Bethenny Frankel details how she went from being 'broke' to creating a $100M business empire

9 mins read

[ad_1]

Bethenny Frankel delved into the secrets of her multimillion-dollar fortune in her new Inc. Magazine profile, published Monday.

The 51-year-old Real Housewives Of New York City veteran recounted how she went from being ‘broke’ after a string of failed business ventures to becoming a high-profile reality star and eventually a successful entrepreneur.

The most important part of creating her empire involved holding out for a RHONY contract that bucked tradition and prevented producers from taking a cut of her future projects, which became known as the Bethenny Clause.  

Moving on up: Bethenny Frankel, 51, shared in Monday's Inc. Magazine profile how she went from having only $8,000 in the bank to selling her Skinnygirl alcoholic drinks for a rumored $100 million

Moving on up: Bethenny Frankel, 51, shared in Monday’s Inc. Magazine profile how she went from having only $8,000 in the bank to selling her Skinnygirl alcoholic drinks for a rumored $100 million

The businesswoman was always on the look for a new opportunity, even going back to high school, when she would rent out hotels rooms, hire a DJ and charge her friends for access to the party. 

‘I was always an entrepreneur,’ she said of her early days. ‘I just didn’t know what it was called.’

After graduation from New York University, she headed west to Los Angeles, where she worked odd jobs that put her in proximity to the rich and famous, including working as a nanny for a young Paris Hilton and serving as a personal assistant to Hollywood superproducer Jerry Bruckheimer and his wife Linda.

After a stint in event production, she got the idea to sell stylish cape scarves for $68, and she was initially able to interest stars including Salma Hayek, Susan Sarandon and Julia Roberts.

But after expanding into ponchos and pajamas, the business cratered forcing her to start all over.

‘It was the bad apple that spoiled a whole bunch,’ she said of the poorly timed expansion. ‘I’ve always built the plane while flying it … but it’s different now. I’m just more lean and decisive.’

Out West: After graduating from NYU, she moved to LA, where she was a nanny to Paris Hilton and started selling scarves and shawls to celebrities like Julia Roberts; publicity still for RHONY

Out West: After graduating from NYU, she moved to LA, where she was a nanny to Paris Hilton and started selling scarves and shawls to celebrities like Julia Roberts; publicity still for RHONY

After returning to New York, Bethenny was inspired by a lack of pre-made health foods to start BethennyBakes, which sold desserts marketed as being healthy.

‘This was way ahead of its time,’ she said. ‘There was no “natural food” chef. No “plant-based.” There was nothing.’

After selling her confections to more celebrities — including Reese Witherspoon to Law & Order: Special Victims Unit star Mariska Hargitay — her hopes of getting a Food Network show were dashed after a VP at the network didn’t think she would have a strong presence on television.

She finally got the high-profile spot she had been looking for when she appeared on Martha Stewart’s spin-off of The Apprentice, in which she came in second place.

The gig attracted the Real Housewives Of New York City franchise, at a time when Bethenny only had $8,000 in the bank.

TV fame: She leveraged her RHONY spot after being runner up on Martha Stewart's Apprentice spin-off. But she didn't want to give up a cut of her future ventures to producers, as most stars did

TV fame: She leveraged her RHONY spot after being runner up on Martha Stewart’s Apprentice spin-off. But she didn’t want to give up a cut of her future ventures to producers, as most stars did

‘I was thinking, this is not going to get cute at 39 or 40 years old,’ she recalled. ‘Like, what am I going to be doing — working at a restaurant, busing tables?’

After earning a $100K endorsement deal following her Apprentice stint, the rising star was determined to keep as much of her money as possible from producers looking for a cut.

‘Now it sounds like a sheer stroke of genius — because, I mean, it was. But it was just gut instinct,’ she said. 

Because RHONY had already started filming her before she finalized a contact, Bethenny negotiated to take out a clause giving a percentage of her future ventures to the show’s producers, as she assumed they wouldn’t be willing to refuse her, which would necessitate starting filming from scratch. 

‘So I took it out,’ she said. ‘I wasn’t going to do it.’

Trade offs: Bethenny added a clause — known as the Bethenny Clause — that retained all her business rights, in exchange for a paltry $7,250 for the first RHONY season

Trade offs: Bethenny added a clause — known as the Bethenny Clause — that retained all her business rights, in exchange for a paltry $7,250 for the first RHONY season

She had to take a significant pay cut for the privilege, so she only made $7,250 for starring in the first season.

But because she had her future earnings secured, she wasn’t as desperate for side gigs like her fellow housewives.

Instead, Bethenny focused on making herself the show’s villain and a source of instantly quotable lines, which gave her enough publicity to help with her business ventures.

Eventually, she came up with an idea for ‘a skinny girl’s margarita.’

The reality star noted how earlier women associated with cocktails had failed to capitalize on the public interest they ginned up.

‘I decided to do something with it,’ she said. ‘Sarah Jessica Parker made the cosmopolitan relevant. She could have had the “SJP Cosmo.” It would have blown it out. But people didn’t even think like that.’

After she scored a hit with her Skinnygirl margarita’s, the parent company of Jim Beam bourbon tried to purchase her company in 2010, but she held out, sensing her brand could become even bigger with some time to grow.

She envisioned expanding into other ventures beyond liquor, which Beam Global wasn’t interested in.

Paid off: That meant that she had full control of her Skinnygirl mixed drinks empire. She sold the alcohol arm of the brand to Jim Beam's parent company for a rumored $100 million; seen in 2019 in NYC

Paid off: That meant that she had full control of her Skinnygirl mixed drinks empire. She sold the alcohol arm of the brand to Jim Beam’s parent company for a rumored $100 million; seen in 2019 in NYC

‘I knew, I do this deal, it’s going to put me on the map,’ she said. ‘I’m not a dumb housewife. This is street cred.’

After spending months and $75,000 in legal fees, she brokered a deal in which Beam Global got the rights to her alcohol for a rumored $100 million, but she retained the rights to other Skinnygirl products, leaving her free to expand.

Since then, her company has produced coffee, shapewear clothing, nutritional supplements and even popcorn.

Her newest non-alcoholic drink is a cherry juice, which intrigued the RHONY veteran because of its purported health benefits. 

And even as she has expanded her business, her flagship mixed drinks are among the most popular in the world. 

Bethenny’s latest venture is likely to involve podcasting, and she hinted at a possible iHeartRadio deal to be announced shortly. 

But even as she continues to expand her business, she noted that she has become more ‘conservative’ as her wealth has cushioned her.

‘I like the stability,’ she said. ‘I mean, I used to gamble when I was poor. Who gave a s***? You were already in debt. You could gamble a thousand dollars. I would not gamble a thousand dollars now. I don’t play fast and loose.’

Safety: Frankel said she's now more conservative with her money.'I used to gamble when I was poor. Who gave a s***? You were already in debt. You could gamble a thousand dollars. I would not gamble a thousand dollars now. I don't play fast and loose'; seen in 2018 in LA

Safety: Frankel said she’s now more conservative with her money. ‘I used to gamble when I was poor. Who gave a s***? You were already in debt. You could gamble a thousand dollars. I would not gamble a thousand dollars now. I don’t play fast and loose’; seen in 2018 in LA

[ad_2]

Leave a Reply

Your email address will not be published.

Latest from Blog