45 Great Moments in Black Business – No. 23: America’s First Black Billionaire Buys NBA Franchise

This year, BLACK ENTERPRISE celebrates the 45th anniversary of its roster of the nation’s largest black-owned businesses—The BE 100s. To commemorate the significance of this collective’s widespread impact on black business and economic development as well as American industry over four decades, we have presented 45 milestones moments. As part of this tribute, we continue our yearlong countdown.  

Today we reveal No. 23 in the web series “Great Moments in Black Business.” 

2003: Billionaire Bob Johnson makes another slam dunk in black business history by breaking the ownership barrier in professional sports through the acquisition of the NBA’s Charlotte Bobcats.

Recognized as America’s first black billionaire, business mogul Robert L. Johnson is accomplished at being involved with and closing big deals.

Johnson showed his proficiency as a serial entrepreneur when he paid $300 million in 2003 to acquire the National Basketball Association’s Charlotte Bobcats expansion team.  The transaction was huge as it made Johnson the first black majority owner of a major professional sports team.

Johnson’s deal shattered ownership barriers when it came to a black businessman operating in that realm, though at the time, the NBA had a player base that was roughly 80% black.

The acquisition came two years after Johnson, the founder and chairman of Black Entertainment Television (BET), sold that company to Viacom for roughly $3 billion. As such, Johnson became a billionaire and household name.

Key Player in Proposed Airlines Merger

The audacious entrepreneur has always been focused on engaging in commercial enterprises in sectors which had an absence of African American ownership. For example, while in the process of selling BET, he also sought to launch DC Air as a major black-owned airline operating from Ronald Reagan National Airport in Washington. Johnson, a US Airways board member at the time, hammered out a deal to acquire assets in the Washington market for $141 million as part of United Airlines then-parent UAL Corp. ‘s $4.3 billion bid for US Airways in 2000. The deal was grounded when the Department of Justice blocked the merger in 2001.

After he closed the BET deal, Johnson vigorously went after becoming a majority owner of a sports franchise but never succeeded. Johnson failed twice to buy the Charlotte Hornets from team owner George Shinn. After the Hornets relocated to New Orleans, the NBA opened itself to the possibility of adding an expansion team in Charlotte for the 2004-2005 season. In January 2003, the NBA Board of Governors granted Johnson the Charlotte franchise. He also gained ownership of the WNBA’s Charlotte Sting.

Johnson believes it was his business savvy and financial status that won the deal—he connected with NBA owners who were members of the selection team as well as had influencers such as then-AOL Time Warner CEO Dick Parsons and former President Bill Clinton go to bat for him. He also says that being African American was the fast break on his slam dunk: “The fact that I am African American was a plus, but at the end of the day, if I didn’t have the credibility or experience, there’s no way they would have said, ‘We’ll give it to you just because we want a black guy running an NBA team.”

Yet Johnson’s tenure as the NBA team’s owner was tarnished by forces like poor attendance and slow sponsorship sales, contributing to the loss of tens of millions of dollars and unprofitability. In 2009, Johnson began seeking a buyer.

Deal With Jordan

He eventually sold the franchise in 2010 to NBA legend Michael Jordan, who had been a minority investor and head of basketball operations since 2006, for $275 million. The Hall of Famer and six-time NBA champion became the second African American and first NBA player to own a franchise. At the time of the sale, Bobcats Basketball Holdings L.L.C., which Johnson founded, was ranked No. 40 on the 2009 BE INDUSTRIAL/SERVICE COMPANIES list. “I am confident that Michael’s leadership will bring success to the Bobcats whether it’s measured by on-the-court performance, success as a business, or making a positive impact in the Charlotte community,” Johnson said.

After operating under the Bobcats moniker for a decade, the franchise was named the Charlotte Hornets when it became available again after New Orleans owner Tom Benson changed his team’s name to the Pelicans.

Johnson continues to build his legacy as one of America’s most dynamic businessman and wealth builder. He currently serves as chairman of The RLJ Cos., a portfolio of holdings in assorted industries, including the RLJ McLarty Landers Holdings L.L.C., the highest-earning black-owned auto company with revenues of $1.6 billion and ranked No. 1 on the 2017 BE Auto 50 list and RLJ Equity Partners L.L.C. (No. 10 on the BE PRIVATE EQUITY FIRMS list with $334 million in capital under management). He was No. 2 on BLACK ENTERPRISE‘s list of “Titans: The 40 Most Powerful African Americans in Business” in the magazine’s 40th-anniversary issue and the recipient of the A.G. Gaston Lifetime Achievement Award, the media company’s highest honor, in 2013.