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Here's the story of how I came to own a piece of the @warriors.
In 2011, I was 34 and had left $FB to start @socialcapital. When I was raising my first fund, I spoke to @peterthiel about investing. He asked me how much I planned to invest as the founder and only keyman. https://twitter.com/darrenrovell/status/1351160767769436165
In 2011, I was 34 and had left $FB to start @socialcapital. When I was raising my first fund, I spoke to @peterthiel about investing. He asked me how much I planned to invest as the founder and only keyman. https://twitter.com/darrenrovell/status/1351160767769436165
I told him that I planned to put in $20M. He laughed and said, triple it and I'm in. I wanted Peter to invest and be an LP so I did.
The first fund was $275M so $60M ended up being 22% of the capital. But it was a masterstroke of luck:
It gave me control.
The first fund was $275M so $60M ended up being 22% of the capital. But it was a masterstroke of luck:
It gave me control.
1. I defined my carry: 30% and never changed it
2. I defined the terms of fund1 and every subsequent fund and never changed it.
3. I realized that I would have to invest $60M in every subsequent fund and may not see distributions for years so...i needed a hedge!
2. I defined the terms of fund1 and every subsequent fund and never changed it.
3. I realized that I would have to invest $60M in every subsequent fund and may not see distributions for years so...i needed a hedge!
I was looking for the most uncorrelated asset possible and in 2011, from what I knew, I thought sports was the best bet.
I was friends with a well known hedge fund manager and I called him to sound out the idea.
He told me: this is brilliant...let's buy an NBA team together.
I was friends with a well known hedge fund manager and I called him to sound out the idea.
He told me: this is brilliant...let's buy an NBA team together.
We flew to NY and approached Allen&Co to be our banker and broach a meeting with the then commissioner, David Stern.
Specifically, we had our eye on the Sacramento Kings with the goal of moving them to either Seattle or Las Vegas.
Specifically, we had our eye on the Sacramento Kings with the goal of moving them to either Seattle or Las Vegas.
The meeting rolls around and Stern sits and listens patiently about our ideas and desire to buy the Kings. At the end of our monologue, he asks one simple question:
"How much do you think the team is worth?"
We answer and float an admittedly low number (less than $300M).
"How much do you think the team is worth?"
We answer and float an admittedly low number (less than $300M).
He looks around, slams his fists on the table and says:
"Then you're in the wrong fucking meeting!"
My friend and I fly home dejected. I'm now all-in on venture capital with no diversification to speak of and 100% anxiety ridden.
When I land, I call my friend @phil_hellmuth.
"Then you're in the wrong fucking meeting!"
My friend and I fly home dejected. I'm now all-in on venture capital with no diversification to speak of and 100% anxiety ridden.
When I land, I call my friend @phil_hellmuth.
He listens to my sob story and says, hey, let's go and have some pizza and watch basketball with my friend Joe Lacob.
So the next day, a Saturday, we go to Joe's house to eat pizza and watch some basketball.
At the end of the pizza, he tells me that he's close to buying GSW.
So the next day, a Saturday, we go to Joe's house to eat pizza and watch some basketball.
At the end of the pizza, he tells me that he's close to buying GSW.
At the time, the news was that Larry Ellison was going to buy the team and I didn't think it likely that Joe would win the bid.
But he was confident and says to me: "I have 10% of the team you can buy for $25M if you want to join our bid."
But he was confident and says to me: "I have 10% of the team you can buy for $25M if you want to join our bid."
I shook his hand, wired the money and at 34, became a co-owner of an NBA team. Pretty nuts!
Joe's obviously done an amazing job building the best franchise in sports and I've been extraordinarily lucky to be along for the ride.
It's given me so much joy and happiness.
Joe's obviously done an amazing job building the best franchise in sports and I've been extraordinarily lucky to be along for the ride.
It's given me so much joy and happiness.
And it all started because Peter Thiel pushed me to invest more in myself, David Stern deflated my dreams of diversification and Phil Hellmuth was just a good friend who wanted to cheer me up.
Crazy how life works sometimes.
Crazy how life works sometimes.
