Maria Sharapova Built a Business Empire Thanks to Her Winning Team

Entrepreneur on 2018 -Nov -27

For the tennis champ and entrepreneur, teamwork is the key to success.

Even in black sweatpants and basic white sneakers, Maria Sharapova is impossible to miss. We meet in late spring in Sarasota, Fla., at the IMG Academy Bollettieri, named for the tennis coach who helped make her famous. His name, this place, are very much part of Sharapova’s often-told rags-to-riches story. Here is where she came — straight from Russia, with her father, Yuri, neither of them knowing much English — to become a tennis star at the age of seven. They had just $700 to their name and got to practice by bicycle because they couldn’t afford a car. Turned out that at seven, Sharapova was still too young to even attend the academy, but Yuri took odd jobs to help keep them afloat until she was, at nine, when she entered with a full ride. When her mother finally arrived, a year later, Sharapova was home­schooled so she could focus on tennis.

It was sacrifice that paid off, of course. By 18, Sharapova was the world’s highest-paid female athlete, a title she held for the 11 years following, a silver Olympic medalist and one of only 10 women to win a career Grand Slam in tennis. Her talent made her bankable, but so did, ironically, her “all-American” good looks — six-foot-two with long, golden hair. Eventually, multimillion-dollar endorsements from brands like Canon, Porsche, Nike, Head, and Evian overtook tournament prize money. The fashion industry grabbed hold, too, bolstered by early support from tennis fan Anna Wintour, who put her on the cover of Teen Vogue. Her 18th birthday was sponsored by Motorola.

Sharapova, now 31, is still playing tennis full time and is currently ranked at number 29. As we settle into seats at an outdoor table during a short training break, she tells me that while she may never have gotten a formal education, the principles of tennis have actually prepared her very well for whatever comes next. Already, her business portfolio is deep: It includes Sugarpova, her six-year-old candy line; investments in Ultimate Fighting Championship, sunscreen maker Supergoop and an app called Charly that lets users message celebrities; and an upcoming partnership codesigning hotel gyms with architect Dan Meis, whose projects include the Staples Center in Los Angeles and Safeco Field in Seattle.

And like most smart entrepreneurs, she knows the value of getting the absolute best experts on board. “One of the things I’ve taken from my sport is the importance of team building,” she said. “I have a very small group I rely on, whose opinion I very much call for.” It’s key to have those people, even, she said, “as you become more confident in your own voice and your own choices. There’s a reason you have a team behind you, and that’s because they are much more knowledgeable in certain areas than you are. I don’t want to be the smartest employee on my team.”

Those she’s chosen for her inner circle, whose tenures span from 20 years by her side to just a few months, reveal a lot about how she’s gone from child tennis star to international brand. And they also show just how important it is to build the right team — and evolve it as you grow.

If Sharapova is the team captain, Max Eisenbud, vice president of IMG Tennis and Sharapova’s longtime sports agent, might be considered the MVP. He’s involved in every business deal she makes, sports-related or otherwise, and has been since he signed her at age 11 — though like any good agent, he’ll throw the credit back to the talent. “In 2004, she won Wimbledon and got thrust into this life, with the opportunity to work with huge companies on huge ad campaigns,” Eisenbud said. “She would ask questions, meet with the director, meet with the creative people, really seek to understand what they wanted, take the shots and then look at the camera and say, ‘No, I can do this better.’ I think she’ll be a better businesswoman than she is a tennis player. She’s amazingly competitive.”

In 2012, Sharapova was on break from tennis with a hurt shoulder when she told Eisenbud she wanted to try her entrepreneurial hand. She’d been part of a few very successful collaborations by then, having designed an entire line of tennis apparel for Nike and a ballet flat for Cole Haan that became the brand’s best-selling shoe for two years. “And about that time, she came to me and said, ‘You know, I’m enjoying these collaborations, but I want to make my own decisions,’” said Eisenbud. “‘I want to not make 5 percent; I want to make 100 percent.’ ” Not long after, he spotted the first opportunity.

Candy may not seem like the most natural fit for a professional athlete’s entrepreneurial foray. The story Sharapova likes to tell is that growing up, her parents would reward her good performance on the court with a treat; the smell of baking, meanwhile, reminds her of her grandmother’s kitchen back home in Russia. But in reality, sentiment had very little to do with it. The idea came up, said Eisenbud, at a working lunch with Jeff Rubin, a cofounder of boutique candy shop Dylan’s Candy Bar, who was looking for Sharapova to partner with him in some way for his new chain of stores, called It’Sugar. “Jeff blurted out the name Sugarpova, and a light went off,” said Eisenbud. “[Maria] loves gummies, so I pitched her the idea. She was laughing about the name. And then she came back to me after a few weeks — she’d done some research.”

came back to me after a few weeks — she’d done some research.”

What she learned, he said, was that the candy business was not just big but huge, with plenty of room for growth. Despite the public’s increasing concern about health, the industry is predicted to hit nearly $19.6 billion by 2025. It also had an identifiable hole. “I’m not someone who goes into something without looking at charts and looking at how it’s distributed in the world and what the growth opportunities are,” Sharapova said. “I wanted to create a brand that people saw on shelves and didn’t eat on their way from the register and throw away before they got in the car. I wanted them to treat it as a souvenir, something they appreciated, something they wanted to share and show and gift.” Most candy packaging was pretty down-market; she suspected people would appreciate, and be willing to pay for, something nicer.

She sent Eisenbud to track down the makers of a particular gummy she liked, which landed him, four flights later, in a small town outside Madrid, Spain, where a company named Fini agreed to manufacture what would become Sugarpova’s inaugural line of gummy candy and gumballs. With Eisenbud acting as CEO, and Sharapova having final say on every decision, they launched Sugarpova with $500,000 of her own cash and no outside investment.

“Fini really helped us,” said Eisenbud. “I mean, I know nothing about retail. I’m a sports agent.” He also knew nothing about advertising or design, so he hired Dentsu, the Tokyo-based advertising and PR firm that had worked for years with Sharapova on Canon campaigns, to oversee the branding. Dentsu then brought in Brooklyn branding agency Red Antler to help design the product and create the packaging. The candies were colorful and quirkily named, shaped like lips, high heels, and handbags, and packaged in brightly colored bags that bore the tagline “Some style for your smile.”

A few years later, the brand was doing well enough when, Eisenbud said, he “turned to Maria and said, ‘Maria, we need, like, real people. I don’t actually know what I’m doing.’”

Patrick Kenny had the exact kind of retail acumen Eisenbud was looking for. As managing director and partner at Traub, a firm that’s worked with what it calls “iconic celebrities in building their businesses”—Jessica Simpson, Paul Newman, Dita Von Teese, as well as brands like The North Face, MoMA, and Related Urban—his company could help take Sugarpova to the next step.

But Kenny hadn’t been on the project long when in 2016, they ran into a critical and unexpected challenge: Sharapova was banned from tennis after testing positive for meldonium, a heart medication added to the list of prohibited substances at the start of that year. Most of Sharapova’s biggest sponsors, including Porsche and TAG Heuer, dropped their endorsements, while the United Nations suspended her status as a goodwill ambassador with its Development Program, a partnership Sharapova had called one of her proudest ever.

The way Traub decided to handle the ban — which, at the time, Forbesestimated could cost Sharapova upwards of $50 million — was to treat it as a nonissue. “We didn’t brand around it,” said Kenny. “We branded right through it. Maria worked as hard as ever on bringing new products to market during that time period, and we touched base with all our customers and told them that we were going to continue to be successful and Maria was going to continue to be behind the brand. There was never space between us and Maria and our customers, and everybody stayed with the project.”

If Sharapova broke a sweat, she didn’t show it. Under Kenny’s and Eisenbud’s advisement, she instead used the 15 months of her suspension to focus on Sugarpova, becoming more hands-on. She showed up for meetings at Bed Bath & Beyond and Kroger, and visited food shows and fairs. “I allowed her to go to a lot of meetings, help us close deals, fly to different places she didn’t before,” said Eisenbud. She enrolled in a 10-day strategic management program at Harvard Business School in Boston on leadership and team building, then spent time interning at Nike’s London-based ad agency — learning about “why this sneaker was chosen over that sneaker, how much do you spend on e-commerce marketing,” she said. She also interned at the NBA, where she worked with commissioner Adam Silver, who taught her that everyone in a room can learn from one another.

Meanwhile, the team at Traub got back to the initial challenge — getting Sugarpova into more stores. Eisenbud had been literally knocking on doors himself. Relationships were key, and he had none. “People were like, ‘You know, we buy from this distributor…’ They wouldn’t even look at you unless you were in their system.” With Traub’s help,  Sugarpova grew in a year and a half from having a single distributor — the New York–based Nassau Candy — to maintaining partnerships with the biggest distributors in the country. “We said, OK, if you’re going to build a large-scale business, then there’s some infrastructure and supply chain issues you have to prepare,” Kenny said. “With a consumer product, you can’t get big and then figure out your logistics infrastructure, production, and supply. You have to figure that all out in advance, even if you have the best product.” Traub also lowered the price point from $4.99 to $3.25 and suggested the brand expand into chocolate, which Sugarpova did in 2016. Since then, Kenny’s team has continued to identify areas of potential client goodwill. When Hudson News began stocking Sugarpova at 450 of its airport locations, for example — a deal Traub orchestrated earlier this year — Sharapova returned the favor by Instagramming from stores during her travels to her 3.3 million followers, “which kind of knocked the socks off the Hudson News team,” said Kenny. (The star’s Instagram is any brand partner’s dream, especially when they’re a part of a mix that might include posts from the front row at Ralph Lauren or with supermodel Helena Christensen, and where there are as many photos of Sharapova on her couch looking relatable as there are of her sitting on the hood of her #sponsored Porsche Spyder.)

Today, as a result of such synergy, Sugarpova is sold in 22 countries and offers about a dozen products. Sales for 2017 have been estimated at $10 to $12 million, and while the company declines to confirm that figure, it will say that business continues to grow at double digits year over year. In the end, Sharapova’s suspension did not impact sales, said Eisenbud, and eventually all her sponsors aside from TAG Heuer renewed their contracts. “I’m not going to say it was good, but she made the most of the time,” he said. “And the fact that her brand was so strong allowed her to get through a very bad, turbulent hurricane that most celebrity brands, or brands in general, could not have gotten through.”

Earlier this year, Sharapova and Eisenbud began talking about ways to build up her recognition as a businesswoman while also promoting the sort of female-to-female mentorship she’d felt she’d missed out on in her own careers, both in tennis and in business, where she often found herself the only woman in the room. “You might have a great idea, you might be creative and have the drive,” she said, “and you might still end up not being successful because you didn’t have the right voices around you.” She wanted to be such a voice for other women.

On her behalf, Traub researched and interviewed dozens of women’s organizations as potential partners before approaching the National Association of Women Business Owners (NAWBO), which offers mentoring and leadership support for female entrepreneurs through more than 60 chapters across the country. “They seemed to be the right people, who understood Maria, and the right size — not too big or too small,” Kenny said.

NAWBO, for its part, was thrilled by the idea of partnering with Sharapova. “One of the core missions of NAWBO is strengthening and supporting women-run businesses in wealth-building capacities, and we’re always reaching down and pulling the next woman up,” said Lynda Bishop, national program director. “Women are really good at helping each other. If you tell me five issues you’re having trouble with, I can probably think of solutions for each of them. But if I’m faced with one of those challenges myself, I might struggle to know what to do.” That said, partnering with Sharapova wasn’t an automatic no-brainer. “NAWBO is pretty careful about how we use our time, resources, and name, so when we were first contacted, we did our homework: Who’s Traub? Who’s Maria, and what’s she doing in business?” said Bishop. But they came away satisfied. This is a team, they decided, that really means business.

Bishop worked with Kenny and other members of the Traub team to create the Sharapova Women’s Entrepreneur Program, which provides customized mentoring and education to winning participants. In the spring of this year, seven women were chosen for the inaugural 12-month-long run. Each was paired with a high-level female business mentor from within NAWBO’s network; participants also have the opportunity to take part in workshops and seminars on topics like hiring and efficiency, and connect with investors. Then Traub was able to start securing additional partnerships, like an upcoming one with fashion house Veronica Beard: Ten dollars from every Veronica Beard online purchase will be donated to NAWBO.

Sugarpova’s in-house PR team, meanwhile, has been brought in to help program participants understand how to “get noticed the right way by the right people,” said Bishop. The biggest takeaway: More is not better. “It’s about strategic outreach, not just outreach for the sake of getting your name out there.” Already, the women have used what they’ve learned to assemble their own PR campaign, to be shot and produced by program participant Reema Dutt, who owns a video production firm in Los Angeles. “Having a community of female founders has been the most empowering aspect so far,” said Dutt, who is in the process of making her first full-time hire with her mentor’s help. “Having the confidence to take risks, having someone with real experience say, ‘We believe in you,’ has been invaluable.”

In the spring, Sharapova announced her latest partnership, with architect Dan Meis. It began when Meis noticed her interest in design via Instagram and reached out to her. As it turns out, Sharapova grew up wanting to be an architect. Over the three years she renovated her Manhattan Beach, Calif., house, she’d regularly have samples of materials sent to wherever in the world she was. Meis saw an obvious opportunity here. They could collaborate on designing boutique health and wellness facilities for hotels and resorts around the world. “Hotel gyms are often all the same,” said Meis. “Even the best aren’t all that inspiring. I told her I wanted to do for tennis and training what Ian Schrager did for hotels; to think about the hotel gym from the point of view of the person using it, and the whole experience of that person beyond just the actual working out.”

He isn’t concerned that Sharapova has no experience with design, and comes with plenty of opinions. “Because she’s the model consumer, too,” he said.

Eisenbud, for one, trusts in her instincts. And he’s still MVP of the growing entourage. “We disagree all the time, on a lot,” he said. An example of just how in the weeds these two major industry players will get: Sugarpova has a chocolate bar that’s milk chocolate with strawberry. Eisenbud lobbied for it to include pieces of strawberry, because “otherwise, to me, it tastes artificial,” he said. Sharapova thought the pieces would get stuck in people’s teeth. “And I’m like, ‘This is ridiculous,’ ” Eisenbud said. “ ‘You need to see the pieces!’ ”

They got into a huge fight. Eisenbud lost. Who was right? “The milk chocolate with strawberry bar,” he conceded, “is doing very well.”