By Marianna Kazazi, The Sports Financial Literacy Academy
In the transitional world of professional sports, athletes are presented with a unique opportunity to transcend their traditional roles. With the advent of technology-driven changes, athletes have the chance to not only excel in their respective fields, but also to leave a significant mark in the entrepreneurial arena.
While in the past athletes relied heavily on their sports careers for income, the realization that their athletic careers are often short-lived prompted many to diversify their income streams. A number of athletes have ventured into entrepreneurship, leveraging their personal brand, financial resources, and connections to launch businesses across various industries. This transition has been facilitated by the growing impact of technology in the sports industry.
One of the key advantages for athlete entrepreneurs, as discussed in previous articles, lies in their ability to leverage their Name, Image and Likeness (NIL). In the current digital era, an athlete’s brand extends far beyond their playing field. Social media platforms, such as Instagram, Twitter, and Tik Tok, offer athletes a direct channel to connect with their fanbase, establish a strong online presence, and effectively promote their businesses. Athletes who have a significant number of followers can use their platforms to endorse products and services and connect with a large and involved audience.
In recent years, athletes have been progressively evolving into content producers mostly through social media platforms, since content creation holds a lot of benefits. Specifically, athletes who grow their audience and engage with their fans transparently, maximize their value for sponsorships and endorsements and also establish a basis for fresh business prospects.
Furthermore, technology has expanded the scope of investment opportunities available to athletes. Fintech apps and online investment platforms have streamlined the process of diversifying investment portfolios. Athletes now have the flexibility to explore avenues like backing startups, engaging in real estate ventures, trading stocks, and even venturing into the realm of cryptocurrencies. This technological evolution has made the expansion of wealth and financial stability more attainable than ever before.
A famous example of an athlete-investor who achieved substantial profits through investments in technology startups is former basketball player Shaquille O’Neal. O’Neal made investments in Google during its Series A funding round in 1999, before it went public in 2004 with a valuation of $100 million. During this period, the athlete is reported to have also invested in the tech giant Apple Inc. and a ride-sharing app, Lyft, which eventually reached a valuation of $22 billion.
Athletes are progressively diving into the realm of sports technology. They are putting their investments into or even founding startups that specialize in sports technology, with the objective of improving performance, safety, and fan engagement. In 2021, NBA superstar LeBron James, alongside notable figures like tennis sensation Naomi Osaka and the musician Drake, made investments in StatusPRO. StatusPRO is a sports technology and gaming company that merges player data with XR (augmented reality and virtual reality) to develop a range of training and fan engagement products for both businesses and consumers.
Even though there are a lot of opportunities for athletes seeking to become entrepreneurs during this digital era, challenges do exist and they must be prepared to tackle them effectively. Specifically, they need to handle their time and energy in order to find balance between their sports careers and entrepreneurial ventures. Furthermore, they must confront the complexities associated with entrepreneurship (such as legal and financial matters). To ensure a seamless transition into entrepreneurship, athletes should prioritize seeking advice from professionals with a sports advisory background.
In this dynamic era where technology and entrepreneurship intersect, athletes find themselves in a position to redefine their roles beyond the sports field. They now have the opportunity more than ever to harness their personal brands, diversify their income streams, create engaging content with their fanbase and make strategic investments. As athletes delve into the business world, they are in a position to make a significant impact, both on and off the field.
The Money Smart Athlete® Blog is established and run by the Sports Financial Literacy Academy® (SFLA). Through its education programs, the SFLA has the vision to financially educate and empower athletes of all ages to become better people, not just better athletes. For more information on our courses, our SFLA Approved Trainer Program®, and how they can benefit you and your clients, please get in touch with us at email@example.com.