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Why own a pro sports team?

Businesspeople (and potential Dodgers owners), beware: Longtime sports owners such as Robert Kraft, Mark Cuban and Ted Leonsis say that owning a pro team is unlike any other business.

May 20, 2011|By David Wharton
  • Dallas Mavericks owner Mark Cuban understands what it's like to face scrutiny from both fans and the media.
Dallas Mavericks owner Mark Cuban understands what it's like to face… (Kim Johnson Flodin / Associated…)

The list of potential buyers for the Dodgers — should Major League Baseball or a divorce court force a sale — features all the usual suspects.

Forbes 400 types who have amassed personal fortunes large enough to afford every sports fan's dream. That includes men such as Eli Broad and Tom Gores, who do not have much experience when it comes to owning a team.

The scenario sounds familiar to Robert Kraft, who purchased the New England Patriots in 1994 after years of cheering from the stands.

"When I first took over the team," he recalled, "I was in Disney World every day."

But even for the savvy businessman, sports can be tricky. Just ask Kraft or Mark Cuban of the Dallas Mavericks or Ted Leonsis of the Washington Capitals, who say they learned a thing or two in their early years as owners.

They discovered that success in the boardroom does not guarantee wins on the field.

"You think you understand it," Leonsis said. "But until you are in this pressure cooker, you don't."

In other words, being an owner isn't all fun and games.

Under a microscope

None of the people who own Southern California's biggest teams would agree to be interviewed for this story.

Frank McCourt has been fighting to keep hold of his team since Commissioner Bud Selig assigned a trustee to oversee day-to-day operations last month. This week, ex-wife Jamie McCourt asked a judge to order the immediate sale of the club as part of their divorce settlement.

The Dodgers aren't the only ones dealing with tough times.

Jerry Buss just watched his Lakers lose early in the playoffs. The same thing happened to Philip Anschutz of the Kings — who rarely grants interviews — and Henry Samueli of the Ducks.

The much-maligned Donald Sterling and his Clippers suffered through yet another losing record and even Arte Moreno's Angels are off to a sluggish start.

Successful businesspeople venturing into sports often find themselves in a vastly different world. As Kraft put it: "They don't teach you how to run a professional franchise at Harvard Business School. You have to get knocked around a bit first."

Control is a big issue. Consider the Walt Disney Co., which carefully manages employees and the environment at its theme parks around the world. When Disney owned the Angels, it was a different story.

There were agents with huge demands and players with big egos who occasionally acted out in ways that did not suit the corporate image. Disney had no way of assuring a happy outcome — a victory — for fans who showed up at the ballpark.

"They had difficulty with something unscripted like a sporting event," said David Carter, executive director of USC's Sports Business Institute. "They didn't quite understand."

Bad calls and injuries only add to the uncertainty. Sterling, for example, has watched key players such as Blake Griffin, Chris Kaman and Shaun Livingston miss large chunks of playing time in recent seasons.

"At America Online, I never had a human resources person come in and say, 'Our lead HTML programmer blew his elbow out and can't go,'" said Leonsis, an Internet entrepreneur. "There's luck involved."

Which can provoke anger and frustration to a degree not always associated with other businesses. And millions of people are watching.

Owning a team is like a "roller coaster where your every move is second-guessed and over-analyzed unlike any other industry," Cuban wrote in an email to The Times.

Some of the scrutiny comes from media. Leonsis said AOL could launch a new product worth millions of dollars and garner only a few paragraphs in the Washington Post, but a regular-season Capitals game gets plastered across the front of the sports section.

Now add fans — in his early days as the Patriots owner, Kraft realized he was dealing with a different sort of customer.

"I'd be at a red light and people would pull up and offer their opinions," he recalled. "I'm at Dunkin' Donuts and if they didn't like a trade, I'd hear about it."

Under such pressure, otherwise brilliant executives sometimes abandon the principles that made them successful in the first place.

They might spend too much money on players, or not enough. They might be too impatient, switching coaches every other season, or meddle in personnel matters with no real knowledge of the game.

"The less I've done," Leonsis said, "the better record we have."

Buss has taken a similar approach, closely watching his team and weighing in on major decisions, but just as often trusting his general manager and coaches.

The most successful owners, it seems, find specific ways to transfer their business specialty to sports.

Calling upon his experience in new media, Leonsis blogs and writes on Facebook and answers emails from fans, all of which have boosted his popularity. Similarly, Kraft has succeeded by sticking to his management style.

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