4 Strategies Michael Jordan Used To Become A Billionaire

Recently it was announced that Michael Jordan has become the first billionaire athlete. Mike started his career in the mid-80’s and dominated the 90’s but, athletes weren’t making the type of money then that would come in later years. Hello, Shaq’s rookie NBA contract was a 7-year – $40 million deal in 1992. By contrast, the number one pick in the 2014 NBA draft can expect a contract of around $15 million for his first 3 years in the league.

So MJ set the blue print on how to “get money” off the NBA court. Obviously LeBron James was paying close attention. But what lessons can other athletes learn from Jordan to maximize their $$ and get close to the billion dollar dream? Forbes magazine lays out four areas that were key.

One: Get a percentage. MJ’s licensing deal with Nike for the Air Jordan earns him a fortune in large part because in effect the former NBA great gets percentage of each of his branded basketball shoes Nike sells. The original five-year deal was worth $500,000 annually, plus royalties. The royalties now generate more than $60 million annually for MJ.

Two: Buy distressed businesses in great industries. When Jordan became controlling owner of the Charlotte Hornets (then called the Bobcats) in 2010 the franchise was in bad financial shape and was reeling under the ownership of Robert Johnson.

Three: Use your brand as leverage to strike a favorable deal. There were other investors to pay as much or slightly more than MJ for the Hornets in 2010. But the league wanted Jordan. As part of the deal MJ was able to get terms that would have him increase his stake in the team at a price that was much less than market value.

Four: Use social media to keep your brand relevant. MJ hasn’t been on the court since the 2002-03 season. But he has 27 million Facebook fans, and although he does not use Twitter Nike’s Jordan Twitter account has 1.7 million followers.

Granted, most athletes aren’t Jordan or LeBron. But look at Magic Johnson’s off court wealth. He’s made more money since he retired from the NBA than in his entire pro career. Take advantage of opportunities presented to you. Invest in self, develop a network. These are the people that will help you during your post career days. Connections matter! Also have a long term vision for yourself.