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HomeSportsDallas is not an investment.” But under Mark Cuban, the value of...

Dallas is not an investment.” But under Mark Cuban, the value of the franchise increased 11.5 times.

Date: May 29, 2024 Time: 17:40:55

Mark Cuban is far from the richest, but he is still a very successful owner in the NBA. More than half of his multi-million dollar fortune is an 85 percent stake in the Dallas Mavericks. But when the businessman bought the franchise, he did not pay even 10% of what it is worth today. At the same time, Cuban, unlike most league officials, is a true embodiment of the phrase “do it yourself.” And that’s how he got there.

After Cuban graduated from Indiana University, where he studied business and management, he decided to move to Dallas. There he lived in a three-bedroom rented apartment that five other people shared with him, and he lived poorly: he slept on the floor, he had credit card debt and things like that. But one day, having lost another job, he got a job as a consultant at a retail network selling software, Your Business Software.

There Cuban realized that his soul is in computer technology. He never got into them, but after working in the industry for a while, he realized his own potential. And over time, he got noticed. One of Your Business Software’s clients sponsored Cuban and helped him found MicroSolutions, which also specialized in systems integration and software sales.

cuban mark

Photo: Christian Petersen/Getty Images

With MIcroSolutions, he experienced ups and downs, but the company grew, and at one point, its total revenue surpassed the $30 million mark. In 1990, Cuban sold her for $6 million, earning approximately $2 million after taxes. Well, five years later, he, along with a friend from college, became a co-owner of the AudioNet streaming service, which was later renamed Broadcast.com.

The site started as a basketball game for the Indiana University Cuban team, but has grown to cover everything from the presidential election to the Victoria’s Secret show.

Here Cuban was lucky: the heyday of his organization fell on the so-called “dotcom bubble”, when the shares of Internet companies grew at an incredible rate. As a result, Yahoo acquired Broadcast.com for up to $5.7 billion.

To date, this deal, by the way, is considered one of the worst in its field. The dot-com bubble burst, and Broadcast.com and Yahoo’s other streaming services were liquidated a few years after the acquisition.

But Cuban became a billionaire, and a few months later, in January 2000, he became the majority owner of the Mavericks. The amount for which he acquired a controlling interest varies between $280-285 million from source to source. And taking inflation into account, this amount would be around $500 million.

The first thoughts of buying Dallas crept into Cuban’s head in 1999. Then he, a season ticket holder, attended the season opener with Golden State. To Cuban’s surprise, that set did not sell out. And then he thought, “I can make this team better.”

Through mutual acquaintances, Cuban contacted the team’s then-owner, real estate billionaire Ross Perot, Jr., and approached him with an offer to buy the team. Negotiations were fast; according to Cuban himself, the entire process took only six weeks. On January 14, 2000, he was officially declared the owner of Dallas.

“I love the Mavericks. I am a great fan. I have been blessed and placed in a position where I can contribute to the team. This is a business in which I am willing to invest as much money as necessary. All the energy, the money, to make this franchise a success,” Cuban said in 2000.

And he started investing in the team right away. He installed DVD players and televisions in each locker room booth, upgraded the jumbotron in the arena and purchased a new $36 million Boeing 757 plane for the team.

At the same time, Cuban believed that the Mavericks needed to improve not only on the court, but also beyond: work on marketing, promote players to interest new fans.

Mark Cuban and Mavericks fans

Photo: Tom Pennington/Getty Images

And he himself did not shy away from work to attract viewers. The billionaire refused a separate office and worked in the same room with employees of the sales department. He himself called those who had attended Mavericks games in the past in an attempt to convince them to return to the arena. Cuban talked about how going to a Dallas game with the family would be cheaper than going to McDonald’s and promised to cover the cost of tickets for the first game.

And the strategy appears to have worked. In 2001, the Mavs moved to a more modern (by those standards) and spacious stadium, and since 2003 they have never broken out of the top five teams with the highest average attendance.

This, as well as overall NBA revenue growth and the signing of a new television contract, had an impact on franchise value growth. In October 2022, Forbes valued the team at $3.3 billion, $440 million more than the NBA average. And 11.5 times what Cuba originally invested. Now his Mavericks are the eighth most valuable organization in the league (in 2000 they were ranked 23rd).

“I never thought of Dallas as an investment. I did it because I love basketball,” Cuban said a few years ago.

Cuban’s love of basketball led his team to its first championship. In 2011, the Mavericks, led by Dirk Nowitzki, defeated Miami Big Three LeBron, Dwyane Wade, and Chris Bosh in the NBA Finals. And a year before Nowitzki retired, Dallas acquired Luka Doncic, who is now a key player in the franchise.

Since Cuban acquired the Mavericks, they have missed the playoffs in six of their 23 seasons, five of those coming in the past 10 years. Especially sad was the last championship, in which Dallas collapsed, despite the signing of Kyrie Irving. And he collapsed so much that not only did he lose a play-in, but he was even fined by the NBA for 750 thousand dollars.

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But while things aren’t looking good for Dallas right now, Cuban has made it clear that he has no intention of selling the franchise, at least not in the foreseeable future. And not for money.

* This website provides news content gathered from various internet sources. It is crucial to understand that we are not responsible for the accuracy, completeness, or reliability of the information presented Read More

Puck Henry
Puck Henry
Puck Henry is an editor for ePrimefeed covering all types of news.
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