Sports Tech Atlanta June Blog and Podcast.
We are going to start a new blog trend where every podcast we will show the articles and topics we are discussing in long format. This will give listeners a chance to learn more about the companies and tech we are discussing.
We recorded right after the US Open and discussed Rory’s tough finish to the US Open and what should Tiger do to finish his career out. Rory jumped out to a 2 shot lead before missing two short par putts which gave the way for Bryson DeChambeau to win at Pinehurst No.2.
YouTube link of out Rory conversation
Dallas vs Boston (we recorded before game 5 but we knew what the outcome would be).
Skip to the end of the podcast where we discuss the WNBA, Caitlin Clark, and why the conversation surrounding the WNBA has missed the mark from the national media.
Sports Technology Stories and Funding Rounds
Whoosh Funding Round
Whoosh, Inc., the most advanced club operations software solution, today announced the closing of its $10.3 million Series A funding round, led by AlleyCorp. Additional institutional investors participating in the round include 8VC, Alaris Capital, Bienville, Craft Ventures, Eberg Capital, Operator Partners, and Raptor Group.
Other notable investors include Larry Fitzgerald Jr., Alison Lee, Howard Lindzon, Kurt Kitayama, Andy Roddick, and Mike Walrath. The backing of golf operators and industry professionals is evidence of the value Whoosh's current solutions create for customers and the power of its strategic vision.
Since the company's launch in 2022, Whoosh has remained steadfast in its mission of creating the most intuitive operations and hospitality solutions for private golf and racquet clubs and public/daily-fee facilities. The business has evolved to become the best-in-class provider for the industry, powering the most premier clubs and "Top 100" golf courses in the country.
Roland Garros introduces head-cams for chair umpires in bid to enhance TV viewing experience
The device "brings viewers even closer to the action, enabling them to discover the umpires' duties, as well as their interactions with players," the French tennis federation stated.
RootNote Funding Round
Creator and athlete data startup RootNote, a growing provider of business intelligence for sports, media, and entertainment companies, has raised a $1.5 million pre-seed funding round led by Indianapolis-based Elevate Ventures.
Previously in a “private beta” stage, the company is opening the platform to the wider public.
Major Sports Tech Discussion:Private Equity and Investing in Sports
Today, private equity firms have made significant inroads. Historically, strong and stable returns have perpetuated the appetite for this type of investment, adding valuable diversification to portfolios. Evolving regulations across various sports leagues have made this vertical undoubtedly one of the fastest-growing sectors in private equity. Yet, there is still work to be done. While private equity firms can take on huge minimums, there will be challenges for the retail investor until these minimums can be more accessible.
Skin in the game + Portfolio diversification
For many investors, simply being a fan is not enough. That’s because being a part-owner of a sports organization makes fandom that much more exciting. Investing in sports franchises is tempting for those looking to actively participate in their most coveted passion while creating a more diverse and well-rounded portfolio.
A game-changing shift: Leagues begin allowing private equity investment
We are now seeing a major disruption to the previously established regulations across various leagues, which barred a wider range of investors from participating in the business side of their favorite sports.
For decades, sports leagues in the U.S. and abroad historically only allowed private, ultra-high-net-worth individuals to own shares in teams, creating a bubble of considerable exclusivity among the select few with the means to pursue partial ownership.
One of the first noticeable shifts in regulations regarding private equity participation in sports occurred in 2005 when F1 accepted the backing of the private equity firm CVC Capital Partners.
Another noteworthy shift occurred in 2021 when a new class of investors was born with the decision to allow private equity providers to acquire up to 20% of any single NBA franchise being ratified.
This decision was mutually beneficial for those individuals looking to acquire equity in their favorite franchise and the teams and leagues who could now accrue additional capital to enter into various deals or projects (i.e., stadium construction, premium partnerships) with greater speed and efficiency and potentially bolster profits.
In the past four years alone, the MLS, NHL, and MLB have all begun allowing private equity investment.
Each league varies regarding specific rules and regulations, such as the percentage eligible for sale, the percentage a lone investor may hold, the minimum investment commitment, and the number of teams one fund can own.
Interest driven by evolving business model
The rise in private equity interest across multiple sports verticals is also reinforced by a transforming business model that includes several exciting areas. These areas include:
Streaming: The streaming boom has completely transformed the landscape in which sports content is consumed. With multiple subscription-based models and a global audience reach, the advent of sports streaming has created a lot of interest from private equity investors.
Sports Betting: The widespread legalization of sports books in numerous states has created an undoubtedly lucrative market for teams and leagues. Another component is the abundance of data and analytics associated with sports betting, which can be a valuable asset for teams.
Sponsorships: Sports teams, clubs, and franchises can achieve substantial revenue boosts, widespread branding and exposure, and long-term partnerships through sponsorships. All of which are considerable draws for private equity firms and investors.
Intellectual Property: Owning and monetizing intellectual property within particular sports, such as broadcasting rights and distribution, merchandise, and archival content libraries, can help drive revenue for various sports entities.
How it works
First, private equity firms typically invest equity and/or debt in return for a stake in a newly incorporated holding company or join a venture vehicle of the sports organization. That equity and/or debt is then leveraged to manage the commercial side of the business. The capital generated from these endeavors is typically allocated to explore monetization opportunities. The visible division between the commercial and operational sides allows sports organizations to maintain a level of control over the governance of their businesses.
Investors are paid after an exit following a certain period, typically between five and 10 years. In some cases, investors will receive a portion of cash flows from the organization itself.
Historical investment performance
The value of all major sports leagues within the U.S. as well as several soccer clubs in Europe, has outpaced the S&P 500, especially within the past decade.
Spiideo,Funding Round
A Swedish firm that makes AI-powered video and analytics software used by teams in the NBA, NHL and English Premier League, secured a $20 million venture capital investment from a group led by Cipio Partners and including Mathias Kamprad, the billionaire son of the founder of retail giant Ikea.
Spiideo makes automated video products for sports applications including providing multi-angle replay for officials and for use in player training. Every stadium in the NWSL, for example, has Spiideo camera systems installed. Among its other 4,000 clients, the company recently started a deal with ESPN using Spiideo camera systems to automatically stream the 400 scholastic games it hosts at its Orlando Wide World of Sports facility each week.
The latest round is the first investment in the company by Cipio, a German technology-focused business. Joining the round to follow their earlier investments in Spiideo is Kamprad, who with siblings owns Ikano Group, a business initially formed to manage Ikea’s real estate, as well as Swedish executives Måns Hultman and Håkan Roos. Global tech-focused investment bank Drake Star advised Spiideo on the private placement, announcing the deal on its LinkedIn page Wednesday.
The company will use the latest funding to expand its various employee teams, including product, AI and international sales. Spiideo says it gets about half its revenue from North America, and lists MLS, the NCAA and the German Bundesliga as other leagues where its products are in heavy use. Among clubs worldwide using its products are EPL clubs Brentford and Wolverhampton, Inter Milan of Serie A and LA Galaxy of MLS. Collegiate teams like Virginia Tech basketball use automated feeds to let coaches give players immediate feedback during practices, according to a case study on the Spiideo website.
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