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Women’s sport investment – where is the money coming from?

Amid a surge in viewership, commercial revenue and fandom, women’s sports teams are starting to command nine-figure valuations and are selling for tens of millions of dollars. From private equity firms and tech entrepreneurs to female owners and celebrities, SportsPro takes a look across the landscape to map out some of the major players and to identify some of the key investment trends.

10 July 2023 Sam Carp

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Viewership is on the rise. Revenues are not even close to their ceiling. And as a result, investment in women’s sport is soaring.

A recent report carried out by The Sports Consultancy and accountancy and business advisory firm BDO concluded that women’s sport properties could be a better long-term investment than their male equivalents. The theory is that there is more scope for audiences to grow, plenty of time for media rights revenue to increase, and lots of space in the calendar to try new formats.

After several years of sustained momentum, investors are coming round to the idea. The inaugural Women’s Premier League (WPL) cricket franchise auction commanded around US$572 million for five teams, averaging out at just under US$115 million apiece, which is more than what owners paid on average for the first eight Indian Premier League (IPL) clubs.

It is a similar story in more established domestic competitions like the National Women’s Soccer League (NWSL), where expansion clubs were reportedly going for up to US$5 million as recently as 2020, but are now selling at ten times that figure.

The first five WPL cricket franchises sold for a combined US$572m

Whether it be record television audiences for the Women’s March Madness final or mammoth attendances across European soccer, investors can see the growth in front of their eyes and are now increasingly keen to get in while women’s sports properties remain a sweet spot investment. Those tasked with securing buyers are also now equipped with an ever-expanding trove of data to help those investors understand the opportunity and business case for women’s sport.

“There’s now a clear business case which has led to more sophisticated investors entering the conversation,” says Maddie Winslow of Inner Circle Sports, which has been assisting the NWSL with expansion. “Instead of the buyer universe consisting of solely the passionate women’s soccer fans or the parents of female athletes, because you have the data, because you’re running formal processes, you’re able to educate people properly, and educate around a business case that savvy investors can get excited about.”

In a year that has already seen some landmark investment deals, SportsPro surveys the women’s sports landscape to see where the money is coming from.

Private equity

The NWSL’s most recent expansion franchise, which will be based in California’s Bay Area, sold for a cool US$53 million.

But just as eye-catching as the fee itself was the identity of the team’s majority shareholder. With approximately US$65 billion in assets under management, private equity giant Sixth Street isn’t in the business of making investments because it is the right thing to do. Instead, its principal aim is to identify undervalued assets that are going to generate returns for its investors.

The US-based company’s other investments in sports include FC Barcelona, their El Clasico rivals Real Madrid and the National Basketball Association’s (NBA) San Antonio Spurs. Its decision to buy a NWSL team therefore feels like significant validation for both the league and the growth potential of women’s soccer in the US.

Sixth Street’s entry via the NWSL highlights the calibre of investors now prepared to spend big on women’s sports and could yet be the catalyst for more investment from private equity firms who spy an opportunity to secure properties at a low cost relative to what they could potentially be worth in ten years’ time.

Arctos Sports Partners, for example, now owns a stake in the NWSL’s Portland Thorns. In England, the likes of Bridgepoint and CVC Capital Partners were previously linked with soccer’s Women’s Super League (WSL), although nothing concrete came of those rumours, while the latter firm recently stumped up US$150 million for a 20 per cent stake in the WTA Tour’s commercial business.

Female-led ownership groups

The ongoing rise of women’s sports has emboldened a new wave of female investors. The current price point means that highly successful women who might have been cornered into limited partner positions in men’s sport are now taking the starring roles.

One of the higher profile investors is Michele Kang, an American businesswoman who founded medical technology company Cognosante and the Cognosante Ventures investment firm.

In 2022, she paid a then-record US$35 million to buy the NWSL’s Washington Spirit and more recently became the majority owner of French side Olympique Lyonnais Feminin, who are arguably the most successful side in the women’s game. Her aim now is to bring the multi-club model to women’s soccer.

The impact of female-led ownership is already being felt elsewhere. In the Women’s National Basketball Association (WNBA), the Seattle Storm’s Force 10 Hoops LLC ownership group is headed up by three local businesswomen who purchased the team in 2008 to prevent it from leaving the city along with the NBA’s Seattle Supersonics.

They are now reaping the benefits after the Storm were recently valued at a WNBA-record US$151 million following a minority share sale. But even then, co-owners Ginny Gilder and Lisa Brummel have been keen to highlight the diversity of investors that participated in the funding round, which was led by media executive Michelle Cardinal and included 11 entities with at least one woman involved.

“We have a phenomenal organisation, and we are incredibly successful as a team,” Brummel told The Athletic. “So why not share with the world that here’s an example of what can happen in women’s sports when you run a team well, and you get some championships?”

Seattle Storm owners Lisa Brummel (left) and Ginny Gilder recently sold a minority share that valued the team at US$151m

When the WNBA decides the time is right to expand, Winslow believes the league will benefit from some of the same factors currently driving investment in the NWSL.

“The WNBA has a similar advantage as the NWSL in that they both have the number one talent pools for their respective sports worldwide,” she says. “If you’re going to make a bet on a league right now, that’s something you can’t readily find anymore if you’re not at that billion-dollar-plus valuation level.”

Female-led investment firms

On top of female-led ownership groups, there are also funds being established specifically to invest in women’s sports teams, leagues and other associated businesses.

At the start of this month, it was confirmed that Billie Jean King Enterprises, the tennis icon’s eponymous investing, marketing and consulting firm, was teaming up with The Mark Walter Group to buy the Premier Hockey Federation (PHF) in order to form a single North American women’s ice hockey league that will launch in January 2024.

Another company that might soon be making moves is Monarch Collective. Announced earlier this year by Angel City co-founder Kara Nortman and business partner Jasmine Robinson, the firm has been described as a first-of-its-kind fund that has US$100 million to spend exclusively on women’s sports teams, leagues and adjacent revenue streams such as media and gaming.

Speaking to SportsPro in April, Nortman said Monarch plans to make four to six investments and is particularly interested in soccer in the US and Europe. She also suggested that she wanted her firm to be the catalyst for driving more investment in women’s sports in the future.

“Ten years from now there should be many funds,” she said, “and we want to be the one that’s got a talent pipeline, has playbooks, and who people really enjoy working with.”

Men’s team owners and family offices

It’s not uncommon for men’s team owners to also have that club’s affiliate women’s franchise as part of their investment portfolio.

In the WNBA, five of the 12 majority owners also have a franchise in the men’s NBA. For example, the Washington Mystics and Wizards are both part of the Monumental Sports and Entertainment (MSE) empire, while the Phoenix Mercury and Suns were recently acquired from Robert Sarver by Mat Ishbia.

In soccer, six sides in the 12-team NWSL have men’s affiliates, and that number will grow in 2024, when Real Salt Lake owners David Blitzer and Ryan Smith return the Utah Royals to the competition.

David Blitzer, who owns the New Jersey Devils and Philadelphia 76ers, has started to make investments in women’s sports properties

The trend is more prevalent in Europe, however, where there are only three clubs in the top two divisions of the women’s game in England who operate independently from a men’s outfit. The story is similar in most of the other major leagues in places like France, Germany, Italy and Spain. Perhaps the owners are keen to keep hold of an asset that could appreciate in value quite quickly over the coming years.

That’s not necessarily a bad thing if those owners are giving their women’s teams the same attention as they are the men’s. But it does risk the women’s operation being deprioritised when a club falls on hard times, as was the case for many during the coronavirus pandemic.

Men’s sports leagues

Some men’s leagues have taken it upon themselves to financially support female equivalent competitions in their sports until those entities are able to operate independently. The WNBA, for example, was founded by the NBA in 1996 and the men’s organisation still owns a share of the women’s franchises to this day.

A similar strategy has been adopted in Australia by both the Australian Football League (AFL) and the National Rugby League (NRL), both of which formed and continue to operate their affiliate women’s competitions.

Most recently, as part of a new collective bargaining agreement (CBA) for NRLW players, the NRL committed to investing AUS$118 million in the women’s game over the next five years, which will also see the minimum wage for female professional rugby league athletes increase from AUS$30,000 to AUS$50,000.

That came a year after AFLW players agreed a new CBA that secured them an average salary increase of 94 per cent.

Athletes and celebrities

When Angel City launched in 2020, it did so with an army of athlete and celebrity investors from across the world of sports and entertainment, including founder Natalie Portman, 14 former US women’s national team soccer players (USWNT), Serena Williams and Eva Longoria. Today, the NWSL team’s 99-strong ownership group also comprises Christina Aguilera, Lindsey Vonn and Billie Jean King.

Those (current and former) athletes and celebrities might not be providing the majority of the capital, but involving them in the organisation has proved an effective way for women’s sports teams to build their profile and raise awareness among the general public.

Reddit co-founder Alexis Ohanian is the lead investor in Angel City, who also count Billie Jean King as part of their ownership group

Indeed, it’s an increasingly common strategy. The aforementioned Bay Area team’s investor group includes Aly Wagner and Andre Iguodala. Patrick Mahomes has a stake in the NWSL’s Kansas City Current, while four-time Grand Slam tennis champion Naomi Osaka has invested in the North Carolina Courage and the likes of Carli Lloyd, Sue Bird and Kevin Durant are minority owners of NJ/NY Gotham FC.

Elsewhere, in the WNBA, retired NFL great Tom Brady recently acquired an interest in the Las Vegas Aces, while Renee Montgomery is part of the Atlanta Dream ownership.

Tech entrepreneurs

Women’s sport is also attracting interest from investors with backgrounds in technology who see an opportunity to “start from a blank sheet of paper” and to use their expertise to accelerate revenue growth.

The lead investor at Angel City, for example, is internet entrepreneur and Reddit co-founder Alexis Ohanian. Co-founders Julie Uhrman and Nortman also have backgrounds in tech. The club has gone on to become a case study for women’s sports teams open to doing things differently, with its purpose-driven, community-based approach resonating particularly strongly with sponsors.

Tech investors have also been making their presence felt in other ways. A US$75 million investment in the WNBA at the start of 2022 included participation from the likes of Michael and Susan Dell, Laurene Powell Jobs and Sports Innovation Lab’s Angela Ruggiero.

This feature forms part of SportsPro’s Women’s Sport Week. Click here to access more exclusive content and sign up to the SportsPro Daily newsletter here to receive daily insights direct to your inbox.

To find out more about future themed weeks, click here.

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