LeBron James redefined player empowerment – but not the way you think
The Decision was a big deal, but his moves as a business executive are more influential
LeBron’s Power Plays is an occasional series examining LeBron James’ two decades in the NBA and how he has influenced both professional sports and the larger culture.
One phrase has followed LeBron James ever since he announced in 2010 that he’d be “taking his talents to South Beach.” Even more than the four NBA titles, the two Olympic gold medals, and, soon, the record for most points scored in league history, he’s become identified with the movement for “player empowerment.”
On one level, the phrase means precisely what we think it does: Players — especially superstar players — dictate where they want to play, who they’d prefer to play with, and, often, when they want to play.
Yet that’s only a piece of the impact James has had in empowering today’s players. Indeed, the far more important change James has pioneered is for players to redefine themselves from athletes and endorsers to leaders of businesses. And that change reaches far beyond a small handful of superstars in the NBA and figures to expand in importance long after James retires.
“LeBron has shown you don’t have to start when you’re at the tail end of your career. You can start being a business person very early in your career and reap the benefits of trying to take more control over your destiny,” said Harvard Business School professor Anita Elberse. “I think he’s encouraged others to think beyond the conventional options. The conventional ways of structuring deals … He’s really pushed the boundaries in a number of different ways.”
“LeBron has had to understand he was a brand since he was a high schooler. That concept of ‘You are a brand and your brand is your business,’ ” Renee Montgomery, co-owner of the WNBA’s Atlanta Dream, said in a phone interview last month. “That business is a separate business from basketball. That’s what LeBron gave. That’s gonna be the gift that keeps on giving.”
To appreciate James’ influence in that regard one must understand the playing field that was presented to him more than two decades ago. As a high school junior, he was contemplating turning pro and observers were already speculating about how much he would get paid.
“He’s probably going to make more from endorsements and shoe contracts than he would make in his own rookie deal,” ESPN college basketball analyst Jay Bilas said then.
But James could see that he was already making money – for other people. It was a lot of money, which he — under the archaic guidelines governing amateur athletes — couldn’t benefit from. His high school games moved to the University of Akron to accommodate the growing hysteria over James’ feats. Some were even being shown on pay-per-view.
“My first game of my sophomore year was at the University of Akron, and there’s like 6,000 people … and they sell season tickets,” James reflected in 2019 on an episode of Kevin Durant’s The Boardroom. “Right then and there as a sophomore at 15 years old, I knew that this was a business.”
Jim Jackson isn’t the “back in my day” type. Nevertheless, the retired 14-year NBA veteran, now a TNT commentator, chuckles at how much things have changed. When Jackson entered the league in the 1992-93 season with the Dallas Mavericks, it was frowned upon for players to pursue business endeavors away from the court. With rare exceptions, players focused on their athletic careers. Everything else had to wait.
“I think the times have shifted,” Jackson said. “If organizations now want to recruit a big-time free agent or a big-time player coming out of college, you gotta talk about the business stuff and opportunity. They have an entity to themselves, they have a business idea of what they want to do, and they wanna engage in that early on. I think a lot of that has to do with timing with the internet, with social media.”
Jackson noted that James wasn’t the sole reason for the shift. But not acknowledging the four-time MVP’s influence is grossly disingenuous. “Everybody can’t be LeBron, but you can be LeBron-esque in utilizing potential partnerships, relationships that you have businesswise. That can mutually benefit both parties, and LeBron kind of put that blueprint into place by doing it that way.”
James’ initial business moves were controversial. His vision didn’t align with the status quo for how things were traditionally done. For example, in 2005, he fired his agents Aaron and Eric Goodwin, who had helped orchestrate his $90 million deal with Nike and $12 million deal with Coca-Cola. To replace them, he brought in three childhood friends, Maverick Carter, Randy Mims and Rich Paul, to help run The Business of LeBron. At best, the move was dubbed a “youthful mistake.” At worst, “… a bad decision that is going to cost LeBron.”
Then he chose not to sign a max extension after his rookie deal because it would give him more leverage in the future. That leverage turned out to be “The Decision.” The televised spectacle of free agent James signing with the Miami Heat was widely panned in the moment. James said the event “[could have] been done differently.”
But even as he was labeled as arrogant, shameful and selfish, James helped raise millions for charity in the one-hour program. And it’s worth noting that James has won at least one NBA title for every team he’s played for.
As James’ exploits on the court piled up, he and his team were developing a new form of sports marketing that relied less on endorsements and more on partnerships and ownership.
When James was a high school phenom, analysts raved about his 40-inch vertical leap. They loved the assortment of shots he could create for himself. But what they loved the most was his ability to read defenses and get his teammates involved. The same can be said about his presence in business. James is the centerpiece. He brought in Mims to handle daily operations. Paul worked on the agency side with the Creative Artists Agency for years before branching out on his own in 2012 with Klutch Sports Group and taking James with him.
Meanwhile, Carter handled business outside of basketball. James’ decision to entrust those three marks one of any athlete’s most consequential business decisions in recent times. James has always been hands-on, but those three brought stability, innovation, and perhaps most importantly, they had his trust.
“The biggest challenge at the beginning was the perception [of whether] these three young Black men could be powerful, smart and intelligent enough to navigate LeBron James’ basketball and business careers. LeBron put them in a situation, but they had to take it to the next level,” said Jackson. “Those three put themselves in a position that when LeBron finally brought them on board, they were ready to assume their responsibilities.”
This group would expand the nature of player empowerment that James would come to symbolize. They shared a vision for a new model of not just sports marketing, but marketing in general.
“In the past, you did the McDonald’s deal. And LeBron did the McDonald’s deal early on. But then he said, ‘Wait a minute. I can own my own chain of pizza restaurants. That’s probably a better way of using my brand,’” Elberse said, referring to James’ stake in Blaze Pizza. Starting with a $1 million investment in 2012, James and Carter became investors, a franchisee and a paid endorser with a stake that was worth $35 million in 2017. Blaze Pizza was named the fastest-growing restaurant chain of all time.
Elberse continued, “I’m creating value for myself and I’m an owner, or at least part owner. [James] isn’t the only one to say I’m gonna push for revenue shares or equity shares, but he’s one of the main proponents of that. So that’s an example of the impact you cannot undo.”
The dough stretches far beyond pizza. There’s Ladder, the supplement company he founded with Arnold Schwarzenegger (their second venture together). There’s Tonal, the at-home workout equipment start-up in which James invests (Golden State Warriors guard Stephen Curry, former WNBA player Sue Bird, and boxer Mike Tyson are also investors). His stake in Beats By Dre is one of James’ longest-running and lucrative partnerships. In 2015, James and Nike inked a lifetime deal, the largest agreement given to a single athlete in the company’s history. The SpringHill Company, the media and storytelling entity he started with Carter, was valued at nearly three quarters of a billion dollars last year.
And as James lobbies for future team ownership in the NBA, his portfolio within the world of sports continues to expand. In August, James joined the New York Yankees as minority investors in the European soccer powerhouse AC Milan. James and Carter were already 2% owners in Liverpool FC, and in 2021 the two became the first Black partners in Fenway Sports Group that gave them an ownership stake in the Boston Red Sox, Roush Fenway Racing and the Northeastern sports network NESN. The partnership almost immediately expanded with the Fenway Sports Group purchasing controlling interest in the NHL’s Pittsburgh Penguins, a deal reportedly worth $900 million. Last month, James, along with NBA players Draymond Green, Kevin Love and others invested in Major League Pickleball.
Moreover, James has done this with the expectation that he will compete for an NBA championship every year. He’s still an elite player even in this rarefied air of 20 seasons in the NBA — something only eight players in league history have done before this year, when they will be joined by James, Udonis Haslem and perhaps Carmelo Anthony. It remains to be seen how competitive this year’s Lakers will be, but any James-led team will never be short of headlines and theater.
At the same time, he continues his business endeavors and remains outspoken on social justice issues. These are three separate lanes and only a handful of athletes have thrived in two simultaneously. James is the first to do all three at such a high level while still an active player.
“People are watching and see the potential for this because there will be more people who will come along and understand what they can do,” said Battinto Batts Jr., dean of the Walter Cronkite School of Journalism and Mass Communication at Arizona State University, whose professional background has included marketing and branding. “Athletes now realize they can have this broad impact beyond their playing days, and they can really influence society.”
In 2020, James, Carter and former WNBA star Montgomery were working on the More Than A Vote campaign. At the time, players were demanding that Atlanta Dream owner Kelly Loeffler, the former U.S. senator who spoke out against Black Lives Matter, sell the team. Montgomery was part of a three-person investor group that purchased the franchise.
According to Montgomery, it was her wife Sirena who first mentioned the possibility of ownership. And once she began serious conversations with James and Carter, it created a snowball effect.
“The more I started to think about it, the more I started to be like, why not. That’s when I really started to tap in with LeBron’s team,” Montgomery said. “They helped us contact all the right people I needed to know … I feel a sense of community even when I’m doing business with them.”
Entering his 20th year in the NBA, James is now an elder statesman, playing with young men who barely remember a time when he wasn’t a force with either a basketball or a briefcase in his hands. Some of whom were newborns when James scored his first professional basket. These younger men and women are entering a world shaped by James, but with different questions, such as those involving name, image and likeness rights.
Vaughan Moss is Temple University’s assistant athletics director for branding and digital strategy. A significant portion of his job involves ensuring student-athletes are educated in this new world of college athletics and compensation.
“Most generally understand the concept of, ‘This is allowing me to make money or have more decisions and/or questions about opportunities I couldn’t get before,’ ” Moss said.
“We have a professional development course for student-athletes. I introduce myself with my job, but I’m also interested in other things. I love sneakers; I have a podcast. You should be thinking of yourself that way, too,” he continued. “You’re playing that sport, but you also do other things. LeBron is a frequent example of a few I use. Look at what he’s doing with Uninterrupted or his ‘More Than An Athlete’ stuff.”
Moss frequently references James because of how the name “LeBron” resonates with the young athletes he interacts with. “To make sure these young men and women are thinking like that. They have to now. ‘What else do you do?’ ”
Last month, preps hoop phenom Mikey Williams said on the I Am Athlete podcast that he hoped to be a billionaire by the time he turns 25. Without mentioning Williams by name, Jackson said he’s inspired by the ambition of today’s young players but notes that James, despite his many business ventures, always kept the main thing, the main thing.
“You don’t want the future to distract the present because all that has to marry together. LeBron can have all the plans he wants, but if he doesn’t live up to the high expectations, a lot of these things don’t fall in line,” Jackson said. “That opened up the doors for all the other business opportunities to flourish. So you take care of that first, and that opens up so many doors, to be in situations, to be in rooms that normally you wouldn’t be in or we wouldn’t be in as young Black men.”
Despite the caveats and loopholes that still need to be addressed, the positive is that athletes today have more opportunities to monetize their talents, athletic and otherwise. The days of athletics displacing outside passions are over. They’re now wed to each other. Bronny James, much like his father 20 years earlier, finds himself as one of the most high-profile high schoolers in the world. Yet, unlike the situation his father faced at his age, Bronny James is already profiting off his likeness and passions, recently signing NIL deals with Nike and Beats By Dre. Today, an athlete doesn’t have to be the best player on the team — nor have James as a last name — to capitalize on the newfound opportunities.
“It’s now accepted and very popular among athletes to be thinking about questions like how to transition to a new career or what to do next with your active career and think about them very early in your career,” Elberse said. “We had Julius Randle relatively early in his career saying he wanted to do an executive education program. Is he directly influenced by LeBron? I don’t know, but there is a general tendency to say, ‘I have this amazing platform. I have all these opportunities. I’m also representing an enormous amount of value to the teams and brand partners. I need to be able to make the most of that.’ LeBron has shown how valuable, how much wealth you can create, how many opportunities you can create for others if you think about that in a very strategic sense.”
What’s next? What does player empowerment look like after James?
That depends. The world in which athletes operated in during 2003 is vastly different from the one James helped create as he begins his 20th NBA campaign. What he’s built for himself isn’t expected to become the norm, but it is an example.
“It’s sort of like you play in the NBA, but then something else is gonna emerge,” said Batts. “So what is that something else. You take your wealth, and you’re influencing business, media, and society. Maybe you influence public policy, providing opportunities for others. But then what is the next thing? I don’t quite know what it is yet.”
There’s still work to be done within the game itself. For example, James and others have played a significant role in workload changes such as back-to-back games, travel and rest requirements. Yet, when it came to playing in the NBA bubble during the coronavirus pandemic or the league mandating a 72-game schedule for the 2020-21 season, the players had little to no say. So Jackson is left to wonder what the next era of leadership will look like and focus on.
“Who the player or players that will be able to lead that charge is gonna be very interesting,” said Jackson, “in a post-LeBron or post-Chris Paul world.”
As for James himself?
“I would think that no one can predict what he’s gonna be known for 30 or 40 years from now. There’s just no limit to what he can do, and that’s pretty unique,” Elberse said. “It’s entirely up to him at this point.”
Such has always been the LeBron James business model.