From Layups to Startups: Magic Johnson’s Entrepreneurial Journey

When we think of Magic Johnson, the first image that often comes to mind is that of the legendary point guard who dazzled the basketball world with his flashy passes and charismatic smile.

He is one of the greatest basketball players of all time, with five NBA championships, 12 All-Star selections, three MVP awards, and a gold medal with the “Dream Team” at the 1992 Olympics.

But Magic Johnson’s story goes far beyond the basketball court. He’s also a remarkable entrepreneur, investor, and philanthropist. I had the chance to host Magic on the Business Lunch podcast for a live event, and our conversation remains one of my favorites.

Here’s his story, and what we can learn from it…

Magic’s Vision

Magic’s journey into entrepreneurship began with a clear and ambitious vision. He passionately stated, “Since my childhood, I had two distinct dreams that fueled my determination: to become a professional basketball player in the NBA and to excel as a successful businessman." This dual and extraordinary aspiration not only shaped his dreams but also became a powerful driving force in his life, propelling him towards greatness.

Recognizing the importance of seeking guidance and wisdom from experienced individuals, Magic made one of the most intelligent decisions of his life - to surround himself with mentors who had already achieved remarkable success.

Through the combination of his unwavering determination, relentless pursuit of excellence, and the wisdom gained from his mentors, Magic Johnson embarked on a remarkable journey that would forever leave an indelible mark on the world of entrepreneurship.

An Unlikely Mentor

Among these mentors, one individual stood out as a pivotal figure in Magic's life - Dr. Jerry Buss, the esteemed owner of the Lakers. Dr. Buss played a significant role in shaping Magic's entrepreneurial mindset and providing invaluable insights.

Dr. Buss took Magic under his wing and became not only his mentor but also opened the doors for him to explore the business aspects of the Lakers organization. This was a remarkable opportunity for Magic as it allowed him to gain firsthand knowledge of the team's financial operations, such as season ticket sales, sponsorships, and TV deals.

By immersing himself in the inner workings of the Lakers, Magic acquired a wealth of insights that proved to be immensely valuable. These insights not only provided him with a deeper understanding of the business side of basketball but also served as a solid foundation for his future entrepreneurial pursuits and ventures.

Magic’s Business Philosophy

Evaluating opportunities was another key aspect of Magic’s approach to entrepreneurship. He stressed the importance of having a team to thoroughly vet deals, examine revenue histories, and project future growth.

Magic’s emphasis on choosing the right people to work with extended to his partners. He believed in only partnering with people who brought expertise to the table and were honest and compatible.

Magic also believed a three to five-year plan was the perfect time frame so he wouldn’t become overly attached to small goals. Once he’d build and grow a business to be profitable on its own, he’d look to sell it and buy another business. This strategy allowed him to maintain a dynamic and ever-evolving portfolio of businesses.

Persevering Through Obstacles

Despite being a legendary basketball star, Magic often faced resistance from banks when seeking capital to invest in urban America. The banks were reluctant to invest in minority communities, despite the substantial spending power within these demographics.

Magic’s perseverance paid off when he secured a $50 million investment from CalPERS, a pension fund, to kickstart his ambitious Starbucks project in underserved urban areas.

Lessons From Magic

Throughout his career, Magic Johnson has broken down barriers for minority entrepreneurs and advocated for equal opportunities. His story serves as an inspiration to those who aspire to be successful entrepreneurs.

As you pursue your entrepreneurial dreams, remember the lessons we can learn from Magic. Commit to learning from mentors, be meticulous about carefully evaluating opportunities, and be relentless in the face of obstacles.

With a clear vision, unwavering determination, and an “always learning” mindset, anyone can make their mark as an entrepreneur.

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