Brooklyn Nets Jay-Z Cut
Reading time: 3 – 4 minutes
I was in the barbershop the other day when me and this young barber got into it. As usual my boy runs the barbershop so I wasn’t sweating it but when it comes to talk about money I can’t help myself. So young homie was looking at me funny like I didn’t know what I was talking about. I told him Jay-z probably owned like 1 or 2% and really doesn’t own the franchise. I told him it’s like a spokesperson deal same as Magic with the Lakers and Usher with the Cavaliers. They pay to have celebrities attached to their franchise to make that pop audience come in.
I told young homie to go look up the owner and he’ll find out the Russian cat has super deep pockets on some owning steel factories in Russia. I said now that cat has the real dough. But, you know in typical I don’t understand money way he said he wanted to bet on it. Now I’m all for taking a cats money but I had to pass as youngin would get his feelings hurt. Then since we are all from different gang neighborhoods it’s bound to get ugly sooner or later. So I had to play the role of being a grownup and declined the EASY CHIP$!
So for those of you who don’t know here’s the deal!
The nature of Jay-Z’s stake in the Nets was never officially disclosed, but New York newspapers did their requisite digging. The Daily News reported that Jay-Z invested $1 million in the team, while the Post pegged his holdings at 1.5 percent (based on FORBES’ valuations of the team, such a stake would have been worth about $4.2 million in 2005 and worth about $4.6 million today). Though the two reports seem to contradict each other at first glance, they both make sense under the scenario that Jay-Z invested $1 million and received a 1.5 percent stake, demanding a deep discount on his purchase because he knew that the Nets wanted an A-list star in their court.
Publicly, Jay-Z is quick to point out that he paid for his stake. “Nobody gave me anything,” he declared in 2005. “I spent my money like everyone else, and I came in and added value.” But just because he spent money doesn’t mean he didn’t get a hefty discount. Celebrities often receive sweetheart deals when buying stakes in professional sports teams, and Jay-Z isn’t one to pass on such freebies.
In any case, Jay-Z wasn’t getting only a discounted rate. He was getting a discounted rate on an asset that was sure to dramatically increase in value with the team slated to move from the Prudential Center in Newark to the Barclays Center in Brooklyn (now scheduled for a 2012 debut). Here at FORBES, we estimate that if the Nets can field a competitive squad — looking more likely following the team’s trade for star point guard Deron Williams — the team’s value could approach $500 million in Brooklyn, nearly twice what the team was worth in New Jersey.
When Jay-Z first bought into the Nets, he undoubtedly realized the favorable math: Assuming that he indeed paid $1 million for an investment already worth $4.2 million, his deal with the Nets virtually guaranteed an eight-fold return.
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It’s all about the money sir! I’m trying to orchestrate a sweetheart deal for myself. Way to give the young man one to grow on. Its a good look, not taking his money. There could’ve been drama LOL
The best lessons I’ve learned occurred behind losses. Nothing teaches like the short end if the stick. Keep up the grind Freeman!
Yea, the real dude behind that team is the Russian dude. No one knows much about him outside of the 60 minutes clip he did awhile back, but the dude has REAL money. The type of money that owns things and can make governments bow down. He owns factories that control prime resources, so dude is a mover and shaker.
I applaud Jay-Z for getting in on the deal and hopefully making a great return. But the Russian dude is on some next level shit. The real money is never in front of the camera. Its the guy that plays the background who’s FINANCING the guy in front of the camera who has the real chips.
One of the key factors that so many people miss when it comes to money is DISCIPLINE. Discipline to focus on chips and not fame. Discipline to let someone else get the groupies while you get the money. Discipline to let someone else be the spokesperson while you be the financier. The dichotomy between Jay-Z and Prokhorov is an example of this.
Discipline starts way before the major chips role in. It starts with how you budget your money. It starts with how you save your money. It starts with what you buy with your money. It starts with who you decide to spend your money with.
Discipline and execution are what seperates the rich from those who want to look rich.
This why is so important to get your chips up & why “the rich get richer”. Deals fall like rain into the lap of the wealthy, becuz they’re in a position to make a move on it.
I GUARAN-PHUCIN-TEE ya Jay KNEW the were headed to the BX eventually, thus capitalizing off his street cread.
The writer said 8 fold, Sheeeeeaaaaa. Of he sits on this for 20yrs it could flip a hunded-fold
I had to laugh at this, Freeman. Your convo reminded me of the saying, “Never argue with fools, because they scorn the wisdom of your words.”
I see that alotta people fall into the propaganda of other people’s business moves. People actually think “Jay-Z owns the Nets!”. I mean, props to Jay for the business acumen he had…but him actually being RESPOSIBLE for moving the Nets to Brooklyn? Pardon me, I had to laugh t that…
“A wise man said not to argue with fools, cause people from a difference can’t tell who is who.” -Jay-Z
This dude, as well as others, don’t know that franchises (not just in sports, but just about in any business) do this to put a celebrity’s face on their product, team, service, etc. I mean, the same people who think Jay-Z owns the Nets probably think that Magic owns the Dodgers or LeBron owns Liverpool F.C. They admire them solely and not the billonaire tycoons who really have the majority ownership behind the franchises. I respect Jay, Magic, LeBron and other celebrities because they’re just knowing their roles in this chip game and playing it, but I respect MJ even more for being the majority owner of the Bobcats, as well as the other billionaire franchise owners who stay low-key with their empires.
Also, just got the book in the mail last night and I’m already half-way through it. I’m definitely studying this bonds game and acquiring some in the near future. As always, good look on the knowledge!
I had the same conversation with a cat a week ago with the logo and how he was so hyped Jay-z made it. Then I told him..he don’t own it. Dude was mad as hell.
@m85…you said it. They aren’t disciplined. Cats rather be Jay-Z than Prokhorov. I’d rather be Mikhail than Shawn anyday. Jay Z had a stake in the Nets before Prokhorov. He coulda owned the team, but at least he has a 2% interest. Something is better than nothing.
@TW – I didn’t want to make him look like a fool and lose money. For the youngins they can’t handle humiliation well so my boy shook a NO gesture to me and I understood that meant he ain’t stable!
Ignorance is killing the understanding of money. Puffy with Ciroc, Jay-z with the Nets, Magic with the Dodgers. Since we are so proud that Black folks are getting put on we take that incredible leap of thinking they own the team! Got to put a end to that one cat at a time!
@MCD85 – The Russian cat is falling back and letting the world think a Pop Star is going to bring entertainment to Brooklyn. Shit he couldn’t have done any better than getting Jay-Z to cosign the hustle than if Frank Sinatra was still alive. Great overall execution of the master plan of getting more eyes and chips on his hustle.
Just a great example of cats avoiding the fame and getting the chips. Like you said the discipline to not get jealous or stand out front and let the world know I own this shit. Instead falling back and conducting business and letting your naked white girls sell Victoria Secret while the real secret is a cat owning fancy underwear and making billions!
You got to love the game in full execution. But, I had to school a youngin to the chips and make him think a second. I had the whole barbershop pulling out their smart phones to verify the angle.
@Preme – Money attracts money! If you got the chips to make a helluva deal then it’s bound to come your way. If you can put money into a business and the owner wants to give you 50% and you don’t have to work! Pull the damn trigger.
It was a deal for Jay-Z that was beautiful in execution. He gets a stake of ownership for a deep discount. He’s from Brooklyn so it makes all the Suckers believe if he did it anyone from Brooklyn can. It keeps his name floating in bigger circles. And, he makes a helluva return. Like you said maybe 100 fold when he does cash out.
@Rex – Cat’s want to believe in that rags to riches shit so much bruh that they will just take the leap without any proof. It’s a attractive storyline to be a cat on the block to a cat who owns the team.
So I had to burst their bubble but it’s still a great money move and that’s what I wanted to bring to light!
@Matthew – MJ is the only true owner but he’s also part of a group. I’m sure he’s the majority owner though. People don’t understand chips and they keep believing that the talent somehow makes more money than the cat doling it out. It’s just the way the game is setup to make cats forever look for work instead of doing for self.
Glad you got the book. Cat’s just don’t know that I gave them the keys to the game. It might be small steps but in the end it’ll be the steps you need to get to your empire. We have to get out of the game in order to start our own. But, we don’t have to take a vow of poverty. Dollar15 shows you how to make the right choices and how to make CHIPS!
@AH – Bruh when you enlighten a cat drop the jewel and walk away. Cat’s get mad for you showing they are a fool. He wasn’t mad at the knowledge at all. I usually try to give cats one to grow on and then a week later we all dap and break bread with no issues as I don’t bring it up again.
Jay-Z is a real hustler. If you study his road he’s played the game to his benefit. Hell yes the Russian owner has the chips but the deal was a win-win. You can’t move to BK without BK’s darling hip hop artist on your team. Especially with the influence hip hop has on the game. Flipping 1 mill while being a part of a NBA franchise is nothing to sneeze at.
Nah bruh I ain’t jumping on Jay-Z at all as the skill to flip a mil is worth admiring. I just wanted to clear up for the youngin that there’s even more money on deck!
No hate in my heart for any cat willing to hustle!