"He didn't start this for himself, he did it for legacy reasons" - Billionaire Bill Ackman on why Novak Djokovic started the PTPA for the welfare of other tennis players

Hedge fund manager and billionaire investor Bill Ackman believes that Novak Djokovic didn't need to start the Professional Tennis Players Association (PTPA) but did so solely for "legacy reasons."

Bill Ackman recently made a foray into tennis and has become an investor and advisory board member in the PTPA. The organization was co-founded by former World No. 1 Novak Djokovic and Vasek Pospisil as a means to ensure better remuneration from tournaments for players and more direct involvement in decision-making for athletes in the sport.

Ackman, who is the CEO of Pershing Square, a hedge fund, was invited to speak with CNBC about his role in the PTPA and elaborate on why he made the investment. The investor referenced his own experience funding a tennis player and explained the high cost of being a professional and the diminishing returns from prize money when ranked outside the top-100.

"So about 15, 16 months ago, Novak Djokovic and a good friend of mine, Rebecca Macdonald met and she called and said look, Novak and Vasek are putting together something to help the players, maybe you can help, and I viewed this as a purely philanthropic thing. I love tennis, and I'm super passionate about the game and I understood the plight of the player. I actually backed a guy, Matija Pecotic," Ackman said.

"He wanted to go on the tour, but the economics make it impossible unless you have a trust fund or a backer, and i was like, fine, i'll back you. He spent about $350,000 a year, travel, hotel, coach, couldn't afford a physio but from all that he went from nothing to 200 in the world and he was fastest ever, so i thought, okay, i've really got something here, and then he got injured," he added.

"During that entire period, he might have made $20,000 in prize money. The reality is, if you're not hundred in the world or better, you lose money on the tour, you make less than minimum wage."

Speaking about Djokovic's role in setting up the PTPA, the investor praised the Serb and explained that the initial investment players made has been returned, adding that the 35-year-old probably "needs" the PTPA the least given his privileged position in the sport.

"Actually, Novak deserves credit for setting up the ptpa he stepped back after I got involved and Pospisil has been leading the charge for the PTPA. But what I quickly realized is we wouldn't make this organization work as a philanthropic organization.

"Novak is not an investor in the entity, in fact, we're returning the capital to people (players) who put up capital to start the PTPA. This is for all of the players. Novak Djokovic needs this organization the least, he didn't start this for himself, he did it for legacy reasons, he knows about how hard it is," Ackman added.

Novak Djokovic to contest at ATP 250 event in Tel Aviv as top seed

Novak Djokovic will take part at the Tel Aviv Open

After being unable to compete at the US Open due to his unvaccinated status, Novak Djokovic will now compete at the Tel Aviv Open in Israel as the top seed. The Serb last took part in the Wimbledon Championships in July as a three-time defending champion and successfully defended his title against Nick Kyrgios in the final.

He had to skip the entire US hardcourt season as foreign nationals who aren't vaccinated are barred from entering the United States. As a result, the 35-year-old has dropped outside the top-5 of the ATP rankings.

Djokovic will hope to regain his form and enter the top-5 again. He is also scheduled to take part in the Laver Cup in September as part of Team Europe, and will join Roger Federer, Rafael Nadal and Andy Murray as part of the ensemble alongside Stefanos Tsitsipas and Casper Ruud.