A thrilling inaugural Wharton Sports Business Summit concluded on Friday, November 3rd, with Josh Harris as the keynote speaker. Mr. Harris is currently the Managing Partner of the Philadelphia 76ers, New Jersey Devils, General Partner of Crystal Palace F.C. of the English Premier League. Mr. Harris provided a fantastic overview of his sport investment opportunities, the process of running an organization, and his advice for attendees to get involved in sports business. Mr. Harris began his talk by highlighting his love for the 76ers as the spark for his interest in owning the team. Mr. Harris grew up in Philadelphia, and most of his family is from the city as well. Mr. Harris graduated from the Wharton School in 1986. During his youth, he idolized Moses Malone and Dr. J, and envisioned himself as a part of the organization one day. In 2010, when the previous owner of the 76ers was quietly preparing to sell the team, Mr. Harris seized the opportunity to buy the team he loved. Mr. Harris spearheaded a team from Apollo Global Management and bought the 76ers for $280 million in July of 2011. The acquisition of the Sixers closely resembled the process of acquisition Mr. Harris had executed during his time at Apollo in acquiring other companies. Following the lockout, the Sixers were valued relatively low, which presented a great opportunity for investment.
Mr. Harris then moved to explaining the complexities of owning a professional sports franchise. He highlighted media scrutiny as particularly tough while noting sports are like religion in the United States. Mr. Harris stated he stresses to his organization to take their own independent view of success and not let the media affect them. In terms of crafting the team, Mr. Harris noted that the ability to affect change takes time. The Process, which has become enthralling recently, has taken 4-5 seasons to execute, with each season resulting in one high draft pick. Mr. Harris stressed the idea behind The Process was that organizational success must be built from the ground up with a strong foundation. He complimented his basketball operations team for executing this plan that is showing signs of success in the beginning of the current NBA season.
Mr. Harris and his partners enjoyed running the 76ers so much so they yearned to acquire another sports franchise. In August of 2013, they acquired the New Jersey Devils for $320 million. Mr. Harris highlighted the proximity of Newark to the New York Media Market and his familiarity with the city of Newark (where his father grew up). Mr. Harris and his partners helped the Devils and Prudential Center stave off bankruptcy with their investment in the franchise.
Beyond the 76ers and Devils, Apollo Management also runs Crystal Palace of the Premier League. Mr. Harris highlighted the vast differences between English soccer and American Sports, especially the non-existence of a salary cap. In a moment that brought out laughter among the audience, Mr. Harris explained “Here, if you lose, they boo you. There, if you lose, they kill you”. Mr. Harris explained that due to the relegation/promotion reality in the Premier League, each game has major consequence. Relegation from the Premier League results in major losses in revenue, thus it is essential to win in the short term. Mr. Harris also noted the major talent gap between smaller teams like his and the major teams such Manchester United and Chelsea. The bigger teams have global brands that bring in large revenues streams, thus leading Mr. Harris to note his goal of increasing Crystal Palace’s own global brand.
Beyond the well-known sports, Mr. Harris has begun investing in E-Sports, which he calls a “lottery ticket”. He explained that 350 million people watch E-Sports leagues even in its infant stages. Mr. Harris tempered his enthusiasm about E-sports, but it was obvious he sees enormous potential.
Mr. Harris concluded his talk by offering advice to current students interested in getting involved in the sports business. He stressed the importance of demonstrated excellence to a craft or many crafts as a trait his company looks for in future employees. Mr. Harris’ talk helped open eyes for the sports fanatics in attendance. There are few people in the world other than Mr. Harris that can truly describe what it takes to run a professional sports organization. It was a fitting conclusion to a day that featured so many brilliant minds from the sports industry.
USBC Journal Writer
Class of 2021