Clippers owner Steve Ballmer made a second investment worth nearly $10MM in the now-bankrupt “green bank” company Aspiration, according to legal filings reviewed by Mike Vorkunov of The Athletic.
The previously unreported investment, which occurred in March 2023 when the company was “hemorrhaging cash, laying off employees and struggling to raise funds,” was corroborated by a former Aspiration executive, Vorkunov reports.
On September 3, Pablo Torre reported on his “Pablo Torre Finds Out” podcast that Ballmer agreed to invest $50MM in Aspiration in September 2021 (the actual payment occurred in December 2021). Multiple sources tell Vorkunov the Clippers also made a separate $50MM+ investment in Aspiration for “carbon offsetting toward the goal of becoming carbon neutral.”
In April 2022, Kawhi Leonard signed a four-year, $28MM endorsement deal with Aspiration but there’s no evidence he ever performed any work for it.
A subsequent report from Boston Sports Journal, which was confirmed by Torre, indicated that Leonard made a separate side deal with Aspiration to receive an additional $20MM in company stock. That $20MM came directly from co-founder Joe Sanberg.
“I am personally contributing stock to Kawhi to make this partnership possible,” Sanberg wrote members of his leadership team in a May 2022 email obtained by The Athletic. “Aspiration’s CEO judged the deal to be not worth doing. For avoidance of doubt, any and all benefit to Aspiration from the Kawhi deal is being subsidized by my contributing my equity to make this happen.”
Sanberg pled guilty last month to two counts of wire fraud for defrauding investors and lenders of more than $248MM.
Bruce Arthur of The Toronto Star also reported that Leonard’s camp was seeking essentially the same deal he got with Aspiration when he was a free agent in 2019.
Ballmer’s second investment in Aspiration came three months after his college roommate and the Clippers’ lone minority owner, Dennis Wong, invested approximately $2MM in the company after it failed to make a $1.75MM quarterly payment to Leonard, as reported by Torre. Leonard was paid nine days later, on the same day Aspiration laid off 20% of its workforce.
The NBA is investigating whether the Clippers and Leonard circumvented the salary cap through their deals with Aspiration.
Leonard’s contract had certain obligations he was supposed to meet but it also permitted him to refuse to do anything “not consistent with his beliefs,” according to Vorkunov. Former CEO and co-founder Andrei Cherny disputed that Leonard had a “no-show” deal,” Vorkunov adds.
However, Leonard’s contract drew “confusion and frustration” within the company, with one former top executive telling Vorkunov the deal “materialized essentially out of the ether.”
Another former Aspiration executive told Vorkunov that celebrity endorsers Leonardo DiCaprio and Robert Downey Jr. both received less than $2MM in their deals.
The NBA will need to come down hard on the Clippers. Reminds me of college football finding out players were getting free stuff but NCAA would come down harder on teams that were not top 10 teams.
Yeah, this is ugly looking and the league ain’t having any of this. I see forfeited picks and a massive fine coming the Clips way.
Does Kawhi get suspended for this as well? I mean, he should be. He obviously made this as part of his contract negotiations.
I agree on Kawhi, but I have a feeling the Player’s Association will intervene. Should they? Of course not. But that’s one of the downsides with strong unions—they will advocate even for their worst members in order to prevent a precedent being set for the rest, even in instances of wrongdoing.
Ultimately I think he does get suspended, but not for nearly as long as he should be.
@greg1,
It’s going to be hard to sanction Kawhi unless there’s evidence that the Clippers knew about the Aspiration endorsement deal. It’s not illegal to ask for money, and speculation about why the contract was offered to him isn’t evidence.
As was stated in this article, Aspiration co-founder Cherny (who resigned in 2022) has come out with a statement that the endorsement wasn’t a “no-show job” and Kawhi WAS expected to do work, despite the lack of evidence that he did anything. So that’s another line of defense that Silver will take into account.
Sorry, I can’t believe that the Clippers did not, what with Steve Ballmer being an investor in Aspiration and all.
@greg1,
I think your take is completely common sense. But that doesn’t make Kawhi responsible for asking for it, it’s the Clippers who would be responsible for having used Aspiration to accomplish it.
And that’s if Silver agrees that circumstantial evidence is enough in this case to punish the Clippers, (meaning the rest of the owners are pushing him to do so).
Agreed,
My guess would be that they will offer Kawhi leniency to confirm the arrangement. He gets a lighter punishment, where they are allowed within the CBA to punish him severely, so he gets to keep the money hes already made, and they get a star witness against the organization.
The league cares about punishing the team more, since if teams are scared of the punishment they wont do it in the future with other players. Kawhis career is nearing the end as it is.
This nugget escaped me previously: “Leonardo DiCaprio and Robert Downey Jr. both received less than $2MM in their deals.”
So two well known and very charismatic actors get $2M each and Claw gets $48M in cash and stock to do absolutely nothing. That makes perfect sense.
I hope the rest of the owners apply intense pressure on Silver to blow this thing up.
@ JBS…Downey Jr. and Leo, like Ballmer, were also investors. Conviently, that part was left out. They got ripped off as well. The rest of the owners won’t do S**t. Half the leagues teams and star players would have separate dealings with the same company or entity. Someone should write an article on that. Steph’s personal shares went through the roof when Lacob did him a solid sixteen months later. Embiid has a seperate endorsement deal with a 76ers patch jersey sponsor etc etc. I agree, let’s get it all out in the open and go through every star player.
@Nrg82
The difference between $2 mil and $28 mil is pretty significant wrt NBA sponsorship rules. The fact that those 2 were also investors is 100% irrelevant to Kawhi’s endorsement contract given the relationship between the Clippers and Aspiration.
Correct, agree it’s irrelevant reporting said actors only made so much and Kawhi this much when using it as a point of guilt towards Kawhi. I’m sure the investors were hoping to clean up big time on the back end. Being an investor and signing endorsement deals are a little different. Ballmer most definitely has a conflict interest as I’m sure other top players and their current or former ball clubs have too. Mentioning Jr and Leo without the full story is pointless in my opinion. Just clickbait.
“agree it’s irrelevant reporting said actors only made so much and Kawhi this much when using it as a point of guilt towards Kawhi.”
It’s actually a point of guilt towards the Clippers having used Aspiration to circumvent the cap, not towards Kawhi.
Of course, celebrities investing in a company that’s selling “doing good” for the planet and combining banking with planting trees to offset carbon were hoping it would succeed and they’d end up profiting, but the NBA looks at differentials between endorsement amounts and a $26 mil difference is a red flag.
You should do a bit more research skippy. The company is in bankruptcy and shedding assets to pay off creditors. The founder was found guilty of fraud.
What does Lacob and Curry have to do with it? None of his companies have been found guilty of fraud. I highly doubt Curry has any endorsement deals with any of Lacobs companies.
Endorsement deals sure. Personal portfolio ie shares Steph invested in with Lacob and Warriors entering into a partnership ship a short time later with the exact same company had Steph benefiting greatly though through his private portfolio. Leave Steph alone, lols.
Please name the company to which you refer.
JP Morgan Chase….and I was wrong about endorsement deals too. Steph entered into a partnership with Chase through his conglomerate, thirty ink. Lacob and JP Morgan teamed up like eighteen months later. Hence, Chase centre. Bitcoin, shares etc etc. Steph did do promo work for his endorsement deals though. Benefited greatly through endorsements and personal portfolio me thinks, you?
I’m using this as an example seeing how it’s mostly warriors fans crying about the Clips and Kawhi. People are naive to think star players and their ball club aren’t as sqeeky clean as they think. Circumnavigating the cap is more than likely rife. Embiid also has a seperate endorsement deal with one of the teams jersey logo sponsors. I’m sure there are plenty more examples, I just can’t be stuffed looking that deep into it. More a between the lines guy. Would be good if someone else did a deep dive for a good read though.
Insider trading comes to mind, NO? Coincidental maybe Lacob and the Warriors entered into a very prosperous agreement that no doubt benefited their star player don’t you think?
Also, did Silver and the NBA investigate Steph and the Warriors in that Crypto currency fraud case? Steph Tom Bradey, the Warriors and other athletes and celebs were ambassadors for FTX I think? Crypto bitcoin crap. Went bankrupt and investors got their backside handed to them. End result, a judge couldn’t say the investors were able to prove Steph and co had any prior knowledge of defrauding investors. I suspect this will be the same result for Kawhi and the clips. The self serving Torre may of just opened up Pandora’s box. Unless other star players and owners want their endorsement deals and personal portfolios investigated. They should probably keep their yap shut and be backing the Clips. Anyways, back to between the lines for me. This gives me a headache, lols.
Steph also has an equity stake in Ratuken. A Japanese e-commerce company. Ratuken just so happens to be on the Warriors uniform, no? Seems Steph has done extremely well from the Warriors’ mutual investments, no? Pablo Pandora Torre probably should of thought this through more.
Steph has been advocating for active players to be able to hold equity stakes in the team they play for. Not allowed as yet, but….how to tip toe or circumnavigate that little conundrum? Read above. Seems you can have some equity in your team, just not directly.
Like other owners. Might be best for Adam Silver to be on the clips side, too. It was he who bought in the rules to allow equity funds to own a curtain percentage of NBA teams. Maybe it’s not just star players benefiting from this. If Torre thought breaking this would get him back on ESPN or another powerful mainstream network. He’s probably only shot himself in the foot. These rich guys don’t want any of this public knowledge man.
You can get an equity stake in Rakuten.
JP Morgan Chase is not one of Lacob’s companies.
What I never said they were, lols.
None of what you are saying makes any sense.
Ballmer was an “investor.” Once Claw got $20M in shares he was an investor too. This is dirty as can be and “what about Steph” ain’t gonna fix it.
First, Ballmer is a full on idiot. Statistically the worst CEO of any major company in history. He’s a billionaire because Bill Gates liked him. This makes it easy to believe he was dumb enough to do this.
Second this is just another in a long line of sleazy activities for Leonard and his family. The NBA needs to publicly – not quietly – crush them both for this.
BING!
Bill Simmons once said he considers his Clippers season tickets an investment. After Pablo Torre torched Bill Belichick and Simmons insulted Pablo’s journalistic morals, Torre crashed his clippers season tickets like a memecoin.
In all seriousness I really enjoy every update we get on the clip show. It’s like a dramatic clown soap opera at intuit arena.
a joke have open bidding for guys it all gets leaked any way
This last $12 million “invested” by the Clippers owners a full 9 months after Aspirations’ auditor KPMG resigned due to indications of fraud seems to belie the “I didn’t know/I was conned” defense from Ballmer.
There’s no way they were unaware of that huge red flag in March of 2023.
@NBAisOK, indeed.
Two days ago, I think you were skeptical when I said we’d reached a point where it will reflect badly on Silver to insist on a 4-6 month investigation.
Everybody knows what happened. The Aspiration principals were crooks, and that enabled Ballmer and Uncle Dennis to take advantage for their own crooked means. The documentation that Torre laid out in 2 podcasts, followed by the news of this $12M investment makes it certain.
If Silver can’t bring down the hammer shortly, he looks weak and like a tool of the owners.
Umm…Did Ballmer have access to the KPMG audit? Not every investor does. The Ballmer Group has invested billions in countless companies and initiatives over a decade. The founder of Aspiration might have hid it; he plead guilty to fraud after all. Their is very good reason for them needing cash in March of 2023. Their money and most tech startups was deposited in Silicon Valley Bank. It lost $24 billion in one day in the largest bank failure in US history.
Old mate fudged the books, showing investors inflated BS figures.
@Giants74
“Did Ballmer have access to the KPMG audit? ”
By March 2023 when he sent Aspiration another $10 mil, unquestionably.
The $10 million was part of a round of financing. He was part of a group.
@Giants74
I’m aware of that fact. The question (point) is why would he add financing to a failing company well after the KPMG resignation was known about?
Today’s drop from Torre:
Joint Statement of Aspiration Senior Executive Team
At the time of the KL2 Aspire, LLC endorsement arrangement with Kawhi Leonard (the “Leonard Deal”), we served as Aspiration’s Chief Legal Officer, Chief Technology Officer, and Chief Financial Officer, reporting directly to then-CEO Andrei Cherny.
The Leonard Deal was presented to the company as a completed arrangement and executed by Mr. Cherny despite significant objections from members of this senior management team. It did not reflect any strategy previously communicated to us, nor was it reviewed through Aspiration’s Investment Committee process. For comparison, a transaction of similar size ($29.5m) in the same period was subject to that review, as described in the federal court decision in Zero Carbon Holdings, LLC and Four Thirteen, LLC v. Aspiration Partners, Inc., No. 23-cv-05262 (LJL) (S.D.N.Y. May 1, 2024).
The team expressed concerns at the time regarding the high cost of the agreement and its lack of alignment with Aspiration’s brand and business strategy. While subsequent marketing efforts were undertaken, they were ultimately discontinued and should not be interpreted as support for the deal itself.
In our judgment, the Leonard deal was not in the company’s best interest. It was strategically difficult to justify then, and it remains so today.
Rojeh Avanesian
Former Chief Financial Officer, Aspiration
Mike Shuckerow
Former Chief Operating Officer and Chief Legal Officer, Aspiration
Eric Anderson
Former Chief Technology Officer, Aspiration
@NBAIsOK,
I guess you and I are now having a friendly debate about how fast this entire affair is concluded :–)
What you report above was all provided on record to Torre weeks ago. Torre was reading from sworn statements by these ex-Aspiration execs who all lawyered up months ago. (Shuckerow spoke live and “anonymously” behind a synthesized voice, but everyone knew it was him.) What we’re seeing now is an orchestrated release of information that’s been planned for a long time. Torre and his employer wouldn’t take on the 6th richest guy in the world without all their ducks in a row.
Nobody knows exactly what information will be discovered by other parties along the way, but there is more coming.
Ballmer has balls of steel, but he’s not going to fight this one long.
“Investigation:
The league
has hired the New York-based law firm Wachtell, Lipton, Rosen & Katz to conduct a comprehensive investigation into the matter.
Commissioner’s Stance:
NBA Commissioner Adam Silver emphasized that the league needs to prove wrongdoing with the “totality of the evidence” and is not acting on mere appearances. “
Nothing has been proven yet. Why the rush to judge the Clippers. I’d say the basketball gods have already judged them. We all just wait till the NBA investigation is over. And forget the self serving Torre .
What’s the point in having this incredibly complex CBA if you can just engineer $48M in no strings attached payments to your star player? This was so obviously an attempt to circumvent the CBA. It screws every team that was complying with the terms of the CBA. This is what cheating looks like in the NBA. No PEDs just $$$$$$$.