We believe a series of global macro tailwinds will help drive value creation across the TMT sector. Additionally, the sports industry offers its own secular trends that will further support significant value creation across the asset class. Below is a roundup of industry news highlighting some of these themes and related transactions.
- In 2023, there was a notable increase in fan eagerness to attend live sports events, with record attendances reported across various leagues including the NBA, NHL, MLS, NWSL, U.S. Open, MLB, WNBA, and NFL. This trend marked a departure from the usual fluctuating attendance patterns in sports.
- Despite the high attendance in 2023, looming economic challenges in 2024 might impact revenue, necessitating price cuts and adjustments in ticket sales strategies. This shift includes a rise in alternative ticketing options like flex packages and subscription-based tickets, and a decline in traditional season tickets, as seen with initiatives like the Arizona Diamondbacks' cost-effective season offer.
- Women's sports are an outlier in this scenario, showing significant growth and drawing increased crowds and revenue. Records in attendance were set in women's sports events like the Women's World Cup, college volleyball, and the WNBA. StubHub reported substantial increases in ticket sales for women's leagues, and Deloitte projects 2024 as the first year to achieve $1 billion in revenue for women’s sports, highlighting their growing importance and popularity.
- Women's volleyball, particularly at the collegiate level, is experiencing significant growth, with increased youth participation, record-breaking attendance, and rising TV ratings. Notable events include Nebraska's volleyball match drawing 92,003 fans, setting a world record for a women's sporting event, and matches like Wisconsin vs. Nebraska attracting unprecedented viewership.
- The sport's growth is further supported by broadcasters like the Big Ten Network, SEC Network, ESPN, and Fox, who are airing more volleyball games in prime time slots. However, there's a recognized need for better promotion of individual players and their stories to appeal to casual fans and further expand the sport's reach.
- The growth of women's volleyball is expected to continue, with upcoming events like the Paris Olympics, where the U.S. women's team is the defending gold medalist, and the launch of two professional volleyball leagues. This surge in interest and exposure marks a significant shift in the sport's mainstream appeal and potential for further expansion.
- The NCAA volleyball championship on ABC, featuring Texas' victory over Nebraska, set a new viewership record with 1.69 million viewers, surpassing the previous record set by a Big Ten match on Fox. This marked a significant 115% increase from last year's Texas-Louisville match on ESPN2.
- ESPN's coverage of the volleyball semifinals also saw a notable increase in viewership, with 1.1 million viewers, a 52% rise from the previous year. The regional finals and semis on ESPN2/ESPNU experienced substantial viewership growth as well, with increases of 35% and 42%, respectively.
- Female viewership played a significant role in the success of the women's volleyball Final Four, with women constituting 51% of the championship audience and showing a 15% increase from the previous year. The overall season was ESPN's most-watched for women's volleyball, with an average of 116,000 viewers and a record 466 million total minutes viewed across various ESPN platforms.
- The Pro Volleyball Federation (PVF), a new professional women's volleyball league in the U.S., has signed its first media deal with CBS Sports, involving a multiyear agreement to air a minimum of 10 matches in 2024, including the semifinals and championship match.
- PVF, founded in 2022, will begin its inaugural season in January with seven teams and plans to add three more in 2025. The league has notable ownership representation from Major League Baseball, the NHL, and the NBA, and includes investment from five-time Olympian Kerri Walsh Jennings.
- The league's first college draft selected 35 players, including top NCAA athletes, with an average player salary of $60,000. PVF aims to provide a platform for players to compete domestically and allows flexibility to participate in other international leagues throughout the year.
- Sunderland's Stadium of Light will host the opening game of the Women’s Rugby World Cup in 2025. The event aims to showcase women's rugby with 16 teams playing 32 matches across eight cities. Engaging local communities, former England player Sarah Hunter conducted a coaching session in Sunderland, emphasizing the importance of community and family in rugby.
- The Women’s Rugby World Cup 2025 is part of a broader effort to grow women's rugby, including using technology for player welfare and launching the WXV tournament to improve competitiveness. World Rugby’s Accelerate Programme aims to address challenges in expanding women’s rugby globally, emphasizing technology, player safety, and the creation of iconic moments to increase visibility.
- The ambition is for rugby to be globally inclusive, with the women's game leading expansion into new markets and attracting younger audiences. Events like the Women’s Rugby World Cup are seen as game-changers, inspiring future generations and creating pathways for new, inspirational players, emphasizing rugby's transformative impact on individuals and communities.
- The Portuguese Football Federation (FPF) is focusing on promoting women's football, developing youth talent, enhancing performance analysis, and expanding global fan engagement. Their Project 2030 emphasizes increasing participation, coverage, and visibility in women's football, preparing youth for professional football, and using data and technology for performance improvement.
- To achieve these goals, the FPF partnered with Pixellot, utilizing its technology to broadcast women's football and futsal matches on the FPF's OTT platform, Canal 11. Pixellot also provides data analytics for teams and coaches, enhancing performance and tactics, and helping democratize access to football content across all levels.
- Pixellot's technology offers deep insights for fans and coaches, including player-focused analytics like heat maps and shot charts. Covering over 1,000 matches annually across five leagues, this technology provides valuable video for scouting and analysis, contributing significantly to the development and visibility of Portuguese football and futsal.
- Private equity firm Carlyle is reportedly backing the Seattle Sounders' bid to purchase the NWSL club OL Reign, participating as a non-control partner in the deal estimated around $50 million.
- The NWSL is experiencing surging valuations and an influx of new ownership, with franchise values averaging $66 million. Private equity investments in the league are increasing, with firms like Sixth Street, Arctos Partners, and Monarch Collective taking stakes in various teams.
- Carlyle is actively seeking to expand its presence in the sports sector, including involvement in potential bids for major teams like Manchester United and the Minnesota Timberwolves. The firm has invested over $3 billion in sports, media, and entertainment since 2018. The current OL Reign owners, Eagle Football, acquired the team in 2019 for approximately $3 million.
- V Sports, owned by Nassef Sawiris and Wesley Edens and controlling Aston Villa FC and Aston Villa Women’s Football Club, has agreed to partner with Atairos, a strategic investment company. Atairos will become a minority partner in V Sports, with V Sports retaining full ownership and control of Aston Villa FC post-transaction.
- The investment from Atairos is intended to fund growth and infrastructure investments at Aston Villa FC, aiming to create sustainable value for the club and V Sports network. The agreement, pending Premier League and regulatory approval, is seen as a testament to Aston Villa's achievements under V Sports and a step towards future growth.
- Nassef Sawiris and Wesley Edens express enthusiasm for partnering with Atairos, highlighting the partnership's potential to strengthen Aston Villa FC's financial position and competitiveness. Michael Angelakis of Atairos praises Aston Villa's history and potential, expressing eagerness to contribute to the club's future success.
- EQT AB is currently leading the race to acquire a stake in the Bundesliga's media rights business, with its bid valuing the German football unit at approximately €12.7bn (£11.3bn). The deal, still under negotiation, involves an up to 8% stake in the subsidiary handling the Bundesliga broadcasting rights.
- Other private equity firms in contention include CVC Capital Partners, offering €12.5bn, and Blackstone Inc. at €11.9bn.
- Advent International, not involved in any other league or football club, proposed a lower bid of €10.8bn. The German Football League is expected to meet soon to narrow down the potential buyers, considering both the bid value and possible conflicts of interest.
- US-based Footpath Ventures is in advanced discussions to acquire a stake in the Indian Premier League's Rajasthan Royals franchise, with an estimated post-money valuation of the team between $800-850 million.
- Footpath Ventures, already an investor in notable Indian unicorns like Dream11 and Zetwerk, is expected to lead a funding round for the Rajasthan Royals, anticipated to be in the range of $50 million to $80 million.
- Alongside the potential investment from Footpath Ventures, the IPL franchise is also in talks with other investors as part of its funding strategy.
- Michele Kang has acquired the London City Lionesses, an independent women's football club in England’s top two professional leagues, demonstrating a commitment to enhancing the women's game both in the UK and globally.
- Both Diane Culligan, the founder of LCL, and Michele Kang share a vision for creating opportunities and building a sustainable future in women's football, with a focus on fostering a player-first culture and inspiring female athletes.
- Kang’s acquisition aligns with recent governance changes in the Barclays Women’s Super League and Championship. She plans to maintain each club's identity while investing in infrastructure, fan base growth, and shared resources like performance science and scouting, aiming to elevate women's football to new professional heights.
- TeamSnap, a youth sports management software company, has acquired Mojo Sports, founded by former Disney executive Ben Sherwood, to enhance its platform with live streaming, content sharing, and instructional coaching videos for coaches, athletes, and families.
- Mojo Sports, launched in February 2021, collaborates with major leagues like MLB and MLS to develop training content, offering a personalized app experience for youth players to track their highlights and progress throughout a season.
- This acquisition bolsters TeamSnap’s bid to lead in the digitization of youth sports, enhancing both its consumer and business-to-business operations. TeamSnap now has a user base of over 25 million, following its previous acquisition of LeagueSide, and Mojo's existing user base and staff will integrate into the expanded organization.
- Rypplzz, a geo-location platform, has raised $3 million in seed funding, led by sports technology investment firm KB Partners and Triptyq Capital, bringing its total funding to $6.8 million. This investment is aimed at further developing its venue experience technology and expanding its commercial team.
- Rypplzz’s technology offers precise device location capabilities, with accuracy up to six inches compared to the ten to 20 feet range of standard GPS. This advancement enables efficient new applications and a range of new uses in stadiums, including augmented reality, navigation, and crowd management.
- The company plans to enhance spatial technology and fan engagement in sports and entertainment venues. Rypplzz’s technology is seen as a key driver in the evolving dynamic of fan experiences, promising a new level of personalization and immersion in both physical and digital sporting events.
- Warner Bros. Discovery (WBD) CEO David Zaslav and Paramount Global CEO Bob Bakish have reportedly met to discuss a potential merger between their companies. This merger would combine significant media assets across sports, TV, and film.
- WBD and Paramount, with respective valuations of $28.43 billion and $10.31 billion, are considering a merger to pool their assets, particularly in the streaming sector. Paramount, currently facing a $15 billion debt, could benefit significantly from this consolidation.
- Both companies hold significant sports broadcasting rights (e.g., MLB, NHL, NBA for WBD and NFL for Paramount). A merger could reshape the sports media landscape and impact the way sports content is delivered, particularly with WBD's new sports tier on its Max streaming service and Paramount's diverse sports offerings on Paramount+.
- Trackhouse Entertainment Group, founded by Justin Marks, is exploring the private equity market to raise capital. This funding is aimed at supporting the company's growing ambitions in motorsports, including a fourth-year NASCAR team and a new MotoGP team in 2024.
- Initially funded by Marks and corporate sponsors like Chevrolet and Coca-Cola, Trackhouse has disrupted motorsports with innovative approaches. The company plans to expand its operations, including potentially adding more drivers and exploring opportunities like fielding an Indy 500 entry.
- Trackhouse is not only expanding within motorsports, but also looking to venture into consumer-packaged goods and other business areas related to racing. With ambitions to be recognized for more than just NASCAR, they are positioning themselves as the sole American team in MotoGP and are open to future opportunities, including possibly competing in Formula 1.
- Amazon is in discussions to invest in Diamond Sports Group, which would further Amazon's expansion into sports content streaming, competing with Disney and Netflix. This partnership could make Prime Video the streaming platform for Diamond’s games.
- Diamond Sports Group, which holds local broadcasting rights for many teams in MLB, NBA, and NHL, filed for bankruptcy earlier this year. The deal with Amazon would involve a strategic investment and a multiyear streaming partnership, though details on the investment amount and valuation are not specified.
- Following the news of Amazon's potential investment in Diamond Sports Group, shares of Sinclair Inc., which owns Diamond, saw a rise of up to 7.6% on the New York Stock Exchange. Sinclair operates or services 185 TV stations across 86 markets.
