06/25/2025
You've probably seen this stat making the rounds. Jerry Buss's $67M investment in the Lakers grew to $10B, but the S&P 500 would have theoretically yielded $13B over the same time period.
At first glance, it seems like a misstep. But this is a classic apples-to-oranges comparison that misses the bigger picture of true wealth creation. It's the kind of surface-level analysis we help our clients see past.
Here's what the simple math ignores:
1. Annual Cash Flow Opportunities: The Lakers weren't just a number on a screen; they were a cash-generating machine. The annual income from tickets, media rights, and sponsorships likely dwarfed any dividend from an index fund. That's money in your pocket, not just on paper.
2. Tax Advantages: Every business owner knows the power of deductions. From player salaries to stadium maintenance, the tax advantages of owning an asset like the Lakers are immense—benefits an S&P 500 investment simply can't offer.
3. The Legacy Asset: You can't teach your kids life skills by showing them a brokerage statement. The Buss family didn't just inherit stock; they inherited an empire, an identity, and the ability to handle executive-level responsibilities. That's a legacy.
4. The Next Venture: Selling the team wasn't the end. It's the beginning of the next chapter, unlocking billions in capital to deploy into new ventures, charities, or family projects with complete control.
The S&P 500 is a fantastic tool for investing. But for building a multi-generational legacy and creating strategic wealth? Ownership is, and always will be, in a league of its own.
For business owners, the best investment may very well be back into your own company. You need a financial strategy that enhances that growth, not one that fights it. If you want to work with an advisor who understands that your business is the engine, not the piggy bank, send me a direct message. Let's build a plan that fits reality.
P.S. I believe there's a lot more to unpack here. I'm considering writing a full article detailing the nuances of ownership vs. market indexing. If that's a breakdown you'd like to see, just comment below.
