Mark Cuban turned 91% of his employees into millionaires when he sold a company for $5.7 billion

Dallas Mavericks owner Mark Cuban looks on during a NBA game between the Dallas Mavericks and the Los Angeles Clippers on January 10, 2023 at Crypto.com Arena in Los Angeles, CA.
Icon Sportswire | Icon Sportswire | Getty Images

When Mark Cuban sells a business, he always sets aside some of the proceeds for one specific purpose: divvying it up among the company’s employees.

“In every business I’ve sold I’ve paid out bonuses to every employee that was there more than a year,” Cuban posted Tuesday on social media platform X.

The bigger the acquisition, the larger the payout: 300 of Broadcast.com’s 330 employees became millionaires when the audio streaming service sold to Yahoo for $5.7 billion in stock in 1999, Cuban wrote.

Cuban started the practice after selling his first company, a software firm called MicroSolutions, for $6 million to CompuServe in 1990. He took 20% of the total sale price, he tells CNBC Make It, and paid it out to 80 employees — which would equate to $15,000 per staffer, if distributed equally.

Cuban did something similar upon selling his majority stakes in HDNet, now known as AXS TV, in 2019 and the NBA’s Dallas Mavericks last year, he wrote in his post. “And only HDNet had any layoffs right after the sale,” he added.

Cuban’s co-founding and sale of MicroSolutions marked his first big entrepreneurial success and a triumph over setback: He nearly went broke after his secretary stole roughly $82,000 from the company.

“It was f—ed up,” Cuban told Barstool Sports’ “Pardon My Take” podcast in 2020. It also presented a silver lining, he added: “It made us get our s— together.”

The business bounced back, and Cuban sold MicroSolutions five years later, making him a millionaire. “You have to hustle the most when you think it’s the darkest,” he said.

In 1995, Cuban invested in and took operational control of AudioNet, the streaming platform that eventually became Broadcast.com. The business idea was met with skepticism at a time when the internet was still fledgling, he told CBS’s “Sunday Morning” last year.

“There was nobody doing it. Nobody,” Cuban said. “People thought I was an idiot.”

Upon selling Broadcast.com, Cuban received a large portion of Yahoo stock, which was considered highly valuable at the time. But instead of holding onto it, he quickly cashed out. He was happy with the money he’d earned and suspected the stock market was overpriced, he told GQ in 2022.

Months later, the dot-com bubble burst and Yahoo’s share price sank. “It taught me a hell of a lesson: When you just chase dollars, it never works out well,” Cuban said.

Last year, Cuban sold a majority stake in the Mavericks to the Adelson and Dumont families, who run Las Vegas Sands Corporation, in a deal reportedly valuing the franchise at roughly $3.5 billion. He retained a 27% ownership stake and control of basketball operations, the Associated Press reported at the time.

The deal ended Cuban’s longtime status as an NBA majority owner. In 2000, the newly minted billionaire purchased his initial stake in the team for $285 million — without negotiating or trying to push the price down by even a penny.

“It was all about fun,” Cuban told “The Draymond Green Show” podcast, in an April episode. “That was like a dream … I didn’t even negotiate, I was just like, ‘Yes, whatever.’”

Cuban’s current net worth is $5.4 billion, according to Forbes.

Want to be a successful, confident communicator? 

Take CNBC’s new online course Become an Effective Communicator: Master Public Speaking. We’ll teach you how to speak clearly and confidently, calm your nerves, what to say and not say, and body language techniques to make a great first impression. Sign up today and use code EARLYBIRD for an introductory discount of 30% off through July 10, 2024.

Plus, sign up for CNBC Make It’s newsletter to get tips and tricks for success at work, with money and in life.