Mark Cuban on the Future of the Mavs, Taxing Billionaires, and Why Elon Musk Is ‘Irrelevant’ to Crypto

“I haven’t slept in two days,” explains Mark Cuban. “So, I apologize for being a step slow.”

The dot-com billionaire (net worth: $4.2 billion) is blaming his insomnolence on the Dallas Mavericks’ first-round loss to the Los Angeles Clippers in the NBA playoffs, an event that’s triggered rampant speculation regarding the team’s two young stars, Luka Doncic and Kristaps Porzingis, with reports indicating that the lengthy Latvian once known as the “unicorn” does not get along with the Slovenian wunderkind and feels like an “afterthought.”

His basketball franchise’s future is just one of many topics we explored over the course of our wide-ranging conversation, which just so happened to fall on the same day that ProPublica published an explosive report revealing how the world’s top billionaires, despite their surging wealth, pay next to nothing in income tax (we covered that too). But the official occasion for our talk is Shark Tank, the ABC reality-television show that recently wrapped its 12th season and is vying for a number of Emmys. The show sees entrepreneurs in search of additional investment capital present their businesses to its five “sharks,” the most compelling of which is Cuban, in the hopes that they’ll back them.

“Every story is impactful. That’s why I like to do it—you’re literally helping people’s dreams come true,” says Cuban. “You’re changing the lives of not just them, but their families and their employees. It’s really rewarding just to be part of it.”

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In addition to the Mavs, taxation, and Shark Tank, we also discussed crypto, Elon Musk, and politics.

Gonna be fully transparent here: I’m a very bitter Knicks fan. But as a basketball lover, I enjoyed watching your team duke it out with the Clippers. What do you feel went wrong with the Mavs’ playoff run?

For us, when our role players made threes, we beat them. We won. When our role players didn’t make threes, and we had plenty of open looks in Game 7, we lost. And their role players? I mean, Luke Kennard is who beat us. We did a great job on Kawhi, and it’s one of those things where you pick your poison: If Luke Kennard is gonna beat us, he’s gonna beat us. And he beat us.

You’ve surely seen the recent reports about the supposed beef between Porzingis and Doncic.

They don’t know what they’re talking about. That’s what it comes down to in a nutshell. They get along great. They don’t have to be best friends, just like I know guys on the Knicks aren’t best friends. But on the court, they’ve got a good chemistry. We just used KP as a decoy. The whole idea was: create more space for Luka because it’s really crowded, and KP did a great job cutting and everything we asked him to do. Our role players just didn’t make shots.

That’s a pretty expensive decoy though, I gotta say.

You know what? I’m fine with that. It’s all about winning, because not every guy can be a decoy. If we had other guys we could use as a decoy, we’d be using them.

What do you feel the team needs to become a title contender? I know you have Tim Hardaway Jr. and Josh Richardson potentially coming off the books, which would free up $30 million to go after an ace shooter.

We need a secondary ball handler with some size. KP will spread the court, make threes, is a great cutter, and block shots. Luka will create. We’ve got shooters with Tim and Trey [Burke] and Maxi [Kleber] and others. But we need someone to take the pressure off of Luka, so instead of him having to have the ball in his hands for 40 minutes, it could be 32 minutes, and that’s what we need.

Let’s talk Shark Tank. How do you feel the show has evolved?

At the beginning, they had to work hard to get entrepreneurs to want to come on. Now, going on 13 years later, the show is so iconic that everybody who comes on the show can watch hundreds of episodes to get a feel for what’s going on. That’s been the biggest change: they know more about us than we know about them. They get about 40-50,000 auditions. It’s crazy. Pre-pandemic, when we’d come to a city for auditions, people would line up and get there 8, 10 hours early. I felt bad for the producers having to filter all those out, but people have a dream and that’s why the show does so well.

You’ve invested about $20 million in businesses on Shark Tank. Have you made your money back?

Yes, definitely. I sold one company, Cycloramic, that pivoted from being an app on an iPhone to being computer vision for online auto e-commerce, and I made—now that the stock price is up so high—double all my investments just from that one alone.

Will we start seeing more crypto or NFT-related companies on Shark Tank?

I hope so. Because I know that I’m always asking companies questions about how they deal with those things. Do they take crypto? Do they take Dogecoin, like we do with the Mavs? How do they invest their money? If they have capital, would they be willing to buy USDC stablecoins and invest that in DeFi and make 10-12 percent on their money as opposed to 0.2 percent in a bank account? How are they going to take their digital assets and turn them into NFTs? If they’re a textbook company, for example, wouldn’t it be better to sell a textbook as an NFT because the marketplace after the kid’s done with a class is more efficient, effective, and profitable?

Thanks to apps like Robinhood, there are a lot of first-time investors out there. What advice would you give a new investor who has $10K to invest?

If you’re trying to invest the money you’ve saved, what I’d tell you is: 1) Pay off your credit cards, because that’s 29 percent you’re getting ripped off every month and it’s hard to make that up in your annual return; 2) Make sure you have a rainy-day fund, because who knows if we’ll have another wave of the pandemic or what have you; 3) If you’ve got money left over after that, that’s when you can have some fun. It’s easy to get lost in the hype of Dogecoin, GameStop or AMC, and I’m not saying don’t invest in those companies because they can be good investments, but you’ve got to know why you’re investing. Are you investing because of some video you saw on TikTok, or a video you saw on YouTube, or a friend told you? Those aren’t good enough reasons. Part of the fun in investing is doing the homework, finding out companies, and seeing if it’s something you agree with—and believe in.

A report in ProPublica today revealed that America’s richest paid little to no income tax, and we’ve already seen the wealth of America’s richest rise over $1 trillion during the pandemic. What do you think we should do to bridge the gap between the haves and the have-nots? Because that gap is widening every day.

There’s a couple of questions here. One is: What is income vs. net worth? Do you tax net worth or do you only tax income? Because net worth is fleeting. If you go back to the internet stock days, there are a lot of people who were billionaires who aren’t even close anymore and working regular jobs. When you have this type of environment where interest rates are zero, people with appreciable assets, those numbers get inflated. But if interest rates go up three months from now, six months from now, a year from now, those inflated net worth numbers could be a tenth or a hundredth of that. So, how do you tax that? That’s a legitimate question. Obviously, I’m biased, but when you see net worth, that doesn’t equate to liquidity, and I think that’s where people get confused. If someone has $100,000 in their house, that doesn’t mean they have $100,000 in cash that they can pay their taxes with, and the ratio stays solid as you go up the income ladder, so people like myself, I don’t keep cash in the bank. It’s invested. If you tax me on my net worth, I’m going to have to sell a lot—not just a little, but a lot—and if that net worth comes down considerably because the prices of any stock or crypto I own deflate, then what happens? Do you credit it back because net worth declined?

Historically, we’ve taxed income. I don’t mind paying more taxes on my income—not at all. I’ve written blog posts saying that paying more taxes is patriotic. I’ll give you another example: When Elizabeth Warren started talking about her wealth tax, I started doing some homework. I thought, OK, I know from my own personal financial circumstances I’d have to sell stuff, because I don’t keep that much liquidity. The way that she published these numbers about the amount of money in taxes, well, I happen to know an economist who worked with her on her plan, and I asked them a simple question: “Did you model what would happen if people had to dig into their net worth and sell assets in order to get the number you came up with?” They said, “No.” I said, “Did you model this out over 10 years to see what the impact of the economy would be? Because it could be negative if everybody is selling assets, and all of a sudden, the 51 percent of people who do own stocks saw their IRAs, pensions, mutual funds, and house values drop significantly?” “No.” So, it’s one thing to talk about it from a political side, it’s another thing to do it because it makes good copy, and it’s another thing to do the work to find out truly what is fair and what’s not fair. Fair is good. I’ve got no problem with fair, but you have to look at the realities.

But if you have someone like Warren Buffett whose personal wealth goes up $24.3 billion and he pays only $23.7 million in income tax during that time, that doesn’t seem fair.

Well, they’re two different things. Taxable income is different from your net worth. If you have a house and because there’s an apartment complex built down the street, its value goes up from $100,000 to $1 million. The only way you’re going to benefit from that financially is if you sell it. Should you have to sell your house in order to pay your taxes? It’s not like Warren Buffett got paid that money in cash—at least I don’t think he did—it’s just the inflated value of his stocks. Look, I don’t want to seem like I’m making excuses for this, because with that much money it’s crazy anyways no matter how you look at it, but you’re picking a point in time where the asset values are significantly inflated, and the price values could be 1/100th of it in six months. You have to take that into consideration when you look at taxing. For ProPublica, it makes for great headlines, so it’s mission accomplished for them, but they’re not being honest about the whole thing. Should I pay more in taxes? I’ve got no problem doing it. I paid 29 percent last year, and 19 percent the year before. Fair or not, we can discuss that, and I’m open to paying more. But if you tax me on my net worth, then I have to sell shit.

I’m curious where you fall on social media companies like Facebook and Twitter banning Donald Trump.

It’s not tough at all. If someone is using your product to do something really bad, you stop selling them the product.

Like insurrection.

[Laughs] Yeah. Insurrection is bad. If I realized that something I sold was being used for something that was nefarious or wrong, I would stop it. How is this any different? Putting aside the TOS, it’s just the right thing to do. If you’re selling a toy car, and you don’t realize that toy car can be used for this bad function, you’re going to fix it because it’s being used in ways you didn’t imagine. Nobody at Twitter or Facebook imagined this set of circumstances when they started their companies. Now, do I think Facebook is a piece-of-shit company? Yeah. I’m not a fan of it at all. The way that they use algorithmic amplification or AI amplification and put revenues first over…

…democracy?

[Laughs] Democracy, yeah. I have a problem with that.

If Trump brought his constellation of dogshit companies on Shark Tank, what would you tell him?

[Laughs] I couldn’t think of anything more fun. I’d torch him, obviously. I’d ask him about Trump University, Trump SoHo, Barbara Corcoran having to sue him to get the commission he promised and winning. Every single time he’d ripped somebody off, I’d ask him about it.

It’s interesting you mention Trump SoHo—now The Dominick—because not only was that built over a hallowed burial ground, but LeBron James and the NBA helped put pressure on that place to change its name. I read that all the NBA teams stayed there, and then LeBron started this movement to get people to stop staying there.

Yup! We used to stay there, and we stopped staying there. For sure. I don’t know if that was the exact reason why. But we stopped staying there.

I wanted to ask you about Elon Musk’s influence over the crypto market. I’ve spoken with a lot of people in that space who’ve tired of his antics, and his move organizing a consortium of miners rubbed a lot of folks the wrong way, because it seemed to fly in the face of what crypto stood for, which is being decentralized.

He’s irrelevant when it comes to crypto. In the early days of the internet stocks, “esteemed analysts” would say something, and stocks would move 20, 30 percent. A stock would go up a hundred dollars and double in one day because this guy or this woman said something about this stock. In nascent industries where there’s a lot of volatility and a lot of new players coming in, you get that type of significant movement. Elon Musk is perceived to be an analyst or influencer when it comes to crypto, but that’s because the industry is so young. It’s not about Elon, it’s about how young the market is.

I know you’re a big booster of crypto, but are you worried about the amount that crypto could be financing terrorism? Because it’s largely unregulated, and about 5 percent of all crypto mining is conducted by Iran, so who the hell knows where that money is going.

I mean, look what happened with the ransomware [attacks]—they got the money back. If you’re paying someone ransomware, you know there’s a wallet somewhere and you’re going to be able to blacklist that, track it, and watch where it goes, so it’s going to be a lot harder to wash it. When it comes to mining, you know there are miners in Iran because you can see where they are and where the wallets are. We know who they are, and it’s on the blockchain, so while it may be anonymous in the short term, it’s never anonymous in the long term.

What about the argument that crypto mining is terrible for the environment?

Let’s just look at what the product is: it’s an alternative to gold—digital gold—so it’s not a currency, and not something that will be used continuously, and there’s a minimal amount of transactions that happen on bitcoin, it’s just the mining process. And if you look at the mining of gold and its impact of the environment versus the mining of bitcoin? There’s no comparison. It’s dramatically less. And it’s not just gold. I believe we lose $200 million a year in coins—pennies, nickels, dimes, and quarters. Copper, nickel, they’re all mined and have a significant environmental impact. If we moved to a digital coin in the United States, the environmental impact would be significantly positive.

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OK, on a completely different note, I’ve heard that you tried to break into acting in the ’90s—and even auditioned for Philip Seymour Hoffman’s role of Dusty in Twister.

[Laughs] Yup! True. It was mostly Taco Bell commercials, a Ford commercial, and some other commercials. I moved to L.A. in the ’90s and took some acting lessons just for the fun of it. I took classes from a named Aaron Speiser who was really, really good, because look, business is one thing—I’m in control and I do it—but acting is the exact opposite, where you just have to let go, put everything aside, and be in the moment. It was good for me cathartically, because I’d just sold my company and needed to decompress, and then I went back to Dallas for a girl I was dating and that didn’t work out, but I started auditioning and taking acting classes here. They started to cast Twister in Dallas and I even got a callback, but obviously the better man won.

I’ve got some family down in Texas, and I’m curious how you feel about this voter-suppression bill being proposed in the state, and also Governor Greg Abbott.

I really don’t have a lot of thoughts on it. I’ve really tried to avoid local and Texas state politics. I really have. We don’t see eye to eye and I’m in the minority here. I’ve typically been apolitical across the board until Trump got involved, because I just think I can have a far greater impact on the community staying outside of politics. If it were up to me, I’d get rid of both parties, make political parties illegal, and put ranked choice voting in for every position. I’m disappointed with the mayoral election in New York, and how you guys are not talking about ranked choice voting and the impact it can have, because it really could be even more game-changing than the mayoral election itself, but nobody’s talking about that shit at all! If I had my druthers, again, get rid of all parties, because it’s not like the two parties pick the best candidates.

Are you still thinking about running for public office?

Not a chance. Not a chance. That was just a response to Trump, and beyond that I have no interest.

You were photographed meeting with Steve Bannon in November of 2016, right after Trump was elected president. I’ve interviewed Steve Bannon before, so I have my own perspective on him, but what was that meeting about?

It was just me being curious, that’s all. I’ve met with Michael Cohen and I’ve met with Eric Schneiderman. People who are “infamous” are interesting to me. There was no set agenda and no “let me see what I can get,” it was more me asking him about Trump and comparing my experiences with Trump to his. They were pretty much in alignment. He thought Trump was an idiot, and that he could control him. He was the guy behind the guy and was able to influence him. He didn’t come out and say Trump was “an idiot,” so I don’t want to mischaracterize him, but I didn’t get the sense that he did it out of respect and support for the Trump agenda.

How good of a job do you think Joe Biden is doing so far?

I think he’s doing great. I don’t see families at each other’s throats, the vaccination is widely distributed, and those two things are 99 percent of the battle. That’s why he’s got a 62 percent approval rating. Things are more issues-driven instead of personality-driven, and that’s a huge step forward.

To go back to the NBA, I wanted to ask you about the NBA’s relationship with China. There was the whole Daryl Morey and Tilman Fertitta episode two years ago, where they were critical of China and walked it back. It reminded me of the recent dystopian episode with John Cena where he had to apologize for just acknowledging Taiwan. So, I’m curious how you feel about the NBA’s partnership with China. Has it become problematic?

Um… I’m not really the most qualified to say, because I don’t deal with China directly, but at the same time, I didn’t want to talk about Texas politics, so I don’t want to speak on domestic issues in other countries, because I don’t know them all. Am I against concentration camps and what’s happening to the Uyghurs? One hundred percent. Are we taking steps to make sure the products we sell aren’t sourced there? Yes, a hundred percent. There’s no question about that side of it, but I’m not getting into the politics of specific countries, because I’m just not there.

Trae Young is still in the playoffs, but I’m guessing you still feel pretty good about that trade.

Really good.

I would too. You’ve flirted with purchasing a Major League Baseball franchise for quite some time, and I live in New York City where the Mets are under terrible ownership. Do you still want to buy an MLB team—maybe the Mets?

Before I had kids that was of interest, but not anymore. Major League Baseball would have freaked out if I came in. I would have fucked it up so much for them. You think I get fined a lot by the NBA? It wouldn’t be about how much money I spent, but just changing the entertainment aspect of the game. I would be encouraging bat-flips, telling guys to ham it up and have fun, and fuck the unwritten rules, because it’s not 1908 anymore. I think Major League Baseball is missing a lot. There are so many things you can change, and they would just shit their pants if I would have bought a team.