Chapter 1: What is the main topic discussed in this episode?
Welcome to Pablo Torre Finds Out. I am Pablo Torre, and today we're going to find out what this sound is.
I love your show. I love being on it, but don't overestimate. Right after this ad.
David is furiously, frantically...
Well, I'm trying to track down people because you screwed up on time, and I'm very structured. I know. And this was the window.
The window is shattered. We are holding space, as they say, for John Skipper. There's a microphone that is pointed at nothing because John is not here, despite saying he would be here. I'm not taking it personally. And now Nadir is wheeling the chair. That's a bad sign. I thought he was like in the elevator. Yeah, this is going to be a different kind of sporting class.
But it is one that I am very excited to do with you, David, because we've done this story on the show this week in partnership with Hunter Brook Media and my friend Sam Koppelman that I've been truly curious. What does David Sampson think about this?
Well, let me just start with a part that you glossed over on the show that to me was spectacular because it resonated so well that someone mentioned, hey, Justin Timberlake owns the Grizzlies. And he was not too happy about that. That is a guaranteed true story. And I have like four things I want to talk about with that.
So the character, the main character of the story is Robert Pera, who's the owner of the Memphis Grizzlies. He is the founder and CEO of a company called Ubiquity. Ubiquity, and I'm going to TLDR this. Please watch the episode. It is detailed and deliberate and structured and reported.
And it's the product of six months of investigative journalism with Hunter Brook doing so much good work that I just want to continue to shout them out. Is it by or with Hunter Brook? They did a six-month investigation, and then we added some fun stuff. Some cheese to melt on their broccoli is how I would put it, including what you just referred to, which is that— The LP story.
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Chapter 2: What does being Robert Pera's 'co-owner' of the Grizzlies mean?
He threatened to buy out his limited partners, which included Justin Timberlake, because he was out one night and a woman said, wait a minute, you're not the owner of the Grizzlies. Justin Timberlake is the owner of the Grizzlies. And this did not sit well with the guy who bought the Grizzlies for social capital.
His stock could go down by 30 points. His net worth could decrease by 15 billion. And it would not impact him the way... It hits incorrectly and horrifically when someone at a party who's a woman says, you're the owner of the Grizzlies? I thought it was Jessica Biel's husband. That is DEFCON 1000.
That's when you pick up the phone and you're calling your lawyer and you want to get rid of that partner. And I've seen this. It's happened two quick things. One, George Steinbrenner did not like his limited partners. And there were a lot of limited partners. And there was a time in Jeffrey Luria's life when he was offered to become a limited partner of the Yankees.
And he wanted to have some power. He wanted to have some say. And what George Steinbrenner said is, just keep in mind, there is nothing so limiting as being my limited partner. You may not talk about it. It's like it's like Fight Club to be a limited partner with the Yankees. And so Jeffrey and many other owners in baseball and basketball.
have taken that thought process out into the world because they all have limited partners. Even Steve Ballmer has Mr. Dennis Wong. Yes, his one limited partner, which is special because he only has one.
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Chapter 3: Why is Robert Pera's ownership style controversial?
Which is very rare. In the old days, at a lower purchase price, 100-0 could happen. But right now, at billion-dollar and two-billion-dollar valuations, it's a syndicate. And there's someone in charge. There's someone who puts in the most money. But so many other people get to say, yeah, I'm an owner. Yeah, I own the Yankees. 1%. No one asked that.
No one ever follows up at a cocktail party, oh, you're an owner of the Marlins? Because I got this in Miami where I would get reports. Wait a minute. I just met the owner of the Marlins. And it was one of Jeffrey's limited partners who would go around and there were multiple of them saying, yeah, I own the Marlins.
But it's the whole reason why you buy in. It's to say it. So you can say it. By the way, and I get it. It's the coolest thing you could own is a pro sports team because you are visible and...
in exclusive televised spaces but think about the level of insecurity that this guy had so the fact that someone thought justin timberlake when you bring in a celebrity partner and that's become a big thing that i learned about back when stephen ross did it with the dolphins he had this whole red carpet where the williams sisters and mark anthony and other people were supposedly had bought into the team and they would come to games and they'd be announced like it was
the damn Oscars. And I thought to myself, there's only a certain number of owners who would ever want this sort of light to be shown upon someone other than themselves. And it turns out that number's dwindling down to zero these days, where if you have a team, you want the world to know you've got the team.
Well, I want to recap for people who aren't somehow familiar with your backstory. You're the president of the Marlins and Jeffrey Luria, who is your... the man formerly known as my stepfather. Correct.
Close relationship with him, though, for 50 years.
And the thing that I didn't know that I only knew because I am friends with you is that that dude grew up loving the Yankees. Did he ever, which is hilarious and heartbreaking for me, a Yankee fan, because this gives a new subtext to the whole, like you guys beating the Yankees in the world series thing.
And also gives new context for him considering, should I be George Steinbrenner's limited partner?
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Chapter 4: How does Ubiquity's business model impact the Grizzlies?
Oh, there's that dude. I've talked to you about this off-air, but we can mention it now. I've been, like, staring at this dude, Patrick Bet-David, who is, like, this now right-wing influencer who is in, I think, South Florida, but... He's a huge YouTuber. And in his Twitter bio, it says, let me just get it because this is exactly why you buy in despite not being the guy. Does he write limited?
Does he just write owner of New York Yankees? Because that would drive, that used to drive me crazy. The first line, at Patrick Bet David, the first line is Yankees minority owner. Baseball emoji, author of your next five moves, and then the rest of it. PVD podcast and Valuetainment. Valuetainment is the company.
In case you wanted to, I don't know, claw your eyes out at some point after watching this. So anyway, so I've been curious, like, oh, a Yankee? I didn't know that. And I'm a Yankee fan. That guy is a co-owner of the team.
Yeah, there was an opportunity to buy into the Yankees, not just, he wanted to take over and George did not want to sell. This is back when I was much younger. I was probably in my teens. Jeffrey, no. He had an opportunity to buy the Yankees and the argument that he and George had was over control. What makes me smile about this Grizzlies story
is that the need for relevance is supposed to come with ownership. But now what's happening is owners need more of it because there's a bigger universe of people who have fame. Back in the day, there was not social media. You were not competing with people without money for fame.
And now there are so many people who don't have money that have fame that the people who have the money want the fame and they need to figure out the way to do it. So this example is outstanding.
So let me give you some more context for it because I've been doing some more reporting. The story is ongoing, by the way, and I keep on getting to say this. There is vast and serious moral implication here for what Ubiquity was doing. But the backstage power stuff that comes... right into the wheelhouse of the sporting class.
That's where I want to live with you today, because what I was told was that when Robert Pera was buying the Grizzlies, there was an arrangement that fell apart because Ubiquiti's stock tanked. So he becomes, spoiler alert again, in 2012, the youngest owner in NBA history. He's in his 30s, and he owns the Grizzlies.
But the way that he was originally scheduled to buy the Grizzlies fell apart because he was using the valuation of his company. to provide all of his financial purchasing power. And so when the Ubiquiti stock tanks, what I'm told is that There is a meeting and it is David Stern and Adam Silver and Robert Perra and his associates.
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Chapter 5: What are the implications of the Grizzlies' ownership structure?
So they would never, the NBA owners would never allow a newbie to take the Vegas market. Explain that, because this is 2012, and I want to understand. Yeah, so if you buy team at X, and with relocation, you get a value of Y, in theory, what that means is that you've had an increase in your investment. You've made money on your money. And what owners say is, hey, you're new to this.
They keep track. Like, how long have you been in the game? Like, there's a list. Team owned since 1990. Team owned since 1992. 1978. And you can't reward a new owner with the change in value of a team that's been relocated. And what my response always was is just charge me a fee. Charge me a relocation fee for the difference.
You're saying that once an owner gets the rights to move to Vegas, the valuation of that team is all his. Mushrooms.
Yeah, and it's all his. And what baseball did is they wouldn't allow us to move to Washington. They bought the Expos and themselves moved it to Washington and got the increase in valuation. When the NBA goes to Vegas, there's going to be a huge, huge expansion fee that gets split amongst the owners, not into the pocket of one of the owners and whoever buys that team, LeBron or Shaq.
who both want it, will pay accordingly. And it will be a multi-billion dollar franchise to start with.
So one of the fun dynamics of the, okay, I would like to move the team to Vegas thing, as perhaps ill-fated as that had always been because of the power dynamics you just outlined, is that the seller of the team was this guy, Michael Heisley. And Michael Heisley wanted to keep the team in Memphis, right?
And that was one of his, it's funny when an owner is like, I want out of this, but don't leave. And so reportedly, by the way, one of the bidders, one of the people, one of the suitors for the Grizzlies at the time was Larry Ellison. Larry Ellison wanted to move the team out of Memphis. It's called the Herb Cole, Pablo.
I don't know if you know that. The Bucs? Within our industry, that's called the Herb Cole. Please explain. The Herb Cole is when you own a team and you sell it and you claim that you are selling it to people who have guaranteed to keep the team. He didn't want Milwaukee to lose a team. And so he famously sold the Bucs. And the thought was, what he was able to say is, hey, don't you worry.
This team will not move. I have taken care of it. I'm even investing in the new stadium, which there is now an old arena in Milwaukee that And it's always been a joke, the Herb Kohl effect, because it's not everlasting. So there is no guarantee when you say, oh, my team's not going to move out of this market. That is a promise you can never make. That's former Senator.
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