Billionaires have exorbitant sums of money and can ultimately do what they want with it, but why do so many of them buy sports clubs?
There are many reasons why a billionaire would purchase a sports club. Firstly, it diversifies their portfolio and offers another revenue stream. Also, it acts as a popular and visible asset that boosts their profile. Finally, they could just plainly love the team and ultimately have the money to buy it.
Read on to learn more about the diversification of billionaires and what they do to make all their money.
All That Money And Nowhere To Go
There comes a point in the life of a super-rich individual when they have more money than they can spend. Through shrewd business sense, entrepreneurship and investments, they’ve accrued a fortune so huge that there’s no way they could ever lose it.
When a billionaire becomes a billionaire, they’re almost certainly going to make some staggeringly huge purchases. They could invest in a luxurious and expansive superyacht, complete with more technology than a modern warship.
Alternatively, they could purchase a sumptuous private jet to fly from country to country. They’d spend a few thousand here and there on an expert crew for that jet, ensuring they receive nothing but the finest of flying conditions.
Or, they could pour millions of dollars into the outright purchase of a sports club, such as a basketball, baseball, or soccer team. It’s a dramatically popular practice for billionaires of today, and countless major or premier league teams are owned by the super-rich.
One of the most prolific sports team owners in the world is Steve Ballmer, who served as the CEO of Microsoft for several years, among other things. He has a net worth of around fifty billion dollars and owns the Los Angeles Clippers, a prominent NBA team.
The Mumbai Indians cricket team is owned by Mukesh Ambani, an oil and gas magnate with a net worth of more than thirty-six billion dollars. He sits just behind Steve Ballmer as the second-wealthiest sports team owner in the world.
In the United Kingdom, many of the top-flight soccer – or football – teams are owned by dramatically wealthy individuals or groups. For example, Chelsea is owned by Roman Abramovich, a prolific businessman with a net worth of more than twelve billion dollars.
The team known as Manchester City is owned by Mansour bin Zayed Al Nahyan, who has made his money working with the Abu Dhabi United Group. His net worth exceeds twenty-two billion dollars.
You’ve Purchased A Sports Team… But Why?
There are so many reasons why a super-rich individual would purchase a sports team, starting with the simple fact that they just can. They have the money and there aren’t many other things in the world that they can spend it all on.
However, a sports team can make for a lucrative investment, should it be a high-performing one with a loyal fanbase. Although many sports teams run at a loss, the cost of merchandise and ticket sales, as well as endorsements and sponsorships can make for a financially secure investment.
Alternatively, a billionaire might just want to diversify their portfolio, especially if they’ve made all their money thus far focusing on one specific vertical. If they purchase a sports club, they’re moving into an entirely different market – which is the safest game to play when you’re super-rich.
In many cases, an individual will purchase a sports club because they’re a fan of it, or they followed the team when they were younger. It’s more of a sentimental and nostalgic concept, but they buy the team simply because they have that loyal connection to it.
Finally, a billionaire might purchase a sports club to boast the ownership of a tangible and visible asset, to boost their profile and image. It’ll gain them a little popularity overall, particularly if the club is a good one, and they’ll be more prolific as a result.
It isn’t just the top-tier billionaires that own sports teams, though – there are plenty of instances where a trust or a group will purchase a sports club. For example, in the United Kingdom, a low-tier team called Salford City is owned by a collective of ex-professional football players.
As a group, they boast a net worth of more than two billion dollars, and they all have a ten percent stake in the club. There are many other examples of this kind of ownership style littered throughout the sporting world.
It doesn’t matter if you’re a lone trader or a group of wealthy individuals – everybody wants to own a sports club these days.