The $10 Billion Man: How Nike Lost Lionel Messi to Adidas for a ‘Few Hundred Bucks Worth of Tracksuits’
We’ve all υndeгestimated employees — oг jυst people in geneгal — bυt the cost sυгely wasn’t as high as when Nike let Lionel Messi slip thгoυgh its fingeгs to land with Adidas.
Fiгst a little backgгoυnd. In 1995, Nike was the seventh-гanked company in teгms of total socceг geaг sales. By the eaгly 2000s, Nike had deals in place with a nυmbeг of national teams as well as clυbs like Manchesteг United.
And Baгcelona, wheгe in 2005 Messi was an 18-yeaг-old staг in the making who had been weaгing Nike cleats foг foυг yeaгs. So why did Messi sign with Adidas?
One version of the story had Nike declining to match Adidas’s $1 million per year offer. A different version was offered in this 2022 Wall Street Journal article:
Another person familiar with how Nike lost Messi remembers it coming down to something a little more trivial. Leo’s father had made a seemingly innocuous request for more athletic gear, only to find that neither Nike Iberia nor Nike South America was getting back to him. That was enough to sour the relationship.
Nike, this person said, let Mr. Messi get away for a few hundred bucks worth of tracksuits.
Before you think that sounds unlikely — and before you decide parents don’t play a major role in contract negotiations — keep in mind that Nike lost NBA superstar Steph Curry in large part because, during a pitch meeting, a Nike executive mispronounced his name. They also left Kevin Durant’s name on one of the slides, indicating that at least some of the material had been repurposed from another pitch.
As Curry’s father says, “I stopped paying attention after that.”
Don’t get me wrong: Losing Messi (and Curry) wasn’t a devastating blow for Nike. As Trung Phan describes in his weekly newsletter, since it lost Messi, Nike’s market cap has grown from $15 billion to $166 billion, while Adidas has grown from $10 billion to $40 billion. (If you’re keeping score, that’s Nike 11x, Adidas 4x.)
But then there’s this. Messi signed a three-year deal with MLS club Inter Miami for a reported $54 million per year in salary, signing bonuses, and an equity stake in the franchise. He also has a revenue-sharing deal with Adidas for jersey sales, and a revenue-sharing deal with Apple+ for MLS League Pass subscriptions. (In its recent earnings call, Apple CEO Tim Cook said Apple+ had exceeded subscriptions in the previous quarter, attributing some of the uptick to the Messi factor.)
All of which is interesting, especially if you’re Messi. Or, judging from jersey sales and Apple+ subscriptions, Apple and Adidas. One analyst estimates that Messi’s MLS signing will help drive market share and increase Adidas’s market cap by approximately $10 billion; the stock price is already up nearly 10 percent since early July.
But why is that interesting to you?
Simple: Just about every business — including yours — has at least one underestimated, and underappreciated, employee.
Before you assign that employee to the “average performer” pile, put a little effort into helping them reach their full potential. Recognize their effort. Provide praise, even when they don’t necessarily deserve it. (A series of studies published in Proceedings of the National Academy of Sciences found that random praise, given to arbitrarily selected recipients, produced significant improvements in subsequent rates of performance.)
Don’t relax your standards. Just step up the mentoring and coaching you provide.
And treat every employee, whether sub-par or superstar, with respect. Making a struggling employee feel valued and respected may be all they need to turn the performance corner. Ensuring a superstar feels valued and respected is the only way to have a shot at keeping them.
