business executive
Personal Information
Born Don H. Barden, December 20, 1943, in Detroit, MI; son of Milton (a laborer) and Hortense (Hamilton) Barden; married Bella Marshall, May 14, 1988; children: Keenan.
Education: Attended Central State University, Wilberforce, OH, 1963-64.
Politics: Democrat.
Career
Lorain County Times (newspaper), Lorain, OH, founder and publisher, 1967; real estate developer, 1967-c. late 1970s; councilman, City of Lorain, 1972-75; owner and president, Don H. Barden Co., 1976-81; talk show host, WKYC-TV, Cleveland, 1977-80; chairman and president, Barden Communications, Inc., Detroit, 1981--. President, Urban Action, Inc.; delegate, White House Conference on Small Business; board of directors, National Cable TV Association; member, Executive Committee of the Democratic Party.
Life's Work
Don Barden, the former owner of a Detroit cable television empire that employs more than 300 workers and serves nearly 120,000 households, has the Midas touch. Throughout his business career, Barden has cleverly melded his political connections with his entrepreneurial know-how, building vast radio and television holdings from exceedingly modest roots. He began his career with $500 he had saved performing odd jobs; relying on his own business savvy and vision of the future, Barden parlayed a tiny enterprise into a fortune estimated at more than $100 million at the end of 1994.
Born on December 20, 1943, Barden grew up in a family that advocated hard work. His father, Milton, scrambled to earn a living, working as a mechanic, a farmer, and an auto-plant laborer, among other jobs. When Don was not hard at work, he turned his attention to sports. In high school he quarterbacked his football team. He also excelled at basketball, and at one time captained both teams. After high school Barden enrolled in Central State University in 1963. College was expensive, however, and Barden did not have enough money to pay for four years of schooling. He dropped out after his freshman year and set out to make his way in the world of business.
Barden moved to Ohio, where a brother was living, and worked over the next few years as a hired hand in shipbuilding yards, a plumber, and a restaurant worker. Like other entrepreneurs in the United States, Barden realized that the best way to make money, create jobs, and make a difference in the community was to go into business for himself--and that is just what he did.
Barden told Black Enterprise magazine that his goal was to "control his own destiny," so he withdrew $500 that he had squirreled away in the bank and opened a record store. Not content with a mere retail establishment, he expanded further and began booking bands and promoting shows. The next step was to create a small record label and get into that side of the music business. When he found that he had a flair for promotion, he got into public relations full-time, creating a firm in Lorain, Ohio. Each successive step created new challenges and taught him more about business, but did not result in riches. The financial rewards would come later, when Barden turned his attention to real estate.
Barden's first real estate deal involved the U.S. government, which was in the market for a new building to house its military recruiting station in Lorain. Throughout his career Barden would work hand-in-hand with the federal government, either negotiating deals for minority representation of community businesses, or in the case of the military recruiting station, just being in the right place at the right time. In that instance, he scouted around Lorain until he found a suitable structure, then approached the government and received a commitment from the military that it would indeed lease the facility. With the government's commitment in hand, he went to the bank and secured a loan to purchase the building. Barden invested $25,000 and, two years later, sold the building for $50,000.
Now that he was firmly established in Lorain, Barden explored new opportunities. He turned to publishing and, with a partner, tried to start a newspaper in 1967. That particular enterprise failed, but he tried again, eventually creating the Lorain County Times. Using the newspaper as a springboard for even greater community involvement, Barden entered politics, serving two terms on the Lorain City Council, from 1972 until 1975.
Barden moved from the political pulpit to the electronic pulpit in 1977, when he took to the airwaves at WKYC-TV in Cleveland. For three years he held sway on a talk show that aired on Cleveland's National Broadcasting Company (NBC) affiliate. Barden kept his eyes open to the changes that were occurring in the entertainment industry; prognosticators were predicting the demise of network television as more and more people turned to cable. Barden saw that cable was coming, and with it would come the potential for great profits. Though real estate development deals were still his main business venture in the late 1970s, Barden kept his eyes trained on the electronic landscape, looking for an opening.
According to Black Enterprise magazine, Barden used his television acumen and "his community leader status" to put together an arrangement that would start him on the road to becoming a cable television magnate. Barden helped broker a deal whereby four percent of the cable television franchises in the City of Lorain, as well as those of another nearby community, were set aside by the licensing authorities for African American investment. Barden bought two percent of each franchise for $2,000 apiece. He was quoted in Black Enterprise as saying, "That's a once-in-a-lifetime opportunity." It proved to be a special opportunity, indeed, for two years later Barden sold his tiny interests for $200,000.
After such a business coup it was not surprising that Barden turned his attention to cable and its profit potential full-time. Barden had a clear aim: to find communities in the West and Midwest that were primarily black, and, using his know-how and connections, attempt to wire as many as he could for cable television. His first opportunity was in Inkster, Michigan. That community awarded Barden a contract to wire 10,000 of its homes. Barden completed the job on time and on budget. In 1981 and 1982, he negotiated his reputation for good work into contracts wiring other communities. He learned the new business as he went along and that education eventually paid off for him.
The City of Detroit, with its 375,000 households, wanted to get wired for cable and put the big job up for bids in 1982. Barden was prepared. He invested his own money and took out bank loans. Eventually he put $500,000 together to write a proposal on how he could do the job for Detroit. The city hired a consultant to review Barden's plan as well as the plans of other would-be cable wirers. The consultant gave his approval to Barden, recommending to Detroit's cable commission that he get the job. Mayor Coleman Young signed off on the Barden plan, as did the Detroit City Council.
The work was just beginning for Barden, however. Over the next three years he worked hard to put the cable television operation together. The project required an enormous capital investment, for it entailed laying massive amounts of wire, both above ground and through underground conduits, as well as the purchase of facilities and equipment. Barden needed approximately $100 million, so he set about finding a partner.
According to the New York Times, Barden found his deep pockets north of the border, in the Canadian communications company Maclean Hunter, Ltd., of Toronto. In 1984, when Maclean Hunter agreed to purchase 25 percent of Barden Cablevision, Inc., for $230,000, the company was Canada's largest communications enterprise. Barden would eventually sell 60 percent of his cable company, retaining the other 40 percent for himself. However, he always maintained 51 percent of the voting rights in the company. According to Black Enterprise, Maclean Hunter lent Barden's company $15 million and a Canadian bank put up an additional $80 million.
In 1986, Barden began the task of wiring Detroit. Making cable available was the first step. Then Barden had to solicit a pool of dependable subscribers. In 1994, Barden Cablevision had about 120,000 subscribers, meaning that it had the potential for further growth. Barden told Black Enterprise that his cable customers-- primarily less affluent Detroit residents--are not the most ideal customers in the eyes of cable analysts. Such residents, he said, often have trouble paying their monthly cable bills, and sometimes the customers end up canceling their service. Barden's outfit, therefore, had to spend a lot of time "churning" customers, or signing up new subscribers and canceling others. He told the magazine: "Our business is good now.... I'm concerned about the future, concerned about people having the money to buy cable."
Rather than just worry about how his empire could become diminished by changing technology, Barden took some bold steps to stay ahead of the market changes he saw coming. In 1991, Barden Communications, Inc., received from the Federal Communications Commission (FCC) one of the few experimental licenses to test Personal Communications Services (PCS)--devices similar to wireless pocket phones, but noncellular in nature and able to send high quality transmissions of faxes, phone messages, and computer information.
According to Black Enterprise, Barden saw the PCS trend early. Because he had already had the experimental licenses and had been experimenting with the technology, Barden was ahead of other entrepreneurs who wanted to get into the market when the FCC auctioned off the real PCS licenses in 1994. "We're in a good position to aggressively pursue those licenses," Barden was quoted as saying in Black Enterprise. Barden's company was one of the few black firms to get a share of the new, high tech business.
Getting the jump on the PCSs has another, more personal benefit for Barden. PCS technology allows the holders of the licenses to take some business away from the nation's large phone companies. It is those same phone companies, such as AT&T, that most analysts see getting involved in cable television, and taking away business from operators such as Barden Communications. Barden was aware of this trend and chalked it up as an inevitability. "Most observers of the industry agree that telephone companies, in the not too distant future, will be able to provide cable service," Barden told Black Enterprise in September of 1994. "Unless a [cable] company has two million or more customers, they will be unable to compete in the next three to five years." When Barden got into the PCS business, he was quoted as saying, "I hope to give the phone companies some of their own business."
It was the inevitability of an impending takeover and his knowledge of the new economics of cable television that caused Barden to bow out of the business he had helped create. He announced late in 1994 that he was selling Barden Cablevision--part of Barden Communications, Inc.--to Philadelphia's Comcast Corp. Maclean Hunter had already sold its share to Comcast. The deal was expected to be completed by the end of 1994. Barden's 40 per cent share of Barden Cablevision was expected to net him $100 million after the sale.
His success in the stressful worlds of politics and business notwithstanding, Barden is reported to be a cool, low-key individual. In a Black Enterprise profile, he is described as a "soft-spoken" man, who "never yells even when angry." That same article detailed his plans to diversify his communications empire and his contemplation of a return to the recording business.
When those people who know him discuss Barden's future, one potential profession always comes up: politics. In 1992, the speculation focused on his becoming mayor of Detroit. His reply then, as quoted in Black Enterprise was, "I don't have a strong desire to do so. For me to run for mayor would be an extreme sacrifice, actually, because I'd be foregoing my business career while I am in my prime." Barden is a member of the executive committee of the national Democratic Party.
While speculations continued as to the powerful entrepreneur's future plans, Barden turned his attention to two industries very much at the heart of his hometown's financial endeavors: casino gambling and cars. In 1995, Barden won a contract to build a riverboat casino gambling enterprise in the depressed city of Gary, Indiana, and he wanted to get in on the ground floor of casino gambling in Detroit when the possibility opened up in 1998. When Mayor Archer rejected his bid, Barden recruited black celebrities Michael Jackson and Stevie Wonder to help him campaign for a contract in the hopes that Detroit voters would overturn Archer's decision. His billion-dollar casino proposal was to be called "Majestic Kingdom" and included plans for an 800-room hotel, botanical gardens, nightclubs, restaurants, and the Michael Jackson Thriller Theme Park. But in spite of Barden's vigorous campaigning, Detroit voters rejected his proposal on August 8, 1998.
Never one to put all his eggs in one basket, Barden secured a deal with Namibia to supply them with 824 Chevrolet pickup trucks to be delivered in 1998. However, the deal quickly soured on delivery of the trucks when it was discovered that Barden had sold left-hand- drive cars to a country that drives on the left side of the road. Namibia has to pay an additional $15 million to convert the trucks to right-hand drive--a contract which Barden also won. Barden responded to critics of this deal by saying that such criticism is racially motivated because many people cannot accept the financial success of a black businessman.
Barden's success, however, is an undeniable fact. He has proven himself more than able to make money in a diverse range of businesses, from cars to publishing, to the communications industry. Doubtless, Barden will continue to make a powerful impact on the business world.
Further Reading
- Black Enterprise, June 1992, p. 135; May 1994, p. 25; September 1994, p. 17.
- Forbes, October 19, 1998, pp. 112-113.
- New York Times, June 26, 1984, p. D4.
— John LoDico and Rebecca Parks
