Brother, Can You Get ROI on $100 Million?

A pre-pandemic investment in LeBron’s SpringHill makes headlines. Finding a return in a post-coronavirus world is a different game.

Kudos to Bloomberg, and to New York Bureau Chief Jason Kelly (who also writes #longform, I guess?). This morning they went viral with a press-release-as-journalism feature on investment, past successes and future plans for LeBron James’s SpringHill company.

Such articles are catnip for media outlets starved of Actual News. If your beat is sports, entertainment or finance, not much is happening. Money is tight, games aren’t being played, movies & series aren’t being shot. What a perfect time to talk about the King and his empire.

To keep the Worldwide Reader societally compliant, LeBron and business partner Maverick Carter must be complimented. They come from humble roots. They are successes beyond anyone’s expectation. Their taste for the mood of the media is impeccable.

(In fact, the Reader would even argue that the notorious ‘The Decision’ was genius. Bloomberg calls it a mistake, but any seasoned pro wrestling observer knows of the thin line between love and hate.)

Unsaid in Bloomberg’s article (or in any of the other countless re-blogs of which the Reader is aware) is that a pre-pandemic media company now has $100 million to spend in a post-pandemic world.

To paint it with a fine-tipped brush, SpringHill is and always has been focused on goodwill and sponsorships, not excellence and transactions.

Critical praise pours in for ‘The Shop’, ‘Shut Up and Dribble’ and other social justice-focused content. Audiences remain scant, and their relationships to HBO and Showtime subscription growth are dubious at best.

General audience productions such as ‘The Wall’ and ‘Space Jam 2’ are far from critical darlings, which is fine. Nobody gives awards to ‘Black-ish’, but it remains a huge earner for ABC Studios and its producers.

The problem for SpringHill’s more accessible fare is the ongoing advertising collapse. NBC paid SpringHill for ‘The Wall’ because marketers were willing to pay NBC to advertise during the show. ShapChat made deals with SpringHill for the same reason. Many — perhaps most — of those ad dollars have evaporated.

The post-coronavirus entertainment game looks increasingly transactional. “Will people pay for this?” is the quintessential question. (Shout out to Peter Vecsey for that last line.)

If ‘Space Jam 2’ sells tickets, LeBron is golden. If SpringHill develops the next successful black sitcom, they will succeed. Netflix and Amazon Studios want high concept game shows. That helps.

The all-time success story of private equity in Hollywood was Legendary Pictures. Thomas Tull rounded up a ton of money, helped finance some huge box office hits (the ‘Hangover’ and ‘Dark Knight’ trilogies, among others), and sold to the Wanda Group out of China for $3.5 billion.

The investment in SpringHill is much smaller, but the goal remains the same: produce hits. Only now, critical praise and free-to-air eyeballs won’t be enough. For their investors to receive the return they are hoping for, LeBron & Mav will need to make stuff that people will pay for.


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