Michael Jordan: billionaire basketball player turned businessman
Think of the greatest basketball player of all time and a name immediately springs to mind: Michael Jordan. The legendary basketball player was part of the glorious Chicago Bulls team of the 1990s, winning three consecutive NBA championships between 92 -94 and 96 – 98. Jordan was the undisputed star of the game, bringing worldwide notoriety to a sport that was until present the domain. of the American people. His fans went maniacal and he was revered wherever he went.
He played basketball the right way, could match his speech to his walk, and became the face of the modern-day basketball player: rich, famous, and extremely talented on the court. Jordan announced the birth of the commercial basketball player: a superstar who had several endorsement deals that could use his influence to boost sales for his sponsors.
In this article, we will look at how he turned his gambling winnings into a $2.5 billion fortune.
Jordan, the basketball star
Jordan was a precocious teenage basketball player who, in high school, was a McDonald’s All-American. After becoming the fourth player to start at the University of North Carolina as a freshman, he won the national championship as a sophomore. In 1984, he was selected as the third pick in the NBA draft by the Chicago Bulls, joining an illustrious list of Hakeem like Hakeem Olajuwon (1st), Sam Bowie (2nd), Sam Perkins (4th) and Charles Barkley (5th) .
Jordan was a colossus. In 15 seasons in the NBA, he was 14 times All-Star, won the scoring title every year except for the 18-month hiatus he took to play baseball, won the League MVP, won the NBA 6 times, with an impressive 6-to-6 record in the NBA Finals. Jordan earned an estimated $93.7 million during his time in the NBA, which wouldn’t put him in the top 150 in all-time career earnings, but it’s his off-court earnings that set him apart.
While playing in the league, he earned between $550,000 and $4 million over 13 years out of his 15-year career, with the Bulls taking advantage of a salary cap loophole.
Jordan, the billionaire
Interestingly, only 4% of his total net worth comes from his NBA salary. He made money from being the owner of the Charlotte Hornets and a very lucrative and unique partnership with the shoe company Nike.
Starting with the Hornets, Jordan bought the basketball franchise for $180 million from Bob Johnson, to take over 97% of it, although he already had a small minority stake. While the team still hasn’t pushed to the upper echelons to be consistent in the play-offs and even win the championship, Jordan is making a fortune.
Media interest and international interest continue to earn them money, and although he sold a 20% stake to a group of investors last year, the deal has valued the team to around $1.5 billion, which is a six-fold increase in what he paid. over 10 years ago.
Today, the team is worth an estimated $1.6 billion, nearly 10 times its initial investment.
The Nike Angle
While at the University of North Carolina, Jordan wore Converse shoes because his coach, Dean Smith, had a deal with the shoemaker. When he arrived in the NBA, he wanted to wear Adidas, but the German company changed direction, as the new leaders did not offer him a new contract.
Basketball’s big names, including future Hall of Fame contemporaries such as Larry Bird and Magic Johnson, were signed to Converse, at around $100,000 a year, an offer they made to Jordan. The deal was not attractive to Jordan, and he turned it down, with Nike and its representatives urging him to meet with them. The rest is history. Nike offered him a contract worth $500,000 a year in cash for five years. This gave her the opportunity to create her own personal brand, such as iconic shoes, and then expand into clothing. He hadn’t even played an NBA game yet; such was the hype surrounding it.
Nike estimated around $3 million in sales for Jordan’s signature shoe line, Air Jordan, in its first year, but it brushed off all estimates, raking in $125 million. Jordan’s deal with Nike has become one of the most rewarding deals in sports history, with the Air Jordan brand being one of the most recognizable brands in sports.
Jordan gets 5% on all Jordan Brand sales and brought in over $150 million in revenue for Nike in 2021 alone. The Jordan Brand as a whole brought in $4.7 billion in revenue, highlighting the popularity he enjoys, even years after the end of his playing career.