Billionaire Bosses Become Beggars in Sports: Scott Soshnick
Show me another business so upside down that it’s the bosses who beg. Show me another industry where the boss isn’t really the boss, where he and the company are subject to the whims of one.
Dan Gilbert owns the National Basketball Association’s Cleveland Cavaliers. And yet the self-made man who at the age of 22 started a company that would grow into one of the largest independent mortgage banks in the country isn’t the one in charge. Hasn’t been for some time. Here he is, just like us, waiting on a decision from LeBron James.
If James leaves, hearts will sink in Cleveland. So, too, will the value of Gilbert’s investment.
One question keeps popping into my mind while watching the free-agent frenzy unfold: Why, other than ego, would anyone want to own a professional sports franchise? Only in pro sports do owners become subordinates. Only in sports does the top dog beg and roll over.
Take Gilbert, who once told me that James doesn’t have a boss. He wasn’t kidding, either. Here’s a guy who did everything right and still might be the offseason’s biggest loser. Gilbert spends to win. He’s involved. He cares. He constructed a contender in Cleveland, which reached the NBA Finals in 2007.
James, it seems, wants more. It’s as if he and the rest of the marquee free agents want some sort of championship guarantee, which, of course, is ludicrous. Not in sports, where funny things happen all the time. A bounce here or there. A sprained ankle at the worst moment.
James, a two-time Most Valuable Player, has spent the past seven seasons with the Cavaliers, who couldn’t find a way to beat the Boston Celtics in the second round of this year’s playoffs. James, we’re told, might fancy Chicago, where he can team with a nucleus of Derrick Rose and Joakim Noah.
Perhaps James should re-watch the pivotal Game 5 against Boston. The box score shows that James was more problem than solution.
There are similar jitters surrounding the Miami Heat, who might lose Dwyane Wade, even though owner Micky Arison, the chairman of Carnival Corp., and team President Pat Riley have already demonstrated they have the wherewithal to build a champion. And still it might not be enough to keep Wade.
New York had to wine and woo Amar’e Stoudemire, a second- tier star who got paid like an MVP because the Knicks simply couldn’t risk coming up empty.
Watching the likes of Arison, whom Forbes magazine says has a net worth of $4.4 billion, and Nets owner Mikhail Prokhorov, whose net worth is pegged by the magazine at $13.4 billion, having to practically beg James to take their money made me think of Warren Buffett.
The world’s third-richest man ($47 billion) is a sports fan. He’s befriended Yankees third baseman Alex Rodriguez and the wannabe billionaire James, who has on more than one occasion told me how much he admires the Berkshire Hathaway Inc. chairman.
And yet Buffett wants no part of owning a big-time sports team. Buffett told the New York Times that, as an adolescent, his wish list included franchise ownership. Then he got rich. Got smart, too.
If you buy the team, Buffett told Gates, the world’s second-richest man, and don’t win every year, you’ll be a bum. Wonder how Gilbert feels right about now.
Years ago at a Blazers playoff game Allen was sitting next to Gates, who seemed to be having so much more fun.
Maybe, if the opportunity arises, I’ll share that tale with Oracle Corp. Chief Executive Officer Larry Ellison, the world’s sixth-richest man who is among those interested in buying basketball’s Golden State Warriors.
Ellison, whose company owns the naming-rights to the arena where the Warriors play, ought to buy season tickets and smile, never having to worry about bad bounces and the day his superstar begins the process of staging exit interviews.
Buffett said something else in regard to buying a pro sports team: That the most important thing in investing is what Ted Williams said about hitting -- waiting for the right pitch.
Gilbert’s franchise player has digested sales pitches from the Bulls, Clippers, Heat, Knicks, Nets and Cavs, whose so- called boss is powerless to prevent James from walking.
(Scott Soshnick is a Bloomberg News columnist. The opinions expressed are his own.)
To contact the writer of this column: Scott Soshnick in New York at firstname.lastname@example.org