Interview: Mark Cuban on PR’s Value for Startups

Last week, an opinion piece in Entrepreneur magazine by Dallas Mavericks owner and business mogul Mark Cuban asserting that startups “should never hire a PR firm” got the PR world buzzing. That guidance is part of Mr. Cuban’s “12 rules for startups,” which is featured in his latest book, “How to Win at the Sport of Business: If I Can Do It, You Can Do It” (Amazon.com review here).

Rule No. 11 states:

“Never hire a PR firm. A public relations firm will call or email people in the publications you already read, on the shows you already watch and at the websites you already surf. Those people publish their emails. Whenever you consume any information related to your field, get the email of the person publishing it and send them a message introducing yourself and the company. Their job is to find new stuff. They will welcome hearing from the founder instead of some PR flack. Once you establish communication with that person, make yourself available to answer their questions about the industry and be a source for them. If you are smart, they will use you.”

PRSay reached out to Mr. Cuban to get his take on why he made this statement and for further insight into his thinking on the role and value of public relations.

PRSA: What prompted your assertion that startups should “never hire a PR firm”? Do you see PR firms and PR professionals not providing the right kind of value for entrepreneurs?

Mark Cuban: It’s not really about what PR professionals can and can’t do. It’s about prioritizing the use of limited resources available to a startup entrepreneur.

It is rare that an entrepreneur fully understands what is involved in putting a PR professional in a position to succeed. In order to be successful with a PR firm, [an entrepreneur has to] dedicate a lot of time to educating them on the startup. It requires quite a bit of time to interact with them and to make sure everyone is on the same page, and it requires quite a bit of follow up to create results. Although time is a critical resource in a startup, these aren’t even the biggest problems for most entrepreneurs.

The biggest issue is that very often, entrepreneurs, particularly those in their first startup, are looking for ways to offload responsibility for elements of their business that need to be core competencies of the entrepreneur.

If there is one element every entrepreneur/CEO must take responsibility for, it is sales. If you start a company and you don’t take full responsibility for selling your product or service right when you start, there is a good chance you are going to have problems. As the person at the top, you need to always be selling.

The sales process includes not just customers and prospects, but you need to be selling the company to media, vendors, partners, prospects and existing customers. You need to be in the middle of the process not only to close deals, but to also understand how the marketplace, media, partners, vendors and customers are reacting to your company. I don’t believe it’s smart to offload that in the formative years of a company. Things happen so fast in a startup. If you are not a participant in the give-and-take surrounding your company, you are diminishing your chances for success.

If you feel that as an entrepreneur you can’t handle that sales and communication role, then you probably shouldn’t start the business. In that case I can  understand hiring a PR firm. If your business immediately explodes and you are so busy selling and building your company, then yes, I understand bringing in a PR firm, but those are the exceptions. Rare exceptions.

PRSA: If PR firms don’t offer value to startups, as you say, then what is their value to the larger business community? What value have your businesses attained from utilizing PR?

MC: As a business grows, entrepreneurs have to make build-versus-buy decisions. There is a point in a business’ life cycle where it can be a better use of an entrepreneur’s time to hire a PR professional or PR firm. But at that point, you are no longer a startup. You have matured and have a better handle on where best to use your time.

A PR professional can play the role of interacting with media or whatever segment of your business you think they can do a better job than you. It may be a competitive analysis of media or an introduction to potential strategic partners. Different firms have different value-adds. It’s a matter of choosing which PR firm is best for the entrepreneur’s business.

That said, every business, regardless of age, must always be looking for ways to compete and win. The entrepreneur must be in the middle of that. Put another way, an entrepreneur can’t assign strategic thinking to someone on the outside. You can assign functional elements, but never strategic elements that are the foundation of the company’s future.

PRSA: Can you provide a couple of examples of successful PR campaigns waged by your businesses?

MC: HDNet has used  the PR firm Fifteen Minutes very effectively. Prior to using that firm, however, I had to tweet in order to get HDNet’s PR firm off the couch. But my position on PR firms for startups was set long before that event.

PRSA: How can PR professionals and PR firms offer the business community greater value? Is there anything particular you feel could really benefit businesses more than PR firms currently offer?

MC: The thing about PR firms is that they are driven by individuals. No two firms are alike. Each seems to play off the strengths of its founders. So, there really isn’t any one thing the industry can do.

But I find it interesting, that despite the differences from firm to firm, I have yet to hear of one PR firm hiring another PR firm for help. Does this happen at all? And if not, does that mean that internal to the PR industry, PR firms and PR professionals do not really believe in what a PR firm can do, but rather, each entrepreneur believes in what he/she can do?

PRSA: Where do you see PR fitting within the broader marketing and advertising landscape? Does PR play a pivotal role within your companies or is it part of a larger marketing service?

MC: I see public relations like any other professional service. Every company I am involved with has unique needs. Those needs change depending on where the company is in its life cycle. We try to find professionals [outside of the company] that fill those needs when we can’t or won’t do them internally.

PRSA: Final question: Care to offer us your 2012 NBA Finals prediction?

MC: I never make predictions.

Keith Trivitt is associate director of public relations at the Public Relations Society of America and editor of PRSay.