NFL players make a lot of money. But over the course of his 10-year, $503 million contract with the Kansas City Chiefs, none will make more than quarterback Patrick Mahomes.
Here's the crazy part: the money Mahomes will make through his off-field investments will most likely dwarf what he earns as a player. To merely call Mahomes a quarterback is to dismiss his business acumen.
In the half-decade since he was drafted, Mahomes has acquired a diverse list of endorsement deals, including Adidas, Airshare, BioSteel, Bose, CommunityAmerica Credit Union, DirecTV, Electronic Arts, GEHA, Hy-Vee, Molson Coors Brewing, Nestlé, Oakley, Panini, Procter & Gamble and State Farm.
Mahomes has also partnered with the digital art agency Impossible Brief to release a collection of limited edition NFTs (Non Fungible Tokens — essentially, digital artwork) centered on the greatest moments of his career.
Mahomes' quest to build his legacy has not stopped at endorsements and NFTs. He has also bought into the ownership group of Kansas City’s other two primary professional sports franchises: the Kansas City Royals and Sporting Kansas City.
He has also flexed his philanthropical muscles through his 15 and The Mahomies Foundation.
So here is the question: how does one person achieve so much in such a short amount of time?
It appears that Mahomes has followed four basic tenets. Welcome to the Patrick Mahomes School of Entrepreneurship.
It may sound counter-productive, but one of the keys to Mahomes’ financial success has been the uncommon level of patience he has shown. When he was drafted 10th overall in the 2017 NFL draft, it would have been easy for his reps to plaster Mahomes’ face across every billboard in the country. But instead of saturating the market, Mahomes’ agent, Leigh Steinberg, wanted his client to first become acclimatized to the NFL.
“We did a whole series of endorsements ... but none of them were with firms that were national where there would be billboards all across Kansas City (or) where his face would be on the air waves because that would raise the level of expectations and pressure on him,” Steinberg said.
Before he did anything else, Mahomes needed to prove his success on the field — and his patience paid off. By the end of his second season, Mahomes was the starting quarterback for the league's most exciting offense ... and the reigning NFL MVP.
Another area where patience has served Mahomes well has been in his contract negotiations. Coming off what was arguably the best two-year run of any player in NFL history, Mahomes put his faith in his representatives, trusting they would get a new contract done for him. The outcome was a contract that was somehow the largest in North American sports history — while also remaining team-friendly.
“There was never a sense of ‘We need to win this,’ or ‘We have to win this.’ This was, ‘How can we get this done?’” said Kansas City general manager Brett Veach. “And that goes back to Pat, because ultimately [Chris Cabbott] and Leigh work for Pat — and Pat has to have this long-term vision on what he wants his legacy to be.”
And that leads us to the next item.
Patience and forethought can be a powerful combination. The structure of Mahomes’ contract is a perfect example. According to Spotrac.com, Mahomes’ 2021 cap hit is only $7.4 million, which ranks 20th out of all quarterbacks.
By backloading his contract, Mahomes provided Veach a window to build a contending team around an elite quarterback — one who is still being paid like he is on his rookie deal. Mahomes essentially gave himself two years of runway to build his brand, make investments and take shots on projects he believes in — knowing that he has a massive security blanket to fall back on if things don’t pan out.
And by signing a 10-year contract extension, Mahomes tied himself to the Chiefs — and by extension, Kansas City itself — for the remainder of his career. This may seem like a limitation, but what it actually did was free Mahomes to go all-in on his investments in the city, such as the Royals and Sporting franchises.
3. Calculated risk
The Museum of Mahomes NFTs opened in March. A recent report by analytics platform DappRadar found that NFT sales were up 704% over the second quarter of 2021, with a trading volume of $10.67 billion.
Crypto markets are notoriously volatile; it’s not uncommon to see the price of a currency fluctuate 10% in the span of a few days. So at first glance, investments in digital marketplaces seem like just the sort of thing Mahomes should avoid. But NFTs are not cryptocurrencies. Instead, they are works of art — and art is worth whatever someone is willing to pay for it.
And what differentiates NFTs from traditional works of art is that the creator of the artwork earns a percentage each time the artwork is resold. So the larger Mahomes’ brand grows, the higher the likelihood that his NFTs will be resold for a profit — thus giving him a passive, repeating income stream.
The same can also be said for his relationship with BioSteel. As part of his endorsement deal, Mahomes received equity in the sports nutrition company. This incentivizes the athlete to grow the product — and in turn, the company’s bottom line. These are bold business moves, and quintessential Mahomes.
Amazon owner Jeff Bezos didn’t just wake up one day as the richest man on earth. He saw a gap in the marketplace and set out to fill it. In the beginning, nobody knew Bezos’ idea was going to be successful, but he got himself in front of the right people to sell his idea — and himself. To do this, he had to be likable. Nobody is going to bet on a person they don’t like or trust.
Mahomes is humble. He is in love with his high school sweetheart. He never takes himself too seriously and emanates an all-around good guy persona. It’s this likability that makes people want to purchase products with his face on them.
The bottom line
For Mahomes, this is just the beginning. By the time he is done, he will have revolutionized the ways athletes can enter the business world; we’ve never seen anything quite like this before. Mahomes has a clear vision for his future — and it entails more than just playing football. He is building generational wealth.