With major league sports teams, "it's never a good time to sell," says ex-NBA owner, pointing to steady upside. BSE's Clara Tsai sees more boom in value of Liberty.

Three sports team owners, including Clara Wu Tsai of the Brooklyn Nets and New York Liberty, spoke at the Forbes Iconoclast Summit June 5 in Manhattan, with Wu Tsai suggesting that the WNBA offers a "huge investment opportunity" and Marc Lasry, former co-owner of the NBA’s Milwaukee Bucks, saying "it's never a good time to sell" a sports team, given steadily rising valuations.

(See coverage in Forbes and NetsDaily.)

Nobody, of course, mentioned that the leagues are monopolies, that team ownership offers great tax breaks, and that team owners leverage subsidies, tax breaks, and other benefits from their host cities and states.

To Forbes' Randall Lane, Wu Tsai confirmed that, yes, the Liberty just got a minority investment that valued the team at $450 million. (Previously, it was just "reportedly.")

He congratulated her on the path to the professed $1 billion valuation: "So that number is good."

"Number's great," said Wu Tsai. "And we have a lot of people interested."

Liberty worth $400M?

Since that panel, Forbes, in its June 6 article, The WNBA’s Most Valuable Teams 2025, noted that Joe Tsai and Clara Wu Tsai "reportedly paid between $10 million and $14 million for the team in 2019."

The magazine said its $400 million valuation for the Liberty slightly discounts the recent deal because new potential majority ownership "would likely come at a discount because the franchise would no longer control its home arena, Brooklyn’s Barclays Center."

Seller's remorse?

Lane then noted that panelist Alex Rodriguez, the former New York Yankee star, had recently won, via arbitration, co-ownership of the WNBA's Minnesota Timberwolves and WNBA's Minnesota Lynx.

Given the three-year process, Lane observed, "Clearly somebody had seller's remorse... Forbes says the team is worth $3.1 billion. Just the Timberwolves. You guys bought it for about a billion and a half. There was some seller's remorse."

Lane then addressed Marc Lasry, former co-owner of the NBA’s Milwaukee Bucks, who'd last year sold his stake in the team at a reported valuation of $3.5 billion: "Great price. And you're putting the money into other assets. But then the [Boston] Celtics are sold for $6.1 billion. Any seller's remorse from you? 

"If I could have gotten $6 billion that would be a lot better, obviously," Lasry said, unruffled. "No. I think we all know that the value of these teams keeps going up. So the question was, I think the rule in the NBA or in sports teams, it's never a good time to sell, right? I mean, when Alex bought it, you know, everybody thought, 'OK, that seems like a fair price.' And within a couple of years he had already doubled his money. So I think in all of these you can't really look back. I think at the time I did it, it was a good price. I think five years from now it'll look like a bad price. And you sort of know that."

(Emphasis added)

The lesson, in the alternate history of Atlantic Yards, is that Bruce Ratner, who bought the New Jersey Nets to move them to Brooklyn and leverage a real-estate deal, should've held on. His successors, Mikhail Prokhorov and then the Tsais, have done very well.

That's one reason I believe New York State could and should require the team owners to pay for the privilege of a permanent plaza.

Women's teams vs. men's teams

Lane observed that the cost of women's sports teams is lower than that of men's teams.

"The NBA I think is a fantastic asset," Wu Tsai said, agreeing with Lane that it's "as blue chip as it gets. And I think you hold it because it's scarce. It's premium. And there's definitely going to be steady franchise upside right, from $2 to $6 [billion], to we don't know what we're going to see. The women's sports is growth asset with a lot of long term upside potential. I think."

Note that the rise from $2 billion to $6 billion covers not merely the value the Brooklyn Nets but the overall BSE Global, which includes the arena company, teams and other assets--and that the Tsais bought BSE, without the Liberty, for somewhere between $3 billion and $3.3 billion.

"We're long and we're going to hold our core assets, which is the NBA, the WNBA, and Barclays Center," Wu Tsai said, observing that the three fuel "a lot of value creation."

"Again, the NBA: scarce, premium, mature. WNBA, you know, large and growing viewership," she said. "There's value there because the viewership is growing. The revenue hasn't quite caught up."

While WNBA game draw 30% to 40% of NBA viewership, the media deal is only 2% of the revenue, rising next year to 4%. "So there's so much monetization that's available," she said. "And that disconnect there between the growth of viewership and revenues, that's the investment opportunity. And that's why we like the WNBA."

"But I also just want to point out how important Barclays Center is to our world and our ecosystem," she said, "because it not only lets us take advantage of the demand in live entertainment, but it also lets us control our full fan experience. And it's the anchor for everything that we do in the community."

That "ecosystem" is growing to include media, entertainment, and experiences, such as a future hotel.

The entrepreneurial path

"Being a governor of a team in the WNBA right now really is a great place if you want to be entrepreneurial," Wu Tsai observed, "because we don't have to do things like the NBA, like we can borrow from them, but we can also create a new path."

"We don't know what the ceiling is for the WNBA," she said. "There's still so much upside. And so you can be really creative about your sponsorships... about how you bring in customers. And I just think... there's a lot of opportunity."

After all, a team is a "sports entertainment corporation."