Photo: AP Images
For all the money they earn, professional athletes have a hard time holding onto any of it.They’re apparently unaware that even millions of dollars can disappear pretty quickly when…
- Your garage is stuffed with sports cars
- Your house has the “largest residential aquarium in the southeast”
- Your child support payments span several mothers across the country
- Your social life necessitates thousand-dollar bottles at luxurious nightclubs.
- The money stops coming in after age 33.
But you know what’s even sadder than all the athletes who lose their money by spending it? Those who lose all their money investing it…in their own companies.
They are a set of athletes-gone-broke in a class of their own.
Call them althetepreneurs. They start businesses to cash in on their famous names and WHAM…they fly straight into a mountain.
For every George Foreman and Magic Johnson, there are dozens of failed entrepreneurs whose business decisions left them with the same fate as the spendthrifts, gamblers, and alcoholics: battered, broke and bankrupt.
Lenny Dykstra refuses to admit that he can't fund his magazine and brokerage company despite earning $35M on the field
Estimated Career Earnings: $35M from 1985-1998
Brilliant Business: The Players Club, a magazine and would-be brokerage company helping high-paid athletes 'live the dream.'
What Happened: Known as 'Nails' during his playing days for his gritty on-field persona, Dykstra is all glamour off the field. He spent nearly $20 million on Wayne Gretzky's old home, sunk a fortune into a private jet, and pledged millions more to fund his glossy magazine and brokerage firm. Now he's swamped in legal troubles having failed to pay off the costs of his floundering company. He reportedly owes tens of millions of dollars and was forced to file for Chapter 11 protection.
Estimated Career Earnings: $4.6M from 1935-1952, although it's said he pocketed less than 20% of that estimate
Brilliant Business: Joe Louis Restaurant, Joe Louis Milk Company, Joe Louis Punch, and Louis-Rower P.R. Firm
What Happened: One of the most beloved boxers in an era when the ring was king, Joe Louis bet on his golden name to preserve the lifestyle he enjoyed as the heavyweight champion. Though a corrupt business manager coupled with the numerous poor business investments left the champ broke, Louis managed to live somewhat comfortably thanks to generous contributions from wealthy admirers.
Estimated Career Earnings: $18-20M from 1991-2001
Brilliant Business: Rock N' Roll Cafe, COZ Records, a plan to create nationwide phone-card dispensers, and It's in the Name, a store where tourists could buy framed calligraphy
What Happened: Rocket Ismail had blinding speed on the field, and blindly helped found numerous business doomed for failure. While he blames the foolish decisions on smooth-talking partners, he doesn't seem to have learned his lesson. Ismail is currently investing in a company that designs and manufactures specialty mouth guards. 'Lord willing,' he told Sports Illustrated, 'this is going to be my one.' While he's avoided bankruptcy thus far, statements like that indicate it may not be too far off.
Source: Sports Illustrated
Estimated Career Earnings: $1-4M from 1956-1973
Brilliant Business: Johnny Unitas' Colt Lanes in the 1960s, a printed-circuit-board company in the 1990s
What Happened: The Golden Arm didn't possess the Midas touch when it came to business, as he filed for bankruptcy in 1991 thanks to a litany of failed businesses and investments. However, he did manage to land on his feet thanks to appearance fees he amassed at collector exhibitions.
Estimated Career Earnings: $3.5M 1973-1983
Brilliant Business: A Bjorn Borg fashion label
What Happened: The Swedish star won six French Opens and five Wimbledon titles before retiring at age 27, but Borg had to sell off many of those trophies just to stay afloat when his fashion label faulted. Borg attempted to return to the tour eight years after his first retirement, but was embarrassed on the court. He did mount a successful return to the clothing industry, having launched an underwear company whose net income surpassed $11M in 2009.
Estimated Career Earnings: $55M from 2003-2010
Brilliant Business: D. Wade's Sports Grills
What Happened: Even the best, highest paid, athletes seem unable to avoid entrepreneurial misfortune. Dwyane Wade partnered with two others to open a restaurant in Florida in 2008. Wade's investors wanted to expand across the southeast before Wade felt the business was ready, and he allegedly didn't make promised promotional appearances as a result. The two established restaurants closed for business in 2009 and Wade faces a $25 million lawsuit. Said one potential juror: 'But Mr. Wade, he's got some skills. ... I'd like to have those skills. It's impressive. Very impressive.' We assume he's talking about basketball, and not entrepreneurship.
Source: USA Today
Estimated Career Earnings: $1-2M from 1976-1982
Brilliant Business: Athletic shoe stores in Ohio
What Happened: The only man ever to twice capture the Heisman Trophy as the nation's best collegiate football player, Griffin had an underwhelming professional career. His business career was no different. He filed for personal bankruptcy less than a month before competing in Super Bowl XVI thanks to failing footwear stores he opened with his brother. But the running back learned his lesson. Griffin returned to the comfort of college when his playing days were over and earned an MBA from his alma mater, Ohio State.
Source: The New York Times
Estimated Career Earnings: $6M from 1977-1989
Brilliant Business: Bill Buckner Dodge Chrysler Jeep Dealership
What Happened: Desperately trying to escape the shadow of his 1986 error that facilitated the Red Sox' World Series collapse, Buckner lived in anonymity in Idaho. However, he decided to stamp his name on a car dealership that drove him to personal bankruptcy two years after opening. Good luck is not his forte.
Estimated Career Earnings: $36M from 2001-2008
Brilliant Business: Nissan Car Dealership
What Happened: McAllister filed his Mississippi dealership for bankruptcy in 2009 citing the tough economic times, and was sued by Nissan this year for allegedly defaulting on payments and exceeding on credit limits. McAllister countersued. Nissan, he argues, should have known he was an athlete and an inexperienced businessman.
Estimated Career Earnings: $93M from 1993-2006
Brilliant Business: Vin Baker's Saybrook Fish House
What Happened: Many players have sunk their money into restaurants, and for every Mike Ditka's restaurant there are about five Vin Baker Fish Houses (heck, even Michael Jordan shut down his establishments). We use Baker because his fall was the most precipitous. While gambling and alcoholism certainly contributed to his $93M loss, the failed restaurant was no help. He owes about $1M on the foreclosure and his parents owe a half million more. Outside investors have since reopened the restaurant.
Muhsin Muhammad made $42M but has to put his house on sale to repay credit on an entertainment company
Estimated Career Earnings: $42M from 1996-2009
Brilliant Business: Baylo Entertainment
What Happened: Muhammad's entertainment business is credited with finding some Atlanta area entertainers, but it was sued by Wachovia in 2008 for defaulting on credit card payments. Muhammad has had to cover the suit expenses by putting his Chicago-area mansion on the market for 70% of his original asking price.
Source: Sports Illustrated
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