Ever since they bid to buy the Chicago Cubs in 2009, the Ricketts family has been credited with making sound business decisions that have brought the team to the brink of its first World Series championship since 1908.
But Chicago Cubs Chairman Tom Ricketts, who has led the organization since the acquisition, also has had a hearty dose of luck. He has benefited from an insanely loyal fan base that could tolerate years of poor results while the deep-pocketed Ricketts family rebuilt the entire team – a luxury that many other baseball teams might not have had.
“They (the Rickettses) have had the rare combination of having great management, great resources and great luck all coming together at the same time,” said Marc Ganis, president of consulting firm Sportscorp Ltd, which advised Tribune Co in its sale of the Cubs to the Ricketts family.
The World Series between the Chicago Cubs and Cleveland Indians, currently locked in a 1-1 tie, now moves to Chicago’s Wrigley Field for three games, with the Cubs seen by many analysts as having a slight edge.
The Cubs were worth $1.2 billion in 2009, Ganis said, but with credit tight during the financial crisis, the field of bidders was limited and the Ricketts family was able to snag the team for $900 million. Real estate investor Sam Zell, who had bought Tribune Co by loading it up with debt, was motivated to sell in an ultimately unsuccessful effort to avoid a Tribune bankruptcy.
Tom Ricketts, an investment banker whose father Joe Ricketts founded TD Ameritrade Holding Corp, immediately engaged with fans after buying the team. He stated at the annual Cubs convention in January 2010 that his aim was to win a World Series.
Ricketts in 2011 hired Theo Epstein, the wunderkind who as team president of the Boston Red Sox in 2004 helped lead the team to its first World Series championship since 1918. The two announced a long-term plan to build a perennial playoff contender by unloading costly veteran contracts, rebuilding the Cubs’ farm system and making a limited number of key free-agent signings. Young stars Kris Bryant and Kyle Schwarber have come up through the Cubs’ farm system.
“Ricketts and Epstein have been transparent that it would take years to rebuild the team, and that has helped them with fans,” said ESPN reporter Sarah Spain.
Ricketts’ vast family wealth has helped the team recover from its few missteps. When free-agent pitcher Edwin Jackson could not perform, Epstein was able to release him and eat the $26 million remaining on his contract.
“You need to have huge, deep pockets to be able to walk away from contracts like that,” said Irving Rein, a Northwestern University professor who formerly consulted for Major League Baseball. “If a team like the Minnesota Twins made a mistake like that, they would have to live with it.”
Baseball and Business
Ricketts has shown a savvy appreciation of the Cubs’ famously loyal fans.
Paul Sullivan, who covers the Cubs for the Chicago Tribune, said fan loyalty kept revenue high during some ugly seasons from 2010 to 2014.
“The fans were subjected to some pretty awful baseball and some pretty awful baseball players, but many of them stuck with it,” he said.
Ricketts has shown a deft hand on the business side, too. He bought a number of buildings across the street from Wrigley Field, ending a long-standing dispute with owners who sold pricey rooftop seats so people could view the games.
And working around the local landmark status that protects Wrigley’s hand-operated scoreboard and other parts of the ballpark from alteration, he has installed large video screens that generate revenue, and begun tearing up adjacent properties to build a hotel and entertainment complex.
The changes have disappointed people like longtime fan Floyd Sullivan, 66, who writes a blog titled “Waiting4Cubs.”
“I believe what the team says because they do what they say they are going to do,” he said. “But I think the organization is just about making money.”
Ganis, the Sportscorp consultant, said he believes changes by Ricketts have increased the value of the Cubs’ franchise to $3 billion. He points to the sale of the Los Angeles Dodgers in 2012 for $2.15 billion, as well as investments by the Cubs owners like a new complex in the Dominican Republic to develop raw talent and a spring training facility in Arizona.
“We’re seeing the results on the field and the Cubs are going to be one of the top teams in baseball for a number of years to come,” Ganis said.