Joe Tsai admitted when he was first contacted about buying the Nets two years ago he didn’t take it seriously at first, but he eventually picked them over the Rockets or the NFL or European soccer.
Why? Partly because the NBA has a better model and more growth potential, but mostly because he just loves New York.
“Here’s the thing: financially, it made sense. Business-wise, it’s very interesting,” Tsai told US Lacrosse Magazine. “But at the end of the day, there’s nothing better than having the joy of going to games. I love going to basketball games. My family loves it. My kids love it. It’s just great.”
Up until this interview, Tsai’s only remarks to the US-based media about the Nets had been to the Post about the team coming to play exhibition games in China.
Tsai, who was schooled in New Jersey and used to live in the city, bought 49 percent of the Nets from Mikhail Prokhorov a year ago, along with the right to buy a majority share in 2021. And the way he tells it, it was pure luck.
“I came into the ownership of sports teams in a serendipitous way, two years ago when the Brooklyn Nets were for sale,” Tsai said. “We were contacted by the seller’s bankers. I really didn’t treat the opportunity too seriously at the beginning. We have a group of people in our family office and I said to them, ‘Let’s sign the NDA, get the materials. Let’s give it a look, see what we have.’
“So as we peeled through the materials, the more we looked at it —this is really more specific to the NBA — the NBA is really interesting from a business standpoint. You have a very good system to share the economics between the owners and the players. The players are very, very important. In any sport, without the talent — the players — you’re not going to have a good team and you’re not going to have fans. So they’re very, very important.
“So in the NBA, there’s a very fair share of the economics between the players and the owners. That’s one thing. The other thing is among the owners, there’s a very good system for sharing the economics at league level. So, for example, the TV broadcast revenues nationally are shared equally by 30 teams. So in a way it’s kind of a socialist system.”
Tsai was referring to the NBA’s balanced revenue-sharing so absent in European soccer. But his reasons for picking Brooklyn over Houston that were even more interesting.
The 55-year-old Tsai graduated from the tony Lawrenceville School, where he’s still on the board of trustees. He spent his 20s working and living in the city, even meeting his wife Clara – a philanthropic investor – here. It’s more home than Texas will ever be.
“At the same time the Nets were up for sale…the owners of the Houston Rockets also put the team up for sale. We thought about it, but we decided to put the focus on the Nets because I just couldn’t imagine myself spending too much (time) in Houston,” said Tsai. “No knock on Houston, but I love New York. And owning a sports team, especially in a major league like the NBA, it’s like owning a nice apartment on Park Avenue: The value’s not going to go down.
“From a business standpoint, it made a lot of sense. Then, I was looking at the upside. The NBA and basketball is a very, very big sport globally. Everywhere, people love the NBA, especially in China. I was seeing how the people loved the sport in China. Also, in Southeast Asia, in the Philippines, they love basketball. Indonesia. Even Mexico; that’s going to be a big market. So there’s a lot of international expansion opportunities. So it all made sense.”