Entrepreneurs

The key to success: Expect rejection, says billionaire Patrón tequila founder

John Paul Dejoria.
Qin Chen | CNBC
John Paul Dejoria.

These days, billionaire co-founder of Patrón Spirits International John Paul DeJoria can buy all the tequila he wants. But there was a time when the serial entrepreneur struggled to afford a 99-cent happy hour margarita. Back then, he ordered it for the complimentary chips and salsa, which were dinner.

"The salsa was my vegetable," he tells CNBC.

As a kid growing up near Los Angeles, DeJoria would help his family make ends meet selling newspapers and Christmas cards, and later he was a door-to-door salesman. Twice he was homeless and had to live out of his car.

DeJoria is now worth about $3 billion, according to Forbes, thanks largely to Patrón, which brings in an estimated $1 billion annually according to a 2015 Fortune article, and Paul Mitchell Systems, the hair care company he co-founded, which also has estimated yearly revenues of more than $1 billion.

DeJoria knows something about creating success. So what's his advice for others who want to get ahead?

"Be prepared for a lot of rejection," he tells CNBC, "because you are going to get it. If you are prepared for it, it's not going to hurt you as much."

Indeed, it's all about persistence, he says. "Be just as enthusiastic on door 101 if 100 have been closed in your face. Eventually you're going to do it."

Long before DeJoria found success with Paul Mitchell Systems, he had plenty of failed ventures: He hustled to sell dictating equipment, photocopy machines, life insurance and more, he says in the trailer for his new movie, "Good Fortune," which documents his life.

Yet DeJoria never let the failures stop him.

"Be just as enthusiastic on door 101 if 100 have been closed in your face. Eventually you're going to do it." -John Paul deJoria, Co-founder of Patrón Spirits International

While selling hair care products, DeJoria met Paul Mitchell in 1971. Mitchell was a well-known stylist but was "going broke," according to DeJoria.

Eventually, DeJoria made his pitch, "Paul, you've got to know how to sell. Let's start a company," he recalls in the movie trailer.

Mitchell agreed and and 1980, the pair launched Paul Mitchell Systems with only $700.

"It took off," says DeJoria.

His next big success came in 1989. DeJoria's friend Martin Crowley promised to bring him back some tequila from a trip to Mexico. Instead, Crowley came back with an idea, DeJoria told Fortune. He believed the world was ready for a higher end tequila product than existed at the time in the U.S.

Patrón Spirits produced 1,000 cases in its first year and has now grown that to over 2 million, according to its website.

DeJoria has come a long way from living in his car. But he believes, "success unshared is failure," so he has also committed to philanthropy. The 73-year-old pledged to give the majority of his wealth away to charity as a member of the The Giving Pledge, a charitable campaign led by Warren Buffett and Bill and Melinda Gates.

"Success is not how much money you have, success is how well you do what you do," he says.

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