Tuesday, August 18, 2009

David Falk loves Ferraris. He loves the way they look and drive, the way they accelerate and keep accelerating, the way they turn heads and widen eyes.

But as he sits in his ninth-floor office in the District, Falk brings up Ferraris not to boast about his stable of luxury cars but to tell a story about the company’s late founder, Enzo Ferrari.

Enzo, the story goes, sat down in a prototype of a two-seat convertible that seemed perfect. It was unlike any car on the road, but Enzo didn’t feel right about something.

He finally figured out the problem: The rearview mirror was out of place. He reached up and ripped it off the windshield.

“When you drive a Ferrari, you never have to look behind you,” Enzo said.

Falk pauses, then transitions into his own story. After 35 years as an agent, he knows he’s at a different stage in his career.

Falk, who has been in the District since he attended law school at George Washington, once was one of the NBA’s biggest power brokers. Representing the likes of Michael Jordan, Patrick Ewing and Juwan Howard, Falk wasn’t just an agent; he was a conglomerate, an empire, a force to be reckoned with.

But 25 years after he began representing Jordan, Falk isn’t looking behind him. He isn’t worried about the next contract he’ll negotiate, the next marketing idea he’ll conjure up or the next client he’ll sign.

At 58, Falk seems utterly content - with his legacy, his client list and, most of all, the relationships he has created.

“At this point in my life, I’m not trying to re-create the past,” the Rockville resident says. “I don’t want to go back to where I was 10, 15 years ago.”

‘A nut for loyalty’

The words “agent” and “loyalty” rarely are near each other.

By nature, agents are sharks, willing to do anything to get the biggest deal, sign the best client and make the most money.

Falk was no different. He maneuvered his clients to his liking, leveraged executives with his elite clientele and wielded his immense power to get his players the contracts they wanted from the teams they hoped to play for.

Falk got Stephon Marbury out of Minnesota and into a New Jersey Nets uniform with a six-year, $70.8 million contract in hand. He got Allen Iverson a 10-year, $50 million shoe deal with Reebok as a rookie - the biggest deal of its kind at the time.

That’s not loyalty; that’s doing his job and representing his client’s best interests. Loyalty, Falk says, is grown not with enormous contracts but by developing relationships and sustaining them over the years.

“I probably spend more time with my ex-clients than most agents spend with their current clients because those are the guys [who] made me who I am,” Falk says. “It didn’t come because of the way I dressed. It came because I was working for the best and the brightest.”

In 1994, Howard was a rookie with the Bullets while his family was back in Chicago. Being 21 and new in town, Howard had no idea where to go for Thanksgiving dinner. Falk and his wife, Rhonda, opened their home to Howard - a gesture that has stayed with the 6-foot-9 forward.

“That’s something that will always stick out in my mind,” Howard says. “He wanted to take me in and show that he cares for me as a person more than anything. You know, 15 years later, I still feel the same way.”

Duke coach Mike Krzyzewski had a similar experience in 2004, when he strongly considered coaching the Los Angeles Lakers. Falk and Krzyzewski holed up in the coach’s 14-acre estate all weekend, but eventually Falk had to head to his private plane for a meeting with Jordan.

Falk made it to the end of the long driveway, then turned around.

“He said, ‘I’m staying with you guys,’ ” Krzyzewski says. “He’s a great friend of mine, and he’s really loyal - really loyal - and completely trustworthy. When someone of that ability and that experience brings loyalty and trustworthiness to the equation, it’s a grand slam.”

For former Georgetown coach John Thompson, loyalty came in the form of his son, John Thompson III. For John Lucas, Falk’s first No. 1 pick in 1976, it came in the form of his son, John Lucas III. For Ewing, it has come in the form of his son, Patrick Ewing Jr.

Falk represented them all - all too rare in the cutthroat agent business.

“I just told [Patrick Jr.] that this is a person I trust, and he’s done a great job by me and hopefully he’ll do a great job by you,” the elder Ewing says. “It’s all about trust.”

At this point, Falk can do deals in his sleep. That’s not why he continues to work, especially when he has made more money than he ever dreamed of as a kid cleaning up blood in his father’s butcher shop.

These relationships - and building similar bonds with current players like Oklahoma City’s Jeff Green and Philadelphia’s Elton Brand - are what gets him to work every day.

“I think I’m a nut for loyalty,” Falk says. “What I enjoy most about the business isn’t making the deals - it’s not the publicity. It’s feeling you’ve sort of stood the test of time with people like John Lucas for 33 years, Phil Ford for 31 years, Michael Jordan for 25. … It gives me endless satisfaction to feel that, for almost all of my clients, [I’ve] been able to maintain a cradle-to-grave relationship.”

Branding MJ

Not long ago, Falk sifted through old files before moving into his new office. He found some old Nike stock certificates in Michael Jordan’s name.

Twenty-five years earlier, Jordan inked a groundbreaking endorsement deal with the company. Falk insisted Nike give Jordan his own product line - an unheard-of honor for any player in 1984, let alone a rookie who wasn’t even the No. 1 pick.

Also packaged in the deal were royalties, a requirement for Nike to spend $1 million marketing the shoes in the first year and stock options for Jordan and his parents. Nike sold $130 million in Air Jordan products in 1985 alone.

Falk and Jordan forever changed the standard for shoe deals.

“It’ll probably be the greatest deal I ever made as far as creativity and insight,” Falk says.

“It was brilliant,” says Robert Boland, a professor of sports law and economics at New York University.

Still, no one - not even Falk - could have guessed Jordan’s power as an endorser. After all, he had yet to play a game in the NBA, he played a team sport and he is black - all of which, Falk says, presented marketing obstacles.

Falk knew after the 1984 Olympics, during which the United States won gold and Jordan established himself as a top draft prospect, that Jordan would be a special player. But a transcendent global icon? That realization came years later.

Falk decided to align No. 23 with American companies, hoping to capitalize on Jordan’s early exposure at the Olympics. The result: partnerships with Coca-Cola, Chevrolet and McDonald’s. Years later, as the brand grew with his power as an endorser, Jordan started his own fragrance line and in 1996 starred in his own movie, “Space Jam.” Falk was the executive producer.

“Michael Jordan is a very good player. Is he the first best player in basketball history? That’s arguable,” Boland says. “Is he the first best endorser in basketball history? That’s not even a question.”

Agents and marketers have copied what Falk refers to as the “Jordan blueprint” - a strategy Tiger Woods, LeBron James and Kobe Bryant have tried to replicate. For all that Falk did to launch Jordan’s career off the court, the agent says, “Michael Jordan not only made my career, he made my life.”

Building an empire

Falk began his career at ProServ, a D.C.-based sports agency, in 1974 as an unpaid summer intern. After the summer ended, Donald Dell, ProServ’s founder, hired Falk as a part-time clerk. Soon, Falk was working 60 hours a week while he finished up his last year of law school.

He graduated and was hired as a full-time associate, making $13,000. A year later, Falk, then 32, was given his first basketball client: John Lucas, who would become the No. 1 pick in the 1976 draft. Falk didn’t recruit Lucas or negotiate his contracts, but he was tasked with overseeing everything else.

“What I remember was that it was so important for me to try to do a good job,” Falk says. “If he had called me up and said, ‘I need to get a new tire for my car,’ I’d call four or five tire stores in Houston and see if I could negotiate like $10 off the tire.”

In 1992, Falk, feeling underpaid and underappreciated, started Falk Associates Management Enterprises - taking his stable of clients, including Jordan, Ewing and Thompson, with him. At the height of FAME, Falk represented 40 of the game’s best players and coaches.

“You know, Mike Krzyzewski and John Thompson are two of the strongest personalities… in all of sports - they are that big and that ubiquitous,” says Kevin Harlan, the longtime NBA announcer for TNT who worked with Thompson for four years. “The fact that they would deal with David - I don’t really know what more needs to be said in terms of validating the guy and where he stands.”

Falk parlayed his independence into huge paydays. In 1996, some of Falk’s biggest clients - Howard, Jordan, Alonzo Mourning, Dikembe Mutombo and Kenny Anderson - were free agents. In six days, Falk negotiated $335 million in contracts. There was a one-year, $30 million deal for Jordan that still hasn’t been topped in any sport. And then there were $15 million-a-year deals for Mourning and Howard at a time when Chris Webber, the league’s highest-paid forward, made $9.5 million.

“We changed the salary structure overnight,” Falk says.

In 1998, Falk cashed in, selling FAME to SFX Entertainment for $82.9 million in cash and 1 million shares of stock. In his book, Falk wrote that the stock price rose to nearly $80 a share, and certain incentives in the agreement were reached, leading the deal to be worth close to $200 million.

Falk took his clients with him and was named the chairman of SFX Sports Group, which had anywhere from 900 to 1,100 clients from various sports under its umbrella. Falk signed Brand, the most coveted rookie in 1999. He was drafted No. 1 by Chicago, giving Falk the sixth No. 1 pick of his career.

“[Falk] has got to be one of the most important people in sports when you take a look at the last 25 years,” Harlan says. “I think his place in history is set.”

The future

From 1999 to 2007, Falk didn’t sign a single rookie. Maybe his newfound wealth deterred him. Maybe he had too many responsibilities at SFX and not enough time for the personal interactions that drove him.

It almost seemed like he had retired with $100 million and his legacy intact. Falk says he simply “stopped feeding the pipeline.” He still worked with clients like Jordan, Thompson and Krzyzewski, but he wasn’t looking for new clients.

In 2007, SFX Sports Group, which had been acquired by Clear Channel and then by Live Nation, was dropped from the company. Falk relaunched FAME on his own and quickly signed Green, the former Georgetown star who was drafted No. 5 in 2007.

Falk says he now has around 10 clients - Atlanta’s Mike Bibby, Indiana’s Roy Hibbert and New York’s Toney Douglas among them - and that he isn’t focused on signing more players or trying to becoming a major force in the NBA again.

“I think I look at myself at this point in my career [as] probably more of a teacher,” Falk says.

He donated $5 million to his undergraduate alma mater, Syracuse, to start the David B. Falk Center for Sports Management, where he teaches once a month.

“Having watched the Jordans and the Ewings and the Worthys for years, [I] can share with the younger players their approach, their training habits,” he says. “That gives me endless satisfaction.”

Falk says he finds it amusing that many of the people who criticized him for having too many clients 10 years ago now are trying to build mega-agencies and merge them with entertainment companies - a plan Falk admits didn’t work “in practice as well as people thought it would on paper.”

That might be even truer today, when the economic climate doesn’t permit the free agent spending of the 1990s.

“I think it’s difficult to have a lot of clients because back then there was no shortage of money to pay all the players,” Falk says. “If you’ve got 30 or 40 clients and five or six become free agents… two or three of them are going to get left out in the cold. The question is which one do you sign first?”

Falk has changed - or at least his motives have.

The man who built Michael Jordan, made record deals and represented some of the game’s biggest stars isn’t a superagent anymore. He isn’t the hard guy who prodded and twisted the arms of NBA executives until he got what he wanted. He isn’t the guy everyone loved to hate because he was too powerful or too manipulative or too cocky.

“He always talks about how he believes deep down he was always meant to be a teacher or a psychologist, and now at this stage in his career he’s really doing both of those things,” says Danielle Cantor, FAME’s vice president. “He genuinely loves what he does. Although many people out there say it’s because he needs to continue to feed his ego - and, yes, he does have a big ego; everyone knows that - deep down he genuinely loves what he does.”

Falk is in a different place now. The relationships he has created in his 35 years in the business are far more important than the size of his commission. He’s more of a teacher than an agent. He wants to rip that rearview mirror off his Ferrari and blaze a new trail.

And maybe he’ll reinvent the game again.

“I think I’m a compulsive perfectionist,” he says, smiling. “I want to do it better; I want to do it different.

“This isn’t a job for me; it’s not really even a career. This is my life.”

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