Magic Johnson Gives Advice to TDAI Advisors

As for his business career, Johnson said that when he was leaving basketball, he asked for and received a list of Lakers’ season ticketholders. He then started cold-calling the heavy hitters on that list, inviting them to lunch, where he picked their brains on how to be successful in the business world. Along with Lakers owner Dr. Jerry Buss, several other business and entertainment luminaries came to serve as Johnson’s mentors, including Peter Guber of Columbia Pictures.

In addition to picking other successful entrepreneurs’ brains, Johnson said he did plenty of research on his own to find business opportunities. So when he learned that the African-American and Hispanic-American communities each has more than $1 trillion in spending power, he decided to do his part “investing in urban America.” His ventures included a partnership with Howard Schultz of Starbucks to first launch three Starbucks in minority neighborhoods, with the option to build 175 more. That expansion happened after the first three stores delivered impressive revenue, and eventually Johnson sold back the stores to Schultz around the time he sold his part-ownership in the Lakers.

“You can drive ROI in urban America,” Johnson says of his company, Magic Johnson Enterprises, whose holdings include a real estate fund that owns multiple hotels, including the Washington Hilton and W hotels in Austin, Texas and Hoboken, New Jersey; a private equity fund; Inner City Broadcasting Corp.; and more. Johnson boasted of a food service business that now supplies both Disneyland and Disney World. A group led by Johnson, who has a personal net worth estimated at $500 million, purchased the Los Angeles Dodgers for $2 billion in 2012.

Despite his many acquisitions, however, Johnson said he buys companies to sell them, and said “I don’t fall in love with what I own.” However, he said “you can do well and do good” at the same time, and repeated his mantra that “it’s not whether you can become successful, it’s how many people can you help become successful.”

Those who’ve traveled the advisor conference circuit for years have often been subjected to current or former professional athletes who may know plenty about football or basketball but don’t have much of a clue when it comes to business or finance. Peyton Manning gave a thoughtful, well-received speech at Pershing Insite in 2013, and I remember Rocky Bleier, of Notre Dame and Pittsburgh Steelers fame, and a wounded veteran in Vietnam, prompting a standing ovation and several laughs when he spoke years ago at an advisor conference (was it a NAPFA national?). The biggest laugh came when he was asked about Terry Bradshaw, and the former Steelers’ quarterback’s standard rebuttal to critics who said he wasn’t very bright. “I called my own plays,” Bradshaw liked to say. “What Terry doesn’t tell you,” Bleier told the advisors, “was that we only had two plays.”

While some advisors after Johnson’s presentation said they wished he had spoken more about some of his business setbacks rather than regaling them with his success stories, this was one sports personality whose words resonated with advisors.