Author Topic: NBA Player looking for 10,000% ROI  (Read 7133 times)

Wings5

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NBA Player looking for 10,000% ROI
« on: January 20, 2015, 08:02:19 PM »
NBA star Carmelo Anthony and his financial adviser are looking for investments with a 10,000% return rate.

http://espn.go.com/espn/feature/story/_/id/11904296/new-york-knicks-forward-carmelo-anthony-wants-bulletproof-reputation

"The key, Goldfarb says, is finding a few "hundred-exers," investments that multiply by 100 or more, which is why Anthony reads through a dozen business plans each week and Goldfarb takes five meetings every day. In just the past three months, they have received pitches from hundreds of companies. "The blessing and the curse of being a famous athlete is that you get pitched a lot," Goldfarb says, and Anthony is still learning how to sort through the deluge. He calls business founders from the bus on the way home from games, and he reads business plans in his hotel room on the road."


gimp

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Re: NBA Player looking for 10,000% ROI
« Reply #1 on: January 20, 2015, 09:51:58 PM »
So he's a VC without, you know, VC knowledge or connections.

I hope for his sake he chooses wisely, it's a much better idea than a ferrari for every day of the week.

nazar

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Re: NBA Player looking for 10,000% ROI
« Reply #2 on: January 21, 2015, 05:07:43 AM »
 "The blessing and the curse of being a famous athlete is that you get pitched a lot,"

Yeah,  like the pitch that led to Anthony hiring an advisor telling him to chase 10,000% ROI.,.

robotclown

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Re: NBA Player looking for 10,000% ROI
« Reply #3 on: January 21, 2015, 06:45:09 AM »
Well, that's easy enough.  Just pick every nano-cap biotech stock in existence.  One of them will get 10000%.

The rest will go bankrupt, probably.  But he can point to that one and say, "I am a savvy, shrewd investor."

trailrated

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Re: NBA Player looking for 10,000% ROI
« Reply #4 on: January 21, 2015, 09:08:40 AM »
Reading that made my brain hurt.

zephyr911

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Re: NBA Player looking for 10,000% ROI
« Reply #5 on: January 21, 2015, 09:13:31 AM »
I always laugh when I read about people who are filthy rich... who then decide it's wise to make big bets and take huge risks, in order to become more filthy rich.
I know right? Assuming he's made at least a few million at this point, he could have a really fucking nice paid-for house, and enough low-risk investments to make a grand a day without even getting out of bed.
The only thing I'd still be chasing at that point? Leaving the world a better place in every way I can while having lots of stress-free fun along the way.

AH013

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Re: NBA Player looking for 10,000% ROI
« Reply #6 on: January 21, 2015, 09:23:19 AM »
He's already invested in something that's grown 10,000%....his ego

viper155

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Re: NBA Player looking for 10,000% ROI
« Reply #7 on: January 21, 2015, 09:25:36 AM »
He needs to "get real".

arebelspy

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Re: NBA Player looking for 10,000% ROI
« Reply #8 on: January 21, 2015, 09:31:01 AM »
I always laugh when I read about people who are filthy rich... who then decide it's wise to make big bets and take huge risks, in order to become more filthy rich.
I know right? Assuming he's made at least a few million at this point, he could have a really fucking nice paid-for house, and enough low-risk investments to make a grand a day without even getting out of bed.
The only thing I'd still be chasing at that point? Leaving the world a better place in every way I can while having lots of stress-free fun along the way.

For someone like that, there's no amount that will be "enough."
We are two former teachers who accumulated a bunch of real estate, retired at 29, spent some time traveling the world full time and are now settled with three kids.
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nereo

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Re: NBA Player looking for 10,000% ROI
« Reply #9 on: January 21, 2015, 09:39:03 AM »
Reminds me so much of an anecdote from Warren Buffett;
(paraphrasing because I can't find the exact quote)
Several decades ago when Mr Buffett was rich but not super-duper-Forbes-top-50-rich, he was at a meeting with a bunch of oil billionaires.  They wanted to chase a risky investment by leveraging their own money.  Buffett turned it down and was laughed out of the room.  The investment went belly-up and the billionaires lost their shirts. 

When asked about it he said how crazy the whole thing was.  These super-wealthy men were willing to risk all the money they did have to get more money they didn't need and couldn't spend.

or put another way:  When you've won the game, stop playing.

MgoSam

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Re: NBA Player looking for 10,000% ROI
« Reply #10 on: January 21, 2015, 11:05:06 AM »
Reminds me so much of an anecdote from Warren Buffett;
(paraphrasing because I can't find the exact quote)
Several decades ago when Mr Buffett was rich but not super-duper-Forbes-top-50-rich, he was at a meeting with a bunch of oil billionaires.  They wanted to chase a risky investment by leveraging their own money.  Buffett turned it down and was laughed out of the room.  The investment went belly-up and the billionaires lost their shirts. 

Where did you read this, I would love to read the original article or interview about this. I love reading about Mr. Buffett.


When asked about it he said how crazy the whole thing was.  These super-wealthy men were willing to risk all the money they did have to get more money they didn't need and couldn't spend.

or put another way:  When you've won the game, stop playing.

Yup! That's my goal for hitting FIRE, my boss is a guy that made an absolute killing in this industry back when there was virtually no competition, but poured it all into the stock market without knowing what he was doing and lost his pants.

MandalayVA

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Re: NBA Player looking for 10,000% ROI
« Reply #11 on: January 21, 2015, 02:04:09 PM »
Hey, Carmelo, why don't you take a page out of Magic Johnson's playbook and invest in your community?  Magic made a bunch of smart decisions and now has a company worth $700 million.  Oh, that's right, I'm sorry, that would take work.

PS--never take advice from someone who calls herself La La, even if it is your wife
PPS--everyone knew you'd suck in New York

Gone Fishing

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Re: NBA Player looking for 10,000% ROI
« Reply #12 on: January 21, 2015, 03:20:48 PM »
I don't feel too sorry for pro-athletes, but peaking early and having to re-invent yourself after the party is over can't be easy.  So what if he wants to become a VC, at least he is thinking ahead. Certainly better than hookers and coke (at least you can sell Ferarris).
 
I don't watch sports or even know who Carmelo is, but there has been some energy around getting pro-athletes to invest more prudently than they have in the past.  An asset allocation for one with a $10mm+ portfolio might include 5-10% for VC type investment deals just to satisfy these guy's need for the big "win".  As long as they can walk away when they lose, chasing a few 10,000% ideas with 5% of their portfolio isn't the end of the world.  The good news is that he is reading lots of pitches, instead of just saying yes to anything and everything that comes along. 

In many ways, their financial planning should be much like the FIRE crowd, 10-15 years or so of high earnings and high savings until they have saved enough to last them the rest of their lives.  Sounds familiar, doesn't it?  But in most cases, probably not nearly "flashy" enough for someone who has made a living in entertainment.
     

skyrefuge

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Re: NBA Player looking for 10,000% ROI
« Reply #13 on: January 21, 2015, 04:54:37 PM »
So he's a VC without, you know, VC knowledge or connections.

Or VC money. From the article: "They have staked tens of thousands of dollars into a company that creates digital children's books and into an education venture that trains programmers in Africa. Some investments relate to sports -- like SeatGeek, a search engine for event tickets -- but Anthony has also put tens of thousands of dollars into ride-sharing (Lyft), a smart nutrition scale (Orange Chef) and voice messaging (Cord Project)."

"Tens of thousands of dollars" into a $250M Series D funding round for Lyft seems a lot closer to just being an amateur stock-picker rather than a true VC.

His partner supposedly provides the connections, and deals with the details of business plans, but yeah, his background doesn't suggest that he'd be particularly knowledgeable about tech startups either.

Another particularly anti-mustachian bit from the article:

"People say I am all about more money, but it's not like that."

Wait, I thought you were saying this was anti-mustachian? That sounds alright to me. But, go on...

"It's about having the appearance of someone with success. Image and reputation matter to me. If you're being honest, they matter to everybody. Money is about people thinking of you as someone who does well."

Ah, got it. :-(

eyePod

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Re: NBA Player looking for 10,000% ROI
« Reply #14 on: January 22, 2015, 07:41:36 AM »
I love how every athlete I read about invests in restaurants. Yeah, those are on the cutting edge and never seem to close every week.

MandalayVA

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Re: NBA Player looking for 10,000% ROI
« Reply #15 on: January 22, 2015, 08:16:39 AM »
I love how every athlete I read about invests in restaurants. Yeah, those are on the cutting edge and never seem to close every week.

To be fair a couple do okay.  Joe Theismann, the former Washington Redskins quarterback, has a restaurant/sports bar in Alexandria, VA that's been around for over twenty years.  The food is decent, too.  Former Miami Dolphins coach Don Shula has a small national chain of steakhouses. 

TreeTired

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Re: NBA Player looking for 10,000% ROI
« Reply #16 on: January 22, 2015, 08:43:45 AM »
I also couldn't read the entire article because it gave me a headache.

Quote
He just signed a five-year contract with the Knicks worth $124 million,

Let's see.... that is roughly   $24.8mm  per each and every year.     You would think a smart guy would put maybe 1 or 2 million aside per year as a safety net for later in life,  but I could see him going broke in a few years.   

MgoSam

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Re: NBA Player looking for 10,000% ROI
« Reply #17 on: January 22, 2015, 08:53:39 AM »
I also couldn't read the entire article because it gave me a headache.

Quote
He just signed a five-year contract with the Knicks worth $124 million,

Let's see.... that is roughly   $24.8mm  per each and every year.     You would think a smart guy would put maybe 1 or 2 million aside per year as a safety net for later in life,  but I could see him going broke in a few years.

$2M likely wouldn't be enough, I would think for most of these athletes. For them, it isn't so much about how much they have saved up in their post-playing funds, but what their level of expenses are. For example, for most on this site, $1M would be enough to retire off of, but a surgeon that makes $500,000, likely would need much more due to the fact that they spend more on average.

Timmmy

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Re: NBA Player looking for 10,000% ROI
« Reply #18 on: January 22, 2015, 12:18:58 PM »
I also couldn't read the entire article because it gave me a headache.

Quote
He just signed a five-year contract with the Knicks worth $124 million,

Let's see.... that is roughly   $24.8mm  per each and every year.     You would think a smart guy would put maybe 1 or 2 million aside per year as a safety net for later in life,  but I could see him going broke in a few years.

$2M likely wouldn't be enough, I would think for most of these athletes. For them, it isn't so much about how much they have saved up in their post-playing funds, but what their level of expenses are. For example, for most on this site, $1M would be enough to retire off of, but a surgeon that makes $500,000, likely would need much more due to the fact that they spend more on average.

The surgeon doesn't NEED more.  Virtually everyone has the ability to retire on less than a million.  It's a choice to inflate your lifestyle.

MgoSam

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Re: NBA Player looking for 10,000% ROI
« Reply #19 on: January 22, 2015, 12:45:25 PM »
I also couldn't read the entire article because it gave me a headache.

Quote
He just signed a five-year contract with the Knicks worth $124 million,

Let's see.... that is roughly   $24.8mm  per each and every year.     You would think a smart guy would put maybe 1 or 2 million aside per year as a safety net for later in life,  but I could see him going broke in a few years.

$2M likely wouldn't be enough, I would think for most of these athletes. For them, it isn't so much about how much they have saved up in their post-playing funds, but what their level of expenses are. For example, for most on this site, $1M would be enough to retire off of, but a surgeon that makes $500,000, likely would need much more due to the fact that they spend more on average.

The surgeon doesn't NEED more.  Virtually everyone has the ability to retire on less than a million.  It's a choice to inflate your lifestyle.

True!

Albert

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Re: NBA Player looking for 10,000% ROI
« Reply #20 on: January 22, 2015, 03:53:31 PM »
The surgeon doesn't NEED more.  Virtually everyone has the ability to retire on less than a million.  It's a choice to inflate your lifestyle.

Of courser, but AFTER you have inflated your lifestyle voluntary de-inflation is very difficult. It's easier not to over inflate in the first place. For pro athletes in major sports, however, even that is challenging because they get a lot of money at young age without having any previous life experience with serious $$$ or just emotional maturity.

eyePod

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Re: NBA Player looking for 10,000% ROI
« Reply #21 on: January 26, 2015, 09:25:34 AM »
I love how every athlete I read about invests in restaurants. Yeah, those are on the cutting edge and never seem to close every week.

To be fair a couple do okay.  Joe Theismann, the former Washington Redskins quarterback, has a restaurant/sports bar in Alexandria, VA that's been around for over twenty years.  The food is decent, too.  Former Miami Dolphins coach Don Shula has a small national chain of steakhouses.

I don't think that's being fair at all. Those are the exception!