MAGIC Johnson clearly has the magic touch when it comes to money matters.
THE NBA The legend became only the fourth professional athlete to reach billionaire status, joining Michael Jordan, LeBron James And Tiger Woods.
According to Forbes magazineTHE the Los Angeles Lakers The icon is now worth $1.2 billion thanks to a number of shrewd investments, including professional sports teams, movie theaters and Starbucks coffee shops.
The main source of his wealth is said to come from a 60% stake in Iowa-based life insurance company EquiTrust, which he purchased in 2015.
Over the summer, Johnson expanded his sports empire by becoming a sponsor of the NFLIt is Washington Commanders.
The basketball legend is part of an investment group led by Josh Harriswho completed the purchase of the Commanders from Dan Snyder for a record amount of $6.05 billion.
Learn more about Magic Johnson
Johnson reportedly owns a four percent stake in Commanders, representing an investment of $242 million.
It means Johnsonwho is CEO and president of Magic Johnson Enterprises, now owns stakes in four major professional sports teams in the United States.
In addition to his investment in Commanders, Johnson is a minority shareholder of MLBIt is Los Angeles Dodgersthe LA Sparks of the WNBA and MLS LAFC club.
Johnson said his involvement in the sale of Commanders was “truly the greatest achievement of my business career and a historic moment for the entire black community.”
Here’s a look at how Johnson reached billionaire status.
Savvy business brain at Lakers
Johnson proved to be a savvy businessman upon entering the NBA in 1979 after winning the NCAA basketball title with Michigan State.
He got a five-year rookie contract worth $460,000 per year with the Lakers, in addition to a $100,000 per year shoe deal with Converse.
Such was his value to the Lakers that Johnson subsequently signed a 25-year, $25 million contract with the team, which began in 1984 and was set to expire in 2009.
Johnson became one of three NBA players to earn $1 million a year, joining Kareem Abdul Jabbar and Moses Malone, but quickly became underpaid as the league’s popularity grew in the late 1980s and early 1990s.
When Johnson attempted a comeback in 1992 after being diagnosed with HIV the previous year, he signed a $14.6 million contract extension for the 1994-95 season.
At the time, the one-year payout was the largest for an athlete in the history of team sports.
The deal guaranteed Johnson $19.6 million over the next three seasons, even if he didn’t play a single game.
On the court, he earned just under $40 million in total from his Lakers. contracts and ended up making $2 million a year with Converse.
He has also signed up to sponsor various companies such as 7UP, KFC, Lincoln Cars, McDonald’s, Quality Dairy and Slice soda.
Johnson, however, reportedly regrets signing with Converse instead of Nike.
He rejected the offer to take Nike shares rather than cash, which could have earned him billions as Nike’s stock price soared over the following decades.
Turning $40 Million in Income into a $1.2 Billion Fortune
Since retiring from the NBA, Johnson has turned his $40 million in earnings into an estimated personal wealth of $1.2 billion through a series of shrewd business deals.
A key part of his business empire was Magic Johnson Enterprises, which included a dozen 24-hour fitness centers, more than 100 Starbucks locations, 31 Burger Kings, movie theaters and shopping malls, a TGI Friday’s in Los Angeles and other businesses across the country.
In 1994, he purchased approximately 4.5 percent of the Lakers for a reported $10 million.
He then sold this stake to billionaire Patrick Soon-Shiong in 2010.
That year, he also sold his Starbucks franchises back to the company, earning about $100 million from the two deals.
In 2012, Johnson acquired a 2.3% stake in the Dodgers for $50 million.
In an interview with HBO, Johnson said it was the biggest check he had ever written in his life.
At the time, the Dodgers were worth $2.15 billion, but the franchise is now valued at $4.8 billion. according to Forbes.
Johnson is also a founding partner of LAFC, which paid a $110 million expansion fee to enter MLS and is now worth an estimated $1 billion.
In 1994, he also acquired a stake in the Sparks and also ventured into esports as an investor in aXiomatic alongside Ted Leonsis, owner of the NBA’s Washington Wizards and the NHL’s Washington Capitals .
Johnson also partnered with Canyon Capital to finance 30 real estate developments in 13 different states.
He was also involved in the $8 billion redevelopment of New York’s LaGuardia Airport.
Much of his wealth comes from Johnson’s majority stake in the insurance company EquiTrust, whose assets have grown from $16 billion to $26 billion since Johnson took control about a decade ago.
A public figure, Johnson ventured into television with a short-lived talk show on Fox, a longtime career as a basketball analyst on ESPN and the subject of a recent documentary on Apple TV.
The Commanders are just the latest asset in a vast trading empire, which shows no signs of stopping any time soon.
“God is so good…I still can’t believe it! I’m living in answered prayer right now,” Johnson wrote on Twitter.
“From the beginning of my journey as an athlete and now a businessman and team owner, it has all been a dream that has come full circle.
“I grew up playing football as a kid, I’m a huge NFL fan and watch games every week.
“Now I am part owner of a legendary franchise, the Washington Commanders.”
