What Happens To An Ownership Dream Deferred? A Case Against Black Ownership Of The Carolina Panthers
Timing is everything.
Leonardo DaVinci said “nothing strengthens authority so much as silence.” We are at a point and time as a nation where silence in the face of assault is no longer muted, and certain actions are no longer being tolerated in certain spaces. Brave women and men are stepping up to name names, and call out those individuals in positions of power and influence. Harassers, sexual assault assailants, and men and women in positions of authority more broadly have been called to the carpet as justice is being demanded nationwide. There remains much to do, but for many, the latter part of 2017 will be viewed as a watershed moment in workplace accountability. If you’re an ethics lawyer or investigator, it’s probably shaping up to be a busy 2018.
On a Sunday afternoon in December news spread that Jerry Richardson, principal owner of the Carolina Panthers, who has owned the team since its inception in 1993 when the Panthers were selected as the NFL’s 29th franchise team, decided to place the team up for sale in the midst of an internal investigation into “workplace misconduct.” The rumor mill started swirling. In addition to lewd comments in the workplace, he may have also made some racist ones behind the scenes as well. Richardson, who was born in North Carolina in 1936 and lived through Jim Crow, was the type who preferred that the front office and players call him “Mister,” which while not well received privately, came to be widely accepted.
Power can be marked by one’s ability to create options. There is another part to it however, in how it transfers and reshapes; how it evolves. Who shapes the policy crafted in response to abuse of power? In many instances, that’s the truest marker of accountability. Those conversations behind closed doors are a different form of power, with a limited number of voices. These voices are typically not loud, but quiet; historically structured far too often in a way that ensures a soft landing spot for those who fall from grace. What happens to Board seats, how are severance packages structured after the accusations have been brought forth, and cases head to court?
When the news first hit of the Panthers sale, there were two immediate thoughts. The first was about Richardson’s exit strategy. These days, with an increase in the number of allegations of sexual assault and or ill advised behavior in the workplace, one might think it would behoove a man with nothing to hide and access to an entire communications team at his disposal, to craft a statement outwardly suggesting they were not guilty. Instead, the allegations surfaced and within 72 hours his team was placed up for sale, just like that. While it’s important to let the justice system play out, this looked like someone who was clearly ready to get out of dodge, comfortably.
The first time I saw anyone in a corporate setting let go it was after months of back and forth meetings with HR. When the time eventually came, they barely had time to grab their coat from their desk, let alone sell off their biggest asset. You hear all the time that when money launderers are being investigated, there may be a freeze on their accounts. Clearly no such lever exists in cases of harassment or assault unless it’s written into the clause, and that is where the options are exercised. That is what allows a Today Show co-anchor to apologize on a Monday, and then lawyer up in an attempt to collect the money they believe they’re contractually owed that following day. It usually always comes down to money, making it very apparent that there are rules for them, and then there are rules in place that are enforced for everyone else. Most times it pays, literally and figuratively, to be in the rules writing business. Don’t believe me? Just ask the US Senate.
the net worth of US born Black Boston residents was less than the cost of lunch, meanwhile for white residents it averaged over $200,000
The second reflection on the Panthers sale was directed towards Black folks, specifically those (the few) who have access to capital. It was a plea imploring them to not jump at the opportunity to own an NFL franchise, and to consider where those resources, that capital, might be better allocated. It was also of the belief that the timing might be less than ideal. Particular considerations were paid towards understanding (in no particular order) current CTE trauma research, TV contract rights & renewals, stadium operating costs relative to fan attendance, youth football stats, and leadership itself within the National Football League. I hit publish on the Instagram story post later that afternoon. By that evening, the Twitterverse was alive with thought pieces on what Sean Comb’s ownership of the Carolina Panthers might mean for the future of everyone, everywhere.
To put a context around why someone would ask that we rethink living out most people’s childhood dream of owning a major sports franchise, it’s important to understand two parts: the historic lack of access to capital for Black and brown communities, and the future outlook of the NFL as a franchise. The gap between Black wealth and white wealth has been written about substantially. Economists like Sandy Darity and Darrick Hamilton have coined language around the field itself; stratification economics. Just last week a stunning Boston Globe report was issued suggesting the net worth of US born Black Boston residents was less than the cost of lunch, meanwhile for white residents it averaged over $200,000. This report was based off findings from a 2015 assessment through the Boston Federal Reserve on inequitable levels of wealth in and around Boston. That Federal Reserve piece was so controversial, the Boston Globe had to publish another piece informing their readers that this was not in fact a typo. Inequity is a way of life for Black communities in America, or so it would seem.
While those numbers may be alarming, they are not particularly relevant when it comes to looking at ownership of an NFL franchise team. That requires looking at the other end of the spectrum, access to wealth and capital. In 2012 the Cleveland Browns franchise sold for 1B. In 2014, the Buffalo Bills were acquired for 1.4B. That’s not exactly something one could walk off the street and acquire. In 2014 Credit Suisse issued a report titled “wealth patterns among the top 5% of African Americans.” The study was done in conjunction with Brandeis University’s Institute on Assets and Social Policy, a research institute that “advances economic opportunity and equity for individuals and families, particularly households of color and those kept out of the economic mainstream.” Side note: for everyone who says Black folks just need to “get over” systemic inequity and economics, there’s clearly enough of a body of research to study that a University created an entire institute around it.
The Credit Suisse study focused on a particular subset of wealthy African-Americans defined as “(financial and non financial assets minus debt) of at least $357k.” The report found that the 95th percentile or, the top 5% of African-Americans, has a net worth of at least $357k and on average just over $1 million. This amount, when compared to white wealth amongst the top 5%, is equal to approximately the 72nd percentile in the wealth distribution for white households.
Now just stop, and reread that sentence again.
the top 5% of Blacks fall somewhere at the 72nd percentile of white wealth
Amongst the top 5% of earners based on race, the top 5% of Blacks (having somewhere between $357K and $1 M) falls somewhere at the 72nd percentile of white wealth. Visualize what that actually means. For those who need some assistance, comedian Chris Rock has a story to tell you about his neighbors. In this set, he talks about living in Alpine New Jersey, and knowing the other four Black people in his neighborhood. Two are sports Hall Of Famers, one is one of the top R&B singers of all time, and himself, a “decent comedian.” The white guy who lived next door to him is a dentist. Chris Rock is deemed to be the pinnacle of Black success, and yet the neighbor next door didn’t invent anything, he simply practiced dentistry. I cite this joke at least once a year, because sometimes the funniest comedy is the God’s honest truth. Later in my career I met a white coworker who (unsolicited) went on to tell me they had lived next door to Mary J Blige. I discovered their dad was an architect.
In short, we’re not on equitable footing. According to the same report, the gap is tied to things like income, overall asset value, business ownership, investment portfolio, education, and inheritance structure. Over several generations, and with a head start that could be associated with over 400 years of free labor and federal policy, that advantage became codified, and it compounded.
If you speak with the folks that structure mergers and acquisitions for a living, the gap in access to capital is widely known. While the days of one individual being willing to shell out the entire cost of an entire team sale term sheet may be waning, there’s still a concentration of wealth in white hands that makes coming in on the same deal flow inherently more challenging for African American owners seeking majority control. This isn’t limited to just Black celebrities, this includes Black senior executives and investment bankers who, because of a historic lack of access to capital and accruing of wealth generationally, are forced to go in eight or more for a deal because they cannot take on that risk as individuals.
This also explains why one of the takeaways from that Credit Suisse report was a greater predisposition for those considered to have Black wealth to be conservative with their investment choices. When you understand the barriers to your level of wealth, you also have a tendency to be more risk averse in your investment portfolio. This does not overall hold true in the same way for white individuals in the study who have amassed a greater safety net, some over generations.
Anytime a deal is being assessed it’s also important to think of the return on the initial investment which brings us to another consideration; timing. Putting it plainly, owning a sports franchise is a risk. Owning an NFL franchise in 2017; a time of Kaepernick kneeling controversy, lower attendance rates, declining ratings, backlash over modern stadium tax incentives, and concern over CTE head trauma, is an even greater risk. One of those factors alone is enough to cause concern, the confluence however could be disastrous.
These moments serve as a reminder that we should work at being better with critiques grounded in love
I cannot recall how I reacted to the proclamation on Twitter from Sean Combs aka Diddy aka Love, but my head hitting my desk likely followed it. We have an example of the celebrity Black wealth, accrued largely due to Diddy’s Ciroc ownership stake, and this is the hill we’re willing to die on? At a time when franchise teams are selling for record rates, and the buy in is astronomical. And all this after a season where we established the National Football League loved our money but not our humanity, and our reaction is to run into the burning building we just collectively decided we needed to leave? How? And more importantly, why?
Since Diddy’s announcement, both Steph Curry and Colin Kaepernick have made announcements via social media they’re interested in exploring an ownership pool for a majority stake in the Panthers. Regardless of who ends up in this pool, Obama could end up in this pool; there should still be questions. At a time when those perceived to be the wealthiest among us step up to speak on behalf of a group of us, there needs to be space for Black critique. It’s fitting that earlier that same day, Cornell West went after Ta-Nehisi Coates in what turned out to be an academic Twitter fingers feud that felt more Tupac & Biggie, than constructively driving valid critiques based on the work. These moments serve as a reminder that we should work at being better with critiques grounded in love. Maybe reality television has numbed our sensitivities to this possibility, and we go straight for the neck these days, truthfully we know this started long before that. But if we’re serious about creating our Wakanda like we say we are, we need to do the work of reconciling what may be possible, and call out our areas where we may be short sighted. Every Black person doesn’t understand all of Black history, and admitting that outwardly would do us better than just pretending we are all domain experts. How can we create safer spaces to learn in public? Consider this a team huddle.
The purpose of ownership shouldn’t be to recreate a white standard as a Black person. Instead, how can we think critically about what that opportunity, what that responsibility means, and act accordingly? The ability to own a team, is in a way like being in on part of a monopoly. NFL teams are scarce, and while some are relocating, more are not actively being produced. An opening would create a hole through which anyone would wish to jump. Add to this conversation the reality and role of masculinity in sports, peers encouraging you, and the belief of ownership becomes palpable; it’s the ultimate hype trifecta.
The purpose of ownership shouldn’t be to recreate a white standard as a Black person.
For a greater understanding of profitability, and how the NFL generates revenues, look at their franchise structure. Much of their revenue is driven by TV deals, sponsorships, and ticket sales. A portion of that is taxed through an intricate (and controversial) NFL tax structure, and some revenue gets split amongst the franchise teams. Now there is a lot to unpack, and I don’t profess to be someone who studies NFL revenue streams particularly closely, but there are two elements which should be looked at more carefully.
The first element is attendance. League attendance has seen some sharp declines this season at certain venues. Interestingly, while television and streaming rights have opened up the NFL to a wider audience, one wonders whether this digital expansion has come at the cost of attendance rates at stadiums. Lavish state of the art NFL stadium costs have been on the rise, with the taxpayers incurring a fair amount of the brunt. Those costs find their way reflected in things such as concession prices. Sure, there are alternative models sprouting up around concessions; the new Falcons stadium for example sells $5 beer, made possible because more expensive stadium seating arrangements offset the cost of the food. Flexibility with how a franchise handles ticket and concession sales impacts how much of that revenue they get to keep. But getting back to the timing piece, this begs the question if ticket sales decline, how does this affect the financial model and expected ROI overall? Digital streaming rights are not immune either with younger audiences catching highlights on social media, and the proliferation of “chord cutters,” opting to cancel their cable TV packages altogether.
The other consideration, arguably a bigger consideration this season, is leadership. As of last week, NFL Comissioner Roger Goodell’s contract was renewed through 2024, at a cost of $200M. It should come as no surprise that Roger Goodell is not loved. In addition to getting booed regularly at Super Bowl trophy ceremonies, he’s also sat in the unenviable spot trying to address free speech stipulations in the NFL, and stadium politics and policy around the National Anthem. Goodell has been a point of contention for fans and owners alike. Few team owners expressed more disdain at the potential contract extension of Goodell than Cowboys owner Jerry Jones. The Cowboys roster has been directly impacted by player sanctions handed down by Goodell, and Jerry Jones has continued to voice his frustration. However, with the contract extension approved, regardless of who the new owner would be, little will be done to change how the NFL manages itself, at least not internally.
This all begs the ultimate question: what changes if there is a team with majority Black leadership? If we’re honest about the answer, the reality is, not much. First, it’s going to cost new owners…a lot. The owners vote together and so absent winning over a majority in that room, there is still the reality for individual owners to be down-voted on individual resolutions (as Jerry Jones was in his pursuit against extending Roger Goodell’s contract). Add to that the reality many team owners are conservative and septuagenarians, and you could see why taking suggestions from younger Black owners isn’t high on their list of things to do. There is also the reality that in an attempt to have a “face” of the ownership, the NFL requires a team be lead by an individual with at least a 30% ownership stake in a team. Sure, there may be an opportunity to bring in additional sponsorships (Ciroc VIP lounges anyone?), but to what end? In an age where there’s increased awareness of the systemic limitations impacting communities of color, this feels like the equivalent of refinancing your home to buy Bitcoin right now. Sure, you can technically do it, but should you is another conversation entirely.
We talk about skating to where the puck is heading, to where the opportunities lie, but few talk about the consistency of the ice we’re skating on. That ice is thin.
These days, the “Black agenda,” if there is such a thing, feels directionless. As if the state of politics is divorced from the economic needs, which are divorced from individual community needs, which are divorced from issues celebrity influencers choose to address. Somebody can read one chapter of Baldwin, or a few articles online, and then they’re an expert on where we as a collective need to go. It doesn’t work like that, nor should it. Meanwhile, as we sort out the nuance of what it means to not be a monolithic group, those in opposition gather on social media, shout racist tropes, bring up America’s racialized and oppressive history, and rally thousands in opposition to our very existence.
The reality is our collective attention spans as a society are decreasing, our reliance on technology is increasing, and our ability to think critically and to contextualize historical truths while holding two opposing thoughts appears to be waning. This applies to all people, but at a time when the tightrope we walk in terms of access to capital is so tight, it affects the Black community more directly. We don’t have reserves. We talk about skating to where the puck is heading, to where the opportunities lie, but few talk about the consistency of the ice we’re skating on. That ice is thin. That is why when it comes to the direction we go in, lead by those who have amassed the capital, it’s important that the conversation not be an isolated one, context matters.
So what is the answer? In reality, there is no easy answer. It takes time, direction, and continued active conversation on a way forward. Sometimes one answer can be found in thinking and acting locally. You don’t need a Masters degree in public policy to understand the current administration’s policies are negatively affecting Black communities. According to the 2010 census, Charlotte was 35% Black, and just last month Vi Lyles was elected mayor of Charlotte on a platform to improve relationships with police, develop more affordable housing, and increase opportunities in low income communities. That can be a starting point for the community. There remains work to be done on the ground in Charlotte, and perhaps having a majority Black investment vehicle could lead to greater opportunities for economic improvement. Longstanding research on the subject of stadiums suggests that stadiums do not spur the economic growth they’re believed to, largely because of the extractive tax incentives to construct stadiums in the first place. Perhaps an investment vehicle more generally could be created, or supplement existing investment vehicles, to identify ways to uplift businesses in the community, or invest in a way that helps uplift the community, while helping the Black majority owners as well.
When it comes to investments in infrastructure that end up going unused, one only needs to google what happens to Olympic Stadiums to realize leaving communities with empty stadiums for the purpose of relocating for tax incentives often doesn’t turn out well. Perhaps the sports investment opportunity can be in the other futbol arena; soccer. At a time when soccer stadiums are less expensive to construct and US Men’s National soccer is struggling, there are a lot of initiatives seeking to level the playing field and provide avenues for young, diverse, talented players (particularly of color) to get involved. That can be an opportunity for Black owners to send a message not just locally, but to the world.
Another recommendation is a simpler solution; more Black women. Whether in the rooms where decisions are being made, at the board table, in owners groups, Black women add an important voice to the conversation. It’s telling in the movie ‘Hidden Figures,’ that Katharine Johnson, Dorothy Vaughan, and Mary Jackson were more preoccupied with building solutions than gaining recognition as “firsts.” Many would not go on to get recognized until later in life. So if it comes down to talking about the moves needing to be made, or making them, there’s a lesson to be learned from what some Black women have historically done, and what their outcomes have contributed to.
Perhaps the answer may also lie in thinking about an alternative model of ownership. While it’s a company mired in controversy right now, Uber presented a model that caused the entire Taxi & Limousine commission to rethink its strategy. At one point medallions sold for millions, and the next day, they were rendered unnecessary. If there’s any lesson to be learned under the current administration, it’s that nothing is sacred. For all the reasons that’s tremendously troubling, it can also serve as an opportunity. When sports groups consider themselves too big to fail, when they elect comfort and familiar leadership over the substantive changes members of the public, particularly in the black community, are demanding, perhaps there’s an opportunity to build a different model. The thing about monopolies is they didn’t get that way by chance, they got there by design. What does better design look like?
The state motto for North Carolina is “Esse Quam Videri,” Latin for “to be, rather than to seem.” As a community, let us focus on what we’re being, and doing, not simply what we appear to be or appear to do. That does not mean it will be easy but perhaps, with a few more offline conversations, we can build a better roadmap of Wakanda for us. Hopefully, if done right, and with love, we will all be better for it.