Transcript
Introduction
Patrick
I came across this week's guest, thanks to the overlap of three passions of mine data informed investing, value creation and basketball. Sam Hinkie worked for more than a decade in the NBA with the Houston Rockets and then most recently served as president and general manager of the Philadelphia 76ers. He helped launch basketball's analytics movement when he joined The Rockets in 2005 and is known for unique trade structuring and a keen focus on acquiring undervalued players. Today, he's also an investor and an advisor to a limited number of young companies in which he feels his experience can improve outcomes. At one point in our conversation, Sam mentioned that he tracked success by a future financial outcomes, much like we would in the investing world. So I did some research and found many interesting stats about the Sixers surrounding Sam's tenure.
When he took over the franchise, it was 24th in ESPN franchise rankings. Today, it is fourth. This is the result of an impressive crop of young talent players like all-star Joel Embiid and Ben Simmons, which resulted in large part from unconventional decisions that Sam and his team made. While I'm sure these estimates are imperfect, Forbes estimated the Sixers value at about $418 million when Sam took over and $1.2 billion just a few months ago. Now NBA teams in general have grown in value, so a lot of that appreciation is the equivalent of market beta. But given that the 76ers had the top percentage growth number more recently of any team in the league, some of it is alpha too.