Over the past decade, there has been a surge in the number of athletes forgoing cash in exchange for equity in endorsement deals with startup companies. They are after that 50 Cent payday, named after the rapper who pocketed as much as $100 million when Coca-Cola purchased Vitaminwater-maker Glacéau in 2007 for $4.1 billion.
A new crop of athletes is set to cash in, thanks to the latest billion-dollar brand from Glacéau co-founder Mike Repole. Coca-Cola announced Monday that it was acquiring the remaining 85% of sports drink BodyArmor in a deal that values the company at $8 billion. Coca-Cola originally invested $300 million for a 15% stake in the brand in 2018. The pact included a path to full ownership, based on a “pre-determined discount.”
The deal will likely trigger eight-figure payouts for some of the earliest endorsers in the company, who in many cases, like Buster Posey and James Harden, invested cash in the company. More recently, Naomi Osaka, Mookie Betts and Christian McCaffrey joined the cap table as part of their endorsement deals.
Repole and Lance Collins launched BodyArmor in 2011 as a healthier sports drink alternative to Gatorade, touting a beverage that was low in sodium and packed with electrolytes, coconut water and antioxidants. Athletes gravitated to the brand, and it is now the official partner of UFC, MLS and the U.S. Open. Pop stars Carrie Underwood and Jennifer Lopez also joined the endorsement roster this year.
The late Kobe Bryant was one of the earliest athletes to bet on Repole and BodyArmor. He invested roughly $6 million for a 10% stake in the company in 2014. His estate is expected to receive more than $400 million from the sale, according to the Wall Street Journal. Repole was at Bryant’s posthumous Hall of Fame induction ceremony in May, as a guest of Kobe’s family.
Bryant was a key part of BodyArmor’s growth. He focused on marketing of the product, helping to recruit athletes like Osaka to the brand. Osaka joined BodyArmor as an endorser in 2019 and received a significant equity stake. “This product can be very disruptive,” Bryant said at the time of his original investment, adding that he thought Gatorade had become “bland with no innovation.”
“If it wasn’t for Kobe Bryant’s vision and belief, BodyArmor would not have been able to achieve the success we had,” Repole said in a statement announcing the Coca-Cola purchase.
In what was the first non-endemic endorsement deal of his young career, Mike Trout joined the company’s roster in 2012, his rookie season, the same year Rob Gronkowski joined the BA team. Andrew Luck and Posey both took stakes in the company the following year, as part of their endorsement agreements.
“We took a chance on a small startup, and we’re tickled that it worked out so well,” Trout’s agent Craig Landis said in a phone interview. Landis said Trout liked the healthier nature of the product, while Landis believed in the brand’s upside, based on Repole’s Vitaminwater history and the management team in place, particularly longtime head of marketing Michael Fedele. Landis would not comment on Trout’s current equity stake, but added, “We hoped in the best-case scenario, it could grow as it has.”
BodyArmor ranked as the third biggest sports drink in the U.S.—and fifth globally—last year, according to market research firm Euromonitor. It is on track to do $1.4 billion in retail sales this year, according to Coca-Cola. For context, sales were $5 million in 2012 and $6 million in 2013, meaning sales are up more than 200 times since the aforementioned athletes became investors. BodyArmor would not comment on the equity stake of any of its athletes.
Luck was in his second year with the Colts when he joined the BodyArmor team, which focused on young, rising stars, to distinguish itself from the mainstay Gatorade brand. “There’s always a risk in any equity, but I feel like there’s a great market for a sports drink that’s good and good for you,” Luck told Bloomberg’s Erik Matuszewski at the time. Luck certainly knew about Repole’s past brand-building story and added, “The hope when things like this happen is the Vitaminwater story.”
(This story has been corrected in the first paragraph to show Coca-Cola purchased Vitaminwater-maker Glacéau in 2007, not 2017.)