Warriors Become NBA's Most Valuable Franchise At $7.56 Billion

[RealGM Wiretap]

The Golden State Warriors have become the NBA's most valuable franchise at $7.56 billion, according to Sportico's latest ranking.

The Warriors had $800 million in gross revenue last season, which was 50 percent higher than any other franchise. The revenue gap between the Warriors and the rest of the NBA is even greater than the New York Yankees and Dallas Cowboys, who generate roughly 40 percent and 25 percent more venue than their league's number two.

The Cowboys are the only franchise in the world worth more than the Warriors at $7.64 billion.

“Our basketball team will always be our primary focus,” Joe Lacob said in a phone interview. “But I view our future as a sports, entertainment, media and technology company.”

Lacob believes the Warriors can become like Disney in diversifying their business after starting with animated movies and adding theme parks.

“There is no reason we can’t do some of those things over the long term,” he said.

 

Via Kurt Badenhausen/Sportico

[Darthlukey]

This is a signal to sell the team. The moment steph retires that valuation is no good

[hippesthippo]

I don't know about selling the team before the new TV deal unless you think that's already priced in.

I'd definitely be looking for minority stakeholders willing to pay at an even higher valuation.

[dougthonus]

This is a signal to sell the team. The moment steph retires that valuation is no good

I doubt you could find a buyer for it at that price to be honest, it's not like other people won't look at it and go 'wow this team is really old and is going to be average soon", so whatever amount of money is there due to team quality, someone who has 7B to throw away on a basketball team will also be smart enough to factor that into the equation.

That said, they probably have built a sustained very high evaluation. The team is in a really high income area and has a brand new state of the art arena built around high end sales. It's got a fanbase now that will probably have some longevity to it based on their recent success (look at the history of the Bulls after a dynasty), so they're probably still a top 5 franchise value team even going through a rebuild.

That said, I agree, it's like when Cleveland was one of the top franchises when they had a LeBron, if you are a top franchise due to a single player, you aren't really a top franchise. You have a temporary high value, and these sites do a really poor job capturing that.

[dubbmotta]

im curious om what the profit looks like compared to other teams.They play in one of most expensive (if not expensive) areas in America, of course the revenue should be high.

[Ryoga Hibiki]

This is a signal to sell the team. The moment steph retires that valuation is no good

What makes you think that the value of a franchise is linked to a singular player?

[Ryoga Hibiki]

I doubt you could find a buyer for it at that price to be honest, it's not like other people won't look at it and go 'wow this team is really old and is going to be average soon", so whatever amount of money is there due to team quality, someone who has 7B to throw away on a basketball team will also be smart enough to factor that into the equation.

the 7B valuation doesn't come from bragging rights because they are the reigning champions, but depends on the revenues the Warriors can generate because of the market they are in and the Chase Center.

[Darthlukey]

This is a signal to sell the team. The moment steph retires that valuation is no good

What makes you think that the value of a franchise is linked to a singular player?

The geographical location is pretty good, being a tech town. But that valuation is solely based on the freak steph is. Nothing wrong with that, but see it for what it is

[Ryoga Hibiki]

This is a signal to sell the team. The moment steph retires that valuation is no good

What makes you think that the value of a franchise is linked to a singular player?

The geographical location is pretty good, being a tech town. But that valuation is solely based on the freak steph is. Nothing wrong with that, but see it for what it is

I can't believe someone would really think that.

[dougthonus]

I doubt you could find a buyer for it at that price to be honest, it's not like other people won't look at it and go 'wow this team is really old and is going to be average soon", so whatever amount of money is there due to team quality, someone who has 7B to throw away on a basketball team will also be smart enough to factor that into the equation.

the 7B valuation doesn't come from bragging rights because they are the reigning champions, but depends on the revenues the Warriors can generate because of the market they are in and the Chase Center.

You snipped my quote where I addressed all of those things. As I said, they have plenty of really good things going for them, and they'll be a very highly valued franchise even through a rebuild, but they won't be worth more than the Lakers/Knicks long term.

[Ryoga Hibiki]

I doubt you could find a buyer for it at that price to be honest, it's not like other people won't look at it and go 'wow this team is really old and is going to be average soon", so whatever amount of money is there due to team quality, someone who has 7B to throw away on a basketball team will also be smart enough to factor that into the equation.

the 7B valuation doesn't come from bragging rights because they are the reigning champions, but depends on the revenues the Warriors can generate because of the market they are in and the Chase Center.

You snipped my quote where I addressed all of those things. As I said, they have plenty of really good things going for them, and they'll be a very highly valued franchise even through a rebuild, but they won't be worth more than the Lakers/Knicks long term.

why? as it is today the Warriors do have higher revenues than both the Knicks and the Lakers.
2020 data, when the Lakers were winning the title while the Warriors had a down year sitting everybody, it was 474m vs 400m.
Considering how NBA teams seems to work with a P/E of 40+ nowadays it makes sense.
Hard to understand what would be the potential of the Knicks if they could revitalize, their brand.

Moreover, I think in those evaluations Arenas (Chase Center and MSG) are included.

[dougthonus]

why? as it is today the Warriors do have higher revenues than both the Knicks and the Lakers.
2020 data, when the Lakers were winning the title while the Warriors had a down year sitting everybody, it was 474m vs 400m.
Considering how NBA teams seems to work with a P/E of 40+ nowadays it makes sense.
Hard to understand what would be the potential of the Knicks if they could revitalize, their brand.

Moreover, I think in those evaluations Arenas (Chase Center and MSG) are included.

The long term value of the brand is based more on the market quality than the current record. The Warriors have, by far, the most bump in the NBA due to their recent performance, and however much you value that bump, it will likely recede back to the mean.

The Lakers/Knicks have no meaningful bump from their performance. Those teams suck. Their values are already based purely on the brand / locale etc.

Maybe this will be the 1st time that all of these valuations got that formula right and didn't overvalue a market based on short term success, but that seems unlikely based on the history of these valuations always overvaluing teams with good current performance vs value with typical level of performance, and if you have watched the league for a long time, you're well aware that well above typical level performance is generally not durable.

[Onlytimewilltel]

What makes you think that the value of a franchise is linked to a singular player?

The geographical location is pretty good, being a tech town. But that valuation is solely based on the freak steph is. Nothing wrong with that, but see it for what it is

I can't believe someone would really think that.

I also feel the same. I think if Curry retires tomorrow and they go back to an average team with no finals hopes the value will drop. I can’t believe you don’t think that them winning all these championships in these last 8 years doesn’t have to do a whole lot with this evaluation?

And if that is the case, then wouldn’t them going back to a losing team of previous two decades also have the reverse effect?

Clearly this stuff matters for most teams (except for cowboys I guess and some iconic teams like that, but warriors have not been considered iconic historically, that was more your lakers Celtics etc). And with Curry being the main reason for the championships (they don’t happen without him) one could rationalize that him retiring will have a decent impact.

[Ryoga Hibiki]

I also feel the same. I think if Curry retires tomorrow and they go back to an average team with no finals hopes the value will drop. I can’t believe you don’t think that them winning all these championships in these last 8 years doesn’t have to do a whole lot with this evaluation?

you should ask yourself a few questions:
- how does the pnl of the Warrioris look in very successfull seasons?
- how it looks with an average team?
- how it looks with a rebuilding team?
The Warriors have been a money machine primarily because of the investment the new ownership made, moving to San Francisco e building a modern Arena in a prime location. A player is not the difference between grossing 500m or 250m, and less successful teams are normally let's expensive that what the Warriors are now and that helps the bottom line.
These evaluation are based on how the pnl might look in the three scenarios above, not about who won the championship last year, but people think the professionals doing these are just idiots who are prisoner of the moment. Nobody assumes that the GSW will be a dynasty forever, it's just ludicrous to think that. But in SF you can capitalize such success very differently compared to, say, San Antonio.