Scott Boras - The Most Interesting Man in Baseball

Scott Boras is a sports agent, a damn good one.

His clients are baseball players, and there damn good ones.

His current client list includes Juan Soto, Max Scherzer, Gerrit Cole, and Bryce Harper, among many others. Boras earned that client list by being really good at his profession for a really long time. He was the first agent to negotiate baseball contracts in excess of $50 million (Greg Maddux 1997), $100 million (Kevin Brown 1998), and $200 million (Alex Rodriguez 2000).

The Boras Corporation, the company he founded, has turned into the Mayo Clinic for baseball players. The agency employs experts in virtually every discipline that impacts clients lives.

The company employs 140 people with areas of emphasis that include the obvious areas of memorabilia, marketing, endorsements, and scouting. Unlike competitors, other areas of emphasis include non-obvious areas like strength & conditioning, data science, specialized lawyers, economists, and investment consulting.

They even have a group entirely dedicated to determining valuations of baseball franchises. In Boras' words, "so we have knowledge of revenue streams clubs have so when we're negotiating with billionaires we can talk their language".

From the sound of it, he doesn't let baseball owners cry poor. He understands their business, specifically what drives valuations higher over time:

"We've gone thru recessions and franchise values have gone up. Owning a team has amazing tax shelters. Revenues owners gain can be depreciated by the contracts of the players they sign. Owners can do all sorts of beneficial tax dynamics to increase profits at their other businesses. We have more billionaires now than ever and the scarcity value of these franchises almost ensures franchise values will continue to go up".

In short, if you have questions, The Boras Corporation has answers.

In an interview with Starting 9 podcast, Boras mentioned baseball is the agency's only focus:

"We don't do any other sport. We just love our game our way. And we try to pass benefit of that knowledge onto our players".

Going on to add, "we have the true blessing of our clients. They've given us the revenue to make divisions of our company unique. Nobody else has psychologist at an agency, we do. Nobody else medical staff or a training staff, they just rely on the teams to do it."

The personal touch is evident. Jake Arrieta, former Cy Young winner and World Series Champ (go Cubs!), talked about being a Boras client after being traded.

Arrieta said, "They do everything for you. From changing utilities, helping you pack, and finding you a place to live in your new city. Scott's probably had more conversations on the phone with my wife than he has with me".

Boras would probably describe the personalized nature as his north star.

"I'm negotiating for the family. I know what his primary is in life. I don't represent a building, I don't represent a piece of clay. I represent human beings."

Some of the human beings he has represented were former teammates.

Boras is a former walk-on at the University of the Pacific. He became a "300 hitter" there before playing professionally in the minor leagues for a few years. His playing career was cut short by a knee injury, at which point, he went back to Pacific and got his law degree.

His short legal career was spent defending pharmaceutical companies against class action lawsuits. The "informal" Boras Corporation got its start during that time when he represented a pair of former minor league teammates during contract negotiations. A few years later, Boras left his law firm and became a full time baseball agent.

Since The Boras Corporation is a private company, revenue and earnings figures are not publicly available, but we can still infer the business has been a shooting star. Seemingly every offseason, in aggregate, Boras clients sign $1 billion plus worth of total contracts.

Bryce Harper (13 years, $330 million), Stephen Strasburg (7 years, $245 million), Gerrit Cole (9 years, $324 million, and Anthony Rendon (7 years, $245 million) inked $1.1 billion worth of contracts during the 2019 off-season alone.

The most recent free agency period saw $800 million in contract values between five players: Max Scherzer, Cory Seager, Kris Bryant, Marcus Semien, and Carlos Correa. And those contracts were signed with depressed revenues coming from Covid when teams were making less on gate sales.

In five years, it wouldn't be a shock if Boras clients were signing $2 billion plus of annual contracts in a single off-season.

Juan Soto will be the next big domino to fall. He could re-sign for close to $500 million on a long-term contract between now and next season. He recently turned down $440 million from the Washington Nationals.

It's unclear what Boras Corp. makes from each contract but it's generally rumored the agency takes 5% of each negotiated contract. So we're likely talking about a business that's doing $100 million plus in annual revenue with a total employee base of around 100. That sounds pretty damn good.

And there's a strong chance revenues are significantly higher when you account for marketing contracts and other revenue streams.

His hard negotiating style has rubbed some the wrong way in the past and will likely do so again in the future. But he works as a fiduciary on behalf of his clients. If franchise valuations continue to go in one direction (up), it's fair for him to negotiate client contracts in that same direction.

Put simply, if you own a baseball team, Scott Boras is likely not the guy you want coming into the conference room to negotiate for a player you want.