Dallas Mavericks owner Mark Cuban in Dallas on Dec. 12. (LM Otero/AP Photo) Listen5 minShareComment on this storyCommentAdd to your saved storiesSave
Mark Cuban, the former majority owner of the Dallas Mavericks, is many things. But when it comes to how America’s lucrative sports franchises are changing, he is the canary in the coal mine.
Cuban is a technology entrepreneur who started an early streaming company and sold it wisely, just before the dot-com crash, for billions of dollars. He’s a measured commentator on X, formerly Twitter, with nearly 9 million followers. But Cuban is most famous for his role as the astute investor on ABC’s “Shark Tank,” where his assigned, made-for-TV role is to crunch numbers fast and be among the first of the sharks to step back from a risky deal.
WpGet the full experience.Choose your planArrowRightSo, Cuban is nothing if not shrewd. And that raises the question of why a guy who so clearly loves his role as owner of a basketball team would sell out. And more to the point, why now? In December, the National Basketball Association approved Cuban’s sale of the majority stake in the Mavericks to members of the Adelson family, who control the gambling empire Las Vegas Sands Corp. The transaction, which left Cuban with 27 percent of the Mavs, valued the team at more than $3 billion, about 10 times what he paid in 2000. For now, Cuban will continue as the face of the Mavs, while no longer having final say on business decisions.
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Cuban has been vocal, if not totally convincing, about why he sold. He sees real estate expansion, potentially into casino operations, as the future of NBA franchises. He told reporters in December, of the Adelsons: “They’re not basketball people. I’m not real estate people. That’s why I did it.”
But given Cuban’s spooky good timing in the past — he didn’t just sell out to Yahoo; he hedged his stake and avoided losing it when Yahoo imploded — I couldn’t resist asking him whether his sale should be viewed as Mark Cuban calling the top of the sports-franchise market.
“I sold for all the reasons I’ve already publicly stated,” he responded by email. “Real estate and entertainment are going to be key for revenue development to compete.”
My bet is that the Mavs deal is a tell. Big league teams, which have thrived for decades by selling broadcast rights, are evolving into multifaceted business empires in which revenue derived from sports is just one facet of the operation.
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Cuban has said he thinks Texas should legalize gambling, which would enable the Mavericks to build a casino around a new stadium. This is what he means by “real state and entertainment.” He’s not alone: In-stadium sportsbooks and betting lounges are already popping up around the nation at existing arenas. New York Mets owner Steve Cohen is partnering with Hard Rock International to build an $8 billion entertainment complex in the parking lots next to Citi Field in Queens, where the baseball team plays. (Cohen is also campaigning for permission to get into gambling in New York.) Elsewhere, real estate is key to juicing franchise value. The Golden State Warriors, for example, surrounded their new Chase Arena with a lucrative office complex. Blocks away, the San Francisco Giants are erecting a retail, residential and commercial real estate project in what was a parking lot across from Oracle Park.
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Cuban didn’t need to hand over control of the Mavs to build a casino, one he and his new partners aren’t even currently allowed to develop. (Cuban has said he’s less interested in gambling than he is about the casino experience, musing about U2 performing in residence in Dallas.) Cuban easily could have borrowed to fund his expansion. And his partnership with the Adelsons could have been a commercial deal that didn’t involve team ownership. By omitting TV deals from his short list of “revenue development” ideas, Cuban is signaling that the NBA’s river of broadcast revenue might be ebbing.
And those deals have been, well, epic, amounting to $24 billion over nine years with networks such as ESPN and Turner Sports. That contract expires next year, and the NBA is expected to run an expensive auction that could include streaming networks such as Amazon Prime and Apple TV Plus. But those negotiations will come against the backdrop of trouble in the cable, broadcast and streaming worlds. No one knows this better than Cuban. Diamond Sports Group, the regional network that broadcasts Mavs and other teams, filed for bankruptcy last year.
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It would be foolish to count out the NBA, which was one of the first pro leagues to see itself as a global media conglomerate as much as a collection of world-class franchise teams. It also would be naive to ignore Cuban’s gut for well-timed selling. Another savvy character, Michael Jordan, recently dumped his majority stake in another NBA franchise, the Charlotte Hornets, for a payout similar to Cuban’s.
Like any good investor, Cuban has maintained his option to have it both ways. If the value of the Mavs continues to rise, his still-considerable stake will rise, too. If not, he’ll have taken money off the table at the right time. In this tip-off, Cuban wins no matter which way the ball bounces.
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Mark Cuban, the former majority owner of the Dallas Mavericks, is many things. But when it comes to how America’s lucrative sports franchises are changing, he is the canary in the coal mine.
Cuban is a technology entrepreneur who started an early streaming company and sold it wisely, just before the dot-com crash, for billions of dollars. He’s a measured commentator on X, formerly Twitter, with nearly 9 million followers. But Cuban is most famous for his role as the astute investor on ABC’s “Shark Tank,” where his assigned, made-for-TV role is to crunch numbers fast and be among the first of the sharks to step back from a risky deal.
So, Cuban is nothing if not shrewd. And that raises the question of why a guy who so clearly loves his role as owner of a basketball team would sell out. And more to the point, why now? In December, the National Basketball Association approved Cuban’s sale of the majority stake in the Mavericks to members of the Adelson family, who control the gambling empire Las Vegas Sands Corp. The transaction, which left Cuban with 27 percent of the Mavs, valued the team at more than $3 billion, about 10 times what he paid in 2000. For now, Cuban will continue as the face of the Mavs, while no longer having final say on business decisions.
Cuban has been vocal, if not totally convincing, about why he sold. He sees real estate expansion, potentially into casino operations, as the future of NBA franchises. He told reporters in December, of the Adelsons: “They’re not basketball people. I’m not real estate people. That’s why I did it.”
But given Cuban’s spooky good timing in the past — he didn’t just sell out to Yahoo; he hedged his stake and avoided losing it when Yahoo imploded — I couldn’t resist asking him whether his sale should be viewed as Mark Cuban calling the top of the sports-franchise market.
“I sold for all the reasons I’ve already publicly stated,” he responded by email. “Real estate and entertainment are going to be key for revenue development to compete.”
My bet is that the Mavs deal is a tell. Big league teams, which have thrived for decades by selling broadcast rights, are evolving into multifaceted business empires in which revenue derived from sports is just one facet of the operation.
Cuban has said he thinks Texas should legalize gambling, which would enable the Mavericks to build a casino around a new stadium. This is what he means by “real state and entertainment.” He’s not alone: In-stadium sportsbooks and betting lounges are already popping up around the nation at existing arenas. New York Mets owner Steve Cohen is partnering with Hard Rock International to build an $8 billion entertainment complex in the parking lots next to Citi Field in Queens, where the baseball team plays. (Cohen is also campaigning for permission to get into gambling in New York.) Elsewhere, real estate is key to juicing franchise value. The Golden State Warriors, for example, surrounded their new Chase Arena with a lucrative office complex. Blocks away, the San Francisco Giants are erecting a retail, residential and commercial real estate project in what was a parking lot across from Oracle Park.
Cuban didn’t need to hand over control of the Mavs to build a casino, one he and his new partners aren’t even currently allowed to develop. (Cuban has said he’s less interested in gambling than he is about the casino experience, musing about U2 performing in residence in Dallas.) Cuban easily could have borrowed to fund his expansion. And his partnership with the Adelsons could have been a commercial deal that didn’t involve team ownership. By omitting TV deals from his short list of “revenue development” ideas, Cuban is signaling that the NBA’s river of broadcast revenue might be ebbing.
And those deals have been, well, epic, amounting to $24 billion over nine years with networks such as ESPN and Turner Sports. That contract expires next year, and the NBA is expected to run an expensive auction that could include streaming networks such as Amazon Prime and Apple TV Plus. But those negotiations will come against the backdrop of trouble in the cable, broadcast and streaming worlds. No one knows this better than Cuban. Diamond Sports Group, the regional network that broadcasts Mavs and other teams, filed for bankruptcy last year.
It would be foolish to count out the NBA, which was one of the first pro leagues to see itself as a global media conglomerate as much as a collection of world-class franchise teams. It also would be naive to ignore Cuban’s gut for well-timed selling. Another savvy character, Michael Jordan, recently dumped his majority stake in another NBA franchise, the Charlotte Hornets, for a payout similar to Cuban’s.
Like any good investor, Cuban has maintained his option to have it both ways. If the value of the Mavs continues to rise, his still-considerable stake will rise, too. If not, he’ll have taken money off the table at the right time. In this tip-off, Cuban wins no matter which way the ball bounces.
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