Golden State is in the NBA Finals for the sixth time since 2015 and seeking its fourth championship with the cast of stars that includes Klay Thompson.getty images
The Golden State Warriors returned to the NBA Finals as a different organization than the one that last played on this stage three years ago.
Gone are the days of being depicted merely as an innovative professional sports franchise. Finishing their third year in the sparkling Chase Center, they have now cemented themselves as a fast-growing, robust sports and entertainment company — one that sources say is projected to generate more than $800 million in total revenue, an NBA record, during the 2021-22 season. Sources say that marks a more than 50% increase since the 2018-19 season, the final for the team at Oracle Arena.
How they became a revenue-generating machine is a testament to the envelope-pushing vision espoused by co-owners Peter Guber and Joe Lacob, as well as the influence of Rick Welts, the former team president and chief operating officer who retired after last season. The Warriors say it is also attributed to securing value-aligned partners in Silicon Valley, and beyond, to drive new revenue streams; striving to enhance the fan experience for more than 60 million of their social media followers globally; and using the opening of Chase Center, not as a finish line, but as an accelerator for innovation.
“Chase Center, you build this $2.1 billion project and some people would go, ‘OK, we did it,’ and you sit back,’” said Brandon Schneider, Warriors president and chief operating officer, referencing the arena and adjacent development. “But like, I’m on the edge of my seat right now talking to you, and Joe and Peter, that’s who they are. Some people want to work for companies where it’s like, ‘We accomplished something. Now we can relax.’ That’s not who we are.”
The team’s revenue now encompasses traditional areas such as corporate partnerships, ticketing, premium seating and media, as well as its concert and special events business, and new ventures such as its upstart content creation company and venture into the NFT market.
The Warriors’ Brandon Schneider said despite growth, “we’re in the first quarter.”Golden State Warriors
Golden State executives talk about how as little as eight years ago, they had roughly 120 employees. Now there are close to 500. They talk about how as recently as three years ago they were a basketball team that rented an aging venue (Oracle Arena) in Oakland. Now they are a thriving sports, media, entertainment and technology company.
It’s an organization in which strategic risk-taking isn’t just encouraged, it’s required. One of the many Guber-isms is, “If you’re not failing, you’re not trying.” One of the pillars of their internal-facing core values is, “We are changing the game with innovation.” And they say their vision is captured in four letters: BHAG (big, hairy, audacious goal).
While never losing sight of the centerpiece — a basketball team seeking its fourth NBA title since 2015 — they strive to leverage the strength of that vastly popular brand, enabled by technology, to become global leaders in experiences and entertainment. They use their success as a basketball organization to pave a pathway into adjacent businesses.
Ask Schneider if a blueprint even exists for these grand aspirations and he’ll smile, thinking of what Lacob has long said: “Disney started as a theme park and look at where they are now.”
“It’s a really good [blueprint] because, for us, the theme park is the basketball team — that is always going to be the center of what we do,” Schneider said. “If we are successful over time, you’re going to see that expand quite a bit. We’re in the first quarter.”
And they’ve jumped out to an early lead — innovation exists in virtually all corners of the organization.
There’s the G League, where they were among the first NBA teams to purchase a franchise, what became the Santa Cruz Warriors, in 2011; executives said that was the first G League team to be profitable. There’s the foray into esports with the Golden Guardians, a League of Legends team. There is Wi-Fi 6 in Chase Center and Verizon activating its millimeter wave-based 5G network.
Because the Warriors own and operate Chase Center, it enables them to control the fan experience through every touchpoint, including how best to deploy technology. The Warriors + Chase Center mobile app — designed by their technology innovation partner Accenture — is a particular point of pride. And the quest for perfection continues; it has already undergone 50 updates since its launch. In total, it has seen 2 million downloads, 120,000 monthly active users and, over the last year, a 64% increase in new users.
“They are obsessed with the fan experience,” said Donna Daniels, a former HBSE and longtime NBA executive who will begin her duties as general manager of Chase Center on June 20. “It is truly amazing to be able to do anything on that app, from prepaid parking to understanding where they may be in the arena, and at any given point wanting something and understanding how long it may take to get there, a glass of wine or whatever.”
The team synthesizes fan data after every Chase Center event.getty images
Enhancing the fan experience can’t be achieved without a commitment to data and analytics. With the Warriors, the analytics team synthesizes fan data after every Chase Center event. It is then sent to the top 90 people within the organization, including some on the basketball side. Team partner Google Cloud powers an enormous data warehouse that enables the Warriors to know the tastes and habits of their fans.
Then there are big projects that further differentiate the Warriors.
Last year, the Warriors became the first team in sports to execute an NFT drop with a collection that included various editions of the team’s NBA championship rings and commemorative ticket stubs. They hold the record for all-time highest sports NFT sale ($871,591.27), and sales from the first drop alone surpassed $2 million.
Then last December came what was billed as a first-of-its-kind cryptocurrency partnership in professional sports between the Warriors and FTX, a U.S.-regulated crypto exchange. This marked the first international rights partner for the Warriors; the NBA announced in 2019 that teams could sign international deals. CNBC reported that FTX would pay the Warriors $10 million.
In February, the Warriors relaunched SuiteXchange, an online resale marketplace for Chase Center suite owners to sell single-event access to their suites. After originally launching in 2019, it is back with upgrades through the team’s partnership with digital experience platform Arc XP. While they primarily built it for customers of Chase Center, they are now in talks with other teams that may want to use the marketplace. The Warriors are the only team using the marketplace, but Schneider believes it could become the StubHub of suites.
And in April the Warriors launched Golden State Entertainment, a vertical that will create original content to tell compelling stories both in and out of sports. Producing documentaries, collaborating with recording artists and hosting culturally relevant events are all on the horizon.
In an example of cross-pollination culture permeating throughout the organization, former recording artist David Kelly will lead the venture as GSE’s chief business officer. But Kelly will also keep his day job — serving as the Warriors’ chief legal officer.
Project ideas also originate from a wide array of sources. The initial idea to dive into NFTs early last year came from David Fatoki, the general manager of the Santa Cruz Warriors, who urged the Warriors to move on it at a time when even some top-level executives were still murky on the space.
Overall, it has been a dizzying ascension for the organization, with the emphasis on innovation only intensifying in recent years. The days of being typecast as just a championship-level basketball team are long over.
What’s next? When it comes to innovation, a popular Guber-ism is that the organization is at the “beginning of the beginning.” In response, some minority investors have begun joking with him, saying, “Peter, when are we going to get to the middle of the beginning or the beginning of the middle?”
“The answer,” Schneider said, “is never. It is a frame of mind.”