At a point of flux for the sports industry, the movement of capital is becoming more influential than ever before.
Sports businesses must be more attuned to the needs and incentives of their financial partners, learning how different investor types operate and what they might find attractive about sport.
That was the core of this day two ISC 2025 discussion in the NFL Locker Room at Tottenham Hotspur Stadium, with a panel that represented a range of investors – from private equity to institutional investors and private offices.
Investment is being drawn to sport, according to Goldman Sachs’ Elis Wyn Jones, by the prospect of a transformative period that could unlock better returns. The sports industry, he says, is “geographically agnostic” but has not yet adapted to changing consumption patterns. That not only means revenue potential is going unrealised, it is also leading to an overdependency on a tightening media rights market.
RedBird Capital’s David Catleblanco sees similar “headwinds” for that model, with rights expenditure concentrated around a few major rights holders as a more conservative approach sets in elsewhere in the media industry.
Wyn Jones is also sceptical that the major streaming players offer a solution to this media rights crunch. That, he suggested, could steer rights holders towards two strategies: exploring how to better monetise other forms of content and engagement, or consolidating their sport around a future-facing headline series – citing SailGP as a potential example of the latter.
For other sports brands and organisations, original programming and social content offer an alternative route to attention. But as Christine Jiang of Monarch Collective warned, “content is a great way to lose money” if it is badly directed. Content strategies, then, must anticipate moments of peak interest to deliver.
Emerging sports properties, operating from a lower cost base, can be more agile in how they bring in capital. 258 Group’s Henry Baldwin – who has just overseen an investment by Anthony Joshua and Sir Andy Murray into a professional padel team – believes athlete investors can add value beyond an injection of capital. That can include their profile and ability to generate interest, their specific experience, their curiosity and their willingness to stay the course.
Those seeking investment should be wary of the risks and expectations attached to their capital. Seed and VC funds might make more bets with higher potential for growth. Private equity funds will commit their capital over the medium term – perhaps five to seven years – but often want a 12%-15% return before they return funds to their backers. As Wyn Jones noted, that might not suit rights holders who do not foresee big new revenue growth opportunities over that timeline.
Other forms of capital – like sovereign wealth – move according to very different objectives. Baldwin noted the massive impact on boxing of Saudi Arabia’s Public Investment Fund (PIF), which has a remit to diversity the kingdom’s profile and financial interests. The level of investment it has offered, he added, has removed several longstanding commercial impediments to major fights – completely reshaping the sport.
This is significant as growth patterns are set to vary across global sport. Major leagues offer strong guaranteed returns which may be plateauing. Wyn Jones argued, for example, that this week’s $6.1 billion sale of the NBA’s Boston Celtics to Bill Chisholm Group could prove a high watermark for the time being. Nonetheless, marquee properties do boast non-financial qualities that appeal to some investors.
If any sector still offers a healthy chance of exponential growth, it is women’s sport. The opportunities, however, are being carefully assessed.
Monarch Collective specialises in women’s sports investment and, Jiang explained, it is
is looking to distribute its latest $250 million funding round among more mature parts of the space. This includes teams in football and basketball: sports where
the fanbase is already showing strong engagement.
Women’s sport, Jiang said, is still at a very early stage of its growth relative to the men’s sector, which affects investor behaviour.
“Inflection is not the moment the growth starts,” she continued. “It’s the moment everyone starts to notice it.”
For all the energy and celebrity backers that women’s sport is attracting, Jiang added, its continued progress is down to diligence and smart focus. The hard work that has brought in new investment will also go into spending it well – ready for the next wave of possibilities.
