Why top athletes look to investing

Over the past few weeks, I have spent time chatting with top athletes about how they manage their finances. The consequences of these decisions are enormous when one invests millions, compounded by the pressure to maximize income over a short career that can be further shortened by an unexpected injury or be replaced by the next young star.

This has led to the ingenuity of some, such as elders National football league player Adewale Ogunleye, who converted and now works as a financial advisor in a Swiss bank UBS. It is to his advantage to be proficient in finance and sports, so better able to make gains on and off the field.

We explore this theme in this week’s dashboard, followed by an interview with Roham Gharegozlou, the general manager of Dapper Laboratories, the makers of “non-fungible tokens,” who insist that sports groups can take a kill if they invest in this new digital trend. Read on – Samuel Agini, sports business journalist

How top athletes invest millions and avoid becoming victims of fraud

LeBron James: slam dunk investments © Ashley Landis / AP

At the highest level, professional athletes become savvy investors.

Basketball star James lebron is a shareholder of Fenway Sports Group, the owner of English Premier League soccer club Liverpool and the Boston Red Sox baseball team.

David Beckham negotiated a call option Major football league franchise while still a footballer.

TV money is fueling multi-million dollar salaries in the world’s top sports leagues, giving athletes the financial power to make money not only by lending their names to supporting products, but also by investing.

But it’s hard enough to protect your capital, let alone grow it. Athletes have alleged more than $ 600 million in fraud-related losses between 2004 and 2018, according to EY, the board. They are targets in an industry plagued by horror stories of unscrupulous financial advisers, scams and surprise tax bills.

No wonder the former English footballer Sol Campbell Told Claer Barrett of the FT, host of the Money Clinic podcast, that property is his preferred investment because the asset is real and can more or less always generate rental income. Listen to part one and part two of the podcast.

Sol Campbell: keeping his property © Tom Pilston / FT

The main problem is that of trust. Athletes can earn millions by their late teens and rarely have the experience to manage their new fortunes.

They are as smart as the people around them. Thomas Hal Robson-Kanu, the Welsh footballer, says he can count on Babatunde Soyoye, the co-founder of the private equity firm Helios investment partners, for advice.

The goal should be to create wealth that lasts for generations according to Jason katz, Managing Director and Private Wealth Advisor at UBS. “What I’ve seen more over the past year than ever in my entire career is that athletes are building these teams of financial professionals around them,” Katz said.

Even as athletes become more financially sophisticated, nothing can replace a second opinion from a scrupulous parent who can bring a real-world perspective: Is this investment proposition too good to be true?

“You always need a second eye. . . separate and independent eyes on her, ”says Campbell.

NFT sports: how long will the party last?

Roham Gharegozlou of Dapper Labs: NFT avant-garde © Michael Nagle / Bloomberg

Thousands of cryptocurrency enthusiasts, sporting goods collectors and venture capitalists descended on New York City last week to attend NFT. new York, an annual conference to discuss “non-fungible tokens”. They are digital objects, encrypted on the blockchain, which makes them unique and negotiable.

Director Quentin Tarantino announced to a flowing crowd at Neuehouse that he would create a handful of “secret” scenes from pulp Fiction in NFT. Later at Cipriani 25, actor Hannibal buress offered his own NFT – a half-minute clip of himself singing out of tune – raising $ 20,000.

The latter event was co-sponsored by Dapper Labs, with the NFT start-up now worth $ 7.6 billion thanks to its ties to the National Basketball Association and the league, the best soccer league in Spain, to provide licensed encrypted sports memorabilia.

Dapper Labs founder and CEO Roham Gharegozlou told Scoreboard that looking at products like Best shot in the NBA take off, years after launching other niche NFT collectibles “it feels like this year is when the race has started”.

Monthly sales volume column chart for major NFT categories, in millions of dollars showing monumental growth in sales of non-fungible tokens

Sport has helped launch NFTs into social discourse. But NFTs are also redefining what is at stake for athletes in merchandise sales. “For the players, it’s about creating a new line of income. It’s not just money today, but it’s securing their legacy forever, ”said Gharegozlou.

“Every time a Top Shot changes hands, the athlete owes a royalty – even after a player dies, his likeness will create value for his estate. . . which is something they don’t necessarily get every time a physical collectible card is resold ”.

This component partly explains why some athletes like Kevin Durant and Andy Murray have launched their own individual NFT offerings.

Beyond sports, Gharegozlou said NFTs have shown that blockchain technology can become mainstream, potentially accelerating the move away from “traditional” social media, such as Facebook and Twitter, with regard to the protection of privacy.

“The benefit of blockchain is that it gives you, as the owner of the information, the ability to control who sees it, what they do with it. And then you can revoke this authorization at any time ”.

Kevin Durant: ballin ‘on the blockchain © Jonathan Daniel / Getty Images

Yet many people involved in NFTs are simply spotting a new gold rush and wanting to get rich.

Dapper Labs party revelers munched on risotto like Patrice Rushen‘s “Forget me not”Slammed the audio system, eager for a piece of the new Internet landscape.

One participant identified himself as the CTO of a stealthy NFT startup, before revealing his daily work as an engineer at Facebook. Is the idea to ride the NFT wave and leave the social networking company behind?

“Absolutely,” he said. “This is the dream”.

Strong points

Daniel Kretinsky: From irons to fire © Thomas Samson / AFP / Getty Images

  • Czech billionaire Daniel Kretinsky acquired a 27 percent stake in West Ham United, valuing English premier league team at £ 700million. He becomes the last wealthy investor to participate in the world’s most important domestic football competition. British entrepreneurs David Sullivan and David Gold remain the main shareholders of West Ham.

  • Sponsors of the Beijing Winter Olympics, including Visa, Coca Cola, Airbnb and Omega, are under increasing pressure from activists to use their influence to fight human rights violations in China. Human Rights Watch said this week that letters sent to each of the major business sponsors questioning their involvement in next year’s Games have not elicited any response from businesses.

  • India’s early exit from the Twenty20 cricket world cup, including a loss to Pakistani rivals, revealed a religious divide in the country. The only Muslim player in the team, Mohammed shami, has been vilified by Hindu supporters in the latest sign of growing social tensions in India.

  • A racism scandal in Yorkshire County Cricket Club growled. General manager Marc Arthur resigned following criticism that the England team failed to respond properly to the former player’s allegations Azeem Rafiq that he has faced repeated instances of racist behavior from his teammates and colleagues.

Transfer market

Sean Bratches: Charting a New Course © Alex Griffiths / Formula One

  • LIV Golf Investments, the investment vehicle backed by Saudi Arabia Public investment fund and run by a former golfer Greg Norman, has been on a wave of hiring. Will staeger, who handled the original production of the entertainment group Effort, joined as media director. Sean bratches, who was commercial director at Formula One, the series of races controlled by Freedom media, will become commercial director.

Final whistle

The world’s largest marathon returned to the streets of New York City last weekend, with more than 30,000 runners competing in the five-borough race a year after the cancellation. That’s down from its typical field of over 50,000 participants, due to ongoing Covid-19 restrictions, although the race had an unexpected new participant: this cute and quick duck. We didn’t check the finish time, but we hope it set a personal best.

New York Marathon: awesome dodge © @DannyDeraney

The dashboard is written by Samuel Agini, Murad Ahmed and Arash Massoudi in London, Sara Germano, James Fontanella-Khan and Anna Nicolaou in New York, with contributions from the team that produces the Due Diligence newsletter, the global network of correspondents and data from the FT. visualization team

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