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King James Inc: Five Business Lessons from LeBron James

December 11, 2007

There’s a really great article on the empire of LeBron James, the NBA star, at Fortune / CNN Money: LeBron Inc. The building of a billion-dollar athlete. (Thanks to BusinessPundit for the tip-off.) What interested me the most was the "summit" that LeBron and his marketing team held at the end of the NBA season, and how LeBron’s team aligned themselves with the top consultants. Even though LeBron is just a baby in the business world, as he’ll be turning 23 this month, he is already demonstrating many fine examples of good business strategy and execution. These include:

  • Find the courage to ask.
    LeBron wasn’t afraid of asking how to get into the meetings of a top investment firm, leading him to contacts he would have not found by other means. I have started several business relationships by having the courage to step up and ask when others sat on the sidelines. If you never get out on that limb, you’ll never know if you can fly!
  • Unity is better than focusing on the individuals.
    At LeBron’s summit, his team told the participants that they were there to see how King James Inc. and the invited endorsers can work together to promote the LeBron James brand for mutual benefit. The goal should not be to see what each could get out of the party, but to see how everyone can increase revenues by working as a team. This is an important concept to remember when you are forming B2B partnerships or networking.
  • Surround yourself with the best people.
    Sure, LeBron’s team consists of his three buddies that didn’t know anything about building an empire before they came on board with LeBron. But what they did was learn from the best—they had advisors from top firms, first-rate accountants, and "financial world superstars" on their Rolodex. While your start-up may not be able to afford the kind of counsel that LeBron gets, you can still hire the best people and surround yourself with quality.
  • The brand is bigger than the man.
    LeBron realizes that he is only one person, and his career will only be so long. By building an entire brand around himself and using solid financial strategy, LeBron is setting himself up for a career that extends beyond the NBA. His team’s concern with market polling and international image allows LeBron to create a version of himself that stands out from his peers and the problems they have had. This principle is true whether you’re an international superstar or the hero at your local mall: When you run a company with your name on it, the brand is some version of yourself that is highly edited and not quite complete but works from a marketing standpoint.
  • Diversify your income streams.
    LeBron isn’t just relying on one stream of income through basketball. He has created equity partnerships in a wide variety of companies including MSN, Nike, Coke, Cannondale, and even a new internet venture. By spreading the interests of King James Inc. across various markets and keeping up with changing consumer trends, LeBron is insuring himself against market and income fluctuations. While specialization is great to help your company excel at one thing (such as LeBron does with basketball), it is not enough to give you a cushion against changes in market interest and consumer behavior (such as a drop in the popularity of a sports star or declining viewship in the sport). Diversifying your income streams and anticipating future consumer trends will ensure your business has longevity.

I’m not the biggest basketball fan—give me football any day!—but I have to agree with Warren Buffett that "King James" is the one to watch in the future, and I’ll be keeping track of his business dealings closely.

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