For the first few months of 2017, sports fans were offered a unique opportunity: the chance to own a piece of the Gotham Ballers, a New York-based pro basketball team in the 16-team Champions Basketball League that was set to start its first season in July. The team’s roster is made up of recently retired NBA players like Shawn Marion, Al Harrington, and Kenyon Martin. Basketball fans who wanted to own a piece of the Ballers were able to invest in the team via a Start Engine page, a Kickstarter-like service that sells actual shares in startups rather than just soliciting patronage. Potential investors were greeted by the kind of pitch video you might expect to see shown to a captive audience in a Hilton conference room:
Production quality aside, the rest of the Start Engine page, along with information available on the Gotham Ballers and Champions Basketball League home pages, painted an enticing picture. Investors were promised a roster full of former NBA players, a home arena at the Nassau Coliseum, a broadcast deal with ESPN, a front office staffed by legends like Walt Frazier and Earl Monroe, and a 14-game season against teams comprised of other former NBA players. There was even a list of Kickstarter-style perks: Twenty shares got you the ability to use the owners-only door at games; 715 shares got you four invites to a special owners-only party at Walt Frazier’s restaurant; around 3,500 shares got you VIP tickets to the league’s $1,000,000 tournament in Vegas.
Shares were sold for $7.00 apiece—this put the team’s valuation at about $80 million, according to the team’s own calculations:
The pitch was apparently pretty convincing, as the Ballers managed to raise $609,959.00 from 1,679 investors before the investment window closed in March. Since then, however, investors haven’t gotten much for their money.
The Gotham Ballers’ homepage and Start Engine page still feature a league timeline showing that the league’s inaugural season was supposed to begin this July:
As July got closer, there was little communication from the Ballers to their investors about the start of the season. Finally, on June 26, the Ballers informed their investors via conference call that the season would begin on July 19. Still, some investors took to the Start Engine page’s comments section to voice their concerns about the lack of communication and the fact that tickets were not yet on sale. Each worried comment was replied to by Lisa Dinndorf, the head of communications for the Champions Basketball League:
On June 15, I received an email from Carl George, the CEO of Champions Basketball League, to which he attached a PDF laying out the 2017 Champions Basketball League schedule. The schedule showed a league of 12 teams (down from the 16 promised on the Start Engine page), divided into Eastern and Western conferences, playing nine weeks worth of games:
At this point, only rosters for the Ballers and teams in Boston and Los Angeles had been released (the L.A. team is currently soliciting investors on its own Start Engine page), and there was still no information available about how to buy tickets to games. On July 12, I followed up with George and asked why there were no tickets for sale even though the season was set to start a week later.
Later that day George emailed me to say that the opening game had been pushed back to August 2, and that the league had been reduced from 12 teams to 10. The email also said there would “likely be a concert featuring Nicki Minaj singing” after the first game. (George seems to have an affinity for celebrity endorsements. In April, Snoop Dogg was unveiled as the league’s celebrity commissioner and owner of the L.A. Superstars.) When asked why the date had been pushed back, George replied:
Tom, yes we are working on a concert that will follow for 6-8 songs and that has stretched us here into others schedules, we think it will be worthwhile but may have to do it as of game 2. I will keep you posted.
The email George sent me on July 12 included another PDF that laid out the updated league schedule and indicated that the opening game between the Ballers and Los Angeles Superstars on August 2 would be played at the Nassau Coliseum. On July 27, I reached out to Brooklyn Sports and Entertainment, the group that now operates the Nassau Coliseum, to see if the arena would indeed be hosting the opening game. I was told that the arena wasn’t scheduled to host any event on August 2.
Also on July 27, I reached out to George to ask him why tickets for the first game had not yet gone on sale, and received no response. On August 3, I reached out to a Gotham Ballers investor to see if there had been any further communication from the team regarding the start of the season, and was informed that the opening game had been pushed back once again, this time to August 23. Brooklyn Sports and Entertainment told me that no event with the league had been confirmed for August 23.
One investor told me that he had grown so fed up with the league’s lack of progress and communication that he asked to sell back his shares. He sent me a screenshot of an email from Dinndorf, in which she told him that he would not be able to sell his shares until one year from the date of purchase, “which is the standard requirement of RegCF investing - it is not our rule, it is an SEC rule.” she wrote.
I first spoke to Carl George on May 23, because I was concerned that the reality of owning a piece of the Gotham Ballers did not match up with what was being pitched on the team’s Start Engine page. A lot of what was being promised seemed too good to be true, such as this list of “key facts” that stated the team had a broadcast deal with ESPN:
Although “broadcast deal with ESPN” might be technically accurate, I learned that none of the team’s games would be on TV. A source familiar with the situation told me that the Champions Basketball League has (or had) a small barter agreement in place with ESPN to stream a handful of match ups on ESPN 3, the network’s online streaming service. This distinction wasn’t made on the Start Engine page, which still features this promotional image:
I was told the agreement between ESPN and the league does not involve the network paying any sort of rights fee to the league.
There was also a promise that the team had secured a home arena at the Nassau Coliseum and would be holding some special events at the Barclays Center:
Back in May, a source familiar with the situation told me that the Ballers had rented the practice arena at the Barclays Center for a scrimmage in August 2016, and expressed interest in playing their season at the Nassau Coliseum, but that no official agreement had ever been signed.
I also had questions about the Gotham Ballers’ roster, which features former NBA stars like Kenyon Martin, Shawn Marion, and Al Harrington. On May 18, I spoke to Shawn Marion’s assistant, who told me that Marion’s status with the Ballers was still “up in the air,” and that no official agreement had been reached yet. “I hope it doesn’t happen,” the assistant added. “Who wants to pay see a bunch of old guys play basketball?”
That same day, a spokesman from ASM Sports, the agency that represents Kenyon Martin, told me that Martin was not involved with the Gotham Ballers. When asked to clarify if Martin ever was on the team, the spokesman declined to comment. On May 23 I was able to get in touch with another player on the Ballers’ roster, Tyshawn Taylor, whose publicist had originally told me he was not involved with the team. By email, Taylor told me that he was indeed planning on playing for the team when the season started. (Additionally, many of the players listed on the Ballers’ and Superstars’ rosters, including Martin and Harrington, have been playing in Ice Cube’s Big3 tournament.)
I shared my concerns with George during our May 23 conversation, and he did his best to assuage them. He told me that the league was, at the time, in negotiations with the Nassau Coliseum to play seven home games in the arena throughout the summer, the first being on July 19. He added that he expected all of the league’s games to be streamed on ESPN 3.
As for the rosters, George told me that the league had signed agreements with 130 players, including Martin, Marion, Taylor, and Harrington. The agreements classified the players as independent contractors, and George informed me that they would be paid on a per-appearance basis. This meant that the players who had signed agreements were not contractually bound to participate in any number of games, though George told me he expected each player to give their team 80 days per year.
When I raised the issue of whether it was fair to advertise a specific roster to potential investors despite the fact that the players listed on the roster weren’t obligated to ever play in a single game, George seemed not to see my point. As he saw it, if someone invested in the Gotham Ballers specifically for the chance to see one player and that player never suited up for the team, the disappointment felt by that investor would be the same as the disappointment felt by any major-sport season ticket holder whose favorite player suffered a season-ending injury.
When asked how many players George expected to not live up to their signed agreements, he told me he expected “10 percent player movement.” He also told me that he had coordinated with the Big3 tournament, and that any player’s participation in that league would not limit their ability to play in the Champions Basketball League.
At the time of our conversation, only the rosters for the Gotham Ballers and the L.A. Superstars had been announced, and George told me that the league was planning on releasing two more rosters per week before the opening game. Since then, a roster for the Boston Rebellion has been released, but official team pages for the Philadelphia Glory, Miami Beach Kings, Atlanta Speed, Phoenix Desert Cats, Chicago Hoopers, Dallas Dunkers, and San Francisco Cyber Ballers remain bereft of rosters.
Since our May 23 conversation, I have reached out to George for updates about the league’s progress. At one point, he had offered to connect me directly with some of the rostered players whose involvement with the league I was interested in confirming. And then, on June 2, George sent me this email:
Thank you for the follow up. We would like to connect with you and your publication and will look to how that can happen.
I have now personally spoken with Marcus Banks and TyShawn Taylor in the past 3 days.
As expected they both reconfirmed their participation in this summers season on their teams and in the off season exhibition games.
Tyshawn said you had emailed his publicist regarding Tyshawn but no conversations with him as well.
We have a call into Kenyon and Mark Aguirre is in communication with Shawn Marion.
Holiday weeks are usually tougher but we should hear back on both over the next several days.
For reference I have sent each of these four players signed agreements to Eric Fischgrund at Fischtank our PR firm for New York. They can vouch for having them in their player files if that is of importance to you.
We don’t agree with the premise of your inquiry - that there can be no movement on player rosters. Additions and subtractions are part of every sport. (what about upgrades to teams comes to mind).
Indeed our league is built out of players from the NBA who are no longer on those rosters.
We will look for ways to connect you with players and we have done this widely for many publications and are doing so currently - but the introduction we have to your organization with you wrongly citing 4 separate players each of which we have signed and have relationships with, Gives us Pause.
If you would like to reach out to these or any of our players directly please feel free to do so but we are not going to spend our time or theirs further on this.
We are satisfied about the status of each of these that you inquired about.
We are consumed launching the summer season. We have great partners and players and we are excited about how we can help change what happens to players in all sports today when they are cut.
Please connect with Eric or Matt and we can see what else we may be able to do for you.
If you are in New York we will be happy to have you do sit downs with the players this summer as well.
I received two more emails from George, on July 12 and July 18, the first announcing that the season would start on July 19 and the second announcing that it had been pushed back to August 2. Since then, I’ve sent him multiple emails asking for confirmation that the season is now set to begin on August 23, as one of the Ballers’ investors told me, and further updates on when tickets might go on sale and when the other rosters will be announced. I also shared with him what I was told by Brooklyn Sports and Entertainment about nothing being on their schedule for August 23. On August 9, he replied:
Tom yes on the 23rd. Concert and player related details still being resolved. Pushing for Friday or Monday for ticket and advertising launch.
Unsure of your BSE exchange on this we have been and continue to work with the BSE Nassau staff.
I’ll send updated program in next day or two as well.
Games 2-20 are also being finales for release after game 1 publishes.
The Los Angeles Superstars are still accepting investments on their own Start Engine page. This page values the team at $47.95 million and promotes all the things investors in the Ballers were promised, including a 14-game season in a nationwide league culminating in a championship tournament in Vegas. It does not mention that more than half the teams in the league do not yet have rosters, or that the start of the league has been delayed multiple times. Among other things, potential investors are assured that sports franchises make for a lucrative investment:
So far, the Superstars have raised $122,745.00 from 262 investors. The investment window will be open for another 40 days.