Listen and Learn: Magic Johnson Shares How He Closed a 9-Figure Deal With Starbucks
Magic Johnson sat down for an in-depth discussion on a live episode of Traffic Sales and Profit with Lamar Tyler where he opened up about his nine-figure deal with Starbucks.
As the chairman and chief executive officer of his investment conglomerate, Magic Johnson Enterprises, the NBA legend successfully scaled his business after turning a failed meeting with Starbucks CEO Howard Schultz into a mega-deal that made him $100 million richer.
“Sometimes those who are not from our community, you need to bring them to the deal,” Johnson said.
He recalled how he brought Schultz from Starbucks’ headquarters in Seattle to his signature Magic Johnson Theaters (MJT) in Los Angeles after his initial failed pitch in Schultz’s boardroom. At the time Schutz came to visit MJT the 1995 hit film Waiting to Exhale was opening in theaters.
“I had 5,000 Black women wrapped around the corner. When he drove up, he couldn’t believe it,” Johnson said.
After Schultz went inside the theater and saw how packed it was and how much money was being made at the concession stand and the culture of the audience, the businessman couldn’t deny the profitable potential of a partnership.
“That sold him,” Johnson said.
The duo went on to build another 125 Magic Johnson Theaters located nationwide that “opened up a whole new marketplace” for both businessmen. Johnson also was an early investor in Starbucks.
From 1998 to 2010, Johnson’s company-owned more than 100 Starbucks. In 2010, Magic Johnson Enterprises sold its stock in Starbucks. The Los Angeles Lakers champion walked away with $100 million from the deal, The Sports Rush reported.
“When you think about African Americans now—over $1 trillion spending power—Latinos, over $1 trillion spending power, and moving even higher—there was nobody really building businesses and going after their disposable income,” Johnson told Maverick Carter on a 2018 episode of Kneading Dough.
“So my company was able to provide jobs and access to these retailers who were not coming in before, but now they hit a home run when we partnered and they came into the inner city.”