Many fans are asking about how successful Marcus Lemonis’s growth strategy has been to date.
According to Marcus, his total investment to date since launching The Profit has been $31.5 million. He elaborated, “I know exactly what I’ve invested. I’ve invested just a little over $31.5 million as I sit here today, with another $4 to $5 million to go into the businesses that have been on the show for this particular season.”
The Marcus Lemonis growth strategy.
However, there have been losses as a result of this strategy. “I’ve probably lost $3.5 million. Maybe more, maybe close to $4 million. Gone. The money’s gone. It’s not like it’s going to come back. It’s gone.” It’s still too early to record any profits. While he may have some paper profits nothing has been divested yet.
In a nutshell, Marcus is playing the standard venture capitalist game. He’s investing in many companies in the hopes that a few will pay off big down the road while accepting that some will die while the majority will just limp along. For every ten companies a VC invests in he hopes that two will hit home-runs. That rest can all fail and he will still make a wild profit. Think Facebook, Google, Amazon, Uber, etc. However, since Marcus is investing in Main Street businesses he’s not expecting those types of spectacular returns.
This season he will invest in a company that makes cedar gazebos, a retail jeans store chain, another that makes lobster rolls, and a food company that makes pot pies. He will also invest in his first startup company. “It’s not truly an idea on a piece of paper, but it’s an early-stage company that does less than $100,000 worth of revenue,” Marcus explained. “We’ve never done that, and so we look at the challenges of starting a business, how do you find distribution, and manufacturing, and all those things.”
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