According to Forbes, the least valuable franchise in the NBA is the Memphis Grizzlies, valued at $1.3 billion. The Utah Jazz was 21st on that list, valued at $1.55 billion – they were sold for $2 billion. There are still a lot of billionaires who would jump at the opportunity to buy an NBA franchise. We don’t need to pour one out for NBA owners.
COVID-19 harmed the revenues of NBA teams, and not everyone stepped up to the plate. We’ve had great examples, such as Steve Ballmer honoring all merch orders for the playoffs, such as t-shirts to support small business partners, and Mark Cuban being the first owner to say all hourly workers who work in the arena will get all their salaries as if all games were played.
“Am I going to lose a lot of money this year? Yes. No question about it. More than $100 million when this is all said and done? Yes. No question about it. Fortunately, I’m in a position where I can afford [the losses]. I’ll keep on paying our folks, it’s just the right thing to do. But at the same time, we need to get back into our normal season [schedule].”Mark Cuban, CNBC
But then we have billionaires like Robert Sarver, the Phoenix Suns owner, who feel like they don’t have such a responsibility. Three weeks ago, the Suns confirmed they placed 5-10% of their workers on furlough and implemented pay cuts across the board. The Republic reported their sources saying 30 employees were furloughed, and there are 20% pay cuts within all departments. Earlier this summer, the Suns laid off about 30 employees on the heels of selling their G-League team, Northern Arizona Suns.
At the same time, the city of Phoenix is spending $150 million of taxpayer money for the arena renovations and $2 million annually for 12 ½ years into a new renewal and replacement fund, which will be used for future renovation needs. The issue of publicly funding the Suns’ arena’s renovations gave us one of the best fan speeches ever.
The previously mentioned Forbes article pointed out team valuations have gone up six times in the past decade. If paying for your team is too expensive, every owner can sell it at a huge profit, as demonstrated by the Jazz sale. Profit that isn’t a part of BRI, by the way. That’s why Mark Cuban is OK with losing over $100 million this year due to COVID protocols.
Cuban said he’s not too worried about the losses, given the fact he bought the team for $280 million in 2000, and they are valued at $2 billion today. Not only that, he expects to be making money hand over first once the vaccine takes effect and fans can come back to arenas.
While it may seem a little up in the air while we get through these next couple of months, once we get post-vaccine, it’s going to be outrageous. Because there’s so much pent-up emotion and so many people looking to get that release and feel good about life again, and I think it’s really going to be something special.”Mark Cuban, CNBC
We need more Cubans and Ballmers, and less Sarvers and Fertittas in the NBA.