Let us imagine that you paid Rs. 17,700 crore & one to own an IPL franchisee from the city of Jhumri Tilaiya. So how will you get your team working? Firstly, you need to decide why you want a team. Let us look at the advantages of having a team. First & foremost it is an immense ego massage. Man you own a bunch of cricketers. You own the guys who have the mass following of a few nations. Gone are the days when you could show off your riches by owning a private jet, a villa in the south of France. or a private island in the Bahamas. The latest fad is about owning an IPL team. If you own one then you get to rub shoulders with the cricketers, bollywood, politicians, models, and corporate honchos all at the same time. This gets you fame. Fame may be far from the comfort of materialistic goods but is in essence is popularity. It brings to the mass population the knowledge that who are you. So you would want as many people as possible to know who you are.
It is alright even if you do not understand the mechanics of the game. One can buy the best players, managers, support staff cheerleaders etc as long as you can shed the moolah. Once the team is set you can formulate strategies to utilize them. They act as an idol for the credibility of the company. If a certain well known player is owned by your company it brings unlettered reliability to the company. There is instant recognition to the brand. It helps lengthen the reach of the company. You can promote yourself without even advertising, since the media will carry the news to far remote places. It shall become common knowledge to all. Owning a team also enhances the shareholders’ trust. Since the shareholders will understand that if their company can support the team then it means that the company is doing good business and it will have enough money to save it from going down. No loss making organisation will be able to buy much less support a team.
Best returns come when the teams are on field. Besides gaining viewership they help strengthen the opinion of the consumers. E.g. A cola giant in view to capture the young crowd will appropriately position itself, as in the T20 format. Add a bunch of sponsors that will align with your team. Now these sponsors cannot promote the team without possible promoting the parent company. If the team logistics are handled in an appropriate fashion then it shall eliminate or have very small affect on the pockets of the owners. Thus only the first shelling for money will be a big deal.
Now to address the first point for which the team is bought. The team is meant to make profits. All this profits come from sponsors, advertisements, merchandise, TV deals, match fees etc. Losses are made when the owners spend like fools. Therefore, it is not for amateurs to buy off teams & run like personal hobbies. There is a lot of business strategies at play.