Many former professional athletes have struggled financially, many of whom to the point of bankruptcy. Roughly 60 percent of NBA players are bankrupt five years following retirement and 78 percent of NFL players are in financial trouble within two years after hanging it up (Daley, 2012).
For every Peyton Manning, with his highly publicized investment in Papa John’s franchises, there are actually a number of similarly successful former athletes who have invested in franchises. Six years after former NBA player Jamal Mashburn retired, he had invested in 37 Papa John’s, 34 Outback Steakhouses, three Dunkin’ Donuts stores, and the largest Toyota dealership in Kentucky (Daley, 2012).
Another former NBA player, Junior Bridgeman, took his earnings and invested all of it into franchises. Nearly 20 years following retirement, Bridgeman owns 160 Wendy’s around the country, as well as 118 Chili’s restaurants. He also sits on the board of the PGA, and owns a stake in Milwaukee soda’s Black Bear Beverages (Celebrity Networth, n.d.). Keyshawn Johnson, former NFL player and current NFL television analyst, is CEO of First Picks Management, a business management and development company that focuses on franchise businesses. The company recently opened a number of Panera Bakery Cafes throughout California. He is also CEO of Keyshawn Capitol Development, a real estate company dealing with properties in both commercial and residential projects in Los Angeles (First Picks Management, 2014).
Max Montoya played in the NFL for sixteen years. In 1995, Montoya started investing in Penn Station East Coast Subs and now owns five restaurants in Kentucky. Following his retirement from pro baseball, Hall of Famer Joe Morgan owned three Wendy’s franchises and was President and CEO of Joe Morgan Beverage Company (Forbes, 2014). The most successful athlete-turned-entrepreneur, however, may be former NBA player Magic Johnson, who has ownership interest in 105 Starbucks, TGI Friday’s, Loew’s Movie Theaters, a minority stake in the Los Angeles Lakers, and owns the Magic Johnson Travel Group (Franchise Help, 2014).
Franchising has been a natural transition and an effective solution to long-term financial stability for numerous former professional athletes. This particular business model brings with it many advantages to those who may not have experience in owning businesses. One advantage is that the entrepreneur does not have to incur all the risks associated with creating a new business.” (Hisrich & Peters, 2010). The new entrepreneur can learn from a franchisor that already has a business plan in place, has an established brand, and probably has a successful track record.
Franchise opportunities offer a number of pre-opening support activities such as: site selection, design and construction, financing, training, and a grand opening program. Ongoing support includes national and regional advertising, operational assistance, and increased spending power and access to bulk purchasing (International Franchising Association, 2014).
It is evident that there are some weaknesses associated with owning a franchise such as restrictions on products that may be offered, franchise fees, advertising fees, and the payment of royalties. Franchising success that has been achieved by numerous former professional athletes, however, will serve as a model, and hopefully an inspiration, for current professional athletes who wisely choose to invest a portion of their money into a promising career following their playing days.
References
- Celebrity Networth (n.d.). Junior Bridgeman (sic) Net worth. Retrieved from http://www.celebritynetworth.com/richest-businessmen/junior-bridgeman-net-worth
- Daley, J. (2012). Why more pro athletes are scoring franchises after sports fame, Entrepreneur. Retrieved from http://www.entrepreneur.com/article/22271
- First Picks Management (2014). Business development and management. Retrieved from http://www.firstpicksmgmt.com/people/executive-management
- Forbes (2014). Joe Morgan. Retrieved from http://www.forbes.com/profile/joe-morgan
- Bogar-portrait photo
- Franchise Help (2014). The all-franchising team: top pro athletes who own franchises. Retrieved from https://www.franchisehelp.com/blog/top-professional-athletes-who-own-franchises
- Hisrich, R. D., & Peters, M. P. (2010). Entrepreneurship (8th ed.). New York: McGraw-Hill/Irwin.
- International Franchising Association (2014). Franchising. Retrieved from http://www.franchise.org/franchiseesecondary.aspx?id=52630
Author Bio
Dr. Craig Bogar has been an adjunct faculty member of the American Public University System since 2012. He currently works in the College of Medicine at the University of South Alabama as the Project Coordinator for Pre-Doctoral Training and adjunct assistant professor in the Department of Family Medicine. He also serves on the adjunct faculties of Southern New Hampshire University and the United States Sports Academy. Dr. Bogar has served as a dean of students, college athletics director, and has coached swimming and track at the college level. He has also worked as a college recreation/intramurals director. He was voted the Athletic Director of the Year by the National Association of Intercollegiate Athletics (NAIA), the Southeast Region Athletic Director of the Year by the National Association of Collegiate Directors of Athletics (NACDA), and the Gulf Coast Athletic Conference. Bogar has a bachelor’s degree from Bryant University, in Rhode Island, a master’s degree from the University of Maryland and his doctorate from the United States Sports Academy.
This article was republished with permission from Dr. Craig Bogar. It was Originally posted on Sports+Fitness Network.