What’s goin’ on, Hard Knocks Community?💰

Hot off the press, it's the latest edition of the School of Hard Knocks Newsletter! Today, we're featuring billionaire Stephen Cloobeck. He's the Founder of Diamond Resorts International, which he led as Chairman and CEO until its sale to Apollo Global Management in 2016 for $2.2 Billion Dollars! Many know Stephen from his appearance on the hit show Undercover Boss, where he changed lives on a personal level. Now, Stephen is running for California governor in 2026, driven by a vision of innovation and affordable living for all.

Today’s Schedule

• The World Through a Billionaire’s Eyes: How Stephen Cloobeck built his timeshare empire and sold it for $2.2 billion

• From the Hard Knocks Library: $100M Leads: How to Get Strangers To Want To Buy Your Stuff

• In Case You Missed It: We hit the streets of Beverly Hills to interview some of the nation’s wealthiest entrepreneurs and business people.

Here we go!🔥

The World Through a Billionaire’s Eyes

When Stephen Cloobeck was young, he had dreams of becoming a heart surgeon. He pursued a degree in psychobiology at Brandeis University and worked in a hospital doing research. However, upon graduation, he took things in a different direction.

Stephen thought about his future and realized he didn't want to be in school forever and take on more debt. He made a career pivot and decided to go into business, working for a friend's father in the shopping center development space.

The company he was working for at the time promised him a bonus, but they never paid him. This prompted Stephen to go out on his own and he started up his own business in the same industry. Stephen was able to convince a bank to finance his first project in Burbank and he was up and running.

Next, Stephen built his second and third shopping centers in Bakersfield. Things were going well until the economy changed in the late 80s. Stephen's contractor went broke as did his lender and many of his tenants.

During this tough time, Stephen rolled up his sleeves and learned the ins and outs of the construction world, tackling many of the hands-on projects on his own. He later teamed up with his father to build the Polo Towers in Las Vegas.

Stephen then set his sights on the timeshare industry and started up Diamond Resorts International. In the mid-2000s, he began focusing on a new, controversial venture: a previously bankrupt timeshare developer called Sunterra Corp.

No one was able to fix Sunterra for 20 years and everyone told Stephen he was out of his mind…which made him want to go after it even more. In 2007, Diamond Resorts acquired Sunterra for $700 million, including $375 million in debt. Stephen took the company through the 2008 recession and then acquired several smaller timeshare companies, resulting in explosive growth.

Stephen's also widely known for his appearance on the hit show Undercover Boss in 2012. He disguised himself as a regular worker and his episodes were two of the most-watched ever in the program's history.

In 2013, Stephen took his company public. In 2016, he sold Diamond Resorts to Apollo Global Management for an impressive $2.2 billion. Since the Diamond Resorts sale, Stephen's been focused on the oversight of his personal investment portfolio, which includes a stake in the biometrics identity company CLEAR, airports, stadiums, and more.

Just recently, Stephen announced his run for California governor in 2026. He's also a donor and philanthropist. His contributions include $1 million to LA4LA, a partnership aimed at building affordable housing in Los Angeles. Stephen has also given to Southern California schools, police departments and churches.

On a live call and Q&A session inside the School of Mentors community, we got to hear Stephen's amazing story along with his wise advice for today's entrepreneurs. Here's a recap of the best takeaways:

Humble Beginnings

When asked about the kinds of skills and achievements needed to make it as an entrepreneur, Stephen advises to be flexible. Structure is important, but as a new entrepreneur, one of the most valuable skills to master is the ability to pivot. 

In entrepreneurship, you have to be comfortable being uncomfortable. You also have to be OK with being a beginner and stay willing to learn. Stephen says the day you're smarter than everyone else is the day you're not smarter than anyone else. 

You're going to have goals and aspirations, but you have to be open to try and test out different things. When you're new to the game, not everything you do will knock it out of the park. However, when you're willing to roll with the punches, get your hands dirty, and run with a curious mindset, you're better positioned to figure out what works. 

Bringing the Business

If you're looking to grow and scale through partnerships with investors, Stephen says the first thing you want to look for in a person is alignment. The way you go into a deal is the way you come out of one. If you go in on the wrong foot, you might end up in a bad situation (or lawsuit). 

You also want them to have skin in the game and deliver on their promises. If they promise you a certain amount of capital, give them a time limit and hold them to it. If they don't follow through, boot them. Stephen warns that anyone who's not delivering for you is wasting your most valuable asset: your time. Time kills deals. 

When you really start crushing it in your business, it's only a matter of time before people start coming to you with all kinds of deals and promises. The people who are truly serious will always have a timetable and stick to it. Focus on people who really know how to close business.

When to Hold, When to Fold

For Stephen, the key to winning negotiations in business deals is to ask a lot of probing questions. He says it's all about getting to know the other side and finding common ground. Sometimes, you might have to give a little to get to the right place. Other times, things might not turn out in your favor and you'll have to back down.

As an entrepreneur, you won't win every deal, and that's OK. Handle these kinds of interactions with class and politeness and avoid letting your emotions get the best of you. You never know -  that person could come back around and be a game-changing partner in the future. 

Remember: for a deal to go through, it has to be worthwhile on both sides. If it's not meant to be, don't force it. Walk away, but leave the door open. 

People Power

If you want to move from making 6 figures to 7, Stephen advises entrepreneurs to scale by hiring the right people. Eventually, you'll max out your capacity and to keep growing, you'll need to start leaning on others. The greatest asset in your business isn't on your balance sheet. It'll always be the people who work for you. 

Stephen also reminds entrepreneurs that your business isn't a charity. The people you hire have to perform well in a task or service that adds value to your company. Nurture and encourage your top talent and let go of those who are underperforming before problems escalate.

When you're building out a team, it's important to take care of your people. Think of your human capital as an investment in your business. Dedicate the time and resources to give them proper training and coaching. When they win, you win.

Connect with Stephen here:

Instagram: https://www.instagram.com/stephenjcloobeck/?hl=en

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Words of Wisdom

From the Hard Knocks Library

In Case You Missed It

Beverly Hills, California is home to some of the richest people in the world. We hit the streets to interview wealthy entrepreneurs and asked them about the most amount of money they have made in a year. We also asked them to share their most valuable career and life advice. We interviewed people in a variety of industries including hospitality, hair salons, transportation, and marketing. Check out the interviews here!

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