Mark Cuban's $61 million ‘Shark Tank’ investing strategy: 'Sometimes my deals are purely to help someone or send a message'
Like everyone, Mark Cuban's investment history has hits and misses — and, at least when it comes to ABC's "Shark Tank," the billionaire has made peace with that fact.
On Saturday, Cuban noted on Twitter that "on a cash basis," he's taken a net loss on his myriad "Shark Tank" investments — which, by one online estimate, include more than $61 million invested into 210 startups since joining the show in 2011. (This estimate is based on Cuban's on-screen investment, which do not always ultimately result in a consummated deal after the fact.)
"I'm good with that with my 'Shark Tank' companies," Cuban wrote. "I don't do the show to get the best investments. And I don't always invest because I think I'll make money. Sometimes my deals are purely to help someone or send a message."
Notably, Cuban added, the net loss only covers companies that he's exited — not any of his active investments in private companies.
"If I add the valuations [of my current investments] based on the last raise, I'm doing great," he wrote. ""But that's not money in my pocket. It's potential. Raising money hopefully creates more upside. However, [in my humble opinion], if you can't spend it, it's not a financial gain."
The self-analysis was a conversation-starter, with Cuban acknowledging that a company's valuation only shows how his investment might be growing on paper: It's not liquid, meaning he can't spend its value on anything without selling his shares first. "Should illiquid valuations count?" he asked his Twitter followers.
It's also a window into the billionaire's investing strategy, at least when it comes to "Shark Tank." In the past, Cuban has frequently discussed having a soft spot for businesses with missions he supports — a vegetarian since at least 2019, he's invested in multiple vegan food brands on the show — and entrepreneurs with strong work ethics who need a boost to get to the next level of success.
"What really gets me going is when people have an operating business where they've already gone for it. And they've invested everything," Cuban told TV Tango in 2011. "They've put their heart, their soul, their time, everything that they have available to them into the business. And they've laid it on the line. And they just need a little bit of help."
Cuban added that when it comes to identifying the type of entrepreneur he wants to work with, he "can see elements in the entrepreneur that are attractive to me in terms of efforts and brains, and ability to sell."
Of course, financial upside still matters — spending money to send a message may be relatively pointless if the company doesn't succeed enough for consumers to receive the message — and Cuban said that the more money he puts on the line, the less willing he is to take a risk on something that won't recoup his investment.
"I contrast [those factors] to the risk-reward of the business or of the investment," he told TV Tango. "So in other words, if I'm investing $10,000, there's a different risk-reward profile than if I'm investing a million dollars."
Disclosure: CNBC owns the exclusive off-network cable rights to "Shark Tank."
Sign up now: Get smarter about your money and career with our weekly newsletter
Don't miss: