SYLVIE DOUGLIS, BYLINE: NPR.
(SOUNDBITE OF DROP ELECTRIC'S "WAKING UP TO THE FIRE")
DARIAN WOODS, HOST:
At the age of 13, Coss Marte made his first drug deal. He bought an ounce of marijuana. He bagged it up, and he sold it to his school friends, making nearly $300 that week.
COSS MARTE: It was supply and demand. It was supply and demand. I don't know. It just came naturally to me, and I feel like that's how entrepreneurship got to me, too - in the same sort of way.
WAILIN WONG, HOST:
Coss grew up on the Lower East Side in New York City in the 1980s and '90s. And as a kid, he wanted to be rich like his cousins and the older guys he saw on the street.
MARTE: Some of them had chains, and their friends had the fancy cars and, you know, beautiful women - and giving out single dollar bills to kids. You know, I would run up to them and ask them for dollars.
WONG: And the fastest way to get rich that Coss knew was by dealing drugs. He was so good at it that he soon became a prolific drug dealer with an extensive cocaine delivery network. But now he's firmly on the legal side of business. He founded his own fitness company with plans to expand.
WOODS: And in the world of criminal justice and advocacy, you do hear stories like Coss Marte's from time to time - a drug dealer turned successful legal business owner, like a restaurateur or a self-employed plumber. And what we were surprised to learn is that that story, that hypothesis has been tested with hard data.
WONG: This is THE INDICATOR FROM PLANET MONEY. I'm Wailin Wong.
WOODS: And I'm Darian Woods. Today on the show - three superpowers that connect legal entrepreneurs with former drug dealers like Coss Marte.
(SOUNDBITE OF MUSIC)
WOODS: There's been this idea that many drug dealers actually have great entrepreneurial skills, and they can just channel those into legal pursuits. Robert Fairlie is an economics professor at UC Santa Cruz.
ROBERT FAIRLIE: I thought it'd be really interesting to see if this holds up statistically using a large data set and doing a very careful statistical analysis.
WOODS: And after controlling for a bunch of factors, Robert found the answer. Yes. People who were dealing drugs as teenagers were 11- to 21% more likely to start their own business than the general population.
WONG: And when he looked at why this was, he pinned it down to three reasons. First, both entrepreneurs and drug dealers love autonomy.
FAIRLIE: There are a lot of individuals that just don't like having a boss. They just don't do well in that environment.
WOODS: Second - an appetite for taking risks.
FAIRLIE: You have to be able to take risks. We know that's part of entrepreneurship. It's an extreme case in drug-dealing. You know, it's a very risky activity.
WONG: And along with risk tolerance, the third big overlap of characteristics that Robert found was natural entrepreneurial ability.
FAIRLIE: Entrepreneurial ability is going to help you create a successful drug-dealing business, and it's going to help you create a successful, legitimate business.
WOODS: And those three factors are completely true for Coss Marte, the former drug dealer. Like, take the need for autonomy.
MARTE: Oh, absolutely. I mean, I never really ever wanted to work for anybody.
WONG: In the early 2000s, still a teenager, Coss Marte would get money by working for himself - by dealing marijuana, crack and cocaine on street corners. He'd wear a triple XL white T-shirt, a do-rag and a backwards baseball cap. And Coss made a steady profit, but he was very much a street-level dealer - dealing to locals, people without a ton of money, but often addicted to cocaine and crack.
WOODS: Coss Marte was targeted by police who would stop and search him every single day. And that brings us to the second characteristic that the economist Robert Fairlie found - risk-taking. Coss has an almost superhuman ability to suppress fear.
Did you ever worry about risk or the worry about getting caught?
MARTE: Yeah. I mean, it's - I was nervous, but then I was - you know, once I went through the system, I was like - I don't know. I just - I became numb to it.
WONG: Coss did get arrested, sometimes locked up for short stints, but it wasn't a huge deterrent. He would even keep running his drug business while he was locked up. And when he got out, it just made him more determined to avoid getting caught the next time.
WOODS: And along with the need for autonomy and risk tolerance, Coss also has the third factor - plenty of that entrepreneurial ability. Even early on, he was thinking about marketing and his target market. He saw that the Lower East Side was changing a lot in the early 2000s. More professionals were moving in, and it was also becoming whiter and more affluent. And here, he saw an opportunity.
MARTE: They didn't really know the price. You know, we were selling grams for 50 bucks then. Now we're selling it for 100 bucks.
WONG: But to attract this new lucrative market of young professionals, Coss realizes he has to overhaul his entire approach to drug-dealing. He even needs to dress for his target market, trading his baggy T-shirt and jeans for a dress shirt and a suit.
WOODS: Coss works with a friend to build a new dealing operation - a cocaine delivery business. He calls it happy endings. And they hire staff, and they print 5,000 business cards with a cellphone number to text in with your order.
MARTE: Just nonstop hustling - you know, we would stay up for days. I mean, I'm talking about where we're taking NoDoz pills, caffeine pills to stay up because the calls were just insane.
DOUGLIS: Coss says he and his partner were profiting about $2 million a year each. They bought a Cadillac with 22-inch gold rims, loudspeakers and a TV inside.
WOODS: And then what happens?
MARTE: We got caught.
WONG: Coss' risk-taking finally caught up with him in a major way. His whole operation was being surveilled by the police. They arrested him while he was working one night, and he was eventually sentenced to seven years in prison. While in prison, Coss is told by his doctor that his cholesterol is through the roof and that he could even die before his sentence is up if he doesn't address it. So he puts Coss on a fitness plan, which Coss takes to heart.
MARTE: There's not much to do but work out, sleep, write and read, you know? So that's all I did.
WOODS: Coss attacks his workout regime with the tenacity that he took to his hustling, and he loses 70 pounds.
WONG: Years later, still in prison, Coss decides to give up drug-dealing once and for all. And like any good entrepreneur, he hatches a new business idea.
MARTE: I created a 90-day workout program while I was in the box, and I wrote out - you know, my whole plan was to start conducting fitness classes in the exact same park lot I sold drugs at in the first time.
WOODS: His plan is to teach people what he calls a prison-style workout program. He'll call it CONBODY. Lunges, jumping jacks, pushups - no equipment needed, just yourself and your body.
WONG: And when Coss is out of prison, he gives it a shot. He's staying on his mom's couch in that same tenement apartment on the Lower East Side. And there, in the park, at first, his mom is his only customer. Coss needs to grow his customer base. He has basically no budget, but he has a few lessons in guerrilla marketing that he had used as a drug dealer.
MARTE: I made business cards. I made postcards. I was going in the subways. I was passing out flyers. I was just nonstop talking about it.
Does anybody have any injuries I should know about - any injuries?
WOODS: I went to CONBODY a few weeks ago and recorded him leading his fitness class.
MARTE: OK. I'm going to give you a couple more, all right? I got you.
WOODS: CONBODY now has its own physical location, and Coss employs 15 people, most of whom are formerly incarcerated themselves.
MARTE: We're going to begin with a regular jumping jack - feet together, hands by your side.
WONG: It's a solid business, making hundreds of thousands of dollars in revenue each year. And he has plans to build a franchise.
MARTE: Good job, people. I had a dream, too. We're going to do a lot of burpees.
WONG: Darian, how many burpees did you do while you were there?
WOODS: I had a microphone in my hand, so I couldn't do any burpees.
WONG: Oh, you had a good excuse, yeah.
WOODS: And Coss is standing up there. He's running this show, at least partly because of the three features that the economist Robert Fairlie identified - like the need for autonomy, the entrepreneurial talent and being OK with risks.
MARTE: Today, I still take, you know, educated risks and, you know, some crazy risks, but they're definitely not illegal.
WONG: Coss' newest risk - getting into the legal marijuana dispensary business.
MARTE: I'm starting a new business called CONBUD, you know, where I'm hiring people that have been justice-impacted by the war on drugs.
WONG: He already has his eye on three locations for his dispensaries.
MARTE: There's always hiccups, and there's always - it's a rollercoaster ride throughout the journey of entrepreneurship. But I'm glad things are happening the way they're happening and things are aligning the way they're aligning right now.
(SOUNDBITE OF MUSIC)
WONG: This show was produced by Jamila Huxtable with engineering from Josh Newell. It was fact-checked by Corey Bridges. Viet Le is our senior producer, and Kate Concannon edits the show. THE INDICATOR is a production of NPR.
NPR transcripts are created on a rush deadline by an NPR contractor. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.