“45 Years, $5 Billion”: Magic Johnson Could Have Reached Billionaire Status Before Michael Jordan if Not for One Major Disadvantage

Published 10/30/2023, 8:39 AM EDT

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Magic Johnson earned $40 million out of an NBA career that ended in his prime after he went public with his HIV diagnosis. He made up for those earnings through savvy investments in brands like Starbucks, Burger King and Equitrust. But it’s his stakes in sports teams that paid off the most. After working with almost every major LA-based team, Magic set his eyes on the NFL. Earlier this year, Josh Harris and Magic Johnson’s group purchased the Washington Commanders for $6.05 billion. His power move in July sent him to the billionaires club.

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But in January, while on Showtime Basketball, he was lamenting that he could’ve been there much sooner. Before Michael Jordan too. It all boils down to a potential deal from 45 years ago.

New billionaire Magic Johnson could have achieved the status sooner

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The billionaire arena has a 6’9″ player now. Magic Johnson has gone from $600 million to $1.2 billion following his hefty promotion to an NFL team owner. Forbes has made it official that he’s the fourth athlete, following Michael Jordan, LeBron James and Tiger Woods, to achieve ten figure status.

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Johnson’s contemporary, Jordan was the first athlete to reach there with his signature Jordan Brand under the Nike umbrella. That was the opportunity Johnson skipped.

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Magic had ushered in NBA’s primetime era with the 1980 title. Everyone wanted him as a spokesperson. Likewise, Converse, Adidas and Nike approached him. “Nike was just a year or two old. And so, Converse offered me the most money. So, you know, when you grow up broke, you take the money,” he said on All The Smoke.

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Nike didn’t have much to offer except $1 for every pair of shoes and 100,000 shares of the company stocks. “I didn’t even know what stocks was at that time. So I passed on the stocks. Can you imagine 45 years, $5 billion… that stock would have been worth today.” His $3 billion-rich friend who did sign with Nike doesn’t have to imagine.

It is estimated that Nike’s share price was $0.18 when they offered Johnson making the value $10,000. So he took a hard pass on it. Four decades later, he was clenching his teeth and clutching his head.

Magic Johnson regrets not cashing in on MJ

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Shaquille O’Neal, who Magic mentored, said that Johnson saw the potential in Starbucks before anyone. That same foresight failed him when picking sneaker brands. Magic Johnson signed with Converse who offered him $100,000 every year. His signature shoes were famous too, but Air Jordans overshadowed every NBA signature shoe.

In 1984, between Johnson’s second and third championships, Nike signed a rookie named Michael Jordan. The five-year deal was worth $2.5 million, higher than any NBA pro had signed then. Nike launched the Air Jordan with humble expectations to recoup the exact amount they spent on the rookie. They ended up earning $126 million in the first year.

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Today, the Jumpman-bearing sneakers have grown Nike to $149.12 billion. 100,000 shares of those billions would’ve been $1 billion to Magic Johnson. In 2003, when MJ retired, Nike acquired Converse for $315 million. In his documentary, Johnson again lamented this deal saying, “Man, Michael  Jordan would have been making me so much money.”

Now these Euro-sailing yacht buddies are also billionaire athlete buddies. Next time Jordan welcomes Magic on his yacht, we imagine him going, “Better late than never.”

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Written by:

Caroline John

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One take at a time

Caroline John is a senior NBA writer at EssentiallySports. With a Journalism degree from a reputed university, she left the team spellbound from day one. Her work ethic, dedication, and hardworking nature pushed her to bag publishing rights in the third month of her tenure at the organization.
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Edited by:

Aakash Nair

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