Before he became a billionaire entrepreneur, NBA team owner and TV star, Mark Cuban was just a college kid trying to make ends meet. On a recent episode of the “Life in Seven Songs” podcast, Cuban revealed the surprising way he paid for his junior year at Indiana University: a chain letter Ponzi scheme. And, according to Cuban, it was an experience he looks back on with a sense of amazement.
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“It was basically a scam,” Cuban said, laughing as he shared the story. In the early 1980s, Cuban devised a scheme asking fellow students to give him $100. He kept $50 and then used the rest to keep the chain going by sending money to others on the list.
The idea was that eventually, everyone’s name would make it to the top of the list and they would hopefully earn more money than they put in. Cuban admitted it wasn’t a foolproof plan, but it worked well enough to get him through college.
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Cuban’s money from the scheme meant a lot to him then. Coming from a working-class family, Cuban didn’t have much financial support beyond the occasional $20 bill his dad would slip him. Cuban found a way to make it work, even if it meant running what he openly calls a scam.
However, Cuban ensured his friends didn’t lose anything despite the clear dangers of his Ponzi-like chain letter. “I made sure my friends all got their money back,” he claimed, revealing that he went to considerable lengths to ensure that no one went without. What was left over he used to pay his tuition.
Reflecting on the experience of opening his dorm mailbox and finding it filled with cash envelopes, he said, “I’d go to my mailbox and there’d be $50 from here, $50 from there.” For Cuban, it wasn’t just about the money – it was about figuring out how to make things work, no matter the odds.
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After college, Cuban moved to Dallas, where he worked as a software salesperson and lived in what he called a “s*ithole” with five other guys.
“It was nasty as can be,” Cuban said. “But literally, I slept on the floor and if somebody was out of town, I got a bed, didn’t have my own closet, didn’t have my own, you know, drawers, nothing.”
Cuban looks back on that time as a lesson in survival and creativity. “It gave me confidence,” he said and once he realized he could sell and make money, that got him “excited about business and reading about business and the rest is history.”
Whether you want to call it a hustle, a scam or just a last-ditch effort to make ends meet, Mark Cuban’s story undoubtedly demonstrates his willingness to take chances that ultimately paid off.
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This article ‘It Was Amazing,’ Says Mark Cuban Of His 80s ‘Ponzi Scheme’ That Got Him Through College, Made Sure His Friends ‘All Got Their Money Back’ originally appeared on Benzinga.com
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