THE ORIGIN STORY OF CARDONE VENTURES

As a self-made serial entrepreneur and expert business strategist who sold his company for over $150 million, Brandon Dawson learned the power of scale when he was just 16 years old and grounded on his parent’s 5-acre walnut farm. 

Dawson was determined to finish his walnut-picking punishment as quickly as possible, so he looked to an unexpected source for assistance: the seniors at his high school, who were trying to raise $1,000 for their class trip. 

The students showed up in droves, and in two days, the whole orchard was picked clean. “I didn’t even touch a walnut,” Dawson says. His new problem? Finding a way to turn a profit on the nuts. 

With a 2.4 GPA and no business experience, Dawson picked a random price, and to his surprise, many of the students’ parents bought the walnuts, allowing him to pay the students back for their labor.

“The more people that you throw at a problem, the more people you have there to present the solution, the bigger, better, faster and more productive you’re going to be at getting it done,” Dawson says.

Despite his budding gift for entrepreneurship, Dawson says that many of his classmates thought he’d barely finish high school. 

“None of those people had done what I wanted to do, so I just shut that out,” Dawson says. “I was so intent on breaking out and doing something incredible.” 

Against all odds, at only 29 years old, Dawson became one of the youngest people to ring the opening bell, listing his company, Sonus, on the American Stock Exchange. Serving as founder and CEO for seven years, he acquired over 100 businesses and raised $38 million in four equity transactions, as well as $20 million in strategic debt financing. 

But Dawson was just getting started.

He soon found his next problem to solve: helping independent business owners scale and grow their businesses (outperforming their industry peer group by 3.5 to 15 times) while preserving all their equity value and control of their business.

Without raising or borrowing money, he grew his new company, Audigy, from a startup to a $151 million sale in 2016, at an astonishing 77x EBITDA.

He credits the relationships he built as the reason for his breakthrough success. “You can’t move around people to move the business, you’ve got to move the people to move the business,” Dawson says. 

The equity structure Dawson created allowed for all his members and employees to share in the proceeds of the sale, transforming hundreds of lives in the process.

Today, Dawson is dedicated to a new mission: helping business owners achieve their personal, professional, and financial goals as fast and impactfully as they can. Teaming up with iconic global entrepreneur and business mogul Grant Cardone, the two have created Cardone Ventures, which promises to help companies transform and scale to 10X levels.  

“We see business owners already seeing 30 to 50 percent increases by doing the things we’re teaching them,” Dawson says.

Having unwavering belief is at the core of everything they do. 

“When I met Grant, I realized that all of my thinking was still too small. The whole premise of the 10X concept is whatever you’re thinking about right now, ten times that thinking,” says Dawson. “You’re going to believe in what you picture yourself as, you’re going to work with every ounce of everything you have to create that, or you’re going to concede and give up. You have to own it and you can’t let anyone take it away from you.” 

In this episode of How Brands Are Born, learn how Dawson went from 2.4 GPA to selling his company for over $150 million.

KRISTEN ALDRIDGE: As the co-founder and CEO of Cardone Ventures, you alongside iconic business partner Grant Cardone together are impacting millions of lives all around the world. With a mission to empower entrepreneurs and individuals to take control of their destiny, throughout your incredible career you’ve started, scaled, and sold multiple businesses, not only creating tremendous financial abundance for yourself but for everyone around you. Your gift for entrepreneurship started at just 16 years old, so take us back to where the magic began.

BRANDON DAWSON: Growing up on the walnut orchard, I had always been one of these people that worked and worked and worked, because my parents didn’t have any money. I was 16 years old and I got grounded for doing something stupid. My parents asked me to pick the walnut orchard. Now I don’t know if you’ve ever picked walnuts, but it’s a nasty job. Your hands get all black, they’re stained for like a month, and I used to hate walnut season. The orchard was five and a half acres, so I knew there was a good week’s worth of work. I walked into school and I saw a note on the locker that said “Senior Fund Drive for the Senior Trip - Raising $1,000.” So I went to the president of the senior class, and I said, “Hey, why don’t you come help me pick up walnuts. Depending on how many we pick up, I’ll contribute towards your $1,000.” So that next morning, I was hoping someone would show up because the faster I get this thing picked, the better chance I had at going over to see my girlfriend. All of a sudden, all these cars were pulling in. Trucks were coming in. Vans were pulling in. I had like 50 or 60 people show up, and I’m like, “This is crazy!” They went out and in like two and a half days, we picked that orchard clean. They raked it, I didn’t do anything. I didn’t touch a walnut. But now I had a new problem. I had to pay them the $1,000 bucks. Now I’m a 2.4 GPA high schooler, so I just made up a number, and said, “Hey, this is how much I have to sell the walnuts for.” The parents said, “Well, what if we want to buy them?” It was an amazing thing because they didn’t just buy a few of them, they bought them all. It dawned on me that it wasn’t about the walnuts. It was about showing their kids they love them. And there’s where I learned the power of scale. The more people that you throw at a problem, the more people you have there to present the solution, the bigger, better, faster and more productive you’re going to be at getting it done. The other anomaly was that I made up a price, and they gladly paid it. Price is only an issue in the absence of value. The actual thing we did was create value for people’s lives so that they could show their kids that they love them. That’s where I learned in messaging, it’s not about the business, it’s about the result of the business. Those lessons taught me a lot of things about how to view circumstances and I think it impacted me forever.

KRISTEN ALDRIDGE: What’s compelling about your story is your ability to create whatever you put your mind to, no matter how many obstacles. When you were 29, you were one of the youngest people to ring the opening bell, listing your company on the American Stock Exchange. You did this against all odds, how did you make those big dreams a reality?

BRANDON DAWSON: As a teenager, every couple Saturdays I would spend all day on the tractor. And although I was cutting the grass, I was always thinking about the fantasy of being the CEO of a public company and doing big things. People would say “Dawson, you’re barely gonna make it out of high school. Settle in for mowing the orchard because those are fantasies.” I used to hear this, but then none of those people had done what I wanted to do, so I just shut that out. I was just so intent on breaking out and doing something incredible. I had confidence I could make a lot of money, but what was the big problem I could find? What was the new walnuts? It wasn’t until a few years later, I was selling hearing devices, and I had paid attention in the device business I was in and a lot of people that sold the devices were aging. These are businesses that are doing all this revenue, and a lot of them were just retiring and shutting their business down, and a new profession was emerging with people coming out of university to do that work. So I had the idea: what if I bought those businesses? And what if I went in and found the kids from university to run it? And that was my launch into entrepreneurism. So I went out and met with lots of different business owners, and I had over $20 million worth of businesses that wanted to sell to me that I put under letter of intent, but I didn’t have any money. All of a sudden, I’m in New York City and I’m presenting to potential investors, big institutions - Saloman Brothers, Goldman Sachs - my dream was coming into a reality. And I realized I don’t know anything about how to raise capital, I don’t know anything about debt structure, I don’t know anything about anything. I’ll never forget I was at one of the most prestigious financial institutions in the world. They said they were interested in potentially investing in me, but they were nervous about my experience. I said, “Well, I’m going to get one shot, because if I don’t make this work, no one will ever trust me again. So whereas you can bet on thousands of businesses, this is the only bet I have.” I was asking for $15 million. They called me up about a month later, and they said they wanted to give me $18 million for the same valuation. And from there, they said, “One caveat: we want you to list your company in the U.S. We want you to take it to the American Stock Exchange. It was one thing to be in wall street. It was one thing to sit across from the table from these titans that control billions of dollars. It was another thing, at 29 years old, to get to ring the opening bell of the American Stock Exchange. That thing I used to dream about, that everyone said I was crazy? I did it.

KRISTEN ALDRIDGE: Like so many legendary leaders, the road to success was far from easy. But out of hardship and pain often comes clarity and transformation. Leading a public company brings a whole new set of challenges. What was the most powerful lesson for you during this time?

BRANDON DAWSON: 2001 I was at the highest peak of success. I had all this cash, I had a strategy, we were starting to make a lot of money…I was crushing it. And then my investors called me and said, “Come to New York.” I thought, “These guys. They’re going to take me to dinner, they’re going to tell me you did an unbelievable job. I was so excited.” So I walked into the boardroom, and they said to me, “Hey Brandon, you’ve raised this debt, and although it can convert back to cash, the debt is in front of our preferred equity.” See, this is where I learned about equity structures, capital structures, capital stacks. And what I learned the most, is that investors don’t like to have debt in front of their preferred equity, because if something goes wrong, they lose their position in the capital structure. So that meeting went from me thinking that at the peak of everything in my life, I’m going to get a pat on the back and told I did a remarkable job, to being told that I needed to sell the company, immediately. I was like, “You guys, are you crazy? We finally arrived. Look at the money we’re making. We’re going to own the global space.” And they said, “Yeah, but we don’t care. We want you to sell the business.” And I just looked at them, and I said, “I can’t sell the business. Seven years. This is my baby.” They sold it so fast, without even shopping it, without using a banker, because they wanted to make sure they got their money and they didn’t care about anybody else. And that taught me a whole other lesson, about what it’s like to be an entrepreneur to pursue your dream, to look your team in the face and tell them about where you’re going. To build systems, to build process, and build people, and then have someone else just make the decision instantly that you’re irrelevant. And I left in the Fall of 2001, it was right after September 11, and I sat there thinking that the whole world was coming to an end at this moment. My career is coming to an end. How can I go from being the superhero, fighting through every challenge, breaking through every wall? On a vibrational energy, I just connected with that day. And I just sat there thinking, what’s next?

KRISTEN ALDRIDGE: It was within that transformation that your next brilliant idea was born. Without raising or borrowing money, you grew your next company from a start-up to selling it in 2016 for $151 million, at an astonishing 77x EBITDA. What was the opportunity you saw in the marketplace?

BRANDON DAWSON: In the window of all this happening, I kept lamenting about how I got screwed over, and it led me on a path of self-discovery. I realized the whole issue is you’ve got all these wall street kids that the minute you buy stuff it’s like cram down, operate, oppress, ratchet, screw downs, all these things, and people don’t want to be in that environment. It’s the psychology of consolidation. My previous company I had no relationship with the majority of my employees. I had 500 at the time. And I realized, that is the problem. You can’t move around people to move the business, you have to move the people to move the business. And that gave me an idea: what if I reversed consolidation? Instead of my buying them, and then cramming down on them, what if I started a company, I gave them equity in my company, and I built programs, resources, tools and digital strategies so they could deploy them back in their practice, and then they could win? And instead of them working for me, what if I worked for them? And everyone again, told me I was crazy. As it played out, there was no equity structure that was available to do what I wanted to do, and so I had to create it. And we created the single largest independent group of business owners that outperformed their peer group three and a half to 15 times in value and in production, and created a whole new standard in North America for private practice audiology. When the world was melting down in 2008 through 2011, every one of those years we were on the Inc 500 5,000 list of fastest growing private companies. We never had a non-profitable month, and it was all self-funded. and I gave 40 percent of the equity to my customers, and we were one big ecosystem. The value we created for those people was unparalleled anywhere in the industry. And then in 2016, we sold the business for $150 million, 77x EBITDA. Best day of my life was sending out $45 million to my customers and every one of my employees, because they all shared in the value. When we started working with them, people that were grinding every single day never being able to leave their office, working 80 hours a week, taking those people and creating a life for them where they didn’t even have to go to the practice anymore because they got so big. We created more multi-millionaires in the hearing care space than had ever existed before, and that personally, is something I’m very proud of. And they’re still crushing it.

KRISTEN ALDRIDGE: Lifting people up is at the core of everything you do. You’ve now partnered with global entrepreneur Grant Cardone to bring your knowledge of scaling to the masses. How is Cardone Ventures helping business owners personally, professionally, and financially?

BRANDON DAWSON: Cardone Ventures exists to help business owners break through the mistakes in the process of trying to grow and scale. How to do the things that will create the highest level of impact the fastest to move them into whatever they’re dreaming about. If we give you the preview looking forwards, you’ll make better decisions. And getting you first to go back and remember that mental picture you had in your mind before you started the business, not after when you’re full of stress and constraint and fear because things are hard. That’s the breakthrough opportunity. We see business owners that are already seeing 30, 40, 50 percent increases by doing the things we’re teaching them. Impacting people’s lives like this is what gets me going. It’s what makes me excited, and it’s what makes Grant excited. When I met Grant, I realized that all my thinking was still too small. The whole premise of the 10X concept is whatever you’re thinking about right now, ten times that thinking. You have to have that foundational belief. You’re going to believe in what you picture yourself as, you’re going to work with every ounce of everything you have to create that, or you’re going to concede and give up. You have to own it, and you can’t let anybody try to take that away from you. Anybody that wants to go through personal self-improvement, Grant wants to create a path for those people willing to do that. As people work in his system and get more profoundly impactful, they go start their own businesses and then I’m there to help them actually grow and scale. That’s our shared purpose together. My personal mission is to help business owners and entrepreneurs be able to achieve their personal, professional and financial goals as fast and as impactfully as they can, without making any of the mistakes that I made. What I’m most proud of is that we’re able to so quickly impact the lives of people that trust working with us at Cardone Ventures. When people trust you, they make a choice to work with you, and then they feel the impact of that, and it’s life changing for people, which is what I’m so excited about.