MediaTalk | Season 3 | Ep. 43 - Navigating the New NBA and WNBA Media Landscape

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Mike Reynolds: Hi, I'm Mike Reynolds, a senior reporter covering the media industry with S&P Global Market Intelligence's tech, media, and telecom news team. Welcome to "MediaTalk," a podcast hosted by S&P Global, where the news and research staff explore issues in the ever-evolving media landscape. Today, I am joined by my colleague Iuri Struta, who covers tech M&A and capital markets for S&P Global Market Intelligence, and S&P Global Market Intelligence Kagan research analyst, Richard Berndes. Both are based in our London office. This time, we're going to be discussing the growing world of sports investment, which has seen a slew of deals in recent years. We're also going to be examining opportunities in women's sports and sports technology. Iuri and Richard, along with Gregory Bedrosian, CEO of tech-focused investment bank Drake Star Partners, were participants in a recent webinar entitled "Scoring Profits: The Dual Benefits of Investing in Sports." You ready, Iuri? 

Iuri Struta: Yes. 

Mike Reynolds: Alright, and Richard, how about you? You ready to go? 

Richard Berndes: Yeah. All ready to go, Mike. Good to be here again. 

Mike Reynolds: Let's go. First off, Iuri, what was the motivation behind you guys putting the webinar together? 

Iuri Struta: Yeah, I think that's a great question, Mike. So, we at S&P with Kagan cover the business of sports from a variety of angles. Kagan covers sports rights, viewing trends, fan activity, and loads of other business-related stuff. But we haven't focused very much on the investment side, and we haven't focused on it until recently. The investment side maybe was not that important five or ten years ago, or even three years ago. But it is increasingly important now as institutional investors, you know, they're expanding into this asset class, or what is becoming an asset class. And we thought it would be great to do a webinar on this. Especially because our numbers show we are at a record for the value of transactions involving team acquisitions and minority investments. Also, the number of transactions is at a record with, okay, what's there, two and a half months to go. 

Mike Reynolds: All right, Richard, your take on the burgeoning world of sports investment. You say there isn't any other asset class like this one. 

Richard Berndes: No, Mike, I don't think there is. Sport has a unique appeal that not any other type of content could command the passion, the appeal, and the viewing level that sports do. Sport has drama, it's rare, and the tension could be unbearable in some of the things we are watching. Also, you have to make a conscious decision in your schedule to make time to watch it. It has to be seen live. It's one of the few things that actually drives subscriptions, and that's borne out by the audiences it delivers. The recent Paris Olympics, for example, were watched by 5 billion people. That's the highest ever audience achieved by the Summer Olympics, and the recent 2022 Soccer World Cup in Qatar had a similar sort of audience. It's not just the size of the audience; it's the commercial appeal that comes with it. The audiences that watch sport are usually very highly demanded by advertisers and sponsors, who only come out in these sorts of big sporting events, in these huge numbers. So for me, sport has to be watched live. It's rare, it's passionate, it has huge numbers, and great economic appeal. 

Mike Reynolds: Yeah, the live aspect works. It's a communal thing. You are watching the game, you're not turning the channel, therefore you get to see the commercials, and there's affinity toward that as well. Alright, Iuri, again, there's been a couple of major deals in the NBA, the pro basketball league. Can you talk about that? 

Iuri Struta: Yes, you are right. We had the acquisition of the Lakers. It was a majority stake acquisition for a valuation of $10 billion, and you had the Portland Trailblazers also in the NBA. The Lakers' acquisition was a record in terms of the money paid for a team. I think we estimated the stake acquisition at about 8.5 billion, but the valuation of the entire team was 10 billion. These two deals basically have propelled deal-making to a record high this year. But I would note that it's not just these two deals or any other big deals in the NBA or NFL that have happened, or in European football and soccer. We're also seeing a lot of activity down market with smaller team acquisitions. Our numbers show that the number of deals is also at a record this year, and you have less than three months to go in 2025. The numbers could be even higher. We might see more deals by the end of the year. 

Mike Reynolds: And this isn't a case again, I think a general perception is, okay, you own a sports team, you're a rich guy. It's a trophy thing. If you're like Steve Cohen, you own the New York Mets, you sit next to the dugout. If you're Jerry Jones and you own the Dallas Cowboys, you know the TV cameras are on you, capturing every reaction in the box. But again, we're getting real investment now in terms of sports teams, right? This is not just a vanity thing anymore. 

Iuri Struta: Yeah, it remains a vanity thing as well, okay. I would say. But it's not just only a vanity thing. Now maybe in the past, this was the case, but now it's changed. It has moved a little bit from vanity to being, as you said, a veritable investment or a veritable asset class. And you are right. We've been writing about this shift in narrative for a while now. Investors are excited about sports. If you are an investor, especially for top teams and even some small ones, there are lots of attributes that you should like. As an investor, it has utility like cash flows with the rights deals. So there is typically no downside variation. And even if there is, it's happening like once every five years when you have these rights negotiations. What we've seen so far, they only go up, especially in the US. Another thing that investors like is durable assets. We've been discussing this with Greg Bedrosian, who's been on the webinar, the CEO of Drake Star, and we were just half-jokingly saying if I were to bet, I would rather bet that the Lakers are going to be around in a hundred years, but I'm not sure. Let's say about Apple, if it's going to be in a hundred years, or Alphabet, or any other big tech company. Investors have recently been caught in this narrative generally that the durability of an asset should be valued at a premium. The more durable an asset is perceived, the higher the price someone should pay for it, basically. This is why, for instance, Coca-Cola stock may seem expensive on a price-to-earnings ratio, given its sluggish growth. But because Coke is believed to be this durable asset or brand, then this has value in investors' minds. The same applies to teams in the top leagues. Another thing that's been driving how investors think about them is that they are unrepeatable assets. Besides being unrepeatable, in investors' minds, teams do not lose their fans, especially diehard fans. So even if team performance is bad for very long stretches, people keep... 

Mike Reynolds: People keep coming back and they're watching and they're rooting maybe. 

Iuri Struta: Exactly right. 

Mike Reynolds: Maybe in a crazy fashion because things don't get better right away. But still, yeah, there's deep involvement for sure. 

Iuri Struta: Yeah. From an economic standpoint, it would not make a lot of sense for you to keep buying the same product, even if the product is lousy. You would move to another product. But here, if you are a diehard fan or a fan, you are for life. Economists call this an inelasticity between product quality and customer demand, which you don't see very much in the broad economy. In other industries, if the quality of products gets worse, or a competitor makes better products at a better price, customers tend to flee. In sports, you don't hear Chicago Bulls fans switching to Lakers because the Lakers win and the Chicago Bulls lose. This feature has positive business implications, and it's attracting institutional investors. We'll probably talk about this more, but a lot of leagues now allow institutions to buy minority stakes, right? 

Mike Reynolds: Absolutely. And you have private equity firms like Atos Partners, they're focusing specifically on buying minority stakes in teams. I think there's a lot of activity around the world, but US investors seem to be maybe taking a lead role here. Is that right, Iuri? 

Iuri Struta: I would say a lead role, and probably it's only them that's driving this interest in sports investing. Americans, of course, are the buyers inside the US, and they're also the main buyers for teams outside the US, especially in Europe. In Europe, for example, most of the buyouts of teams in recent years or the past two or three decades, the money was mostly coming from the Middle East, which still is, and sometimes from Eastern Europe like Russia. Now, you increasingly have US investors buying up sports teams, especially in countries like the UK, Italy, and France. I think what they are doing is because they see the value in sports in a different way than probably some of the European investors see. 

Mike Reynolds: Richard, that's been the case for a while, right? US investors have taken stakes in some of the bigger clubs in the Premier League, the top soccer circuit in the UK. 

Richard Berndes: Oh yeah, a hundred percent right, Mike. I think over half the teams in the Premier League have American owners, most famously the Glazer family owning Manchester United and the Fenway Sports Group owning Liverpool. But as Iuri touched on, you're still seeing some Middle East money around there because if you think about Paris Saint-Germain, the European champions, they're Qatari-owned, and Manchester City does have investment via Silver Lake. But what you're seeing now is interesting: a lot of multi-club ownership cycles. Manchester City, for example, is part of the City Football Group, which owns football clubs around the world, and that delivers economies of scale and profitability, and the ability to move players around different clubs and grow their development. 

Iuri Struta: Mike, I would add to what Richard said. European teams are mostly bleeding cash. Most of them are not profitable at all. One of the reasons I think investors see here is that they could be betting that they can run these teams in a more efficient manner, as Richard said, by having this multi-club ownership strategy and pooling some of the costs across multiple teams. In this way, you drive savings. But also, it could be some sort of a bet that some of these salary caps that have been proposed or trialed, similar to the US leagues, will actually work and lead to business improvement down the road. So they say, let us buy now some of the teams while they are cheap, and then when this thing is going to happen, we're going to improve the business. We're going to have this salary cap. The business for teams is going to improve on a macro basis. Then the valuations of these teams in Europe will also skyrocket. 

Mike Reynolds: Salary cap's a bad word sometimes, but we'll see how this works. Iuri, you just alluded to this. Mr. Bedrosian from Drake Star mentioned this on the webinar. I guess since 2019, major US leagues have opened up investment to private equity groups and minority stakes. This is definitely boosting activity here. 

Iuri Struta: Yes, absolutely. I think that was one of the key regulatory changes that has unleashed the capital. Combined with what we've said on this podcast previously about this change in narrative, these two things have led to this strong deal activity, and I think it's likely to continue for the time being. There are still restrictions. It's not like institutional capital can come and buy everything they want. There are pretty significant restrictions. Especially, no institutional capital can own an entire team. They can own minority stakes, but in this way, they can team up with private investors that have capital and an idea about how to improve the team. Then, basically finance some of the team acquisitions, and this is how most of these institutional investors are participating now. 

Mike Reynolds: Alright. You guys had mentioned this earlier. Something that provides steady cash flow is the rights negotiations. Richard, there's been no shortage of deals of late, and I think there's more on the horizon. Can you talk about some of the things that are driving this end of the business? 

Richard Berndes: Sure. Certainly in the US, you've seen huge deals around some of the big key sports. Sports rights spending in the US grew 122% from 2015 to 2025, up from 13.8 billion to 30.5 billion. It's been those long-term deals with the NFL and the NBA that have been driving that. The current deal with the NFL was worth 110 billion for a 10-year deal from 2023, which is a 76% increase on the 31 billion from 2014 to 2022. In Europe, what we're seeing is media rights values are cooling somewhat, with some marginal growth, particularly around the main leagues. Even the Premier League, which is arguably the most profitable league around the world, is seeing some marginal growth, but they're also showing a lot more games live. So you're seeing it stalling to a certain extent, but I think what's really going to be affecting the sports rights values is the emergence of streamers coming into the market. This is something that leagues and federations have been trying to encourage for a long time because, obviously, if you have more bidders in the market, the value of the rights goes up. So we're seeing Amazon, Apple, DAZN, and Netflix all coming onto the scene and adding to those particular valuations and driving prices. But I have to say, the streamers have been very clever with what they've done so far. 

Mike Reynolds: Yeah. You gave particular kudos on the webinar to what Amazon did with the Premier League. 

Richard Berndes: Absolutely. That was a deal done before COVID for three years. They secured the rights for roughly 30 million pounds. It wasn't a huge deal. They had the rights to two complete weekends of live Premier League football. What was very clever was they scheduled those weekends around Black Friday and Boxing Day, which are two of the biggest commercial days around, I'd argue. So what they learned from that was they got the live viewing data from the Premier League and they could use that data to funnel their commercial plans afterward, which I thought was very clever. That would be some data that Amazon would not have had unless they'd had live sport. 

Mike Reynolds: Another key component here is social media. Again, a marketing platform, a fan engagement platform. Richard, you think that this is also playing a key role in terms of more investment coming into the various games we love around the world. 

Richard Berndes: Yeah, it's without a doubt. Social media is a true driver for sports, and that's for quite a few reasons. It's becoming more and more influential and important. Just a couple of things to bear in mind. Social media allows leagues to engage directly with fans on a one-to-one basis and build that one-to-one conversation with a fan. The same goes with individual athletes, and that builds a personal connection, which adds further value and engagement between fan and team or player. It also provides an avenue for marketing, promotion, and sponsorship, which enhances the rights values. It also taps into arguably an audience that TV rights don't have—it's that younger audience, the sort of the teens who are all over TikTok and Instagram. For them, having that one-to-one conversation with Cristiano Ronaldo or Lionel Messi is so important. Finally, like Amazon, it's a rich vein of data and analytics for leagues and broadcasters to learn more about their audiences and how to further ingrain their product with them. 

Mike Reynolds: Let's take a look over to sports technology. This is an up-and-coming area of investment, right? Iuri, what are some of the key segments that investors are putting some dollars behind? 

Iuri Struta: Yeah, so we also did, as part of this webinar, a research piece on sports technology. We've identified about 400 leading sports tech companies across different areas ranging from betting, sports analytics, collectibles, merchandising, eSports, and loads of other stuff. I think this sector ties into this investor idea that they can bring efficiency via technology. From what we understand, technology penetration in sports is still small. Especially at the administrative levels and others. There might be some demand for tech there and some of these companies are looking to capitalize on it. I think, to your question, some of the most interesting areas of investment within sports tech have been the analytics side across all levels, from player performance to the pitch, to the training, to operations of a club, and other stuff like that. Also, in the collectibles, which has always been a sort of strong market within sports tech, collectibles are seeing some of the investments, especially around blockchain technology. How can you combine blockchain with collectibles to make these NFTs and other stuff that the fans could cherish? 

Mike Reynolds: I think too, one of the things here is that, as you mentioned, it's cutting across a lot of different segments. I think what we're seeing in turn is that there's a variety of investors, whether it's PE firms and even athletes themselves. There are a lot of smaller companies here. Is sports technology ripe for M&A in the years ahead here? 

Iuri Struta: Yeah, this sports tech industry is highly fragmented. So the natural thing that comes with reaching maturity is consolidation. Yes, we should see more M&A in this space. 

Mike Reynolds: Alright, let's turn over to the ladies. Women's sports have been really escalating in recent years. Here in the States, the WNBA, Caitlin Clark is a household name for many. Record attendance, record viewing audiences. The expansion team, the Golden State Valkyries, made the playoffs in their first year. They sold out every game at the Chase Center in San Francisco, which is home to where Steph Curry and the Golden State Warriors play. Two more expansion teams are coming in next season and then three before the end of the decade. Richard, I'm just curious, over in the UK, is the WNBA a thing? 

Richard Berndes: I think it always has some global appeal. It's not unusual to see an NBA shirt in London, Paris, or Moscow. I think the links to the NBA are sort of perks of interest, and certainly, Caitlin Clark's incredible story. But I have to say, I don't think it's at the heights of the US interest. Over here in Europe and the UK, generally, soccer is the number one draw, right? Even more recently, the Women's Rugby World Cup has drawn some huge viewing across the platforms. 

Mike Reynolds: The women's Euros did really well this past summer. 

Richard Berndes: Yeah, absolutely. The combined audience was 412 million, and the media rights more than doubled in 2025 compared to the last one in 2022. It's believed that it delivered 220 million euros of economic boost for the host nation, Switzerland. It's done really well. Just outside that, Nikki Douche, who's the CEO of the Women's Super League, has been on record saying they've analyzed the viewing of women's soccer now, and it's bringing an entirely new audience to the sport who weren't interested in soccer before. That's all come from the success and the growth of women's soccer in terms of visibility. Even some of the teams here, Arsenal, which is arguably one of the most successful women's teams in the Premier League, host all their games at the main Arsenal stadium in the Emirates where the men play their team. So the growth has been fantastic, and I think you can only see that getting better and better, especially if they just signed a new deal for their live rights with Sky and the BBC. 

Mike Reynolds: The interest in women's sports just continues to grow. And Iuri, that has translated into some astronomical growth for women's sports valuations as well. 

Iuri Struta: Yeah. And I think you are right. A lot of investors see women's sports as a growth story. Men's sports teams are more established and mature, and people know their value better. Women's sports are growing faster, but from very low levels. Some investors are attracted by this risk-reward profile, especially believing this growth that we've seen in the recent past with fans and rights is going to continue. It attracts more venture capital-like investors who are willing to take more risks for potentially higher rewards. In men's sports, it's mostly private equity-style financing that is happening, while in women's sports, you have more of this venture capital. 

Richard Berndes: Yeah, just to follow up on that point, there are a couple of investment groups that stand out. Michelle Kang, who owns stakes in the WWSL, also owns Washington Spirit and Olympique Lyonnais. There's a group called Mercury 13, which is an investment group that focuses purely on investment in women's soccer, and they've just brought in interest in Bristol City. They also have links with Angel City and San Diego Wave. So yeah, following up on Iuri's point, there are specialist investors that are women-led groups as well. 

Mike Reynolds: Guys, we're getting to the end here. You guys were asked about whether there is a bubble around sports investment. Greg had mentioned price discovery. Iuri, can you just give us a sense of what that means? 

Iuri Struta: Yes. So you have some people that say sports is in a bubble, and they mentioned this during the webinar. Others say it's not because of the loads of things that we talked about in this podcast, the growth of sports rights, the investors, and I think we are, as you said, in a price discovery process and valuations could probably go up for a few more years before settling. What this means is previously the capital available to invest in sports teams was limited. Now you have more investors that are allowed to invest in sports teams. You have more money chasing the same unrepeatable assets. As a result of that, you see these valuations. You may be seeing a crystallization of the actual value of teams. So we could argue that for many years, because very few investors or very few investor types were allowed to invest in teams, most of these teams were undervalued. Now that the pool has broadened, you probably have... 

Mike Reynolds: Better valuations. Richard, do you think there's a sports bubble, or again, are we in the early innings here in terms of the investment wave into sports? 

Richard Berndes: I think if sports keep delivering the audiences and the valuable audiences that it does, you can see those values maintaining, certainly growing a little bit. I'm not sure if there's the substantial growth that we've seen before. I think the key to this is going to be what the streamers add to the mix. Having more competition in there, and let's talk, some of these people have very deep pockets. They could certainly potentially add a little bit more value. I think there have been interesting developments now around the Champions League, the new deal that's coming up. There's a possibility that they'll be selling the global rights to some of the games, right? Yep. So for someone like DAZN, who covered the Club World Cup, or Netflix, imagine them having the exclusive global rights to arguably the biggest club game in football. That's a very tantalizing product. But again, I think it's also for sports, it's getting the media mix right, especially for emerging sports and women's sports. That means exposure on some of the free-to-air channels that everyone can see, but also making the deals with the pay TV and the streamers who have the big checks to pay for. 

Mike Reynolds: Last question here, Iuri. Are we bubbling in the sports investment business? 

Iuri Struta: It's hard to say, but I would probably say that we're not yet bubbling. 

Mike Reynolds: Alright. Alright, guys, we will see, and bubbling is a good thing sometimes. Anyway, that concludes this episode of MediaTalk. We wanted to thank our guests, Iuri and Richard, for mapping out a number of the factors that are driving more investments in sports as an asset class. Thank you, fellas. 

Richard Berndes and Iuri Struta: Thanks, Mike. 

Mike Reynolds: And those who want more information on the dual benefits of the "Investing in Sports" webinar, you can go to the Cap IQ Pro website and hit the webinar tab to get access there. This is Mike Reynolds. We'll catch up soon on the next installment of MediaTalk. Bye everybody.