Podcast Summary: The a16z Show

Episode: How Magic Johnson Built a Billion-Dollar Portfolio in 30 Years
Date: February 11, 2026
Host: Chris Dixon (Andreessen Horowitz)
Guest: Magic Johnson

Overview

This episode dives deep into Magic Johnson’s remarkable transformation from NBA champion to billionaire entrepreneur. Chris Dixon and Magic Johnson discuss the lessons, relationships, deals (won and lost), and guiding philosophies behind Magic's decades-spanning business empire—covering sports investments, real estate, technology (particularly venture capital), and Magic's unique approach to partnerships, risk, and long-term value creation. The conversation is candid, insightful, and full of practical advice for athletes, entertainers, and aspiring investors.

Key Discussion Points & Insights

1. Early Business Education and Mentorship

• Magic credits both Dr. Jerry Buss (former Lakers owner) and Michael Ovitz (legendary dealmaker) for his introduction to business.
• Story of Persistence: When Magic first sought a meeting with Ovitz, he waited hours only to be turned away—Ovitz challenging his seriousness. After "passing the test" (literally), Magic gained a mentor who taught him deal-making and networking at the highest levels.
  • Quote: “He taught me so much. Not just about business. Yes. The art of deal making. And also making sure you have a long and big Rolodex.” (Magic Johnson, 08:00)

2. The Power of Relationships & Networking

• Magic emphasizes the importance of cultivating genuine, long-term relationships before business is even on the table.
  • Example: Knew Ron Burkle (Yucaipa) for 10 years before their first deal.
  • Building a strong network often means going to “breakfasts and dinners you might not want to attend…because those places are where the deal makers are.” (Magic Johnson, 15:24)
• Quote: “You might not need the people today, but you may need them tomorrow.” (Magic Johnson, 07:18)

3. Diverse Portfolio & Investing in “Unsexy” Sectors

• Magic chose to invest in overlooked or “boring” businesses (Starbucks stores in diverse urban markets, insurance, infrastructure) that offered stability and long-term growth rather than trend-driven volatility.
  • Quote: “There was nothing sexy about anything that I invested in…. But the ones that are boring and people don’t know about or care about, those are the ones who are on a consistent making money or going up, you have growth.” (Magic Johnson, 14:10)
• Strong focus on understanding every sector he enters – always learning from partners.

4. Getting into Venture Capital & Silicon Valley

• Magic’s entry into VC was driven by curiosity about tech’s potential, seeing capital shift toward Silicon Valley, and direct encouragement from Chris and Ben Horowitz.
  • First Major Deal: Skydio (autonomous drones, 19:00) – early investment that gave Magic “a track record in Silicon Valley.”
  • Importance of timing, partners, and being “way ahead of the curve.”
• Approach to Founders: Looks for products/services not yet in the market, strong growth potential, founder “skin in the game,” and ways he can add value beyond a check.
  • Quote: “Can we bring added value?...Being Magic Johnson, all the things that we have in our toolbox…” (Magic Johnson, 23:15)

5. Equity vs. Endorsements: A Paradigm Shift for Athletes and Entertainers

• Magic and Chris discuss the cultural shift—athletes, actors, musicians now routinely seeking equity, not just endorsements.
  • Magic recalls the Nike deal that got away (stock would now be worth over $1 billion, 29:26) as a classic lesson.
• Emphasis on education: athletes/entertainers must learn about equity, long-term investing, and sometimes writing their own checks to get “skin in the game.”
  • Quote: “Don’t be afraid to partner. See, that myth—we got to get rid of that myth that you gotta be the only one.” (Magic Johnson, 62:05)
  • Quote: “Stay ready, so you don’t got to get ready.” (Chris Dixon, 60:10)

6. Building the Right Team

• A recurring lesson: Success comes from assembling—and empowering—a team of experts.
  • “Get people who are smarter than yourself, get the right people and always pay them, and then let them do their thing.” (Magic Johnson, 00:00 and 26:13)
  • Encourages next-gen talent to seek guidance, be coachable, and surround themselves with people who will say “no” when necessary.

7. Risk, Growth, and Missing Out (Miscalculations & Lessons Learned)

• Magic candidly discusses the deals that “got away" (e.g., early Nike stock, Uber, and more)—but emphasizes learning, moving forward, and resilience.
  • “What I have is what I’m supposed to have. And…being 66 now…I can see deals different today. And better.” (Magic Johnson, 30:32)

8. Investing Trends: AI, Blockchain, and the Future

• Magic believes the next wave of tech (AI, blockchain) will enable individuals to build massive businesses and transform sectors like healthcare (Alchemy Health, Function Health as portfolio examples).
  • Key tip: Look at who’s leading the round and their track record before investing (“that’s gonna tell you everything you need to know”—Magic Johnson, 37:38).

9. Sports Ownership as an Asset Class

• Explains the rationale (“no one’s ever going to stop watching sports in America”) and the massive value appreciation in teams he’s co-owned (Dodgers, Lakers, Commanders, LAFC, Sparks).
  • Example: Dodgers’ value increased from $2.2 to $8 billion; Lakers from $65 million to $10 billion (43:40).
  • WNBA and women's sports: Early bets are now paying off, and women athletes are becoming business leaders in their own right.
• Key driver for team growth: Not being afraid to spend to improve player development, analytics, fan experience, and stadiums. “You gotta spend money in order to make money.” (Magic Johnson, 48:19)

10. The Importance of Identity and Playing to Win

• Every business/team needs an identity that people (fans, employees, partners) can buy into.
• Culture of winning, taking risks, and never coasting—applies to both sports and business.

Notable Quotes & Moments (w/ Timestamps)

• “Get people who are smarter than yourself, get the right people and always pay them and then let them do their thing.” – Magic Johnson (00:00, 26:13)
• “There was nothing sexy about anything that I invested in…. But the ones that are boring…those are the ones who are on a consistent making money or going up.” – Magic Johnson (14:10)
• “Don’t be afraid to partner. See, that myth—we got to get rid of that myth that you gotta be the only one.” – Magic Johnson (62:05)
• “Stay ready, so you don’t got to get ready.” – Chris Dixon (60:10)
• “I wanted to get up under them and learn a lot...I was like a sponge.” – Magic Johnson (12:53)
• “If I’d did that [Nike] deal in 1979, it'd be over a billion dollars. So that’s the one that got away.” – Magic Johnson (29:26)
• "You gotta spend money in order to make money." – Magic Johnson (48:19)
• “It's OK to collaborate.” – Chris Dixon (62:32)
• “You showed us the way.” – Magic Johnson, quoting younger entertainers and athletes (60:35)
• "Don’t just want my check. You should want everything else that we bring to the table. Because I’m used to winning." – Magic Johnson (24:54)

Key Takeaways for Entrepreneurs & Investors

• Build your network now—before you need it.
• Understand every business you enter. Be an expert or learn from experts.
• Diversity in your portfolio reduces risk and finds overlooked value.
• Equity is the path to generational wealth for modern talent.
• Don’t be afraid to miss deals, but always learn from them.
• Partnering is not weakness; it’s leverage and scale.
• Sports, tech, and culture are converging—be early, be bold, be ready.
• Invest in talent, analytics, marketing, and identity—whether building a sports team or a startup.
• Give back—share wisdom, open doors, and mentor the next generation.

Timestamps for Key Segments

| Timestamp | Topic | |-----------|---------------------------------------------------------------| | 00:00 | Importance of team and delegation | | 05:00 | Meeting Michael Ovitz, the power of mentorship | | 10:18 | Building long-term relationships, EQ in business | | 13:45 | Investing in “boring” sectors, over-delivering in all fields | | 17:43 | Getting into Silicon Valley (Skydio deal) | | 23:15 | How Magic chooses founders & adds value | | 26:13 | Building a business team; empowering experts | | 29:26 | Deals that got away (Nike, Uber), importance of learning | | 31:00 | Shift from endorsements to equity for talent | | 36:03 | Future tech: AI, blockchain, new opportunities | | 43:40 | Sports as an appreciating asset class, team investments | | 48:19 | Importance of reinvesting in business & operations | | 52:14 | Team identity and playing to win | | 55:49 | New business models with AI, small teams w/ big impact | | 57:09 | NIL deals, transformation in athlete compensation | | 62:05 | Power of partnerships and collaboration |

Tone & Atmosphere

The episode is animated, motivational, and full of practical, hard-won wisdom. There’s a mutual admiration between Chris and Magic, and their energy is marked by candor, humility, and the desire to empower others—especially the next generation of athletes, entrepreneurs, and underrepresented talent.

For listeners hoping to learn how to win in both sports and business, this episode is a masterclass in relationships, risk, perseverance, and the long-term mindset of legendary dealmakers.

(End of summary.)