'Governorship' matters
Why who is writing the checks matters more than you know. Plus, malingering advice for Ben Simmons, the Bing Bong! guy, and more.
OPENING TIP
Basketball is a simple game to understand, until it isn’t. On Wednesday night the Wiz beat the Celtics, the Timberwolves beat the Bucks, OKC topped the Lakers, and the Cavs dispatched the Clips. We have a truly marvelous explanation for these results, which unfortunately the margins of this newsletter are too narrow to contain.
Even though the season still has that fresh new car smell, important storylines are forming. Are the Bulls and Warriors’ 4-0 starts for real? Is Evan Mobley really the second coming of KG? Is Russell Westbrook (or even James Harden) a busted flush?
The truth is that predicting the NBA is usually the opposite of what most assume. The daily tick-tock of the League is essentially impossible to predict: we have no idea what will happen tomorrow night. But three to five years from now? In many ways, that’s much easier.
We even have the hot takes! Would you believe that the Suns’ championship window is already closing? That aging Brooklyn has a brighter long term future than a Nuggets team full of young superstars? How about that we like Trae Young’s winning percentage better than Luka Doncic’s over the next decade?
Okay, okay, but we (mostly) aren’t just shooting from the hip here. Rather, we’d like to draw attention to a principle that we believe doesn’t get nearly enough attention from NBA analysts or fans. The principle is this:
Put another way: NBA franchises, after enough time, end up looking shockingly like their owners.1 It’s hard not to notice that year after year, the Golden State Warriors continue to look like a well-oiled machine, while the Knicks tend to look more like… this:
There are probably only two arguments for what the biggest competitive advantage in basketball is. The first is geography (the “Kawhi Corollary”). The second is ownership. Yet few fans know anything at all about the ownership of any team but the home team.
This was driven home for STL when we read Sam Amick’s piece on Kyrie Irving’s brave stance for privacy, or employment rights, or something. Amick described Nets owner Joe Tsai as “the Chinese co-founder of the online commerce company, Alibaba, whose net worth is nearing $10 billion.”
That is one way to describe Joe Tsai. Another might be that he was born in Taiwan, after his family was forced to flee China. He grew up in Jersey, then played Lacrosse at Yale before becoming a lawyer. After a number of years, he quit his law firm to take a $600 annual salary running the finances of a tech startup called Alibaba. He is a Canadian citizen who lives most of the year in San Diego. He is currently the largest shareholder of Alibaba, which has a market cap of $462 billion.
Yet another way to describe Tsai might be, “Mark Cuban, if Cuban made a lot less noise and a lot more money.” This is a pretty surface treatment, but it feels like enough to help us understand things like how the Nets might handle James Harden’s extension, or even how Tsai might react to Kyrie’s “principles.”
Of course, not every aspect of an owner is equally important. Tsai playing lacrosse probably isn’t, but what about the owner who just put his two twenty-something sons in the front office?2 Or how about the owner who has most of his net worth tied up in the cruise ship business?3
Through the year, we’re going to profile some of the more interesting owners in the NBA, and we also thought we’d try to develop a framework for what really matters when discussing a team’s future. A good start might be:
Are you quite rich, or are you, you know, Rich? It is perhaps not surprising that Ted Leonsis, worth about $1.4 billion, thinks about the cap differently than Steve Ballmer, at $98.9 billion. But that number by itself doesn’t tell the whole story.
How willing are you to spend that money (on the luxury tax, a new stadium, upgraded facilities, etc.)? Joe Lacob in Golden State is nowhere near the top of the rich list, but has repeatedly shown a willingness to both pay the tax and invest in the Warriors infrastructure. Stan Kroenke, despite being worth $10B and married to a Wal-Mart heiress, has not.
How did you make your money? Quite a few NBA franchises or fortunes were inherited, including the Pelicans, Knicks, Trailblazers, Magic, Lakers, and Nuggets. While that’s a mixed list, this one can get ugly. Also, real estate guys do a weirdly bad job? Among those are the Bulls, Pacers, Suns, and let’s not forget the immortal Donald Sterling. Some owners bring transferable management and investing skills to their teams while others just bring emotional baggage.
What is your investment horizon? If you are Minnesota owner Glen Taylor, the idea of shelling out that extra few million on, say, the analytics department when you are already selling the team in two years seems to be an unappealing one. You’ve been warned.
What are your goals for your team? As we noted a few weeks ago, investment funds are increasingly interested in team ownership; they are motivated almost purely by financial returns. That’s also true of some individual owners, like the Kroenke family, who treat the the Nuggets (or Arsenal) like a business. Other owners, like Steve Ballmer and Mark Cuban, view their team as the world’s most interactive toy.
Even leaving aside financial goals, “success” means different things to different owners. Tony Ressler, Josh Harris, and Wyc Grousbeck have demonstrated the willingness to tank to acquire talent. But Herb Simon’s GM seemingly has marching orders to try to make the playoffs every year, come hell or high water.
How does your ownership shape the organization’s culture? Mark Cuban is one of the faces of the league, but all accounts of his “leadership” sound like a shitshow (we particularly enjoyed the image of Chandler Parsons being the Mavs’ leading basketball decisionmaker for a multi-year stretch, according to Haralabob’s fascinating interview with Pablo Toure). Meanwhile, Wyc Grousbeck not only allowed Danny Ainge to tear down the Celtics, he encouraged him to get max value from the Nets while doing so.
When all these factors come together nicely, you end up with the Warriors dynasty or the recent ascendancy of the Clippers and Hawks. But when an owner isn’t willing to go deep into the tax, fans can only hope their team catches fire around a transcendent superstar. And if an owner can’t install a winning culture and organization, even a willingness to spend or the presence of a transcendent talent probably isn’t enough to bring home a chip. Mavs and Pels fans, it’s okay to be nervous.
TWEET OF THE WEEK
The same guy from this amazing video…
… was the recipient of Dolan being cheap a few years back!
STL INVESTIGATES: POUTING
So Ben Simmons is back in Philly. You may have heard. At last report, he was practicing at half speed with his cell phone in his pocket, which resulted in a one game suspension. He is currently out due to “not being mentally ready” for the season.
While we have utmost respect for athletes of all stripes dealing with mental health issues, we at STL still simply cannot express how disappointed we are with this type of behavior. One game suspension? That’s child’s play! One game is never gonna get you that sweet move to Sacramento, Ben. Clearly, Ben needs our help. Are there any better ways for Simmons to do a more professional job of disrupting his franchise, while still getting paid? STL investigates.
Wear stylish clothing. Might we suggest this t-shirt, worn by John Collins after game seven of the playoffs, of Collins dunking on Joel Embiid’s head? Would look fantastic on Simmons.
Improve his shot selection. Everyone has been begging Ben to take threes. So take them! Screener setting a pick? Take a three. Embiid open in the post? Take a three. Inbounding after a basket? Take a three. This would both disorient everyone and remind them that asking a player with a career three point percentage of 14.7% to take more threes comes with certain risks.
Do his own research. Kyrie still got like half his salary, right? Think of the headlines you could get trying to become the first American to get unvaccinated!
Communicate better. You’ve already got a phone in your pocket, why not put it to good use. Add an earpiece! Think of the thrill Kylie Jenner would get if you called her right from the layup line!
Show empathy and understanding. Ultimately, this is a staredown between you and GM Daryl Morey. Maybe you should try to understand some of the issues near and dear to his heart. Start a Free Hong Kong Campaign! Get active about it on Twitter. Maybe give a few interviews.
Visit strip clubs! I mean, it worked for James Harden, right?
AT THE BUZZER
Rare Jordan-worn Air Ships sell for $1.47 million (Bloomberg)
Not sure what is better, Manfred’s shots at RSNs or the amazing extended metaphor in this piece (Sportico via Yahoo)
‘Swag is fun.’ Joe Vardon on Trae Young (Athletic, $)
Warriors clown Klay for missing NBA 75th Anniversary list (ESPN)
It has been pointed out by the likes of Draymond Green and Jon Stewart that when the only thing you sell is the labor of mostly large black men, calling yourself ‘owner’ of that product feels slightly off. As such, the NBA actually refers to owners as ‘governors’.
The Rockets’ Tillman Fertitta.
The Heat’s Micky Arison.