Jerry Jones bought the Dallas Cowboys in 1989 for $140 million, and today the valuation of the NFL club sits around $8 billion. While an NFL team is very rarely ready, newer sports teams, leagues and adjacent companies are increasingly viewed as hot investment opportunities.
Angel City Football Club founder and managing partner at Upfront Ventures Kara Nortman told the audience at Fast Company’s Innovation Festival that opportunities are ripe in sports, especially with the proliferation of streaming services. She said that due to the ever-increasing demand for sports content, emerging leagues in emerging sports have an opportunity to find a wider audience. CBS, for example, bought multi-year broadcast rights for the American Cornhole League in 2020. CBS also broadcast Pro Pickleball this summer, streaming it on Paramount Plus.
Angel City Football Club founder and Upfront Ventures managing partner Kara Nortman [Photo: Celine Grouard for Fast Company] “As someone who has spent my entire career investing in technology, I’m really moving all my energy and focus to sports,” Nortman said , who shared the stage with 35V (formerly Thirty Five Ventures) and Boardroom co-founder Rich Kleiman, and Electronic Arts COO Laura Miele. “I think it’s the beginning of it becoming its own asset class, even for institutional investors.”
Electronic Arts COO Laura Miele [Photo: Celine Grouard for Fast Company]In 2020, Nortman founded Angel City, which immediately caused excitement, thanks to an ownership group that includes actor Natalie Portman, tennis legends Billie Jean King and Serena Williams, co-founder of Reddit. and venture capitalist Alexis Ohanian, and 13 former US women’s national soccer team members.
“Angel City has done an impeccable job of building a brand that is, in some ways, bigger than the NWSL immediately, but it’s benefiting the league and there’s a growing tidal effect,” Kleiman said. He said the success and brand building done by Nortman’s Angel City helped spark his company’s investment in fellow NWSL club Gotham FC in May.
Thirty Five Ventures co-founder Rich Kleiman [Photo: Celine Grouard for Fast Company] Kleiman said part of the reason these new sports entities are becoming more attractive to investors is the new generation of ownership. “You can’t just take over an NBA team or an NFL team, but the ability to have great CEOs and great entrepreneurs who are leading these [new] teams now and leading these organizations, that’s going to be the difference.”
Meanwhile, in another type of investment, Electronic Arts has spent heavily on the development of cutting-edge animation and graphics, as well as AI and machine learning, to make sports stars like Lionel Messi and Patrick Mahomes as realistic as possible. “After 40 years of investing in our technology, we are in a truly unique position,” said Miele. “We can actually take data from real players in a game and put that into our proprietary algorithm and it will actually create natural real-world movement every day, week after week.”