Professional sports are a magical thing. Every match is like an unscripted performance, put on by the greatest talents on Earth in their respective fields. They offer an escape from day-to-day struggles, providing an opportunity to relax, cheer, and bond with loved ones. Personally, I’ll always remember walking into school with a ‘We the North’ flag draped around my shoulders after the Toronto Raptors became NBA Champions, or screaming from the stands of BMO Field as Canadian National Soccer Team qualified for their first World Cup since 1986.
From a fan’s perspective, these moments are what sports are about. However, all this excitement and attention is concentrated into jersey sales, TV deals, and ticket purchases, which contribute to hundreds of billions of dollars in revenue each year for these professional teams, and especially their owners.
For example, take Mark Cuban, well-known for his long-lasting role on the venture capital reality show Shark Tank. In 14 years as a ‘Shark’, Mark has invested $20 million into 85 startup companies, from which he has made a net negative profit. In a much more successful venture, he purchased a controlling stake in the NBA team the Dallas Mavericks for $280 million in 2000, which he sold for $3.5 billion (with a B) in 2023.
Clearly, owning a sports team can be highly lucrative, though it is often accompanied by more public attention than other investment options. Nonetheless, many wealthy individuals and corporations have purchased sports teams, yet their motivations for doing so, as well as their ownership approaches, vary greatly.
For the owners which are motivated mostly by monetary gain, there are still benefits to creating winning teams. In professional soccer, winning the English Premier League leads to $60 million more in merit pay than finishing tenth in the league. In the NBA, deep playoff runs result in more games with higher ticket prices. Forbes even estimated that an NBA championship can increase franchise valuations by 10-15%. These opportunities entice owners to put their best foot forward as far as team performance, which keeps sports competitive and evolving.
Of course, there are owners who operate sports teams with a clear passion for the sport and their franchise. Referring back to Mark Cuban, he is famously known for purchasing a $90,000 bottle of champagne to celebrate the Mavericks’ 2011 NBA Championship with the team's staff and players. He also joined the players in the locker room often, had many of their phone numbers, and listened to their concerns. For example, he upgraded travel accommodations when players complained of late-night travels without room service. Cuban also actively recruited talent in free agency to join the Mavericks, meeting with stars
personally to convince them to join the team. Cuban was a model owner who was clearly very proud of and involved with his team. This eventually helped their on-court performance and indirectly boosted their valuation, which he capitalized on in his sale.
While private and corporate ownership models dominate professional sports, alternative structures could reshape the landscape in the future, offering fans a deeper stake in their teams. An innovative system is implemented by the Green Bay Packers, a standout example of public ownership in the NFL. Owned by over 537,000 shareholders - most of which are fans - the Packers operate as a nonprofit, with no single billionaire at the helm. This setup lets fans truly engage, attending annual meetings to vote on board members and weigh in on big decisions, like stadium upgrades. When the team needs funds for major initiatives, like stadium upgrades, they sell stock to fans, directly linking community investment to the team's long-term success. It’s a model that binds the community to the franchise, making every shareholder feel like part of the team’s legacy.
In the end, every sports team owner holds the hopes of their fans. They must walk a fine line between maximizing team performance and ensuring their investment is worthwhile. Regardless, as ownership structures evolve, it will be interesting to see how these changes unfold. I only hope that in the pursuit of replicating success, the focus remains on the players and the fans, rather than becoming overshadowed by the financial aspect of ownership.