How Roger Federer Made $600 Million Following a Failed $10 Million Deal With Nike to Earn a Billion Dollars
Roger Federer is part of an elite group of athletes that have not only left an ever lasting legacy in their sports but have also gone on to reach a cool billion in career earnings.
Think sports biggest icons and names like Muhammed Ali, Michael Jordan, Tiger Woods and Roger Federer are some of the first ones that pop into everyone’s minds. These athletes had supreme talent and skill on the court most certainly, but they also had an aura about them that allured fans. They were, and remain, amongst the most marketable athletes we’ve ever seen. Naturally, there is a lot of intrigue surrounding their brand endorsement deals.
Nike was one of the first high profile brands that Federer endorsed and had been endorsing since 1994. To everyone’s surprise, it did not last beyond 2018 as the two failed to reach an agreement despite a working relationship for over two decades.
But Federer, who was closer to the end of his career by then, pulled off a massive coup through this adversity and made a fortune worth $600 million out of it.
Why Nike let Roger Federer go?
Nike is known to have a very good eye for picking athletes with massive potential early on in their careers. The sporting apparel brand did exactly that with Federer, who donned everything Nike from the year 1994. As Federer rose through the ranks to establish himself as one of the best to ever step on a tennis court, his popularity and marketability off the court continued to soar too; fans swooned over him and put their utmost faith and trust in him- a goldmine for brands. Naturally, many expected this partnership between Federer and Nike to blossom into something similar to the brand’s hugely successful tie-up with Michael Jordan.
Federer had a massive ten year $10 million annual deal with Nike that ran out in 2018. The expectation was both parties would happily extend the contract but Nike had other plans.
The sports apparel brand decided to stick to its principle of not spending more than 10% of its overall revenue on sponsorship deals with athletes. And with a roster of stars like Serena Williams and Rafael Nadal already on its books, Nike decided not to sweeten the pot enough for Federer to stay as perplexing as it sounds. You’d think Nike would do anything and everything to keep Federer and reap the benefits for decades to come as it did with Michael Jordan.
Federer, however, did what he has often done on the tennis court whenever he’s faced adversity; turn the tables by pulling off a magic trick leaving everyone dumbfounded.
Federer struck a deal with Japanese casual wear brand Uniqlo in June of 2018. And not just any deal but a deal that was worth three times his deal with Nike. Yes, that comes around to a cool $30 million a year, spanning ten years. That comes to a total of $300 million for Federer. This also meant that the then 36-year-old would keep earning the $30 million a year even post retirement. But that was just one of the two best parts of the deal he struck with Uniqlo.
The deal between Federer and Uniqlo covered only apparel as compared to his deal with Nike that covered both apparel and shoes. This gave the 20-time Grand Slam champion the freedom to lock in another lucrative sponsorship deal for shoes. But Roger being Roger, he did something even better.
Federer is turned On
For a while after signing his deal with Uniqlo, Roger continued training and playing with Nike shoes even though he wasn’t being paid for it. But a massive deal that would catapult his net worth was just around the corner and his wife and biggest supporter Mirka played a part in it too.
Federer first got to know about On shoes through his wife who would wear them. Following that, he started spotting many people donning shoes from the brand in his home country. This encouraged the former World No. 1 to reach out to the founders of the brand, Olivier Bernhard, Caspar Coppetti and David Allemann. After a bit of deliberation between the founders and Federer, the two parties struck a deal but not just any straightforward endorsement deal.
Federer joined hands with On as a brand ambassador, design partner and investor with a 3% stake in the company. Soon after, Federer started working on a tennis shoe with the company alongside a casual line named The Roger. Until then, On more or less dabbled in casual shoes.
After going public with the investment deal in 2019, better things were on the way. Until 2020, On was more or less playing just in the Swiss market and some parts of Europe. But following the pandemic, On became a global brand. With a global reach On went public after an IPO was issued. Once shares of the company started trading publicly, the market cap came to around a whopping $10 billion, meaning Federer’s stake was worth an estimated $300 million.
Combine this $300 million worth equity with the $300 million endorsement deal Federer struck with Uniqlo and you get a massive $600 million worth of earnings for the ingenious Swiss gem. Not bad in exchange for a $10 million a year worth of contract with Nike.
Roger Federer earned just over $130 million in prize money over the course of his tennis career. Add to that the fortune he’s made in brand endorsements, including the $300 million from Uniqlo amongst other massive endorsement deals, and the Swiss has earned about $1 billion until now. His net worth comes to around $550 million according to Celebrity Net Worth.
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