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From endorsements to equity

News, 19 May 2016

NEW DELHI: Cricketer Virat Kohli is not only India's leading sportsman, he has become a youth icon and is sought after by brands seeking celebrity endorsement, but Kohli himself is looking beyond merely lending his name to products.

"It's very important to understand when to draw the line in doing only commercial stuff and actually growing a business with you being a part of it," he told the Economic Times.

Bunty Sajdeh, CEO of Cornerstone Sport and Entertainment, the agency manages Kohli outlined an intention for the 28-year-old to have an equity stake – or some other form of ownership – in most of the businesses he becomes involved with.

"Today, brand endorsements are very topical and seasonal as long as you are relevant," Sajdeh said. "Virat realises that he has got a 6-10 years of shelf life and beyond that brand endorsements are not going to sponsor him for the rest of his life."

Endorsements are in any case likely to carry a degree of risk for celebrities in future as the government looks at holding them responsible for misleading advertisements; a parliamentary committee has recommended a maximum punishment of five years' jail and a fine of Rs 50 lakh for offenders, which, if implemented, would significantly alter the current endorsement landscape.

Kohli's colleague MS Dhoni recently found himself at the centre of a controversy surrounding an unfinished Noida building project for which he was the brand ambassador. He subsequently resigned that position, with the head of the realty firm involved admitting that "his name is getting sullied in a controversy which is not in his control".

Exercising a degree of control could therefore be a good option for celebrities in future; apart from the 13 brands he currently endorses, Kohli already co-owns six ventures – including a gym chain, Chisel Fitness, and clothing line, Wrogn – and has plans to launch his own fragrance line and a range of speakers and headphones.

But Kohli takes a serious approach to endorsements too. "I would like to be of use to a brand in terms of growing the brand along with me," he said.

"My first priority is that I need to sync with the brand to get associated with it and I need to see myself in a position to improve things in partnership with the brand."

Data sourced from Economic Times, Times of India, First Post; additional content by Warc staff