This episode, Mak & G are talking about the start of this year’s NCAA tournament, how much basketball players can earn, and the special prize Warren Buffet offered watchers of the tournament.
The NCAA tournament attracts watchers from across America and a lot of money is involved in the games.
This “Money With Mak and G” podcast episode, we discuss how much basketball players can earn, how much schools get paid for having their teams in the tournament, and the special prize Warren Buffet offered people who guessed every game’s outcome correctly…
“Warren offered 1 billion dollars to anyone who could perfectly fill out all the brackets, or 1 million dollars per year for life.” – Mak
“March Madness is the NCAA’s biggest moneymaker that means depending on how your basketball team does will depend on the money the NCAA distributes to your school.” – Mak
00:53 – How much Michael Jordan is worth and how he made his money.
01:37 – The NCAA tournament and the difficulties it has because of COVID.
03:08 – What a bracket is when guessing who’s going to win.
04:00 – The money Warren Buffet offered for anyone who guesses all the brackets correctly.
04:43 – How much money is lost due to people watching the game.
05:56 – What schools get for having their teams in the game.
Connect with Ben Jones:
MAK: Hello and welcome back to Money with Mak & G. Don’t forget to Like, Subscribe and Comment. We’d love to hear from you. Grant, I think everyone around here is going mad.
GRANT: Sis, it IS that time of year, when everyone starts to lose it. Dad’s friends are talking bubbles, brackets, buckets, and above all BASKETBALL. It’s almost a religion.
MAK: Almost? Really? This week, Indianapolis is hosting a couple of rounds of the tourney at Gainbridge arena downtown, and the midwest finals are being held in Chicago.
GRANT: Right at the United Center, directly across the street from where we were born at Rush Medical. Mom loves basketball due to living in Chicago when they won 6, yes 6 NBA championships.
MAK: She said it was insane and one of her favorite memories about living in Chicago. Speaking of Chicago and basketball, you can’t leave out Michael Jordan. MVP extraordinaire.
GRANT: You got that right, and after a quick google search, I found out he’s worth $1.6 BILLION. Basketball and a billion. He’s done an awful lot and big wins financially, including
MAK: Space Jam, the Movie
GRANT: Michael Jordan’s Restaurants
MAK: Big-time Endorsements, like McDonald’s, Coca-Cola…..
GRANT: And, “His Airness” endorsement of Nike AIRRRR Jordans
MAK: I looked it up and one of his pairs of shoes that he wore in 1984, sold for almost $1.5 million at auction. Dad always reminds us how the Indiana Pacers had the chance to draft him, but didn’t. What a big “shot and a miss”. We’re into March Madness and there is a lot of money floating around.
GRANT: When things were canceled in 2020, it was pretty upsetting for a lot of people. And, all of those basketball players missed a year of play. It was a big deal.
MAK: Dad’s friend went to Senior night at IU last week. It’s usually emotional as these guys will be leaving the school at the end of the year. We got to know them on the court. But, the NCAA has allowed them to play an extra year, so all the senior’s AREN’T leaving.
GRANT: They’re all coming back…Possibly. It’s added a whole new dimension to things. What about the younger guys who aren’t getting to play because the older guys are hanging around?
MAK: Pretty strange, for sure. The NCAA tournament was created in 1939 by the National Association of Basketball Coaches and was the idea of Ohio State coach Harold Olsen.
GRANT: It started on March 17 and ended on March 27th when the University of Oregon DEFEATED The Ohio State University 46–33. I guess that’s why an Ohio State coach had the idea.
MAK: Even though he lost, having a really great team might push you to have another tournament to be in so you can win!! Well, Thank you, Mr. Olsen. Many people would agree it’s been a good idea. And, there is a women’s tournament as well that started with the AIAW in 1969 and changed to the NCAA tournament in 1982. That’s a great tournament as well. Maybe even better!
GRANT: It’s definitely exciting. But, not sure everyone thinks it’s a great idea when their husbands, wives, girlfriends, or boyfriends sit on the couch for days on end, right? But, it’s time to pick your teams and determine…. or GUESS, who will win each game and put them on something called a “bracket”. First, it’s not the brackets we have on our braces. It’s like a… diagram with two lines for the names of teams who play each other. The winner of each goes to the next game.
MAK: That’s right. But there is money in those brackets. Even Warren Buffet, investor extraordinaire is in it. I like the word “Extraordinaire”. It’s fun to say. Anyway, Warren, we’re on a first-name basis has a challenge for anyone who can pick all the games, which are now 68.
GRANT: It’s crazy to think when it’s all done, there are 67 losers and only one winner. The odds of winning are like the odds of being struck by lighting about 3.4 million times in your life…. if you lived through them all. There are 9 quintillion ways to fill out all the winners. That’s 18 zeros AFTER the 9.
MAK: Talk about nuts. Warren offered $1 Billion for anyone who could perfectly fill out all the brackets, or $1 million for life. At about 2.4 Trillion to 1, good luck. The closest guy got 49 games right, before missing.
GRANT: But, the last time it was available to the public, like you and me was years ago. Now, he ONLY offers it to the employees of his company, which are a mere 400,000.
MAK: How fun is that. But, there is money out there for the schools too, depending on how they do. IU has 5 national championships behind UCLA, Kentucky, and NorthCarolina.
GRANT: But, they’ve had a dry spell since 1987. Let’s not talk about that. Schools make money, besides bragging rights, which are PRICELESS, by the way.
MAK: Ok, March Madness is the NCAA’s BIGGEST moneymaker. That means depending on how your basketball team does, will depend on the money the NCAA distributes to your school.
GRANT: The NCAA supposedly makes over $1 Billion on March Madness, and that’s about 90% of their TOTAL revenue. It’s crazy important for them. And, it affects other parts of the economy too.
MAK: People are so nuts, they miss work, call in sick or spend time on their phones at work watching. One crazy estimate is over $13 Billion is lost to people not working due to the “Madness”.
GRANT: I know. It almost sounds like a disease, and the only medicine is to watch your teams with friends, eat, drink, throw popcorn at the TV, and maybe win a “work pool”. That’s when people throw money into a pool just like water is put in a pool. This is done at a person’s work.
MAK: Yeah, and depending on how it works, you can win money for picking the most wins through the tournament or if you pick the team that WINS IT ALL, or the first team to score, and more.
GRANT: Some consider it gambling, and others don’t. But gambling sees over $10 billions spent on the games.
MAK: That’s a lot of dough flying around. What about the schools? They get stuff too, right?
GRANT: With all that air time on TV when playing, the school gets some great coverage. The more they play, the more coverage. Schools will run ads showing why their school is so good.
MAK: The number of kids applying to a school, if a team does unexpectedly well, jumps. They’ve seen jumps of over 30% in applications. That’s definitely good if you accept more kids, who pay.
GRANT: Very true. The NCAA also pays a school for “units” earned during March Madness. A “unit” is a standard of measure. It’s a common way to discuss things, like a gallon of milk. It also gives the NCAA a way to calculate how the money is divided up.
MAK: So, the more units you get, the better, and each year they can change the payout for each unit, just like the price of one gallon of milk changes.
GRANT: Yep. About ¼ of a billion is dished out to schools. A max of 5 units can be earned for a team depending on how much they win. A unit was around $340,000, and it’s paid to the CONFERENCE the school is in, like the Big 10.
MAK: The conference will then dish out the money to all the schools in the conference. It sounds like one unit is paid each year for 6 years. That means a unit, in total is worth a little less than $2 million over 6 years.
GRANT: So, it’s really important for a CONFERENCE to have as many great teams in the tournament. It’s estimated that 9 teams from the big 10 conference who have IU, Purdue, Michigan, Illinois and more. It’s highly probably IU is in, but we won’t know for sure until AFTER selection Sunday is over. And, we’re taping early on Sunday. I hope we didn’t jinx it.
MAK: I’m sending great vibes for IU. The Big 10 has a great group of midwest teams, for sure. So, we’ll definitely be rooting for them to do well and get a bigger pool of units. Isn’t it confusing that the big 10 has 14 teams and the Big 12 has 10?
GRANT: You would think colleges could add by now, but this doesn’t seem to prove it. It’s simply confusing. Either way.
GRANT/MAK: Go Big 10!!
MAK: We’ll see you next week for more…..
GRANT/MAK: Money with Mak & G. Bye!