Pickleball, cycling, and women’s soccer.
What do these have in common?
They’re experiencing solid growth, and…
Nearly every league/team is represented by current and former athletes from other sports on their cap tables.
A disaster waiting to happen? Awesome opportunity? Let’s Dive In👇
Ownership Is Here
Athletes are jumping to the ownership seat in alternative sports at a record rate.
Just look at the last few months…
Athletes named as owners in new pro sports leagues/teams:
7️⃣ Andre Iguodala joined the National Women’s Soccer League (NWSL) Bay FC investor group.
6️⃣ Mike Trout invested in TMRW Sports, Tiger Woods & Rory McIlroy’s sports entertainment golf league.
5️⃣ Jeff Teague, Tommy Pham, and Yannick Ngakoue acquired ownership stakes in USL Championship club Loudoun United FC.
4️⃣ Kevin Durant and Desmond Howard invested in the National Cycling League.
3️⃣ MLP pickleball team owners surfaced in Josh Allen, Jayson Tatum, Haley Jones, Cliff Avril, and Zach LaVine.
2️⃣ Kayvon Thibodeaux and Spencer Dinwiddie became team owners in the US Masters T10 cricket league.
1️⃣ Serena & Venus Williams purchased the first TGL team, LA Golf Club (LAGC).
There’s been a bunch more as well (and probably many that haven’t been publicly disclosed).
Why It Makes Sense
Athletes have seen the immense influence they can bring to their own sports…
And now they want to carry that over to new sports.
If Serena Williams and Drew Brees not only say pickleball is cool but are seen playing it, then it must be, right?
That’s at least the perception athletes are trying to portray (as they now have real incentives to bring people to these new sports).
- In their own sports, they had eyeballs and high W-2 money.
- In these new sports, they have eyeballs and own equity.
Dangerous or Smart
I think about these things similarly to the public markets.
Hear me out…
In hindsight, the top of the crypto market was obvious.
When your Uber driver and grandma are talking about Bitcoin who else is left to buy? Those are the people getting the information last.
The hedge funds, market makers, venture capitalists, and smart money were positioned.
After that, they go to CNBC, Fox, and Forbes to write articles and increase eyeballs so the very last people can see it and pass around these so-called “amazing” opportunities.
The smart money does this to create liquidity — they’re selling off while all the “uninformed” people are buying.
Now let’s relate this to sports…
In the short term, these new sports leagues are receiving boosts from athletes and celebrities telling us it’s cool (keep in mind they have a stake in making sure you believe that).
From a macro perspective, new leagues/sports are being driven by the need for content from rights holders and sports betting.
My only question is…
Can the short-term and long-term hold up to create true liquidity for these athletes who need someone to buy it from them?
Enter crowdfunding and the fractionalization of every imaginable asset — but that’s a convo for another day.
