for a year there. My job was to go to Washington and bring back federal money, so my skills set was preparing proposals, convincing federal grant agencies to provide our university with contracts and grants over a lot of other competition. One of my proposals beat out a proposal by the University of Maryland, and that got the attention of the university administration, who was looking for a new grants officer, so it hired me and that got me to the Washington area. My skills set was trying to convince people to invest in the nonprofit world, and I was able to combine that with this burning passion to create a documentary series channel and finally raise money for my own venture. So from ’81 to ’85 I closed my first round of financing. It wasn’t enough — you never get enough money to break even — for me it came in two phases. The first was a $5 million round, and that was enough to get Discovery on a satellite for about five or six months, and fortunately it was well-received by cable operators and their customers; and so after a lot of work, we finally closed the second round, which was for $20 million. That was enough for us to break even by late 1987. But so many great ideas never come to pass because they just never get funding.