Magic Johnson’s journey to becoming a billionaire should be a case study in itself. Retiring from the NBA for the first time in 1991, Johnson had a net worth of $40 million at the time. Cut to 2024, the 5x NBA champ stands at a net worth of a whopping $1.2 billion. In a recent video by Front Office Sports, Multimedia Reporter for the org, Derryl Barnes, has dived deep into the Los Angeles Lakers icon’s journey outside the bounds of the court.

Notably, Buck made a return to the NBA once again in the 1995-96 season. He finally hung up his basketball shoes after the season. And he made up his mind to form a legacy beyond the world of sports.

Magic Johnson’s business moves in the entertainment and food chain

The first move in Johnson’s business motives was the establishment of Magic Johnson Enterprises. The aim was never just to be rich, but to work for a bigger cause of the community. Having taken advice from some big names like Michael Ovitz and Peter Guber, Johnson learned three major aspects of growing big — strategic partnerships or ownership, direct investments in existing companies, and marketing. Fueled by his urge to empower diverse and underrepresented communities, the 5x NBA champ discovered that there was a trillion dollars of spending power in Black and Latin-American communities.

“When you think about African Americans now — over $1 trillion spending power — Latinos, over $1 trillion spending power, and moving even higher, there was nobody really building businesses and going after their disposable income,” Magic once said in an interview. Using his newfound business knowledge and the aim of a greater cause helped Buck convince other CEOs to invest in providing high-quality entertainment and services to underserved communities.

This was a significant move by him, which eventually became the foundation for his first major venture — Magic Johnson theaters. And a partnership with Sony Pictures turned out to be the cherry on the cake.

Speaking of his project, Johnson had stated minorities as the No.1 moviegoers in the country. “But the minority communities have always been the most underserved by movie theaters… We’re about to see that change in Harlem, and I love Harlem,” he said, as per a 1996 Chicago Tribune article. It is worth mentioning it was not just the theaters that were significant in the underrepresented communities, but also the employment opportunities that these theaters brought with them. Although his first move turned out to be a major success, there was still a lot left to conquer.

With this mindset, Magic Johnson became the first person to reach a franchise agreement with Starbucks. The aim was again to bring the outlets into the inner parts of the city. But his boardroom meeting with the then Starbucks CEO, Howard Schultz, alone was not convincing enough. As per the reports, the Lakers icon invited Schultz to one of his theaters. It was reportedly the movie-watching experience that convinced Schultz for the deal. With this, the 5x NBA champ eventually became the owner of Starbucks in 125 locations.

Although he later sold them for around $100 million, the outlets were now in the city’s inner parts. Apart from this, some other major brands that Buck brought into the areas of underrepresented communities include Burger King, 24-hour fitness, TJI Fridays, Best Buy, and many more. And now it was time for him to return to a familiar turf.

Magic Johnson returns to sports but along with a business mindset

He started his journey of team ownership nearly three decades back with a 4.5% stake in the Lakers. Even though he sold these stakes for a reported $29 million, Buck presently has ownership stakes in teams across four major pro sports leagues. This includes a 2.3% stake in the LA Dodgers bought in 2012 for $50 million.

Now, valued at $4.8 billion, the Dodgers stand as the second most valuable MLB franchise after the New York Yankees. It seems Johnson learned from his mistake of selling the Lakers’ stakes, as the value of his 4.5% would now have nearly been $269 Million. No wonder he focused on expanding his ownership in teams — WNBA’s LA Sparks and Major League Soccer’s LAFC. While Johnson’s exact stakes in LAFC are not known, we know it is presently MLS’ most valuable team.

The former Lakers star did not limit himself to the conventional form of sports but evolved with time. His part ownership of the esports org Axiomatic is a testament to this. However, one of the most significant achievements for Johnson, as stated by him, came with NFL owners unanimously approving the sale of the Washington Commanders to an investment group that included Magic in a league with no black majority owners.

The investment group is led by Wall Street titan Josh Harris, defense billionaire Mitchell Rails, Harris’ longtime business partner David Blitzer, and Johnson. The Commanders’ sale is said to be the biggest ever for a sports franchise, even surpassing the $4.65 billion sale of the Denver Broncos last season.

Other major investments and ventures by Magic Johnson

While Johnson invested in sports, he did not stop expanding his business legacy outside of sports. One of the major steps in this direction was his SodexoMAGIC, LLC, acquiring a controlling interest in EquiTrust Life Insurance Co. in 2015. In fact, when Forbes declared the 5x NBA champ a billionaire in 2023, EquiTrust received the credit as his primary source of wealth.

But surprisingly, Johnson’s investments still do not come to an end, as he also owns stakes in multiple other projects like the African American television network, Aspire. The credit for his multiple investments goes to his Magic Johnson Enterprises, which not only acquires stakes in businesses but also helps them grow.

Some of these included Marvel Experience, Walt Disney Imagineering, Uncharted Power (a renewable energy company), and Me Too (a Latin-focused media brand). But if this wasn’t enough, the ex-Lakers star has also tried his hands at different forms of real estate management. One of these included the renovation of areas in downtown Detroit in collaboration with Quicken Loans and Detroit Venture Partners.

The aim was to build sophisticated tech companies to help revive the city’s declining economy. So it’s clear from all the information that Front Office Sports provided, that not only did Magic Johnson become wealthy but also maintained his commitment towards the cause of the community.

Stay tuned for more such updates. And join us for the exciting second episode of the “Dual Threat Show” as our host BG12 sits down with Georgia Bulldogs star and Mountain West All-Freshman Team Selection, Asia Avinger.