The Athlete Family Office (And Its Increasing Popularity)

A look at where athlete empires are headed using Naomi Osaka and LeBron James as examples.

Star athletes are aiming to set up what many would call a “family office” type environment.

They want to have their own:

• Agency

• Venture fund

• Advisory board

• Charitable foundation

• Media/Production arm

Only a few have been able to successfully do this so far…

But it’s extremely powerful and will create generational wealth for those that have the ability to pull it off.

This could have a serious impact across the space. Let’s dive in👇

LeBron James’ Family Office

It’s incredible when you look at the nearly flawless business decisions LeBron James has made since being only 16 years old.

To start…

Before entering the league, LeBron turned down a $10 million check from Reebok to test the market.

Not only that, he’s helped turn Nike into what it is today (and landed a lifetime contract at over $1 billion).

And his success is 99% for three reasons:

1. trust

2. leverage

3. ownership

The first major move was in 2006 when LeBron launched LRMR Ventures alongside his friend and business partner Maverick Carter.

This vehicle has been used to create ownership throughout private equity, venture capital, pro sports teams, and real estate.

Next…

LeBron decided to leave CAA and join his friend and agent Rich Paul at the Klutch Sports Agency in 2012.

(from left) Randy Mims, LeBron James, Maverick Carter, and Rich Paul.

*Lebron can’t have ownership in Klutch — and the NBA has even investigated this, but it’s still an in-house operation and everyone knows it.

LeBron officially launched the “LeBron James Family Foundation” in 2004, but it really started to kick off initiatives in 2018 when his “I PROMISE” school was launched.

And in 2020…

LeBron and Maverick Carter launched their production/media arm in SpringHill Entertainment.

This is a simplified overview of LeBron James’ business operations that many star athletes are trying to replicate:

• Agency - Klutch

• Venture fund - LRMR

• Advisory board - Maverick Carter, Rich Paul, Randy Mims, etc

• Charitable foundation - LeBron James Family Foundation

• Media/Production arm - SpringHill Entertainment

• I have LeBron James’ full business status on the Profluence website.

And this “family office” model is being carried downstream…

Naomi Osaka’s Family Office

We’re even seeing LeBron help assist tennis player Naomi Osaka in the creation of her “family office” environment.

• Agency - Evolv

• Business - Kinlo

• Media/Production - Hana Kuna

• Venture - several angel investments

The only thing…

1. Lebron James has remained one of the best basketball players throughout his career (no matter what he was doing off the court).

2. Naomi Osaka has fallen off since putting more effort into her business endeavors (having a baby hasn’t helped either).

Between 2018-2021 Naomi was a top 5 player in the world — most of her business endeavors started in 2021 (she is currently ranked 312th).

Balance will be key as athletes aim to create these “family offices”.

Impact Throughout Sports

Agency

Agencies have throughout history charged a percentage of contracts and endorsements.

But then athletes started wanting investments.

So we saw some adjustments there:

• CAA Ventures

• Rise of athlete-led communities

• Emergence of athlete business partners

• Wasserman launching a venture arm

And with NIL putting money into the pockets of athletes at a younger age, that has created unique dynamics as well.

Media

Media conglomerates have traditionally used athletes in TV shows, movies, commercials, and radio shows.

Now with social media platforms — athletes are telling their own stories.

They’re bringing endorsements into their business ventures and saving on tax advantages in the process.

And with NIL, athletes are learning how to create & leverage audiences at a younger age — supplying us with more independent thought.

Companies

Endorsement deals use to dominate the landscape.

But now athletes understand their true power and usually do 1 of 3 things:

1. ask for an insane amount of cash

2. ask for an equity stake (if cash is on the lower end)

3. start their own company (if it makes more sense)

Chris Paul is an investor & ambassador for Beyond Meat

Venture

Athletes have long been labeled as “dumb jocks” who go broke after retiring.

But things have changed:

• rise of social media

• democratized knowledge

• more accountability from advisors

We’ve seen athletes begin to leverage their name, image, and likeness to drive better returns in the private markets.

Whether through investing directly in companies or venture funds…

Ownership has become the name of the game.

Board of Advisors

At the end of the day…it all comes full circle.

Athletes can’t do all of this themselves — nor should they.

It’s the same reason why companies need a C-suite.

Via Serve Consulting

The athlete should be the CEO (and put a team around them to run the operations).

Checks and balances on all sides. Transparency!

Looking Forward

Athletes are taking a look at all the places they’ve been controlled (and are trying to reverse engineer it).

• Agents take my money - I’ll serve as my own or hire my most trusted person

• Media properties mess up my story - I’ll tell my own

• Brands leverage me to make money - I’ll invest or start my own companies

The thing is…

It takes extreme wealth, fame, and influence to do this — which is why only a select handful of athletes are able to.

And sometimes it’s actually quite ironic…

Because these athletes are creating the same thing they were running from — except now they’re at the top of the pyramid.

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Podcast 🎙

Today’s guest is Mark Neifeld, CEO/Commisioner of Sport Fishing Championship.

Founded in 2021, SFC is the most extensive saltwater fishing championship series in North America.

You’ll enjoy this episode as we discuss:

• Sports media/streaming landscape

• The blueprint for creating a sports league

• Building the PGA Tour of saltwater fishing

Check out the podcast episode here.

Mark has an array of experience in sports (and what SFC has been able to do with a new league in just 2 years is wildly impressive). Lots to learn and take away from this one!

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I appreciate you reading (and listening today).

Have an awesome rest of your day!

Peace,

AP