Magic Johnson Reveals Purpose Behind $2.2B Investment Aimed at Higher Cause

Who would’ve thought skipping out on selling scones, sweet potato pie, and peach cobbler suckers could make you rich enough to buy the Dodgers? And not just buy them, but at a price higher than anyone’s ever paid for an MLB team. The man behind that flex? Magic Johnson. Sure, he made just $40 million in his NBA career, but today he sits on a $1.5 billion empire. His $25 million Lakers paycheck was nice, but his real game-changing wins came off the court.

Back in 1998, Magic Johnson made one of the boldest and smartest business moves of his career. He believed Starbucks could thrive in low-income neighborhoods and serve the Black community, but convincing Starbucks owner Howard Schultz wasn’t easy. So, Magic switched gears and brought a whole new pitch. “The hardest thing that I thought I was going to do was play against Larry Bird and Michael Jordan. The hardest thing was to go before the board…and try to convince them that this is a great move for Starbucks,” Magic has shared previously. And it worked—his first Starbucks opened that same year in Ladera Heights, Los Angeles. But the real deal came when he sold his Starbucks stores.

At Invest Fest 2025, Magic Johnson opened up about how his $2 billion Dodgers deal really came together. He explained, “We had a deal to make 125 Starbucks and we did that in 5-6 years. We were making so much money.” Johnson had customized his Starbucks stores for the Black community—switching up the menu, the aesthetics, and of course, the music—which made them a massive hit. Then came the big moment: “Howard came to me and said listen, we don’t have to wait these next four years, we’re making a lot of money, the multiples are already in the contract…” Magic sold his Starbucks stake and, as he put it, “who would ever thought that the Dodgers would be for sale, so I used the money that came back to me from the Starbucks sale and put it into the Dodger deal.”

In 2010, Magic Johnson cashed out of his Starbucks deal, selling his equity back to Howard Schultz for a reported $100 million. Just two years later, he joined Guggenheim Baseball Management and made headlines by buying the Los Angeles Dodgers for a jaw-dropping $2.2 billion. To put that into perspective, in 2012, the price was $600 million more than Forbes’ estimated value of the team—just $5 million shy of the average value of every MLB team combined at the time. And remember, this was for a struggling franchise playing in the league’s third-oldest ballpark. Fast forward to today, and as Magic proudly says, “Forbes just came out with the list, we’re valued at 7.5 billion.” ($6.9B, March 2025, Forbes).

Magic Johnson even slipped in a little investment advice while reflecting on his Dodgers deal. “Why did I do that, first of all there was no people of color being honored in Major League Baseball, that’s one reason. Second reason is, I’m buying the Dodgers. The Dodgers got the biggest brand…so I knew it was gonna be a home run.” For Magic, representation has always mattered just as much as money. Speaking on the EYL stage at Invest Fest 2025, he reminded everyone, “What is our biggest challenge is that we don’t have a seat at the table.” He explained that when someone from the community breaks through, it creates real influence and opportunity—because once you’re “at the table,” you have the power to shape decisions that impact your city and community.

So even though he didn’t make a “dime” from his investment in the WNBA team LA Sparks back in 2014, Magic never walked away. At Invest Fest, he recalled, “Now, we’ve owned the Sparks for a few years. We haven’t made a dime.” But for him, it was always bigger than money—holding onto the team and that patience has paid off. As of 2025, Forbes values the Sparks at $235 million with $16 million in revenue, placing them 8th among the league’s most valuable franchises.

Magic’s Winning Formula Off the Court

Magic Johnson swears by

what he calls his three-year rule for success. The idea is simple: whatever you’re chasing—whether it’s launching a business or hitting a major milestone—you should give yourself exactly three years to make it happen. “Everything you should go after should be three years…give yourself three years,” he says. And he makes it clear this isn’t a solo mission. His advice? Go home, sit down with your partner, and be upfront: “Honey, give me three years.” That’s exactly what he told Cookie—he needed three years on the road to build their business, and asked if she could handle the kids while he focused on the grind. Why three? Because if it takes longer, it usually means, in his words, “you haven’t put 150% into building this business.”

And when Magic talks about hustle, he’s not exaggerating—he lives it every single day. Just last month, he broke down the routine that keeps him sharp: in bed by 8 p.m., up by 4 a.m., two hours in the gym, and then straight into the office for a full day of work. It’s a grind most people wouldn’t sign up for, but for Magic, it’s second nature. “I’m driven. I don’t need nobody to pat me on the back, I’m self-motivated, so that plays in my favor,” he explained. That discipline isn’t new either—it’s been the foundation of his success for decades, fueling every move he’s made both on and off the court.

Magic’s first big investment came in 1994 when he bought a 4.5% stake in the Lakers for $10 million, later selling it in 2010 for about $28 million. From there, his empire kept growing—he joined Guggenheim Partners in 2012 to buy the Los Angeles Dodgers. In 2014, he added the WNBA’s Los Angeles Sparks, and by 2018, he was co-owner of MLS’s LAFC, which went on to win the MLS Cup in 2022. He even secured a stake in the NWSL’s Washington Spirit, showing his eye for diverse opportunities. But his boldest play came in 2023 when he dropped $240 million to join the $6 billion purchase of the NFL’s Washington Commanders—calling it, “the greatest deal I’ve ever done.”

And while his business ventures demand at least three years to blossom, funny enough, his basketball career took off instantly—he won a championship in his rookie season!