From Scratch: How the Oklahoma City Thunder Got Here
Part One of a long-term case study on NBA team-building focuses on the events of the last four seasons in Oklahoma City that have led to a full-scale rebuild
This publication is part of a long-term case study performed by Ray LeBov and Adam Spinella on team-building efforts in the NBA. The Oklahoma City Thunder are one of five teams central to the case study, and this publication serves as a primer with background information on why the Thunder were chosen for our study and why it begins in 2021. You can read our first chronicle on the Houston Rockets here
During the years of growth and expansion in the 1980s and 1990s, NBA commissioner David Stern spearheaded a movement to prioritize smaller markets where the NBA would be the only show in town as opposed to splitting a mid-sized or large television market with an NHL, MLB or NFL competitor. The result is that some franchises simply do not have the financial means to keep up with the large market teams in Los Angeles or New York. With local television deals being the largest contributor to franchise revenue that is exempt from league taxes, teams who have deeper pockets typically poach away higher-priced talent from everyone else.
When one of those small market teams hits the jackpot on talent and can compete with those major cities, it’s seen as a triumph of organizational drafting, talent retention and culture. When success hits, there’s a sense of having caught lightning in a bottle, that a championship contender in an underdog situation can’t be sustained forever. The organization has to go all-in on capitalizing on its current position and worry less about the future if it is to succeed in the present.
The Oklahoma City Thunder made the decision to go all-in on success following their jackpot run of drafts in the late 2000s. In a three-year span, Thunder general manager Sam Presti drafted three future MVPs in Kevin Durant, Russell Westbrook and James Harden, as well as three-time All-Defensive First Team big man Serge Ibaka. The tale of those four serves as its own launch point for myriad discussions on team-building, centering on the controversial trade of James Harden back in 2013.
At its crux, the rationale for the trade was simple: the Thunder had three players deserving of max extensions in Durant, Westbrook and Harden, as well as a fourth in Ibaka. Durant and Westbrook were signed first, due to their seniority, garnering max extensions worth a combined $33.4 million. Ibaka came next, adding $12.25 million to that total. Combine them with center Kendrick Perkins (due $8.47 million) and the Thunder were at $56 million with four players. The cap ahead of the 2013-14 season was set at about $58 million.
Why was that so important for the Thunder? Oklahoma City operates within a very small television market. According to television rating metrics conglomerate Nielsen, Oklahoma City was 40th in the nation in terms of television households serviced, reaching 718,770 homes in 2013. Of the 29 franchises in the United States, only Memphis and New Orleans were smaller. But for context, Oklahoma City was only 700,000 homes larger than the tiniest market; that’s half the size of the gap between Oklahoma City and the team in front of them (San Antonio with 881,000). Nineteen NBA franchises operate in markets twice the size of Oklahoma City. Eleven are in markets three times the size.
Oklahoma City had two coveted prized players in Kevin Durant and Russell Westbrook, MVP-caliber players who could lift the franchise into championship contention on their own. The first graze with the Larry O’Brien Trophy came in 2012, as the Thunder made the NBA Finals but lost to the Miami Heat. As long as they had Durant and Westbrook, they’d run up whatever costs necessary to win.
By doing so, the Thunder were propelled into the luxury tax, which would eventually catch up to their organization. A ticking time bomb financially, there are very few ways to de-escalate spending while remaining a solvent contender.
Fast forward to 2018. The Thunder had lost Kevin Durant years earlier but remained in contention in the Western Conference. Westbrook, the face of the organization, recruited Paul George to request a trade to Oklahoma. Carmelo Anthony was also on the books, and the Thunder kept their spending going, trying to utilize trade exceptions and the appeal of playing alongside Westbrook to lure big-name players to town while keeping and extending their homegrown talent.
In July of 2018, the Oklahoma City Thunder became the NBA’s first team to owe more than $300 million in player salaries and luxury tax penalties. By being $36 million above the luxury tax threshold and being a repeater tax team, the luxury tax penalty came out to $154 million. The NBA’s previous high in luxury tax bill: $90.6 million by the 2013-14 Brooklyn Nets.
A spike in the cap during the mid-2010s really hurt the Thunder, escalating prices for player salary to heights they never had been before. The cap doubled in a six-year span, and an increasingly large portion of the cap was eaten up by star players. Revenues were rising league-wide, but the Thunder weren’t in a position to be a tax-recipient team because they were high spenders. National television money wasn’t enough to offset their ballooning payments.
Presti, Westbrook, and the Thunder persisted. Paul George was the first major domino to fall, re-signing with the organization after rumors of his departure for hometown Los Angeles with the Lakers. By re-upping with the Thunder, George locked the franchise into being one of the league’s most expensive and competitive teams.
The Thunder entered the 2018-19 season with Carmelo Anthony on the books, then traded him in late July, along with a lottery-protected 2022 first-round pick, in a multi-team deal that brought back Dennis Schroder and Timothe Luwawu-Cabarrot. Going from Anthony to Schroder, at that point a talent upgrade, while also shedding salary meant parting with an important future first-round selection.
Jerami Grant, who played in 81 games for the Thunder in 2017-18, was re-signed and placed in the starting role vacated by Anthony. Presti made several moves to offset long-term contracts, giving cash away to Orlando to free them from Dakari Johnson. The Thunder brought in several low-profile, low-cost signings to round out the roster, such as Hamadou Diallo and Donte Grantham.
However, Oklahoma City was still one of the league’s most expensive teams. Russell Westbrook ($35.6 million), Paul George (recently re-signing for $30.6 million), Steven Adams ($24.2 million), Dennis Schroder ($15.5 million) and impactful defender Andre Roberson ($10 million) combined to make roughly $116 million. The starting five alone combined for almost $15 million above the league’s $101.9 salary cap mark.
The beginning of the 2018-19 campaign was a strange one. The Thunder dropped their first four games, all by six or more. They then went on to win ten of their next eleven. The trade deadline was approaching, and many executives around the league expected Presti to make an aggressive move that would prove to Paul George he should stay long-term. Guys like Kevin Love, marooned on a sputtering Cavaliers team, were mentioned as targets.
In early February, the Thunder traded Timothe Luwawu-Cabarrot to the Chicago Bulls for cash considerations, opening up a roster spot and saving around $7 million in luxury tax penalties. That’s quite a large number, especially considering TLC’s salary was a mere $1.5 million. Repeater taxes would complicate the trade deadline coming on February 7th.
Ultimately, Presti decided to stand pat. Prior to February 7th, the Thunder had won 9 of their last 10 contests, suggesting a major overhaul or shakeup wasn’t necessary.
The Thunder entered the All-Star Break at 37-20, standing third in the Western Conference. From Valentine’s Day to the end of March, the Thunder went 7-14. Perhaps they should have made a more aggressive push, but the two superstar model, along with the skyrocketing tax penalties, made it difficult to accomplish a mid-season shake-up.
The Thunder regular season ended on a high note, finishing on a five-game win streak. They were back on track, and the basketball Gods matched them with Portland in the first round. During the regular season, the Thunder beat the Trail Blazers on all four occasions. Portland starting center Jusuf Nurkic would miss the entire postseason due to injury as well, propelling former Thunder big man and defensive sieve Enes Kanter into the starting lineup.
Despite all the factors on paper in their favor, the Thunder exited after five games.
In a fortuitous moment during Game 5, Blazers star Damian Lillard hit a dagger to the Thunder organization. His 37-footer at the buzzer won Portland the game, eliminating Oklahoma City in thrilling fashion.
While the rabid Portland crowd rushed Lillard and pandemonium ensued, Paul George left the floor in silence, defeated and dejected. That would be his last game in a Thunder uniform.
The 2019 free agency cycle started off with a bang, as Kawhi Leonard decided to leave the Toronto Raptors mere weeks after bringing the organization their first NBA Championship. Leonard, the reigning NBA Finals Most Valuable Player, was courted by several organizations as a marquee free agent. The Los Angeles Lakers, with Anthony Davis and LeBron James partnering together, were deemed the frontrunner from the outset. Leonard, originally from the Los Angeles area, had been rumored to desire a return home.
At the eleventh hour, the Los Angeles Clippers, crosstown rivals operating in the Lakers’ shadow, swooped in and made a play for Leonard. In order to make their landing spot appealing from a championship perspective, acquiring another star player to team up with Kawhi was paramount.
Leonard and his camp contacted George to gauge interest in a union between the two in their native city. George went to Thunder management, requested a trade to the Clippers, and on July 6th, a trade was agreed upon between Oklahoma City and the L.A. Clippers. In return for the MVP candidate, the Thunder would bring back four unprotected future first-round picks, one protected first-rounder, two pick swaps, first-year point guard Shai Gilgeous-Alexander and veteran forward Danilo Gallinari.
For Presti, this was the haul of all hauls from a long-term perspective. All these future picks could bankroll their entire future, and Gilgeous-Alexander was an incredibly intriguing young piece to build around. Still, player salaries remained high (due in large part to the NBA’s requirement for salary matching in trades) and the financial situation for the franchise wouldn’t be solved overnight.
The financial bubble popped that summer for the Thunder. A report by Forbes Magazine following the season concluded that Oklahoma City was the NBA’s only team operating at a loss, and it was a major one: roughly $23 million in the red. The $61 million in luxury tax penalties was the major factor at play. If the Thunder could get underneath the tax line, they could theoretically move into the green without much more effort.
With George deciding to move on, Thunder leadership grappled with a major decision. Getting rid of George and chipping away at the luxury tax penalty would eat away at their financial woes, but not entirely. An opportunity presented itself, though.
A few hundred miles to the south, the Houston Rockets were facing their own organizational dilemma. Former Thunder player James Harden was in his prime and the foundational piece in Houston. Harden had begun to clash with the Rockets’ second star, point guard Chris Paul. As free agency and summer began, rumors of a split between Paul and the Rockets were hot.
Presti saw Houston’s desperation to unload Paul, the upgrade from Paul to Westbrook from a talent and timeline perspective, and the friendship between the former Thunder teammates as an opportunity to hit the reset button. Presti could leverage Westbrook, four years younger and still in his prime, to get a great return of future draft picks following Paul’s seeming decline from 2018 to 2019. The move might cost the Thunder a lot in terms of wins, popular support and be the final chapter in their glory days of the 2010s. Such a deal cannot be made lightly.
With the blessing of Westbrook through his agent, Presti pulled the trigger on a deal. By swapping Russ for the older Paul, the Thunder picked up two future draft picks (2024 and 2026 from Houston) and two pick swaps in their favor (in 2021 and 2025). As ESPN’s Adrian Wojnarowski reported at the time of the deal, the Thunder were trying to move Paul to a third team at the time of the acquisition. Unable to do so, they hung onto the future Hall of Famer.
The rebuild was on, and the Thunder were ready to start their teardown. Armed with first-round picks (nine total from the George and Westbrook trades), two pick swaps and a promising young guard in Gilgeous-Alexander, Oklahoma City had their roadmap to the future.
Presti’s roster entering the 2019-20 season featured a few veterans, such as 34-year-old Chris Paul and 31-year-old Danilo Gallinari. Steven Adams and Dennis Schroder, each 26, were in the midst of or entering their prime years. The rest of the major contributors were a bit younger. Gilgeous-Alexander, Terrance Ferguson and Hamidou Diallo were all 21, undrafted rookie signing Lu Dort was 20 and Darius Bazley was 19. Balancing the veterans and youngsters made for an interesting dynamic. Early minutes given to Dort and SGA indicated the team’s desire to prioritize youth.
Gallinari, on the final year of a contract that paid him $22.6 million, was a great asset thanks to his expiring contract that could net the Thunder a solid asset in return. In fact, the Thunder attempted to flip Gallinari to the Miami Heat at the deadline, according to Wojnarowski. The three-team deal, with Memphis Grizzlies involved, moved forward without the Thunder, sending Andre Iguodala to Miami. The Heat and Gallinari’s representatives could not agree on a contract extension, a sticking point since Miami wanted the security of keeping Gallinari after giving up assets to acquire him.
The deadline passed and Gallo couldn’t be dealt, likely complicated by the Thunder going 31-20 prior to the deadline and in the thick of the Western Conference playoff race. From December 15th to the early-February deadline, the Thunder went an astounding 20-6. They were too good to be sellers and had no other contracts to shed without giving the clear indication they were giving up on the season.
Less than a month after the deadline, Oklahoma City served as the epicenter for the canceling of the remainder of the NBA season thanks to the coronavirus pandemic. On March 11, the Thunder were due to host the Utah Jazz, top team in the West. Rudy Gobert, Utah’s best player, became ill earlier that day and tested positive for coronavirus. By the time news had traveled to the teams that the league needed them to isolate, each was on the court in their huddles preparing for imminent tip-off.
With fans in the stands, public address announcer Mario Nanni spoke to the restless Oklahoma City crowd after both teams suspiciously exited the court. “The game tonight has been postponed. You are all safe. Take your time in leaving the arena tonight, and please do so in an orderly fashion.”
The timing couldn’t have been worse for the Thunder, who had won eight of their last nine heading into the matchup. Chris Paul was enjoying a resurgence and even being mentioned in MVP discussions. Prior to the shutdown, he was averaging 17.7 points, 6.8 assists and 4.9 rebounds while shooting 48.9% from the field and, per Synergy Sports Tech, a ridiculous 50.5% on dribble jumpers. Shai Gilgeous-Alexander exploded into an alpha dog role earlier than many predicted, jumping from 10.8 points as a rookie to 19.0 in Oklahoma City as the team’s top option.
Even the other veterans were on fire. Steven Adams anchored the most efficient pick-and-roll attack in the league, Gallinari was the team’s leading scorer at 19.2 points per game while shooting 40.9% from 3 on 7.3 attempts per game, and Dennis Schroder (19 points, 4.1 assists off the bench) gave the Thunder their third nineteen point per game scorer. Over the summer, this was supposed to be a group that would enter a rebuild, trim costs mid-season by selling Gallinari and eat the contract of a declining CP3. Instead, they were on pace for a 50-win season and qualified for the Western Conference Playoffs. The salary couldn’t reduce to the point where the Thunder ducked the luxury tax.
Restarting the season in the Disney bubble meant this iteration of the Thunder had one more final push together. They battled the Houston Rockets in a thrilling seven-game series during the first round of the 2020 NBA Playoffs before falling short in the final possessions of Game 7. Their run was over in early September.
An accidentally competitive season stalled the beginning of their rebuild. Paul was too good, Gallinari helped too much and the four veterans carried an otherwise young roster deeper than anyone had predicted. While Presti could have found ways to add talent to the margins via free agency or re-signed Gallinari to a long-term extension, doing so would prevent the Thunder from ducking beneath that luxury tax threshold. Repeater tax penalties were piling up once again, and a global pandemic that shorted the spending power of ownership necessitated a changing of course.
The first sign of the change in direction was the parting of ways with Billy Donovan, a loyal and impressive head coach who had never missed the playoffs in his five seasons with the organization. The decision to separate, described as mutual by both parties, was driven by Presti not giving Donovan “assurances about the future”, insinuating that a rebuild was coming.
In place of Donovan, Presti hired their G-League head coach, Mark Daigneault, a former assistant at Florida under Donovan. Daigneault, 35, was a first-time NBA head coach. He garnered a reputation as a great player development facilitator during his time with the Oklahoma City Blue, preparing guys like Darius Bazley, Luguentz Dort and Isaiah Roby for NBA minutes in a short amount of time. Such a young coach would be the right guy to lead and grow with the team.
The next domino that came was the dealing of Chris Paul to Phoenix. Once the writing was on the wall about the direction in Oklahoma City, Paul and Presti were both in communication about destinations for the All-Star point guard. Paul chose to head to Phoenix to reunite with former head coach Monty Williams on a team that impressed late in the Disney bubble. On November 16th, 2020, the Thunder finalized a trade sending Paul and Abdel Nader to Phoenix for Ricky Rubio, Kelly Oubre Jr., Ty Jerome, Jalen Lecque and a 2022 first-round pick. For the third time in eighteen months, Presti had dealt an MVP-caliber player to his preferred destination, earning a ton of goodwill with agents and other general managers that would serve him well in the future.
Swapping Westbrook for Paul, and then shipping Paul to Phoenix, netted the Thunder three first-round picks, two pick swaps and a youngster like Ty Jerome. A draft day trade sent Rubio and two late-first rounders to Minnesota for James Johnson, and the 17th pick, which they turned into Aleksej Pokusevski. Oubre was sent to Golden State for a heavily protected first-round pick that eventually turned into some second-rounders. The major dominoes of the rebuild came in getting rid of Westbrook and George; eighteen months after the trades, they were fully launched in a rebuild.
More moves on the fringes completely dismantled the team’s veteran presences, making sure there was no salary left to stay above the luxury tax and virtually no shot of making the playoffs. On draft night, Presti agreed to trade Dennis Schroder to the Los Angeles Lakers for Danny Green (a veteran on an expiring deal) and a late first-rounder, which was one of the two picks sent to Minnesota for Pokusevski. Danny Green and Terrance Ferguson were traded to Philadelphia for big man Al Horford, second-round pick Theo Maledon and a top-six first-round protected pick in 2025.
Five days after the draft, Steven Adams was sent to the New Orleans Pelicans in a four-team deal. In return, Presti absorbed a 2023 first-round pick from Denver, the contract of George Hill, Kenrich Williams, two future second-round selections and three other salary fillers: Darius Miller, Zylan Cheatham and Joshia Gray.
Presti didn’t stop there. Gallinari was sign-and-traded to the Atlanta Hawks for a 2026 second-round pick. James Johnson, the salary filler in the Pokusevski deal with Minnesota, was shipped to Dallas in a three-team deal that brought back Trevor Ariza, Justin Jackson and two second-round picks. Ariza would never suit up for the team.
In a matter of weeks, the Thunder had completely gutted the core that carried them to the playoffs. They entered the 2020-21 season with only four players over the age of 26: Mike Muscala, Darius Miller, George Hill and Al Horford. They had the same number of players who weren’t legally able to drink in the United States: rookies Pokusevski, Maledon, as well as Josh Hall and Darius Bazley. Their payroll dropped from $132 million in 2019-20 to $95.8 million in 2020-21, far beneath the tax threshold.
Most importantly, the Thunder had an amazing cache of future draft picks. Presti owned the rights to a whopping 36 draft picks, including their own, over the next seven years. 18 were first-round selections and 18 were second-rounders. What to do with such a treasure trove is unclear when rosters can only be 15 players deep, but the Thunder sat in firm control of the draft board over the next decade.
Presti and his staff worked hard to unearth gems to help in their G-League program and that rounded out the roster. Undrafted rookie big man Moses Brown out of UCLA was signed to a two-way deal out of training camp. Youngster Frank Jackson, who was released by the New Orleans Pelicans in 2020, was brought in for training camp.
Two goals emerged for the 2020-21 season: continue to maximize their trade and draft assets, and develop young talent through reps on-court. Through the deadline in February, Presti found ways to add more assets to the treasure trove to reach that 36 draft pick mark. Ariza, who never suited up for the Thunder, was sent to the Miami Heat for Meyers Leonard and a second-round pick. Leonard had been banished by the team after insensitive comments during a live stream, and the Heat were a playoff contender who needed to unload Leonard to utilize their roster spot. Ariza became a starter for them by the end of the season.
George Hill was shipped at the deadline to the Philadelphia 76ers and brought back Austin Rivers, Tony Bradley and two future second-round picks. Rivers was waived three days later, and Bradley finished the season as a cog in the big man rotation. Hamidou Diallo, who was up for a new contract at the end of the season, was sent to Detroit for Svi Mykhailiuk and a 2027 second-round pick.
Minutes for young players were certainly taking place. Gilgeous-Alexander was now the sole focal point of the offense. Starting next to him in the backcourt on most occasions was rookie Theo Maledon. Lu Dort and Darius Bazley moved into starting roles, and by the end of the season, Moses Brown had supplanted an injured Al Horford as the starter. The oldest player on the five-man lineup of SGA, Maledon, Dort, Bazley and Brown: the 21-year-old Dort.
Brown’s ascent from undrafted rookie free agent to starter was capped off by converting his contract from a two-way to a multi-year deal. Shooters Ty Jerome and Svi Mykhailiuk, both acquired as pieces of bigger deals, averaged more than 10 points per game with the Thunder. Isaiah Roby transitioned into the rotation as a small-ball 5, and the mid-April signing of 25-year-old Argentinian Gabriel Deck gave Daigneault another young piece to plug into their long-term plans.
The 2020-21 season for the Thunder was vastly different than any they’d experienced over the last decade. They went 22-50, their worst season since the first one after the franchise relocated from Seattle in 2008. Regardless, all fans and critics knew to avoid judging the Thunder rebuilding project based off anything that occurred during the year. The real results would come in how they drafted, manipulated their future picks and continued to develop the young players they brought to town.