Handelman was born and raised in Portland, Oregon. He was raised in a Jewish household. Handelman attended Catlin Gabel School, graduating in 1991. He received his bachelor's degree from the University of Pennsylvania in 1995, where he was a member of the Alpha Epsilon Pi fraternity and received an MBA degree from UCLA in 2003.
In addition to his sports-related work, Handelman is a partner in a film production company Productions, whose first film, Surrogates, was released in 2009.
Handelman is married to Actress Elizabeth Banks, his college girlfriend, whom he wed in 2003. The couple live in Los Angeles. He and his wife had their first child, a boy named Felix, via surrogacy in March 2011. On November 14, 2012, they had a second boy, Magnus Mitchell Handelman, again via gestational surrogacy. He is a fan of the Portland Trail Blazers.
