Ted Leonsis: The Many Sides of A Successful Greek-American Billionaire

Ted Leonsis

In an exclusive interview with Greek Reporter, Ted Leonsis talks sports, success,  filmmaking, and helping Greece, admitting, “Me, personally, I’ll do anything to be helpful and to help Greek people.”

Ted Leonsis has made quite a name for himself since growing up as a young Greek-American boy in Brooklyn, NY. Leonsis, now 56, is a sports team owner, venture capital investor, filmmaker, author and philanthropist, and has been recognized for many of his achievements, including making the list of Top 10 Creative Executives in America and Top 20 Most Powerful People in Sports. And, he is also very proud of his Greek roots.

Originally from Gytheio on his paternal side, Ted’s grandparents, who changed their name from Leoutsakos to Leonsis when they moved from Greece to the U.S., settled in Lowell, Mass. His parents ended up moving just a little further South, to the NYC borough of Brooklyn. Ted’s father, a waiter, and mother, a secretary, sent him to Sunday school and they attended a local Greek church, before returning to the highly populated Greek town of Lowell when Ted was 16. After finishing high school, he went on to receive a degree from Georgetown University in Washington, D.C. His parents were big advocates in pushing him to succeed, and he did.

Now living in Maryland, and operating businesses in Washington and New York, Ted is considered an Internet industry pioneer and serial entrepreneur. He helped build AOL into the global business it is today. Under his leadership, AOL increased its membership from under 800,000 members to over 8 million, and their annual revenue increased from $100 million to $1.5 billion. He is also the owner and CEO of Monumental Sports, which owns the NHL’s Washington Capitals and other sports properties. Additionally, he serves on the board of directors at Groupon as well as American Express, where he heads the technology and innovation committee. And it doesn’t stop there. Ted is an award-winning producer of documentaries, and the founder and chairman of SnagFilms; he coined the term “Filmanthropy” to express the idea that films are more than just about making money — they’re also about sending a message. His philanthropic efforts are many, including his involvement with the Hellenic Initiative, whose mission is to develop “sustainable economic and business improvement programs to empower the Greek people toward long-term prosperity.”

We recently had the opportunity to chat with Ted Leonsis about his thoughts on the Greek economic crisis and what he plans to do to help the current situation. We also talked film, sports, and what he believes is the real key to success.

A lot has been said about the Greek economic crisis. What are your thoughts on people who have, or have not, been rallying behind the country to support it?

I separate out Greece and its political and economic system from Greece and the people. That’s very, very important. As an observer and participant in economies, I don’t believe that the Greek political system and economic system was managed and blended appropriately over the last 25 to 30 years. In the sports business, there’s a saying, ‘You are what your record says you are,’ and we’re seeing that. The chickens have come home to roost in Greece. At the same time, the suffering that the people of Greece are undergoing because of the state of the economy, and most importantly, young people, the people who should be the next generation leaders — the drivers of the new economy — are suffering the most. And the Hellenic Inititative’s focus is really on, ‘How do we provide aid, mentoring, loans, money, to help the economy and the people of Greece prosper again.’

What do you think needs to happen in Greece for the situation to improve?

Me, personally, I’ll do anything to be helpful and to help Greek people. I’m not as active and supportive of the Greek political system measures. In fact, I’m disappointed. I think there needs to be a real accountability on where the dollars go. As a philanthropist and business person, you just need to feel very trustworthy in following the monies, and so a new era of transparency and accountability is going to be very important. And then, second, fostering an economy that is based on small business and innovation and entrepreneurs. That usually means less regulation, less bureaucracy, because small businesses create jobs. Small businesses are kind of the life blood of developing an economy, and female-owned businesses become equally as important. The whole European culture of risk in who [to] back will need to be rethought. Celebrating young people, celebrating women, and get risk capital — then they’ll be able to grow the economy faster and better than the government can grow the economy. That takes a real see-change in thinking and structure.

In addition to being involved with the Hellenic Initiative, do you plan on investing in Greece?

With the Hellenic Initiative, it’s really just charity. I really wanted to try and help [and] not only in a charitable way. Just yesterday, I was talking about bringing a young person, or a few people, over to work for one of my companies; we give them experience, and they get jobs, and they can bring that experience back to Greece-based companies. From a venture capital perspective, I once tried when I was president of America Online to open a big European call center in Greece, and the conversations didn’t go very far. We ended up going to Luxembourg and Ireland, and ended up hiring thousands and thousands of people in both countries. The infrastructure was better, the government was more welcoming, the tax structure was very different. Greece is going to have to change some of its policies and frankly, some of its point of view to be more welcoming of tech companies and start-up companies. It’s been difficult to do business with Greece in the past.

You are, and have been, involved in businesses ranging from finance to film, to sports and digital entrepreneurship, and that’s just to name a few. How do you manage to get involved in such a vast range of projects?

I try to only be involved with double bottom line companies; companies that can do well by doing good. For example, nothing brings a city together like a winning sports team. The Red Sox won the World Series; today [Boston] is together, tight, celebrating, happy, proud. That experience of winning a championship and bringing the city together, that’s what the owners will remember at the end of their life, not that they increased the ticket prices 11 percent, but that some young boy was in the stands with his father and they’ll have that memory together for a lifetime. I’ve always been attracted to and have been able to find companies that have a much higher purpose than the business.

My biggest wins and successes have been in finding companies that are worthy of all the hours, all the passion, all the attention that you’re going to put in it because they’re doing really, really good things besides the commercial side of it.

Let’s talk a little bit about the term you coined, ‘Filmanthropy.’ How did you come up with that?

I started to make some movies, mostly documentary films around subjects that had what I call ‘a double bottom line.’ You want to make a movie, a lot of people see it, it goes on television or HBO, and it sells on DVD. But the real reason you make a movie is to shine a light on a difficult subject or to activate volunteerism, or charitable giving. Just as we have philanthropy, I think we’re going to see more and more filmanthropy because this younger generation is living in a YouTube world and they all have video cameras in the palm of their hands with their iPhones, and they all have movie screens in the palm of their hands with iPads, and more and more people will self-express using film. It’s cheaper, it’s faster now to make movies, so I think we’ll see a whole generation of, what I call, ‘filmanthropists,’ and producers of movies that want to tell a story that makes a difference and shines a light on tough subjects.

What movies fall in the ‘Filmanthropy’ category?

I’ve made four movies that fall in that category. I just finished one that went into some film festivals this summer — ‘Lost for Life,’ a very tough documentary about young adults serving life without parole. Most of [these] kinds of movies wouldn’t have been made 20 years ago [because] it was just too expensive to make the film and nowhere to distribute it. So to solve that problem, I created SnagFilms. I also acquired and own Indiewire. Both of those properties are centered around independent and documentary film. ‘An Inconvenient Truth’ [from Participant Media] is also in that space.

Besides film, your philanthropy extends into the current sports teams you own as well, including the NHL’s Washington Capitals. What is being done to promote hockey locally and make it more accessible to youth groups?

We are unbelievably focused on that. In the last five years, the Washington, Maryland and Virginia area have been at the top in terms of enrollment and people getting involved. That’s directly attributable to: 1. The success of our team, 2. That we have a superstar player on our team named Alex Ovechkin. We’ve been incredibly aggressive and generous in supporting youth hockey, both in our own rink – we own two rinks – and we donate ice time and raise money for youth hockey using the team, and tickets, programs, merchandise sales and the like. And then my personal foundation is very involved with the Fort Dupont rink, which is the most inner city rink in the heart of Washington, D.C. That’s something I’m very proud of. We are deeply involved in growing the game and helping youth hockey; it’s part of our philanthropy.

What advice do you have for someone who would like to have a career similar to yours?

I wish I had an easy answer. There’s a science and a lot of data around entrepreneurs that I fit. I’m an only child, and many single children in a household, for whatever reason, they become entrepreneurs. I lived in a household where we were not well-off or well-educated, but with [that situation], the parents in the household push their children to be much more educated than they are and to have higher aspirations. Many entrepreneurs grew out of poor, ethnic-oriented households. My mother and father didn’t go to college, yet they were so focused on me going to college, getting good grades and studying and working really, really hard, because they always believed that education was the path to success.

Speaking of success, you’ve written a few books on the topic. What do you think the most important key is to having a successful career?

I wrote [Business of Happiness] because in my household, I was taught that if you work real hard, you study real hard, you goto a good school, and if you get good grades, you’ll get a good job. And if you get a good job, you’ll make a lot of money. And if you make a lot of money, you’ll be successful. That was the first generation mantra. I’ve come to understand that’s only half true. If you’re successful, it doesn’t mean you can be happy. Headlines are filled everyday with successful people who aren’t happy. Happy people and happy companies tend to build the most value. They have the best family relationships, they have the best work relationships, they’re the most respected leaders, they’re focused on building value. That was my most valuable lesson.

For more on Ted Leonsis, visit his daily blog, Ted’s Take, or follow him on Twitter: @TedLeonsis.


3 COMMENTS

  1. He become successful because he is not in Greece…Unfortunatelly, Greece has never been and will never be a country for it’s own professionals to become successful in their professional life…The multiplicity of explanations postulated by both local and international analysts concentrate mainly on the economic and political factors, with few mentioning or even expounding on the protagonistic role that corruption played in the Greek meltdown.

    How much did corruption contribute to this Mediterranean tourism Mecca, resulting in total debts of US$175 billion owing to foreign banks at the end of 2010, according to ‘Quarterly Review (June 2011) of The Bank for International Settlements (BIS)’? How did corruption contribute to Greece’s humungous public debt-to-GDP, according to the European Economic Statistics (2010 edition; tables 4.24 and 4.26)?

    Today’s estimates from various sources range between 140 per cent to a massive 150 per cent. Did corruption feature greatly in influencing the three prominent ratings agencies (Moody’s, Standard and Poor’s, and Fitch) to downgrade Greek debt to ‘junk’ status, or estimates of its 2011 government to figures around a gigantic €327 billion? Was corruption the reason why Greece has the European Union’s (EU) lowest Corruption Perception Index ranking (according to Transparency International), Index of Economic Freedom (according to The Heritage Foundation) and Global Competitiveness Index (source: World Economic Forum), ranking 78th, 88th and 90th in the world, respectively.

    Tax Evasion

    Some writers trace Greece’s deep-rooted ‘culture’ of tax evasion from its historical period of foreign rule by the Ottoman Turks in the 19th century when Greeks ‘patriotically’ avoided paying tax as a form of resistance or retaliation. It is felt that this unfortunate culture continued into the 21st century where Greeks resist the complex and high levels of taxation, as detailed in sources such as Eurostat’s publication titled ‘Taxation trends in the European Union 2011 Edition’.

    In fact, according to Euronews, then Greek prime minister, George Papandreou, bemoaned in mid-2011 that the evasion of tax and social-security contribution was costing Greece around €30 billion a year. These facts were corroborated by the Tax Justice Network (TJN), which claims that there is more than €20 billion in Swiss bank accounts held by Greeks and the amount of Greek-owned offshore companies top 10,000.

    Allegations are that this culture is so endemic that ‘everybody’ cooperates to evade indirect taxes. Bills are avoided in transactions, with both buyer and seller colluding to keep transactions recordless, and hence taxless. As a result, despite being a developed country ranked in 2010 as the 32nd largest in the world (nominal GDP), and the 37th largest (in terms of purchasing-power parity (PPP)), the underground economy is estimated to be equal to between 25 and 37 per cent of the economy today. Accordingly, the World Bank’s ‘Ease of Doing Business’ table (up to June 2011) ranked Greece as far down as 100.

    Government Fraud

    The details of Greece’s economic history would be too lengthy to address here but, in summary, from about 1993, the public debt-to-GDP ratio has been consistently above 100 per cent. Critics have alleged that successive Greek governments cooked the fiscal accounts in ways that allowed them to keep borrowing and averting disaster.

    Upon ascending to political power, new administrations, on realising this legacy of debt burden, regarded it as political suicide to discontinue this trend by cutting back on welfare measures. Successive leaders lacked the political courage and astute leadership, and instead took the easier path of continuing to borrow, widening the revenue/expenditure gap, interest burden and public debt-to-GDP ratio.

    In 2001, when Greece needed to join the EU to access the benefits of the EMU, its debt ratios were above the required level, plus its deficit was nowhere near the stipulated minimum of three per cent. Perceptive financial analysts contend that to achieve this aim, Greek politicians used ‘creative accounting’ to manipulate derivative financial products, not easily understood, to magically cause the deficit to befuddle European accountants.

    derivatives-focused programme

    Media reports, including The Guardian (February 26, 2010), pointed out that a major US investment bank was instrumental in managing a derivatives-focused programme for the Greek Government to hide the state of its public finances from the EU authorities ahead of its membership to the euro in 2001.

    In fact, at the time, Ben Bernanke, chairman of the United States Federal Reserve, revealed that the Fed was examining the conduct of Goldman Sachs and other Wall Street banks in the troubled southern European country. “We are looking into a number of questions related to Goldman Sachs and other companies and their derivatives arrangements with Greece,” he disclosed, adding that the Securities and Exchange Commission was also interested in the matter.

    Government fudging of the Greek deficit numbers continued up to about 2009 when discrepancies began to surface and the 2009 deficit had to be revised from between six and eight per cent to 12.7 per cent, and then up to 15.4 per cent, as several artificial accounting was unveiled. During 2010, Eurostat confirmed these revisions and their damning comments rattled markets across Europe, causing the FTSE index in London to lose all its early gains, falling 59 points, or 1.03 per cent, in one afternoon, to 5664.5.

    In summary, the current Greek crisis, like most throughout history, was the result of various factors; fiscal indiscipline, misguided policies, inefficient administration, ineffective tax authorities/ enforcement agencies/judicial system, excessive regulation/bureaucracy, immoral tax-evasion culture and an inept European Commission.

    They may have all have played roles. When one dissects the details, however, forensically, the stench of corruption seems to reek heavily throughout the Greek scenario…Because all the above which they are all facts, there are no chances for anyone to become successful…Greece kills it’s childrens…

  2. What is sad about this article is that this guy who is Greek tried to set up a business in Greece and employ Greeks could not as it was just too difficult..
    And so he went to Luxemberg and Ireland and employs thousands of people…Now that is sad….How many others are like this guy….??

    If he can not do it what hope does anyone else????
    We need HELP…

    • John Catsimatidis another Greek millionaire from NY came to Greece to set up an amphibious aircraft business connecting Greek Islands but after 2 years trying to obtain the licence he went back empty handed because of the Greek bureaucracy…To add to that, the Greek aviation authority find him 1 million Euro for parking his plane on the right place yes on the right place which was provided to him by the GAA…Later in a TV Documentary, he said that Greece is only good for the mousaka, the souvlaki and the tzatziki…

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