Business

Shaq Opens Big Chicken Location in Islanders' New $1.5 Billion Arena, as the NBA Icon Expands His Food Empire

Mike Coppola | Getty Images
  • Shaquille O'Neal opened a Big Chicken restaurant at Climate Pledge Arena in Seattle, and has another at the new UBS Arena, home to the New York Islanders.
  • O'Neal also owns various Papa John's locations and shows up in the pizza company's commercials.
  • For Big Chicken, one of O'Neal's objectives is to grow inside sports arenas.
Shaquille O'Neal
Rich Fury | Getty Images Entertainment | Getty Images
Shaquille O'Neal

Shaquille O'Neal once signed the richest contract in sports history and then went on to win four NBA titles. These days Shaq has a new business he's trying to conquer: chicken sandwiches.  

O'Neal, who was inducted into the NBA Hall of Fame in 2016, is the co-owner of a restaurant venture called Big Chicken, which launched its first location three years ago in Las Vegas. Last year, a second opened in Glendale, California.

Now, O'Neal is focused on sports arenas, the type of venue he knows the best.

Big Chicken recently opened a location at Climate Pledge Arena in Seattle, home to the National Hockey League's newest team, the Kraken. And on Thursday, O'Neal made a brief stop through New York to get a glimpse of UBS Arena, the new $1.5 billion home of the NHL's New York Islanders.

Big Chicken will sell its fried chicken sandwiches inside UBS Arena during NHL games and other events at the complex. The Arena is located behind the track for the Belmont Stakes and is scheduled to host its first regular-season game on Nov. 20, when the Islanders play the Calgary Flames.

"Section 206," O'Neal said, smiling into one of the many local TV cameras present to capture the promotional event. He was referring to the section where Big Chicken is located in the arena.

"This is my ritual," he told CNBC, moments after the TV cameras departed. "Fried chicken with cheese, pickles and hot sauce."

O'Neal started Big Chicken with his friend Matt Silverman, and agent Perry Rogers. It's not his first foray into the food industry. O'Neal owns various Papa John's locations, and even makes an appearance in a commercial for the pizza chain. In 2019, he joined the company's board.

But this task is a much different one for O'Neal, because he's starting the brand from scratch.

UBS Arena will become home to the New York Islanders.
Source: New York Islanders/UBS Arena
UBS Arena will become home to the New York Islanders.

At UBS Arena on Thursday, O'Neal was joined by Islanders co-owner Jon Ledecky. In honor of Veterans Day, they took photos with military personnel, and then stood in an unfurnished suite to watch a chef make items that will appear on Big Chicken's menu. O'Neal joked about not knowing all of hockey's rules, but said he watches NHL games.

One of the sandwiches on the Big Chicken menu is called Uncle Jerome, named after O'Neal's uncle. Another is called Charles Barkley, an nod to the former NBA star and O'Neal's broadcasting partner on "Inside the NBA." Barkley's namesake sandwich comes with mac and cheese on top of the chicken, along with crispy onions and "Shaq sauce."

Big Chicken also features the MDE, which stands for most dominant ever, and is meant to describe O'Neal's career at center, primarily for the Los Angeles Lakers. He was first-team all NBA eight times and finals most valuable player three times.

In 1996, shortly after his arrival in L.A. from Orlando, the Lakers recognized O'Neal's dominance. The team signed him to a seven-year, $120 million deal. At the time, it was the richest in sports and set the the stage for the Lakers' resurgence.

O'Neal led the Lakers to three straight championships from 2000-2002, and won his fourth title with the Miami Heat in 2004. He finished his career with 15 All-Star Game appearances and one MVP trophy. Last month, O'Neal was named one of the greatest 75 players ever, as the NBA is celebrating its 75th season.

Shaquille O'Neal #34 and Kobe Bryant #8 of the Los Angeles Lakers during the 2004 NBA Playoffs
David Sherman | National Basketball Association | Getty Images
Shaquille O'Neal #34 and Kobe Bryant #8 of the Los Angeles Lakers during the 2004 NBA Playoffs

Vast business portfolio

O'Neal made over $280 million during his playing career, and Forbes estimates he's made over $700 million in total earnings, including in his off-court endeavors.

O'Neal bet early on Google and Apple, and has branded sneakers at Walmart, a clothing line at JCPenney and a men's jewelry line. He also took an equity stake in an alkaline water company this year.

He's been a "strategic consultant" to Wynn Resorts' sports gambling unit WynnBET. Because of NBA rules, he had to give up his minority stake in the Sacramento Kings for that deal.

Restaurants have been one of O'Neal's biggest plays in his post-NBA life. He told CNBC that opening up quick service restaurants (QSRs) has been a passion since his days at Louisiana State University in Baton Rouge. Said O'Neal of that book that got him going, "The dummies guide to starting your own business."

In May, O'Neal and his Big Chicken team hired Josh Halpern, a former executive at Anheuser-Busch InBev, as CEO.

"We do some things differently," Halpern said in an interview. "We used a higher-end chicken that is antibiotic-free, cage-free, and hormone-free. We're about getting a higher value for the money."

For expanded distribution, Halpern said Big Chicken would use so-called ghost kitchens, allowing it to put items on a menu alongside food from other restaurants so consumers can mix and match in a single order.

Big Chicken partnered with Ghost Kitchen Brands and will feature items on digital menus placed in front of big chain stores. There's already one inside a Walmart in Rochester, New York.

The strategy "brings us into some neighborhoods and cities in the U.S. that may not have been an early adopter city" for Big Chicken, Halpern said. He said a Rockport, New York location will open soon.

Big Chicken started accepting applications for franchises earlier this year, Halpern said. The cost ranges from $450,000 to $1.4 million. There's a $40,000 franchise fee, and the company takes 5% of sales and 2% combined for national and local marketing.

O'Neal understands the franchise model from his experience with Papa John's.

"He told me, 'You better never hurt a franchisee because I am a franchisee, and you'd be hurting me,'" Halpern said. "He means that 100 percent."

Another place consumers can taste Big Chicken sandwiches is on a Carnival cruise. Micky Arison, Carnival's chairman, is the owner of the Miami Heat, which won its first NBA title in 2006 with O'Neal at center.

Shaquille O'Neal
Scott Mlyn | CNBC
Shaquille O'Neal

Restaurant franchising has been an attractive investment for many ex-NBA players. Magic Johnson previously owned over 100 Starbucks locations and has some T.G.I Fridays restaurants and more than 20 Burger Kings in his portfolio.

Former NBA player Junior Bridgeman bought numerous Chili's and Wendy's franchises before selling them for $400 million in 2016. And last February, former Philadelphia 76ers center Theo Ratliff partnered with Corlex Capital to look for athletes who want to invest $100,000 in QSRs. 

"It's like investing in stock," Ratliff told CNBC. "Let it grow, and when you decide to sell, you sell or keep it going and take the residual off the growth. But I think it's an awesome opportunity."

Halpern said QSRs allow "you to have the ability to create wealth for a wide-breath of people."

While Big Chicken is O'Neal's biggest leap into the restaurant business, he's had others. He owned Shaquille's, a restaurant at L.A. Live, an entertainment district surrounding the Staples Center, where the Lakers play. After Covid-19 hit and traffic dried up, O'Neal shuttered Shaquille's. He said paying the monthly $90,000 lease wasn't worth it.

"And I wasn't getting a PPP loan," O'Neal added, referring to the Small Business Administration's paycheck protection program. "So, I shut it down, and we'll look to reopen one day."

In February, officials in Atlanta suspected arson caused the fire to a historic Krispy Kreme franchise that O'Neal purchased in 2016. O'Neal told CNBC he recently approved a new design for the doughnut shop and plans to reopen in 2022.

"Being an athlete, you have to learn how to adjust on the fly," O'Neal said. "You ever see a guy practice one move, and then when they take that move away, [players] don't know what to do. You have to be able to adjust."

But O'Neal's work with Papa John's may represent his most high-profile role in the industry. He was brought onto the Papa John's board in 2019 to help repair the company's image after former CEO John Schnatter resigned the prior year because of racially-disparaging comments that he made publicly.

'Another tough decision'

One of O'Neal's former teams, the Phoenix Suns, now faces a similar controversy.

Earlier this month, an ESPN article alleged Suns owner Robert Sarver mistreated employees and made racist and misogynistic comments during his 17-year tenure with the franchise. Sarver has denied the charges, and the NBA has opened an investigation into the matter.

"I'm not a bandwagon jumper – I've had interactions with the man 10 times, and I didn't see any of that," O'Neal said. "But when there are allegations of this magnitude made by employees, there has to be an investigation."

The issue is rocking the NBA seven years after former L.A. Clippers owner Donald Sterling sold his team when audio recordings surfaced of Sterling uttering racist comments.

"If the allegations are true, Adam Silver will need to make another tough decision," O'Neal said, about the Sarver situation. Silver has been NBA commissioner since 2014.

Shaquille O’Neal performs as DJ Diesel at The SHAQ Bowl for Super Bowl LV on February 07, 2021 in Tampa, Florida.
Gerardo Mora | Getty Images
Shaquille O’Neal performs as DJ Diesel at The SHAQ Bowl for Super Bowl LV on February 07, 2021 in Tampa, Florida.

As a businessman, one of O'Neal's key qualities is the ability to make people laugh. He caused a cameraman to chuckle during his interviews at the UBS Arena, and sparked laughter among the surrounding audience by mocking the chef, who was making the sample sandwiches.

O'Neal credits his mother, Lucille, as the motivation behind his approach.

"I'm just continuing to make people happy," he said. "That's my mission. I'm just trying to fulfill her wishes and do everything she says. I have to make people feel good."

The chicken restaurant market is crowded, with the likes of Chick-fil-A and Popeyes battling it out for best-fried chicken sandwich and McDonald's and other fast food joints promoting their own offerings.

Asked if he's planning to compete with brands like Popeyes, O'Neal said, "absolutely." He then added, "And we don't run out of chicken – ever," a jab at Popeyes, which ran out in 2019 amid a social media swarm.

Before O'Neal left the event to catch a flight, he was asked to pick the best restaurant in his portfolio.

"I don't ever think about it," he said. "What I'm most proud of is getting my mother whatever she wanted."

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Correction: This article was updated to reflect the Miami Heat Finals win.

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