Home » How The “Godfather Of Black Entrepreneurs” Is Closing The Racial Wealth Gap — One Billion-Dollar Exit At A Time

How The “Godfather Of Black Entrepreneurs” Is Closing The Racial Wealth Gap — One Billion-Dollar Exit At A Time

by multimill
0 comment

Sundial founder Richelieu Dennis talks the racial wealth gap, getting turned away from a party at Essence Fest (despite owning the brand), and what he learned from his second near-death experience.

Richelieu Dennis sold Sundial Brands to Unilever in 2017 for $1.6 billion dollars. It was a stunning story and not just because of the price tag; Dennis escaped war-torn Liberia in 1987 and started selling shea butter out of his dorm room at Babson College. He’s now one of the wealthiest Black entrepreneurs in the country. And he’s sending the elevator back down for the next generation. As part of the sale to Unilever (the makers of Dove soap and Ben & Jerry’s), Dennis insisted the conglomerate invest $50 million in a fund to empower Black female business owners.

Dennis, 54, has since backed Slutty Vegan and invested in Monique Rodriguez’s Mielle Organics which sold to P&G in early 2023. He also bought Essence Magazine in 2018, vowing to “to serve and empower women of color.” But apparently owning the brand doesn’t guarantee admission to the best parties at Essence Festival, he admits here in a new interview series called “Cereal Entrepreneur,” hosted by Method co-founder Eric Ryan and journalist Mickey Rapkin. Over a bowl of cereal, Dennis talks big exits, bigger conglomerates, and that rumor that he’s buying BET.

MICKEY RAPKIN: Rich, you brought Frosted Flakes today. Why that one?

RICHELIEU DENNIS: First of all, it’s the cereal I like eating. I’ve always loved the commercials. And I like to fashion myself tiger-ish.

RAPKIN: (laughs) In the early 90s, you were selling SheaMoisture on a card table on 125th Street in Harlem. What got you out of bed back then?

DENNIS: It was hunger. But that’s every entrepreneur. Rent’s due, you’ve got health insurance you gotta pay—if you could even afford it. But for me there was this overwhelming sense of responsibility: there were no real products or brands tied to [our] ancestral culture. These ingredients existed. You’d have people show up and say, “My mother made so-and-so when we were in South Carolina. And she got it from my grandmother who got it from her mother.” But because Black culture had been interrupted with slavery, that never got translated into actual products and goods and services.

ERIC RYAN: That’s really powerful. I’ve never heard you say that—about how slavery basically severed these traditions.

DENNIS: You start to think about all of these young people who have no idea what it is to actually have a product that works for your skin type or for your hair type.

Disrupting The Beauty Aisle

RAPKIN: You once said, “The only place in America where segregation is legal is the beauty aisle.” You sold Sundial to Unilever. But weren’t they the people responsible for that segregation? Did that come up in the negotiation?

DENNIS: You bet it did.

RYAN: (laughs) There’s Tony the Tiger coming out.

DENNIS: If you’re going to transform a market—if you’re going to transform a way of doing things that is wrong—sometimes you need the people that have perpetrated it to recognize that and then correct it. Unilever, to their credit, recognized that they weren’t serving a vast group of people that had the spending power and the willingness.

Repeat Offender

RYAN: One of the challenges of being a serial entrepreneur—one of the reasons we wanted to do this column—is replicating that first success. After selling Method, I had this real fear: Did I get lucky or was I good? Rich, was that your experience?

DENNIS: There was never a feeling of I’ve-gotta-do-this-again. That’s not in my nature. I’m competitive around mission as opposed to accomplishment. For me, there’s so much work to be done in bringing fairness to the marketplace. (pause) It is hard being an entrepreneur. Period. But when Black entrepreneurs have been systemically blocked out of opportunities and access it becomes even harder. There was no infrastructure, there was no ecosystem, there was no path that Black entrepreneurs had to rely on or follow.

RAPKIN: You’ve been called “the godfather of budding Black entrepreneurs”—

DENNIS: I’m old enough now that I can be the godfather.

RAPKIN: The grey in your beard looks good. But let’s talk Mielle Organics. You’re an investor. They sold to Proctor & Gamble earlier this year. But then comes this online backlash from customers saying: They’re gonna change the formulas, they’re gonna cater to white women. Was that frustrating to see?

DENNIS: I think if you’re Black, you understand it. If you’re white, you marvel at how one could feel that way. White kids grow up in this country navigating abundance. And Black kids grow up navigating scarcity. That leads to different mindsets. When you’ve been marginalized and left out and in a lot of cases abused, when wonderful things happen—thing that would be celebrated in a white community—they get scrutinized differently in a Black community.

RYAN: Say more about that please.

DENNIS: What has historically happened in this country—when we’ve seen success in our communities, that gets destroyed. You can go back to Tulsa. Black community builds up economic footing, gets completely wiped out. We come out of slavery and there’s the promise of 40 acres and a mule. Then, no. You’re doing experiments at Tuskegee on people— That leads to major trust issues. Black companies building scale and exiting them is new. We have to normalize business development over time in the Black community so people embrace what it is to actually build these businesses, take that capital out, and reinvest it back into our community. I’ve had the good fortune of building Shea, which became the largest in the category, and then had the good fortune right after that to partner with Melvin and Monique in Mielle and build the second largest. For me, that’s joy.

Welcome to Essence Fest

RAPKIN: Let’s talk about joy. You likened Essence Fest in New Orleans “to the real-life Wakanda.” Give us a great late-night story from this year’s festival.

DENNIS: OK. I come in at two o’clock in the morning, maybe three o’clock in the morning. In the lobby is T.I., Lil Jon, the folks from Target, the folks from Disney, Taraji P. Henson and Jill Scott—all these people just hanging out in the lobby loving on each other.

RYAN: Only you could have made that happen—bringing those individuals to one place, to an environment where everyone is loving on each other.

DENNIS: (laughs) I think they were there for the wine.

RAPKIN: Give us one more story.

DENNIS: D-Nice does his Club Quarantine. It got a lot us through Covid. He brought it to Essence Festival. And so here I am—another two o’clock in the morning deal—coming from the convention center. And I couldn’t get into Club Quarantine.

RYAN: They turned you away at the door?

DENNIS: Imagine that. I’m texting D-Nice, but he’s actually D.J.ing, he’s doing his thing, he’s not looking at his phone. I’m standing outside. I couldn’t get in.

RAPKIN: While we’re talking media, there were reports earlier this year that you tried to buy Vice. Now there’s talk you’re buying BET.

DENNIS: [pause] We are at a stage in the development of Black business in America where there are quite a number of Black people that can be in that conversation. For me, that’s the big win. There are multiple people who have the access, the resources, and the skillsets to pull something like that off.

RAPKIN: OK. But are you buying BET?

DENNIS: We’ve been very focused and bullish on media. We continue to look at whatever there is that’s out there that we think can really benefit from our expertise and drive the culture forward. That’s all I’ll say on that. But I’m extremely motivated by the fact that there’s multiples of people that can have a real serious conversation about this and that can actually pull it off.

[Editor’s note: After this interview was conducted, the Wall Street Journal reported Paramount Global had informed potential bidders—which included Tyler Perry, Sean “Diddy” Combs and Byron Allen—that it would not be selling its majority stake in BET Media Group.]

Getting Schooled

RAPKIN: We often talk about successes. But entrepreneus can learn more from our mistakes. Tell us about a mistake you made with SheaMoisture and what lesson you took away.

DENNIS: We were selling our products the street. We were having real success and we got an opportunity to go into Macy’s. I took great pride in the fact that I was selling a product on the sidewalk—on a table outside of Macy’s—and I was also selling that same product inside Macy’s. And that nearly put us out of business.


DENNIS: I didn’t understand the pricing models, I didn’t do the work to understand them, I didn’t know that I’d have to pay chargebacks. I didn’t understand that I was responsible for labor. I didn’t understand that I couldn’t schedule that labor and tell it when to be and where to be. I didn’t understand all of those other costs that went into being in a department store.

RYAN: After we had our first big Method launch at a grocery chain—it was our biggest order ever—we got a check for a few dollars. (laughs) We went and looked at all the deductions they took. My partner and I were just like, “What the f—?”

DENNIS: We grew like a weed in Macy’s. But the more we sold, the more we lost. That nearly bankrupted us.

RYAN: Switching gears in a big way: You’ve had two near death experiences in your life. How did that affect your outlook on business? Or your motivation?

DENNIS: The most recent one, the most recent near-death experience was Covid.

RYAN: I love that you said “the most recent one.”

DENNIS: I think that’s God’s way of constantly reminding me that I’m here for a reason. And I can’t forget it. But I got Covid very early on—in February of 2020. It was before the medical establishment really understood what they were dealing with much less how to deal with it. It was a horrific experience. I’m lying in the hospital, I’m in the ICU, and every day they’re wheeling people by me—people that didn’t make it.

RAPKIN: That was a scary time.

DENNIS: One day an overwhelming calm came over me. I had spent that entire day thinking of my children. And I was like, “You know what? They’re going to be all right.” Literally that got me through it. Once I realized I had done what I needed to do as a parent, I became very calm. I think that enabled me to focus on fighting as opposed to worrying. That empowered me [then] and that empowers me today.

RAPKIN: Last question. This column is called “Cereal Entrepreneur.” We’re talking over cereal. What were you eating for breakfast when you were selling SheaMoisture on that card table on 125th Street?

DENNIS: I wasn’t eating breakfast. Those were one-meal-a-day days, my friend. I ate from a lot of food trucks. (laughing) Food trucks are sexy now. There may even be a few Michelin-starred ones out there. But back then, that’s not what they were.

The conversation has been edited and condensed for clarity.

The conversation has been edited and condensed for clarity.

Source link

You may also like