SportsInvest Newsflash (by Oakwell Sports Advisory)
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Top Stories of the Week
Barcelona sells further Barça Studios stake for €100m amid struggle to meet budget rules
Barcelona has activated a fourth ‘lever’ to meet LaLiga budget rules, selling 24.5% of its Barça Studios production division for €100m to American investment fund GDA Luma.
The deal with GDA Luma, which is managed by the president of Cirque du Soleil, Gabriel de Alba, was approved by the Barcelona board on Tuesday. It follows the decision in June by Barcelona club members to approve the sale of club assets to raise funds to clear debts that had risen to €1.35bn.
The agreement to sell a fourth set of assets follows the sale, in June and July, of two batches of the club’s future LaLiga media rights to US investment firm Sixth Street for a total of €667m. The club also offloaded a 24.5% stake in Barça Studios to the Chiliz-owned fan token and engagement platform Socios.com for €100m.
The deal with GDA Luma will generate €100m but it is understood that this will not be enough to gain the approval of the auditors who have been assessing the club’s accounts on behalf of LaLiga.
Overtime raises $100m Series D and eyes more sports properties
Overtime recently raised $100m in a series D funding round led by Liberty Media and Counterpoint Global, as the sports media brand—now with a valuation above $500m—continues to develop its own properties.
Starting in 2016 as an app to capture basketball highlights as well as social channels on platforms like Instagram and YouTube, Overtime now has its own pro basketball league for teenage talents (Overtime Elite), hosted in a 100,000-square foot Atlanta facility, and a seven-on-seven football competition co-owned by Cam Newton (OT7). More leagues are likely on the way.
Overtime last year raised $80m at an estimated valuation of $250m as it prepared to launch Overtime Elite—and it has now gathered more than $250m in total funding. Winslow Capital joined this round alongside previous backers Bezos Expeditions (Jeff Bezos’ personal investment company), Blackstone and Sapphire Ventures.
Jake Paul’s Betr raises $50m to ‘TikTok-ify’ betting for gen Z sports fans
Social media personality Jake Paul and Simplebet co-founder Joey Levy have raised $50m to advance their vision for the ‘TikTok-ification’ of sports betting with the launch of micro-wagering platform Betr.
An oversubscribed $30m Series A round led by Florida Funders was followed by a Series A1 led by Aliya Capital Partners and Fuel Venture Capital. Other investors in the startup, which will blend video content with sports betting, included 8vc, FinSight Ventures, as well as professional athletes Ezekiel Elliot, Dez Bryant and Richard Sherman.
The partners hope Paul’s vast following on social media, Levy’s experience in the market and the concept of micro-betting will attract Gen Z sports fans uninterested in legacy platforms.
Football
Real Betis to activate Barcelona style economic levers in order to meet salary rules
Betis have been struggling to work out a way of meeting their salary limits imposed by La Liga this summer. As a result they are considering selling a percentage of their income from ticketing for the coming years.
The club want to raise €20m this summer and with over 50,000 season ticket holders, can rely on around €15m from ticketing every year. It is not yet clear what percentage of their ticket sales they will sell, but the period of the deal is believed to be five years.
It is important to remember that Betis’ and Barcelona’s situations are not quite comparable. While a less powerful economic entity, Betis’ debt sits at around €37m in comparison with €1.3bn for Barcelona. Los Verdiblancos are also using this money to register renewals and the relatively conservative investments they have made in Luiz Felipe, Luiz Henrique and Willian Jose.
LaLiga adds four promoted clubs to CVC-backed Boost programme
The CVC-funded Boost LaLiga programme, that will see the venture capitalist invest nearly $2bn in LaLiga’s commercial business entity, has now see its club membership grow to 40 teams.
Albacete BP, Real Racing Club, FC Andorra and Villarreal B – the four clubs promoted to the Spanish league second tier Liga SmartBank – have all signed LaLiga’s agreement with the CVC fund.
They will this month receive 34% of their CVC allocation, followed by a further 16% in June 2023; 25% in June 2024; and the remaining 25% in June 2025.
Clubs must submit their investment plans and the documentation guaranteeing that the planned investments comply with the conditions set out by Boost LaLiga.
NWSL valuations soar on Angel City’s $100m wings
NWSL valuations have soared over the last several months. As recently as two years ago, teams paid somewhere between $2m and $5m to enter the women’s soccer league. This February, the Washington Spirit were valued at $35m in Michele Kang’s takeover; Gotham FC raised money at a $40m valuation from new owners including Kevin Durant, Sue Bird and Eli Manning.
Newcomer Angel City, however, is in a league of its own. Before it made its NWSL debut, the club raised money in April 2021 at a valuation north of $100m. That number, more than double the next closest known NWSL franchise, is jarring. It’s partially a factor of the league’s commercial growth, the specific approach taken by Angel City’s celebrity-laden ownership, and optimism for soccer in the U.S., where notable investors have rushed to men’s and women’s leagues anticipating even more appreciation.
North America
Silver Lake buying Endeavor’s minor league baseball teams
Silver Lake is buying Endeavor’s recently assembled clutch of minor league baseball teams.The private equity giant will pay $280m for Endeavor’s 10 minor league ballclubs, which are being sold less than a year after Endeavor began assembling its baseball portfolio.
Publicly traded Endeavor bought six clubs for an undisclosed price in December, then added three more clubs this spring for $47m. The baseball properties, named Diamond Baseball Holdings, were an expansion of Endeavor’s burgeoning sports portfolio, led by mixed-martial arts league UFC.
Entry into baseball ownership soon raised objections from the Major League Baseball Players Association, which contended ownership of player agents in Endeavor’s WME Sports division meant the company had a conflict of interest.
Broncos officially sold to Walton-Penner family for reported record $4.65bn after vote
The NFL has officially approved the sale of the Denver Broncos to the group spearheaded by Walmart's Rob Walton, his daughter, Carrie Walton Penner, and her husband, Greg Penner.
Formula One racer Lewis Hamilton and former United States Secretary of State Condoleezza Rice are also investors in the ownership group.
The Walton-Penner group agreed to a $4.65bn price tag in June. It is the largest-ever sale price for a North American sports franchise, nearly doubling the previous record (New York Mets, $2.4bn).
Eli Manning joins Gotham FC ownership ranks
Former New York Giants quarterback Eli Manning has become the latest celebrity investor in National Women’s Soccer League club NJ/NY Gotham FC.
The National Football League legend is joined by current Giants executive Pete Guelli as a minority owner.
Bird is the latest celebrity investor in Gotham FC, following in the footsteps of Women’s National Basketball Association star Sue Bird, National Basketball Association superstar Kevin Durant and former Gotham FC forward Carli Lloyd.
Gaming
Zynga acquisition boosts Take-Two revenues in Q2 2022
NBA 2K series owner Take-Two Interactive Software completed its acquisition of Zynga and increased net bookings by 41% in the three-month period ended June 30.
The New York City-headquartered company revealed in its latest quarterly earnings report that it increased its net revenue year-over-year from $813m to $1.1bn, driven by the added revenue contributed by Zynga, while recording a net loss of $104m.
Aside from Zynga’s revenue boost, Take-Two highlighted that recurrent consumer spending exceeded its expectations, driven by 2K’s NBA 2K22 and Tiny Tina’s Wonderlands and Nordeus’ social soccer management simulation Top Eleven.
AI
Sportsbox AI raises $5.5m to develop mobile motion capture coaching tech
Sportsbox, an artificial intelligence (AI) coaching startup, has closed a $5.5m seed funding round that will allow it to continue the development of its single camera 3D motion capture technology and expand into more sports.
The round was led by EP Golf Ventures, a new investment partnership created by the PGA of America and Elysian Park Ventures which itself is the investment arm of the ownership group of Major League Baseball’s (MLB) Los Angeles Dodgers.
Other participants in the round included women’s golfers Michelle Wie West, Marina Alex and Mel Reid, as well as golf coaches and broadcasters.
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