I recently had a chance to sit down with Shaquille O'Neal and talk about his new venture with Alkaline Water Company (WTER) as well as his general take on business and life.
On a side note, WTER just announced they are in nine major airports. The stock has been on a tear since teaming up with Shaq. While it has retraced a bit from recent highs, the 50-day simple moving average (SMA) continues to hold as support. As I've written time and again, especially when it was trading closer to $1, this is a company I expect to be acquired over the next two years by a much larger name like Nestle (NSRGF) , looking to expand into the premium water space. A price target in the $350 million plus range feels about right.
Until then, here's my interview with Shaq when we met in Dallas, Texas.
What would you say has been the biggest challenge moving from athletics into business?
My answer may surprise you. It's been no challenge at all. Let me tell you why. I'm a great listener. Always been a great listener. You know, before getting into the investment world, I learned about business. I understand business. You don't want to be one of those athletes who have, you know, 60% of all NBA players when they retire and have nothing going on. So, I listened to my mom and my dad and my mentors and educated myself. Had a lot of trials and tribulations. My greatest quote that was ever told to me is, "before you succeed, you must first learn to fail".
My first eight to 10 years I failed in every investment, because as a poor kid you dream of being rich. And one day I became rich. And what do you do when you grow rich? You want to become richer? So, anybody could bring me anything and I wouldn't do due diligence. I was like "let's do it". And that wasn't the right process. I'm big into tech. So, I'm at a conference and I hear this beautiful young man by the name of Jeff Bezos of Amazon (AMZN) speak. And he says, I invest in things that's going to change people's lives. I gonna try that. I'm gonna do it. So you align that with... I align myself with companies that I believe in.
My father's a drill sergeant. We're big on honesty. Can't take your money if I don't believe in your company. I can't take your money and then express to the people how good this product is if I don't believe in your product. So, really been no challenge for me because my formula is a very successful formula. You don't know everything. Ask questions, invest in things that's going to change people's lives. Listen to your mama. Stay out of trouble. Be nice.
It's not been a challenge at all because there are people that have come before me that have failed. I studied that. I mastered that. Try not to make the same mistakes twice. I'm not an expert. I'm not perfect. But I just go by my simple things. Be nice. Be respectful. That's the thing that's going to change people's lives and sit back and wait for the outcome.
Do you like simple or complex when it comes to business and investments?
I like simple. Well, the good thing is I'm smart enough to hire people that are smarter than me. So, when I don't understand a certain language I hire somebody that speaks both languages. I got a guy named Danny and you can put him in a room with anybody and he'll just bring it up. That's what they said. Oh, okay. And now when they tell him and he tells me, now I understand it, now I'm in the conversation. So, you know, getting that answer may sound a little, you know, but for me, being a great listener, I haven't had any problems making the transition because I listen.
Not much simpler than water, I would say...
You know, I fell in love with Alkaline one day. I like to drive a lot. So, we're driving. My favorite place to stop on the highway is Love's Travel Stop. Like my guys, whenever we go to Love's like bros, it's not a mall. So one day I'm tired. We just burning both ends of the candle. So, you know, for big guys, when you get tired, the quick fix drink is water. And I'll tell you so I'm looking. Oh, PH balance. Eight-point-eight PH balance. OK, I'm good. Brings me back to a sensation I had a long time ago, a sensation of drinking pure water, no additives, no preservatives, I'm like... First time was cool. Okay. Then I go to the store, and I see it in aluminum cans. Oh, that's my man. That's been at Love's. I get the same sensation. Now I've got to do my research. Who are these people? Uh Phoenix. Uh, Danny, tell these people I want to meet with them.
I call them. They're nice. They're respectful. Hey. Well, I'd like to talk to guys about doing business. Sure. They get the top guys together. We do a zoom call. I don't like zoom calls. I want to... I want to talk to you. I want to see what your vision is. I want to tell you what my vision is. Hope we can align. You got the vaccine. I got the vaccine. All right. Everybody fly out of Atlanta. Season's almost over. We'll do a, you know, let's hit the Four Seasons. We'll do a meeting. We'll, you know, socially distance and everything. And it was one of the best meetings I had. We never talked about business. It's just this, this how'd you come up with this... boom, boom, boom, boom. When the guys they have their Ricky (Wright) and Frank and all these guys, they're like really, really great guys. And if you're going to be partners with people, I like aligning myself with, you know, great people.
So, when it comes to this deal, I made the contact because that's some damn good water. And I done tried them all. When I'm drinking my water, I want to go back to that sensation of just purity. And you know a lot of waters, you got to (tasting sounds). I don't like that (tasting sound) and I want to drink water. And then when you look at it and vapor distilled water, I'm like, I don't even know what that means. I have a Ph.D. and I don't know what vapor distilled water means, but it don't sound like the sensation of water that I used to drink as a youngster...
Coming out of the hose?
Yeah. So out the hose, yeah. I promised my friend I wouldn't say that anymore, but that's, you know, the sensation that I get.
That's realistic. That's what I grew up doing as a kid, too. In terms of working with the company, how do you see yourself helping grow the Alkaline brand?
You know, along with this pretty face, I have relationships and I have pretty good business acumen. And, you know, when you're working with people such as myself, we don't know it all. So, we put our heads together. Yesterday, we filmed the fabulous commercial that we all co-wrote.
Fabulous. One of my top commercials. It speaks about the brand you know, speaks of, you know, what type of person I am. See my ways...You know, I see myself helping in a lot of ways. Being the nice and respectful guy that I've been.
I've created a lot of great relationships. You know, the good thing about being me is when you get a call from me, at least a person will go "for real?" Like you don't want a person to go, "who?" You never want to get that. When I call, even if you never knew me, hey Shaquille's on the phone. If I can get this, for real, I'm in. Right? So, you know, I have that relationship with pretty much any company.
Here's a story, and it's a true story. Me and my friend were in D.C., and I'm going to get in the White House to see then President Obama. I'm Shaq and I'm getting in the White House. So, I go up. The Secret Service recognizes me and says "Shaq. I love you. I know you're in law enforcement. I can't let you in". No problem. Just tell Obama I'm in the neighborhood. I wanted to say hi. I don't know how the President got my number. Well, we turn around, make about five or 10 steps and my phone rang and the caller ID is zero zero nine nine zero and it was Obama. He says, "Shaq, you just can't be showing up here." So, but, my thing is, if I was a one of those other people, I probably wouldn't have got that response.
So, you know, I see myself, you know, just lending the knowledge that I have and that's, you know, creating more relationships, especially with these other companies. Like I'm big at Gooding's Orlando. You know, family, friends. I do a lot of great business at Walmart (WMT) . So, you know, I just want to help them. You know, we're here in Dallas. I would love to have a conversation with the Army & Air Force Exchange Service (AAFES). I'm an AAFES kid. Grew up on AAFES. And I know all about the PX and the, you know, the commissary and you know, all that stuff. So, just using me and, you know, use my team to just, you know, create more relationships.
We're here in Texas. We got to get you into a Buc-ees too.
Listen, Buc-ees is my second favorite store. You know, I'm telling you, I love Buc-ees.
What one single piece of advice would you give young entrepreneurs looking to grow their own brand? You've done such a great job.
It's not that I don't like giving advice because I don't want to seem like, oh, you're the smartest. My strategy is that I invest in things that are going to change people's lives. My strategy is when it comes to endorsements is that I align myself in companies that I believe in. That's it. Fortunately, the outcome has been really good for me and it's good, it's a strategy that I will continue to use. And thirdly, once I stopped thinking about the monetary aspect of it, I really became a winner.
You know, if I go into it and say I'm going to buy this camera, align with my man right here, and then we're going to sell it and make 30 times as much. It won't work. If we shoot great documentaries on the camera and put them out and the people say "what kind of camera do you use?" And then hopefully Sony (SONY) will come by. But, you know, that's how you should think.
So, I never think about money anymore. I don't. My agent's over there and you can ask him. They're not allowed to tell me how much I'm going make with a deal. Of course, I know, but I don't want to know. Don't tell me how much I made, I don't want to do anything based on money. I want to have relationships with people. I want to help companies grow, because when I obtained my Ph.D, the thought that I would never have a feeling bigger than being Shaq. When the head schoolmaster addressed me as Dr. O'Neal, I was like, like I really felt like something.
So, legacy-wise, especially African American kids, any kids, sports kids, my kids, be a great example to set. So, if I could just do the right thing and, you know, have something, a blueprint for them to follow. I'll be happy with that also.
Fantastic! I appreciate your time today.