He had no knowledge of selling alcohol when he launched Patrón, and it was eventually sold for $5.1 billion.

The Moment series by CNBC Make It features successful individuals discussing the pivotal moment that altered their career paths and lives.

John Paul DeJoria had a wealth of business knowledge when he began selling tequila, but he was completely unfamiliar with the liquor industry, he claims.

In 1989, DeJoria used a substantial amount of his own money, estimated to be several million dollars, to co-found Patrón Spirits. This move may have increased the chances of failure.

Despite the financial and reputational risks being clear to almost everyone, DeJoria was convinced of the superiority of his product and believed he could sell it. All he needed was to get enough people to try it first.

"I felt like it was the right thing to do, so I did it," DeJoria, 79, says to CNBC Make It.

In 1980, DeJoria, a former janitor and door-to-door encyclopedia salesman, teamed up with hairstylist Paul Mitchell to launch hair care manufacturer John Paul Mitchell Systems. What started with a $700 loan grew into a global brand with billion-dollar annual revenues, CNBC reported in 2017.

Nine years after DeJoria's first business partner, Martin Crowley, brought back some high-quality tequila from a work trip to Mexico. According to DeJoria, the tequila was "smoother than anything we ever tasted before."

Francisco Alcaraz, a Mexican distiller, was commissioned by a duo to produce 1,000 cases or 12,000 bottles of a resalable order. Each bottle cost approximately $20 to produce, and they set a consumer price of $37.95. Despite this, nobody was interested, as popular brands at the time cost between $5 and $15 a bottle, according to DeJoria.

They sold smaller quantities to restaurants and bars in Los Angeles and gave free samples to DeJoria's celebrity friends, including Clint Eastwood, after distributors rejected their product.

"They were so fond of it that they kept reordering," DeJoria remarks.

Patrón is a highly popular tequila brand, with annual sales of approximately 3 million cases. In 2018, it was acquired by Bacardi Limited for $5.1 billion, with DeJoria owning a 70% stake at the time. Today, Forbes estimates his net worth to be around $3 billion.

DeJoria talks about the importance of trusting your gut, the benefits of learning on the fly, and the valuable lessons he learned from rejection.

Did you initially believe that Patron could become so large? How confident were you in your knowledge of the situation?

We were unaware, so we said, "Let's simply proceed and see how it unfolds."

We were unfamiliar with the business, but we knew it was the top-rated tequila globally. All we needed was to convince people to give it a try, and they would reward themselves by splurging a little on the finest.

For a decade, all my friends and acquaintances received the finest tequila as a gift for their birthdays, anniversaries, or special occasions.

I truly believed that anyone who tasted it would never use anything else again. It was only a matter of time before it became popular. So, I remained committed to it. Eventually, after a few years, it began to gain traction.

What is your strategy for approaching a business that you have no knowledge of?

To begin with, familiarize yourself with the terminology specific to each industry. Each business employs unique language.

To sell your product in a liquor store or bar, you need to find a distributor to get it there. Once it's in the store, how do you help your customer sell it?

We demonstrated our product to hair dressers and showed customers how to use it on their hair while styling it in the chair.

I would create standup cards, easels, or posters to display in bars and liquor stores, highlighting the unique qualities of the tequila.

What strategies can you employ to rely on your instincts when those around you question your potential for success?

I sold Collier's Encyclopedias door to door in my early 20s. It taught me a lot about rejection.

I also recognized the significance of the product's quality. Despite Paul Mitchell's initial financial struggles, which took several years to overcome, the product eventually gained popularity due to its high quality. Patrón was the top-rated brand, and we simply needed to introduce it to more people. And, we did.

Persist in knocking on doors until you obtain sufficient listeners.

What would you have wished to know when Patrón was first introduced? Would you make any changes?

We learned Business 101 as we went, but we could have done better. Despite that, I loved the experience and wouldn't change anything.

I entered into an unknown territory and it became the largest in the world. When I sold it, we had 82% of the ultra premium market.

Although Bacardi has grown significantly, there are many new tequilas on the market. Despite Patrón being the largest, it may only represent 55% to 60% of the global market. With so many new options, everyone is striving to become the next Patrón.

This interview has been edited and condensed for clarity.

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