Magic Johnson became a superstar through basketball, winning a national championship with Michigan State in 1979 and five NBA titles with the Showtime-era Lakers.
But he became a billionaire mainly through his business deals.
According to an article published by Forbes on Monday, Johnson’s net worth is estimated at $1.2 billion, making him the fourth athlete recognized by the magazine to have reached billionaire status. He follows fellow retired NBA legend Michael Jordan (who reached billionaire status in 2014), golfer Tiger Woods (2022) and current Lakers star LeBron James (2022).
“When you have a high basketball IQ, you can take that same basketball IQ, or high IQ, and translate that into business, reinvent yourself and become a businessman,” Johnson told The Times’ Broderick Turner in July. “The same discipline it took you to be a great athlete is the same discipline it’s going to take you to be a great businessman. The same focus and drive, and last but not least, competitive spirit. So, just take all those things that made you a great athlete and you can transfer that to the business world. That’s what I did.”
Johnson, 64, differs from the other three billionaire athletes in that he amassed relatively little of his fortune during his playing days. Although he was the face of the Lakers and one of the NBA’s best known players in the 1980s and into the 1990s, Johnson made around $40 million in career earnings and only another $2-4 million a year in endorsements, according to Forbes.
Jordan, who won six NBA titles with the Chicago Bulls during the 1990s, earned $94 million in salary and signing bonuses and an estimated $2.4 billion in endorsements during a 15-season career that spanned from 1984-2003. Woods and James are still active athletes.
According to Forbes, Johnson has entered the 10-figure club mainly because of his joint business ventures and partnerships, including early deals with Loews and Starbucks that became quite lucrative as the basketball star helped the companies expand into predominantly Black neighborhoods.
“We got a tremendous amount of leverage in those partnerships,” Ken Lombard, president of Johnson Development Corporation from 1992 until 2004, told Forbes.
Johnson also became a minority owner of the Lakers in 1994. He later sold his shares to Los Angeles Times owner Dr. Patrick Soon Shiong, but Johnson has since become a high-profile minority owner of several teams, including the Dodgers, the Sparks, LAFC and, most recently, the Washington Commanders.
His investments are wide and varied, but the biggest asset in Johnson’s portfolio is his 60% share in EquiTrust Life Insurance, Forbes states. Since Johnson took over as majority owner in 2015, the company’s total assets have risen from $16 billion to $26 billion, with annual revenues at around $2.6 billion.