Anchor Drop: Why rich people own pro sports teams

Feb 3, 2023 - 1:02 PM

Good morning.

Optional Musical Accompaniment

As a new feature, sometimes I’m just going to go off on a rant about something in the Anchor Drop. Today’s topic is an offshoot of last week’s pickleball discussion. There’s weirdly a considerable amount of interest in owning professional pickleball teams, but Jersey Dore wanted to know:

Why has owning a professional sports team become such an aspiration for the truly rich and powerful?

Thirty years ago, world-famous plutocrats stayed far away from professional sports. The only exception to this I can think of is Paul Allen owning the Portland trailblazers. The people who owned teams were either the descendants of the slightly dodgy people who bought them in the 30s — like bookie Tim Mara — or dodgy people who bought them later, like George Steinbrenner, or Jerry Jones or the slumlords who half owned the New York Mets.

What made professional sports teams suddenly become the equivalence of Monets, status symbols for the super rich? I have seen a number of articles attempted to explain this, but none of them has been convincing.

Owning a professional sports team is one of those things that, to a lot of people, sounds like a lot of fun. You’re basically the team’s biggest fan at that point.

Part of the reason why sports team ownership has moved from divorce lawyer/slumlord Donald Sterling to former Microsoft CEO Steve Ballmer (this is literally the Los Angeles Clippers) is of course that the value of professional sports teams, at least in the Big Four sports, has skyrocketed: Sterling bought the Clippers in 1981 for $12.5 million and sold them to Ballmer in 2014 for $2 billion.

So the explosion in costs of ownership has basically walled off the Sterlings and Steinbrenners (who bought the Yankees for like $8 million) from ownership, at least if they didn’t purchase a team a long time ago and pass it down to their heirs. But aside from seeming fun, professional sports team ownership is like an exclusive club for extremely rich people. And of course it’s competitive, which... really rich dudes enjoy beating other people, I guess. It’s also true that there’s kind of a rift between the new wave of ownership, established billionaires who bought a pro sports team as a toy, and older waves that were either regular old millionaires like Steinbrenner or even older waves like the Mara family where the team is the family business. Steve Cohen and the sketchy group that owns the Dodgers view their teams as a competitive enterprise and are willing to throw around a boatload of money to beat you, whereas everybody else in MLB (or just about) is trying to profit off their teams more than they’re trying to win. And that, uh, is going to create some issues until all the teams are owned by hedge fund managers.

But the other, probably more important reason is that owning a Big Four professional sports team is basically a license to print money at this point — which if you’re a billionaire looking for a place to park your money, an NBA team is it. That’s the interest. You get a safe investment that’s also a fun hobby that you can eventually sell to another really rich dude at a massive profit, and you get to be part of an exclusive club in the meantime. And for some of the sketchier owners — say, former Nets owner and Russian oligarch Mikhail Prokorov — there’s definitely an angle of legitimacy and possible money laundering, but let’s not talk about that right now (in fact, MLB and NFL at the very least have been better about this than the European soccer leagues, which seem to be half owned by Middle Eastern public investment funds at this point.) The sorts of people who used to buy pro sports teams, then, end up getting into shit like pickleball in the hopes that it works out for them like the Clippers did for Donald Sterling.

Anyway, on to a bit of Vanderbilt news — the women’s tennis team hosts its spring home opener against Louisville today. Start time is 3 PM CT, with a stream here. Women’s basketball couldn’t make it two SEC wins in a row, dropping an 86-69 decision to Missouri last night.

The Dore Report is openly talking about the top candidates to replace Jerry Stackhouse, so it’s reached that point with the basketball team. And, well, Stackhouse’s media availability yesterday included the phrase “scheduled loss” when talking about how he approached the Alabama game, which makes you wonder if he was tanking:

Sports on TV

All times Central. College basketball schedule here.

• 2:00 PM: PGA Tour: AT&T Pebble Beach Pro-Am, Second Round (Golf Channel)
• 6:30 PM: NBA: Suns at Celtics (NBA TV)

Scoreboard

SEC Women’s Basketball: Florida 61, Texas A&M 54 ... Tennessee 65, Ole Miss 51 ... South Carolina 87, Kentucky 69 ... LSU 82, Georgia 77.

NBA: Lakers 112, Pacers 111 ... Cavaliers 128, Grizzlies 113 ... Knicks 106, Heat 104 ... Bulls 114, Hornets 98 ... Mavericks 111, Pelicans 106 ... Nuggets 134, Warriors 117 ... Bucks 106, Clippers 105.