1 00:00:02,520 --> 00:00:07,560 Speaker 1: Bloomberg Audio Studios, Podcasts, Radio News. 2 00:00:13,680 --> 00:00:17,040 Speaker 2: I'm David Weston. Welcome to Wall Street Week on Bloomberg Radio. 3 00:00:17,440 --> 00:00:19,320 Speaker 2: Coming up on the program, we take a look at 4 00:00:19,320 --> 00:00:23,599 Speaker 2: the growing investment opportunities in and around women's sports. Plus, 5 00:00:23,640 --> 00:00:26,159 Speaker 2: we hear from Robbie Starbuck, who's made news for his 6 00:00:26,239 --> 00:00:29,600 Speaker 2: anti DEI efforts, on his activism and his push to 7 00:00:29,640 --> 00:00:33,840 Speaker 2: advocate for values based investing. First up, though, President Trump 8 00:00:33,880 --> 00:00:37,000 Speaker 2: is in an escalating standoff with Harvard University after the 9 00:00:37,040 --> 00:00:40,000 Speaker 2: government froze two point two billion dollars in federal grants 10 00:00:40,000 --> 00:00:42,800 Speaker 2: for the school this week. The President went on to 11 00:00:42,880 --> 00:00:46,640 Speaker 2: threaten Harvard's tax exempt status and on Wednesday accused the 12 00:00:46,640 --> 00:00:50,320 Speaker 2: school of hiring radical left faculty and said it quote 13 00:00:50,479 --> 00:00:53,680 Speaker 2: can no longer be considered even a decent place for learning. 14 00:00:54,560 --> 00:00:57,279 Speaker 2: For more on this, we talked with former Harvard University 15 00:00:57,280 --> 00:01:00,920 Speaker 2: president and Wall Street Week contributor Larry Summers, who applauded 16 00:01:00,960 --> 00:01:03,640 Speaker 2: the university's effort to stand up to President Trump. 17 00:01:03,760 --> 00:01:07,760 Speaker 3: David, I've been sharply critical of Harvard, and I continue 18 00:01:07,800 --> 00:01:13,200 Speaker 3: to be critical on many dimensions. Anti Semitism is still 19 00:01:13,680 --> 00:01:18,319 Speaker 3: not responded to strongly enough. There are still excesses of 20 00:01:18,400 --> 00:01:25,840 Speaker 3: identity politics. There's still concerns about intellectual diversity. That's all right, 21 00:01:26,800 --> 00:01:30,559 Speaker 3: But here's the thing. In America, you have to follow 22 00:01:30,640 --> 00:01:35,760 Speaker 3: the law and the approach the Trump administration is taking. 23 00:01:36,319 --> 00:01:41,040 Speaker 3: It is not at all consistent with the Civil Rights Act, 24 00:01:41,560 --> 00:01:46,200 Speaker 3: it is probably not consistent with Harvard's First Amendment rights. 25 00:01:46,920 --> 00:01:48,320 Speaker 4: And so the right thing. 26 00:01:48,240 --> 00:01:54,720 Speaker 3: To do was surely for Harvard to respond vigorously and strongly. 27 00:01:55,640 --> 00:02:00,360 Speaker 3: All the more because this is not an isolated thing 28 00:02:00,440 --> 00:02:04,080 Speaker 3: what's being done to Harvard. This is not a manifestation 29 00:02:04,280 --> 00:02:09,080 Speaker 3: of a particular concern about aspects of universities. 30 00:02:09,600 --> 00:02:11,640 Speaker 4: This is a part of a broad. 31 00:02:11,480 --> 00:02:19,440 Speaker 3: And sweeping effort to suppress institutions that challenge the presidential administration. 32 00:02:20,160 --> 00:02:23,160 Speaker 3: It's part of what's being done to law firms. It's 33 00:02:23,200 --> 00:02:26,120 Speaker 3: part of what's being done to countries. It's part of 34 00:02:26,120 --> 00:02:29,880 Speaker 3: what's being done to judges. It's part of what's being 35 00:02:29,960 --> 00:02:33,280 Speaker 3: done to legal residents. 36 00:02:32,160 --> 00:02:33,200 Speaker 4: Of our country. 37 00:02:33,760 --> 00:02:40,400 Speaker 3: And if an institution like Harvard cannot resist tyranny when 38 00:02:40,440 --> 00:02:45,840 Speaker 3: applied to it, with Harvard's fifty billion dollar endowment, with 39 00:02:45,919 --> 00:02:49,320 Speaker 3: all its network, with all its prestige. 40 00:02:49,360 --> 00:02:50,680 Speaker 4: Then who can. 41 00:02:51,600 --> 00:02:57,200 Speaker 3: So Harvard should not go interjecting itself into politics. But God, 42 00:02:57,320 --> 00:03:02,919 Speaker 3: when it is the object of an extra legal set 43 00:03:02,960 --> 00:03:05,239 Speaker 3: of orders and threats. 44 00:03:05,800 --> 00:03:08,560 Speaker 4: I don't think it had any viable choice at all 45 00:03:09,000 --> 00:03:11,360 Speaker 4: but to respond strongly. 46 00:03:12,400 --> 00:03:15,280 Speaker 2: Let's talk about that extra legal part of what you're saying, 47 00:03:15,600 --> 00:03:19,560 Speaker 2: at least defonic. The representative Republican from New York saying, listen, 48 00:03:19,760 --> 00:03:23,280 Speaker 2: colleges like Harvard don't have a right to money from 49 00:03:23,280 --> 00:03:25,400 Speaker 2: the government. They don't have a right to tax mayor money. 50 00:03:25,480 --> 00:03:27,400 Speaker 2: And if they don't have a right to tax mayor money, 51 00:03:27,520 --> 00:03:29,680 Speaker 2: can't the government put conditions on that money. 52 00:03:29,760 --> 00:03:33,760 Speaker 3: First of all, the money is not going It's not 53 00:03:33,840 --> 00:03:35,280 Speaker 3: like the government's funding. 54 00:03:34,960 --> 00:03:37,200 Speaker 4: The DEI office at Harvard. 55 00:03:37,680 --> 00:03:41,680 Speaker 3: Not like the government is funding the student discipline mechanism 56 00:03:42,080 --> 00:03:46,560 Speaker 3: at Harvard. The government is funding researchers who are doing 57 00:03:46,680 --> 00:03:52,280 Speaker 3: vitally important research on diseases like diabetes and cancer, and 58 00:03:52,960 --> 00:03:59,000 Speaker 3: als show what sense does it make to cut their 59 00:03:59,160 --> 00:04:04,120 Speaker 3: funding off off because somebody doesn't like what the associate 60 00:04:04,160 --> 00:04:10,080 Speaker 3: Dean of students did in a student discipline case. And 61 00:04:10,600 --> 00:04:15,320 Speaker 3: what remit does the government have to set as a 62 00:04:15,360 --> 00:04:21,719 Speaker 3: condition the composition which beliefs are valued, in which beliefs 63 00:04:21,760 --> 00:04:26,680 Speaker 3: are not valued in the Harvard Sociology department. That's not 64 00:04:26,800 --> 00:04:32,680 Speaker 3: the way free speech works are in. 65 00:04:32,680 --> 00:04:33,920 Speaker 4: A free society. 66 00:04:34,600 --> 00:04:38,880 Speaker 3: And this is supposed to be done the power of 67 00:04:38,880 --> 00:04:44,080 Speaker 3: the purse. Remember by Congress. It is not the prerogative 68 00:04:44,080 --> 00:04:51,719 Speaker 3: of the executive branch with three days notice, with no hearing, 69 00:04:52,320 --> 00:04:59,680 Speaker 3: no judicial review, no transparent notification to Congress is mandated 70 00:04:59,720 --> 00:05:06,359 Speaker 3: by statute to simply indiscriminately start cutting off previously promised 71 00:05:06,400 --> 00:05:12,000 Speaker 3: and committed funds because it has a disagreement over an 72 00:05:12,040 --> 00:05:15,160 Speaker 3: issue with the university. 73 00:05:15,360 --> 00:05:16,800 Speaker 2: So, Larry, give us a sense of what is a 74 00:05:16,839 --> 00:05:19,760 Speaker 2: practical matter this will mean if it continues through You 75 00:05:19,880 --> 00:05:22,000 Speaker 2: ran Harvard at one point. You know the budget, You 76 00:05:22,040 --> 00:05:24,599 Speaker 2: know that fifty three billion dollars in down there. What 77 00:05:24,680 --> 00:05:25,800 Speaker 2: will it do their operations? 78 00:05:26,120 --> 00:05:31,600 Speaker 3: Look, they'll have to make some very important strategic choices. 79 00:05:32,440 --> 00:05:37,000 Speaker 3: I hope that the university will find ways even if 80 00:05:37,040 --> 00:05:43,680 Speaker 3: there is a cutoff for some interval of funds, to 81 00:05:43,839 --> 00:05:51,000 Speaker 3: maintain vitally important programs, to not cut back research. But potentially, 82 00:05:51,600 --> 00:05:57,000 Speaker 3: if the US government goes to war with our great universities, 83 00:05:57,640 --> 00:06:03,200 Speaker 3: it means a sharp production in the kind of scientific 84 00:06:03,279 --> 00:06:07,599 Speaker 3: progress that has caused the United States to be the 85 00:06:07,720 --> 00:06:11,360 Speaker 3: envy of the world and pull so far ahead of 86 00:06:11,400 --> 00:06:16,279 Speaker 3: Europe and Japan. It means the end of efforts at 87 00:06:16,560 --> 00:06:25,120 Speaker 3: cures to diseases like cancer and diabetes. It means a 88 00:06:25,240 --> 00:06:30,320 Speaker 3: substantial risk to our national security because one of our 89 00:06:30,360 --> 00:06:35,279 Speaker 3: great national assets has been our capacity for innovation, which 90 00:06:35,320 --> 00:06:42,880 Speaker 3: resides very heavily in our leading academic institutions. So a 91 00:06:43,000 --> 00:06:47,960 Speaker 3: short run problem, I think that can be managed painfully 92 00:06:48,200 --> 00:06:53,080 Speaker 3: until the judiciary steps in and does what's necessary. A 93 00:06:53,680 --> 00:06:59,960 Speaker 3: long run war against the universities that is going at 94 00:07:00,080 --> 00:07:04,359 Speaker 3: after what is our hugest asset. You know, if I 95 00:07:04,400 --> 00:07:07,680 Speaker 3: think about all the different sectors of the economy, it's 96 00:07:07,720 --> 00:07:11,160 Speaker 3: hard to think of one where we are as dominant 97 00:07:11,520 --> 00:07:15,520 Speaker 3: as in higher education. All the students from all over 98 00:07:15,560 --> 00:07:20,080 Speaker 3: the world, at least until this administration came, wanted to 99 00:07:20,160 --> 00:07:25,440 Speaker 3: come to the United States. A vast fraction of the 100 00:07:25,440 --> 00:07:30,800 Speaker 3: world's innovation takes place in American universities. If we put 101 00:07:30,880 --> 00:07:35,280 Speaker 3: at this put that at risk, we are making, I believe, 102 00:07:35,600 --> 00:07:41,920 Speaker 3: a very very grave mistake. And yes, these issues should 103 00:07:41,960 --> 00:07:47,440 Speaker 3: be pursued, But destroying medical research grants because you don't 104 00:07:47,480 --> 00:07:49,920 Speaker 3: think people have been disciplined severely enough. 105 00:07:50,120 --> 00:07:52,640 Speaker 4: It really doesn't make any sense, Laria. 106 00:07:52,640 --> 00:07:54,960 Speaker 2: I wonder if there's cautionary tail here that maybe the 107 00:07:55,040 --> 00:07:58,040 Speaker 2: higher education system has become too intertwined with the government, 108 00:07:58,080 --> 00:07:59,480 Speaker 2: that's why they're so dependent upon them. 109 00:08:00,000 --> 00:08:05,160 Speaker 3: There may be questions that can be asked of that kind, 110 00:08:05,720 --> 00:08:10,720 Speaker 3: But gosh, if the government is not prepared to fund 111 00:08:11,280 --> 00:08:16,560 Speaker 3: basic research, the research which ultimately will make possible the 112 00:08:16,600 --> 00:08:19,480 Speaker 3: development of new products, I think. 113 00:08:19,320 --> 00:08:20,680 Speaker 4: We have a problem. 114 00:08:21,280 --> 00:08:26,000 Speaker 3: If the government is not prepared to fund scholarships that 115 00:08:26,200 --> 00:08:29,760 Speaker 3: promote opportunity for our poor students, who are very able 116 00:08:30,200 --> 00:08:35,880 Speaker 3: and generate social mobility, I think we have a problem. 117 00:08:36,360 --> 00:08:39,920 Speaker 3: I think what we need, frankly, is a more mature 118 00:08:40,000 --> 00:08:45,040 Speaker 3: relationship between the government, the broader society, and the universities. Yes, 119 00:08:45,120 --> 00:08:50,400 Speaker 3: the universities have made some very serious mistakes, and yes 120 00:08:50,920 --> 00:08:57,640 Speaker 3: they should be pressured and pressured with escalating strength to 121 00:08:57,760 --> 00:09:03,080 Speaker 3: change that. I didn't even have an objection to the 122 00:09:03,120 --> 00:09:07,400 Speaker 3: way in which the Biden administration opened civil rights cases 123 00:09:07,760 --> 00:09:12,439 Speaker 3: with respect to a variety of universities and anti semitism. 124 00:09:13,080 --> 00:09:17,360 Speaker 3: But that's a very different thing than the kind of 125 00:09:17,480 --> 00:09:23,080 Speaker 3: persecution that is involved here, and this escalated David in. 126 00:09:23,000 --> 00:09:25,400 Speaker 4: A profoundly troubling way. 127 00:09:26,240 --> 00:09:31,840 Speaker 3: When the President of the United States endeavored by social 128 00:09:31,920 --> 00:09:38,920 Speaker 3: media to engage in an individual specific tax matter, namely 129 00:09:39,000 --> 00:09:44,200 Speaker 3: Harvard's five oh one C three deduction, and to suggest 130 00:09:44,280 --> 00:09:50,160 Speaker 3: that it be decided on the basis of a political ground. 131 00:09:50,840 --> 00:09:56,960 Speaker 4: That's the kind of interference with the irash that. 132 00:09:57,000 --> 00:10:03,880 Speaker 3: It's a sacred duty of the Treasure Secretary to resist. 133 00:10:04,400 --> 00:10:09,360 Speaker 3: It is exactly what was alleged to have happened six 134 00:10:09,480 --> 00:10:15,199 Speaker 3: levels down, and many people got very upset in connection 135 00:10:15,360 --> 00:10:19,559 Speaker 3: with the so called Lois Learner case involving five O 136 00:10:19,679 --> 00:10:23,920 Speaker 3: one C three deductions and conservative groups. If there was 137 00:10:24,600 --> 00:10:28,920 Speaker 3: punishment of conservative groups, people were absolutely right to have 138 00:10:29,000 --> 00:10:32,760 Speaker 3: been hugely outraged about it during the Biden administration. I 139 00:10:32,800 --> 00:10:35,560 Speaker 3: don't know anything about the merits of the case, but 140 00:10:35,679 --> 00:10:39,120 Speaker 3: for the President of the United States to be calling 141 00:10:39,240 --> 00:10:44,360 Speaker 3: for changing the tax status of his adversaries, this is 142 00:10:44,559 --> 00:10:52,760 Speaker 3: new and I believe authoritarian and a real question about 143 00:10:52,800 --> 00:10:53,640 Speaker 3: our democracy. 144 00:10:53,920 --> 00:10:56,480 Speaker 2: Larry, one last question, since we're on taxes and this 145 00:10:56,559 --> 00:10:59,600 Speaker 2: is tax week, Basically, what do you make of the 146 00:10:59,720 --> 00:11:02,480 Speaker 2: acts that the Trump adminstration is taking with respect to 147 00:11:02,480 --> 00:11:03,079 Speaker 2: the IRS. 148 00:11:03,280 --> 00:11:07,640 Speaker 3: I think it's possible that the Treasury Secretary and his 149 00:11:07,800 --> 00:11:15,360 Speaker 3: senior colleagues are being seriously delinquent in their duty. I 150 00:11:15,400 --> 00:11:18,800 Speaker 3: look at tens of thousands of people being pushed out 151 00:11:18,840 --> 00:11:24,400 Speaker 3: of the IRS, even as tax compliance is a massive problem, 152 00:11:24,720 --> 00:11:28,839 Speaker 3: and hear so many stories have increased tax seeing as 153 00:11:28,880 --> 00:11:34,040 Speaker 3: a consequence. I see the elevation of a person with 154 00:11:34,200 --> 00:11:40,800 Speaker 3: no experience, no administrative or information technology experience, to be 155 00:11:41,400 --> 00:11:46,520 Speaker 3: the contemporary commissioner of the IRS, chosen on the basis 156 00:11:46,559 --> 00:11:51,880 Speaker 3: of political loyalty to the Trump enterprise. I look at 157 00:11:51,920 --> 00:11:56,880 Speaker 3: what are probably the extra lawful agreements entered into without 158 00:11:56,920 --> 00:12:00,600 Speaker 3: even speaking to people at the IRS, with respec to 159 00:12:01,000 --> 00:12:07,000 Speaker 3: information sharing and immigration. I look at the president's involvement 160 00:12:07,640 --> 00:12:15,960 Speaker 3: in specific cases, and I see the most important line 161 00:12:16,600 --> 00:12:19,080 Speaker 3: that I thought I was supposed to defend when I 162 00:12:19,200 --> 00:12:28,160 Speaker 3: was Treasury Secretary, a political tax enforcement, neutral, professional tax enforcement, 163 00:12:28,760 --> 00:12:34,920 Speaker 3: not driven by politics. And I see that line being 164 00:12:35,080 --> 00:12:41,240 Speaker 3: crossed with the Treasury Department cheering it on, and it 165 00:12:41,280 --> 00:12:43,920 Speaker 3: makes me both very sad and very angry. 166 00:12:44,080 --> 00:12:47,920 Speaker 2: That's former Treasury Secretary and former Harvard president Larry Summers 167 00:12:48,280 --> 00:12:50,840 Speaker 2: coming up on Wall Street Week. Will the money follow 168 00:12:50,880 --> 00:12:54,440 Speaker 2: the momentum of women's sports? I'm David Weston, and this 169 00:12:54,760 --> 00:13:02,280 Speaker 2: is Bloomberg. This is a story about perseverance and the 170 00:13:02,360 --> 00:13:05,080 Speaker 2: women who are laying the foundation for what looks to 171 00:13:05,120 --> 00:13:09,840 Speaker 2: be a huge investment opportunity women's sports, where two of 172 00:13:09,880 --> 00:13:13,960 Speaker 2: the fastest growing are the WNBA and the National Women's 173 00:13:14,080 --> 00:13:14,920 Speaker 2: Soccer League. 174 00:13:20,800 --> 00:13:22,800 Speaker 5: I think when you're looking at the women's sports space, 175 00:13:22,880 --> 00:13:25,200 Speaker 5: specifically in the last five years, what you're seeing in 176 00:13:25,240 --> 00:13:27,800 Speaker 5: the surge of growth really begins with consumers. 177 00:13:29,000 --> 00:13:32,040 Speaker 6: It wasn't really until the last five years that women's 178 00:13:32,440 --> 00:13:36,520 Speaker 6: sports has had as much ability to be broadcast than 179 00:13:36,520 --> 00:13:37,240 Speaker 6: ever before. 180 00:13:37,840 --> 00:13:40,840 Speaker 7: You're finally putting this product in the right spotlight, and 181 00:13:40,880 --> 00:13:43,360 Speaker 7: it is exploding in popularity. 182 00:13:44,120 --> 00:13:49,360 Speaker 2: From tennis to volleyball, to soccer to basketball. Women are 183 00:13:49,480 --> 00:13:53,400 Speaker 2: bringing it both on and off the courts and the pitches, 184 00:13:53,840 --> 00:13:57,840 Speaker 2: with women's sports sponsorships attracting over a billion dollars and 185 00:13:57,960 --> 00:14:01,320 Speaker 2: total team valuations predicted to increase from two point six 186 00:14:01,360 --> 00:14:04,440 Speaker 2: billion dollars in twenty twenty three to four point three 187 00:14:04,480 --> 00:14:06,440 Speaker 2: billion dollars in the next three years. 188 00:14:06,920 --> 00:14:08,439 Speaker 8: Number one limit. 189 00:14:10,240 --> 00:14:14,120 Speaker 2: There is no question that women are fueling fandoms across stadiums, 190 00:14:14,240 --> 00:14:17,839 Speaker 2: fields and arenas, but is it sustainable. 191 00:14:18,640 --> 00:14:21,000 Speaker 6: Little by little we've been able to see huge increases 192 00:14:21,080 --> 00:14:24,800 Speaker 6: in viewership and investment. With that comes the investment that 193 00:14:24,840 --> 00:14:28,600 Speaker 6: we're now seeing today, where people are really seeing more viewership, 194 00:14:28,680 --> 00:14:31,960 Speaker 6: their form, more attendance, their for more sponsorship, their formre 195 00:14:32,000 --> 00:14:35,800 Speaker 6: merchandise being sold, and that all leads to more external 196 00:14:35,840 --> 00:14:38,560 Speaker 6: dollars coming into the ecosystem saying, I believe that this 197 00:14:38,720 --> 00:14:41,400 Speaker 6: is an economy that we can support and that also 198 00:14:41,520 --> 00:14:42,680 Speaker 6: will have great returns. 199 00:14:43,760 --> 00:14:50,880 Speaker 2: More fair Level is the executive vice president of Wasserman's 200 00:14:50,960 --> 00:14:55,400 Speaker 2: The Collective, a women focused global advisory business whose mission 201 00:14:55,600 --> 00:14:58,640 Speaker 2: is to drive investment in women's professional sports. 202 00:15:00,000 --> 00:15:02,440 Speaker 6: The exciting part right now about women's sports is that 203 00:15:02,480 --> 00:15:05,760 Speaker 6: we're seeing similar types of investors in women's sports, which 204 00:15:05,800 --> 00:15:10,120 Speaker 6: means that women's sports has reached a point where true 205 00:15:10,160 --> 00:15:13,240 Speaker 6: capital partners are coming in looking at how can they 206 00:15:13,240 --> 00:15:15,119 Speaker 6: invest in this Nason economy. 207 00:15:16,040 --> 00:15:18,920 Speaker 2: Women's sports might still be new on the scene, but 208 00:15:19,000 --> 00:15:23,960 Speaker 2: they're growing fast. WNBA attendance almost doubled from twenty twenty 209 00:15:23,960 --> 00:15:27,760 Speaker 2: three to twenty twenty four, and in women's soccer, the 210 00:15:27,840 --> 00:15:31,840 Speaker 2: twenty twenty four final alone drew nearly a million viewers, 211 00:15:31,880 --> 00:15:35,680 Speaker 2: nearly twice the audience as its men's counterpart, and the 212 00:15:35,760 --> 00:15:39,280 Speaker 2: money is following the eyeballs, as media writes for the 213 00:15:39,440 --> 00:15:43,520 Speaker 2: NWSL jumped from one point five million dollars to sixty 214 00:15:43,600 --> 00:15:51,280 Speaker 2: million dollars in the most recent deal. What it's given 215 00:15:51,320 --> 00:15:54,480 Speaker 2: the numbers, it's no surprise that investors are paying attention, 216 00:15:55,200 --> 00:15:58,560 Speaker 2: leading Laval to work with RBC to produce a study 217 00:15:58,640 --> 00:16:02,400 Speaker 2: on the investment opportunity these women's sport provide. 218 00:16:02,800 --> 00:16:05,640 Speaker 6: We started this particular study with RBC, which is our 219 00:16:05,640 --> 00:16:09,120 Speaker 6: second study with them earlier in twenty twenty four, really 220 00:16:09,160 --> 00:16:11,360 Speaker 6: wanted to look at the trends that we were seeing 221 00:16:11,400 --> 00:16:13,560 Speaker 6: about how much money was starting to come into From 222 00:16:13,560 --> 00:16:16,680 Speaker 6: an investment perspective, we were seeing an enormous amount of 223 00:16:16,680 --> 00:16:21,120 Speaker 6: private equity coming in different venture capital groups, individual family offices, 224 00:16:21,240 --> 00:16:25,160 Speaker 6: driving some real dollars into women's teams and leagues, and 225 00:16:25,200 --> 00:16:27,760 Speaker 6: so we wanted to stop and think about from an 226 00:16:27,880 --> 00:16:32,080 Speaker 6: RBC wealth investor perspective, how these teams and leagues would 227 00:16:32,080 --> 00:16:34,880 Speaker 6: prove to be really good investment for them. And so 228 00:16:34,920 --> 00:16:37,640 Speaker 6: we set out to look at this specifically through NWSL 229 00:16:37,720 --> 00:16:40,160 Speaker 6: and WNBA because they are the most mature leagues in 230 00:16:40,160 --> 00:16:45,359 Speaker 6: the United States, and really looked at very specific variables, 231 00:16:45,760 --> 00:16:47,600 Speaker 6: particularly the revenue drivers. 232 00:16:48,160 --> 00:16:50,160 Speaker 7: It's amazing to me that we've reached a point where 233 00:16:50,200 --> 00:16:53,440 Speaker 7: this younger generation, this is their normal. They're normal is 234 00:16:53,480 --> 00:16:56,920 Speaker 7: that female athletes are able to play in a stadium 235 00:16:57,000 --> 00:16:59,840 Speaker 7: like this, sold out with incredible amount of fans. 236 00:17:00,720 --> 00:17:03,920 Speaker 2: Chris and Angie Long are among those who have become investors, 237 00:17:04,480 --> 00:17:09,240 Speaker 2: leading the group that bought the NWSLS Kansas City Current give. 238 00:17:09,080 --> 00:17:14,920 Speaker 9: A full panoramic view. As more and more opportunities to 239 00:17:14,960 --> 00:17:19,320 Speaker 9: watch women's sports have arisen, You've naturally now seen this 240 00:17:19,720 --> 00:17:22,840 Speaker 9: massive growth and popularity because at the end of the day, 241 00:17:22,840 --> 00:17:24,359 Speaker 9: it's all about the product. 242 00:17:24,000 --> 00:17:26,680 Speaker 4: On the field. When you have a product that's. 243 00:17:26,520 --> 00:17:30,840 Speaker 9: As fantastic as women's sports, there's no doubt it's going 244 00:17:30,880 --> 00:17:32,000 Speaker 9: to be successful. 245 00:17:32,400 --> 00:17:37,320 Speaker 7: We have been big sports fans. We actually were season 246 00:17:37,320 --> 00:17:40,000 Speaker 7: ticket holders to a bi professional women's team that was 247 00:17:40,000 --> 00:17:44,359 Speaker 7: in Kansas City, and I think our experience in twenty 248 00:17:44,480 --> 00:17:48,800 Speaker 7: nineteen being in Paris that the Women's World Cup really 249 00:17:49,240 --> 00:17:53,040 Speaker 7: was enlightening to see the opportunity from an investment side, 250 00:17:53,160 --> 00:17:56,200 Speaker 7: especially in light of the tremendous amount of global growth 251 00:17:56,520 --> 00:17:57,359 Speaker 7: in the women's game. 252 00:17:59,000 --> 00:18:01,840 Speaker 2: In building their friends in Kansas City, the Lungs are 253 00:18:01,880 --> 00:18:03,320 Speaker 2: focused on their brand. 254 00:18:03,480 --> 00:18:05,800 Speaker 9: One of the leading jerseys sales. 255 00:18:05,520 --> 00:18:07,640 Speaker 2: And one of the things that has limited the growth 256 00:18:07,720 --> 00:18:12,400 Speaker 2: of women's professional sports franchises a dedicated place to practice 257 00:18:12,520 --> 00:18:13,040 Speaker 2: and play. 258 00:18:13,840 --> 00:18:17,040 Speaker 7: This whole space is the Can't State Current. I think 259 00:18:17,400 --> 00:18:21,560 Speaker 7: that alone is a big differentiator because most other women's 260 00:18:21,560 --> 00:18:25,040 Speaker 7: teams are playing in someone else's stadium, so they're relegated 261 00:18:25,080 --> 00:18:27,840 Speaker 7: to a smaller space that might be more akin to 262 00:18:28,160 --> 00:18:29,800 Speaker 7: a visitor's locker room. 263 00:18:30,119 --> 00:18:30,320 Speaker 10: I mean. 264 00:18:30,400 --> 00:18:33,040 Speaker 7: One of the things that is harder to put a 265 00:18:33,119 --> 00:18:37,480 Speaker 7: value on, but incredibly important is brand recognition. The first 266 00:18:37,560 --> 00:18:39,240 Speaker 7: year that we had a team, it was a little 267 00:18:39,240 --> 00:18:41,919 Speaker 7: bit like, oh, did you know there's a women's professional 268 00:18:41,960 --> 00:18:42,880 Speaker 7: team in Kansas City. 269 00:18:42,920 --> 00:18:44,400 Speaker 8: Now to the point. 270 00:18:44,200 --> 00:18:48,080 Speaker 7: Where we are now where if we go somewhere and 271 00:18:48,119 --> 00:18:51,040 Speaker 7: travel outside the country, people say, oh, Kansas City, isn't 272 00:18:51,080 --> 00:18:53,679 Speaker 7: that the place that built the stadium for the women's team, 273 00:18:54,040 --> 00:18:56,080 Speaker 7: And the first thing you see when you drive into 274 00:18:56,119 --> 00:19:00,359 Speaker 7: this city is this stadium. There's not a person in 275 00:19:00,400 --> 00:19:02,680 Speaker 7: Kansas City, the Midwest and a lot of the country 276 00:19:02,880 --> 00:19:05,760 Speaker 7: that doesn't know about the Kansas City Current and the 277 00:19:05,800 --> 00:19:06,480 Speaker 7: state and they play. 278 00:19:07,800 --> 00:19:11,399 Speaker 9: I think from a revenue perspective, I'm unaware of another 279 00:19:11,840 --> 00:19:16,240 Speaker 9: women's professional sports team globally that's done as much revenue 280 00:19:16,920 --> 00:19:20,520 Speaker 9: as we did this past year, which by the way, 281 00:19:20,640 --> 00:19:24,639 Speaker 9: is only our fourth season in operation. So from a 282 00:19:24,680 --> 00:19:28,080 Speaker 9: financial success standpoint, I think that speaks volumes. 283 00:19:29,480 --> 00:19:36,280 Speaker 7: From a revenue growth perspective, we're doing fantastic. I think 284 00:19:36,320 --> 00:19:41,359 Speaker 7: it is north of a twenty million dollars swing in revenue. 285 00:19:41,040 --> 00:19:42,800 Speaker 8: Being in your own facilities. 286 00:19:43,440 --> 00:19:49,800 Speaker 7: From a asset appreciation perspective, we're doing fantastic. 287 00:19:50,359 --> 00:19:53,480 Speaker 9: You look at what you can do in women's sports 288 00:19:53,480 --> 00:19:58,439 Speaker 9: today and the multiple invested capital versus the risk taken, 289 00:19:58,920 --> 00:20:02,520 Speaker 9: it's out of lack. It's absolutely in the investor's favor, 290 00:20:02,920 --> 00:20:04,640 Speaker 9: and I think that's part of the reason you're seeing 291 00:20:04,680 --> 00:20:08,400 Speaker 9: a lot more capital pour in, including private equity firms 292 00:20:08,480 --> 00:20:11,119 Speaker 9: and these new sports funds and all the things that 293 00:20:11,520 --> 00:20:13,480 Speaker 9: are happening, I think are due to the fact people 294 00:20:13,520 --> 00:20:16,440 Speaker 9: are realizing, Wow, if I'm going to take an ill 295 00:20:16,440 --> 00:20:20,800 Speaker 9: liquid asset investment like a sports team, I should get 296 00:20:20,840 --> 00:20:23,639 Speaker 9: compensated for it. And there's no better game in town 297 00:20:23,840 --> 00:20:25,320 Speaker 9: than what we're seeing on women's side. 298 00:20:26,640 --> 00:20:29,520 Speaker 2: But there is another league taking women's sports to the 299 00:20:29,560 --> 00:20:34,359 Speaker 2: next level, the WNBA. Since Caitlin Clark emerged as a 300 00:20:34,400 --> 00:20:39,320 Speaker 2: budding superstar at the University of Iowa, Women's basketball has skyrocketed, 301 00:20:39,600 --> 00:20:43,560 Speaker 2: garnering the league more fans and opening up new markets. 302 00:20:44,160 --> 00:20:46,520 Speaker 5: We are the first expansion team since two thousand and eight. 303 00:20:46,920 --> 00:20:49,080 Speaker 5: The last was Atlanta and then following us, we have 304 00:20:49,160 --> 00:20:52,680 Speaker 5: Portland in Toronto next year. So growth of WNBA has 305 00:20:52,720 --> 00:20:56,120 Speaker 5: been a long time coming and it's taken many years 306 00:20:56,160 --> 00:20:59,320 Speaker 5: to get here. This building has actually always been here 307 00:20:59,400 --> 00:21:02,920 Speaker 5: for the State Warriors, and now it's our Valkyrie's Performance Center. 308 00:21:03,280 --> 00:21:06,080 Speaker 5: So this is the area that you know the championships 309 00:21:06,080 --> 00:21:09,399 Speaker 5: were won before Chase Center was Bill Steph Curry is 310 00:21:09,440 --> 00:21:12,800 Speaker 5: in Steph Curry. Yeah, small name, right, and now we've 311 00:21:12,800 --> 00:21:14,240 Speaker 5: had an opportunity to make it our own. 312 00:21:14,840 --> 00:21:17,880 Speaker 2: Jess Smith was the head of revenue for the NWSL's 313 00:21:17,920 --> 00:21:22,000 Speaker 2: Angels City Football Club, where she introduced new sponsorship models 314 00:21:22,119 --> 00:21:25,800 Speaker 2: and broke records in attendance. She is now the president 315 00:21:25,840 --> 00:21:30,080 Speaker 2: of the WNBA's Golden State Valkyries, the first expansion team 316 00:21:30,240 --> 00:21:31,760 Speaker 2: in seventeen years. 317 00:21:32,240 --> 00:21:35,640 Speaker 5: When you look back during COVID, the WNBA actually got 318 00:21:35,640 --> 00:21:37,520 Speaker 5: together and played. They were the first league to do this. 319 00:21:37,600 --> 00:21:40,000 Speaker 5: It was also a really key moment to where consumers 320 00:21:40,000 --> 00:21:43,040 Speaker 5: were sitting at home on their couch looking for entertainment 321 00:21:43,400 --> 00:21:47,240 Speaker 5: and tuning in and really taking note of these incredible athletes, 322 00:21:47,280 --> 00:21:49,200 Speaker 5: really taking note of what they were standing for when 323 00:21:49,200 --> 00:21:50,560 Speaker 5: it came to social justice. 324 00:21:50,720 --> 00:21:51,280 Speaker 8: And there was an. 325 00:21:51,280 --> 00:21:54,800 Speaker 5: Unlock that began to happen with consumers and women's sports. 326 00:21:54,960 --> 00:21:56,240 Speaker 8: So as consumers. 327 00:21:55,800 --> 00:22:00,760 Speaker 5: Began to unlock giving, those ratings began to unlock by merchandise, 328 00:22:00,960 --> 00:22:03,919 Speaker 5: buying tickets and understanding that their dollars in time and 329 00:22:04,040 --> 00:22:07,920 Speaker 5: interest was driving the growth of the w media listened, right, 330 00:22:08,040 --> 00:22:11,600 Speaker 5: teams listened, leagues listened, and more investment began to come in. 331 00:22:11,840 --> 00:22:16,119 Speaker 5: And those consumers have really really rewarded everyone in that circle. 332 00:22:16,240 --> 00:22:17,760 Speaker 8: That is equated to the growth. 333 00:22:18,080 --> 00:22:20,639 Speaker 2: When we talk about growth, how do you measure it? 334 00:22:21,119 --> 00:22:22,639 Speaker 2: What are the metrics you pay attention to? 335 00:22:23,080 --> 00:22:26,400 Speaker 5: There's two things. One is money and revenue, right, are 336 00:22:26,440 --> 00:22:28,439 Speaker 5: your revenue lines growing? Are you investing in the right 337 00:22:28,480 --> 00:22:31,040 Speaker 5: way to make sure that those are growing exponentially? And 338 00:22:31,119 --> 00:22:34,160 Speaker 5: two is fandom? How many people are coming into your 339 00:22:34,160 --> 00:22:38,520 Speaker 5: ecosystem through purchases but also followship on social media or 340 00:22:38,600 --> 00:22:41,320 Speaker 5: TV ratings, and so if you're looking at both of those, 341 00:22:41,840 --> 00:22:44,680 Speaker 5: the growth is very significant. But we have a close 342 00:22:44,720 --> 00:22:46,120 Speaker 5: eye on both every single day. 343 00:22:47,280 --> 00:22:50,400 Speaker 2: As fast as women's professional sports are growing, they still 344 00:22:50,520 --> 00:22:54,240 Speaker 2: lag behind their male counterparts, at least for the most part. 345 00:22:54,520 --> 00:22:57,800 Speaker 2: Where the NBA Playoffs averaged four point five million TV 346 00:22:57,880 --> 00:23:01,159 Speaker 2: viewers last year, the WNBA had one point one million. 347 00:23:01,800 --> 00:23:05,479 Speaker 2: Twenty two point five million fans attended NBA games in person, 348 00:23:05,800 --> 00:23:09,480 Speaker 2: where the WNBA had two point four million, But the 349 00:23:09,520 --> 00:23:13,119 Speaker 2: gap is closing. Viewership numbers were up one hundred and 350 00:23:13,160 --> 00:23:16,160 Speaker 2: thirty nine percent for the women last year, but down 351 00:23:16,280 --> 00:23:19,480 Speaker 2: twelve percent for the men. You have a foundation in 352 00:23:19,520 --> 00:23:23,920 Speaker 2: both men's and women's sports from your experience, what's different 353 00:23:24,040 --> 00:23:24,640 Speaker 2: about the two. 354 00:23:25,359 --> 00:23:27,200 Speaker 5: That's a really good question. I don't know if I've 355 00:23:27,200 --> 00:23:31,280 Speaker 5: been asked that way before. I would say the assumptions 356 00:23:31,320 --> 00:23:34,520 Speaker 5: of things in women's sports, It's been assumed that when 357 00:23:34,520 --> 00:23:36,879 Speaker 5: you create a product, well, you better not lose any money. 358 00:23:37,000 --> 00:23:39,760 Speaker 5: And it's just interesting the standard that has existed there. 359 00:23:40,560 --> 00:23:42,840 Speaker 5: Before I joined the Angel City, I was in certain 360 00:23:42,920 --> 00:23:46,119 Speaker 5: rooms where organizations would think about should we get a 361 00:23:46,160 --> 00:23:48,840 Speaker 5: women's team, should we explore this? And what was really 362 00:23:48,920 --> 00:23:52,399 Speaker 5: interesting about the mindset there was that it was the 363 00:23:52,400 --> 00:23:54,760 Speaker 5: conversation always came back to, while if we sold four 364 00:23:54,800 --> 00:23:58,320 Speaker 5: thousand tickets, maybe we wouldn't lose money instead of what 365 00:23:58,359 --> 00:24:01,919 Speaker 5: would it take to sell this out? That advantageous opportunity 366 00:24:01,960 --> 00:24:04,000 Speaker 5: to build a product and build a business and seek 367 00:24:04,040 --> 00:24:07,439 Speaker 5: revenue and be relentless about it seemed to be lacking 368 00:24:07,440 --> 00:24:10,160 Speaker 5: from my personal experience when having the ability to kind 369 00:24:10,160 --> 00:24:11,679 Speaker 5: of compare it to and think of the rooms that 370 00:24:11,680 --> 00:24:13,880 Speaker 5: I was in at Angel City. What was beautiful about 371 00:24:13,880 --> 00:24:16,320 Speaker 5: that experience was we had so many people from outside 372 00:24:16,359 --> 00:24:19,840 Speaker 5: of sport really using sport as an opportunity to create 373 00:24:19,840 --> 00:24:21,960 Speaker 5: a better tomorrow, but wanted to build a sports product 374 00:24:22,000 --> 00:24:23,080 Speaker 5: because it. 375 00:24:22,800 --> 00:24:24,200 Speaker 8: Was an untapped opportunity. 376 00:24:24,680 --> 00:24:27,880 Speaker 5: How do we create the most robust partnership, portfolio and assets, 377 00:24:27,880 --> 00:24:29,960 Speaker 5: how do we have the best content? And then you 378 00:24:30,000 --> 00:24:33,280 Speaker 5: saw the market respond. And now you've seen that effect 379 00:24:33,320 --> 00:24:36,960 Speaker 5: globally and certainly within the different leagues and teams. But 380 00:24:37,160 --> 00:24:38,919 Speaker 5: that's only just getting started. 381 00:24:40,160 --> 00:24:42,040 Speaker 6: Only in the last five years have we been able 382 00:24:42,119 --> 00:24:46,160 Speaker 6: to see more games online, more clanging of the drum 383 00:24:46,200 --> 00:24:48,920 Speaker 6: for more viewership of all of these sports through both 384 00:24:48,920 --> 00:24:51,920 Speaker 6: social media and through these athletes just having a bigger 385 00:24:51,960 --> 00:24:53,720 Speaker 6: platform to say hey, come and watch us. 386 00:24:53,960 --> 00:24:55,840 Speaker 8: Hey, if you you fans, it's Caitlyn Clark. I can't 387 00:24:55,840 --> 00:24:58,400 Speaker 8: wait to get to Indianapolis. I know you guys are excited. 388 00:24:58,440 --> 00:24:59,639 Speaker 2: I am so go fever. 389 00:25:00,760 --> 00:25:04,159 Speaker 5: There's often been so many misconceptions about audience in women's sports. 390 00:25:04,880 --> 00:25:05,400 Speaker 3: So long. 391 00:25:05,480 --> 00:25:07,920 Speaker 5: People have said an MBA fan is a WNBA fan, 392 00:25:07,960 --> 00:25:10,600 Speaker 5: And what we know about our consumers is that it 393 00:25:10,680 --> 00:25:12,560 Speaker 5: really is for everyone. I don't know if you've seen 394 00:25:12,600 --> 00:25:14,880 Speaker 5: the T shirts that say everyone watches women's sports, and 395 00:25:15,200 --> 00:25:18,480 Speaker 5: that statement is so powerful because it's true. The audience 396 00:25:18,520 --> 00:25:20,960 Speaker 5: is actually pretty much fifty percent men and women. It's 397 00:25:20,960 --> 00:25:23,960 Speaker 5: not a women's product for women. This is an incredible 398 00:25:24,000 --> 00:25:25,600 Speaker 5: product for everybody. 399 00:25:27,119 --> 00:25:30,679 Speaker 2: Coming up sports as an investment class. It's driven in 400 00:25:30,720 --> 00:25:34,240 Speaker 2: part by the rapid growth of women's professional soccer and basketball. 401 00:25:34,800 --> 00:25:40,240 Speaker 2: That's what we turn next on Wall Street Week. If 402 00:25:40,280 --> 00:25:43,400 Speaker 2: the story of women's sports is one of dramatic growth, 403 00:25:43,760 --> 00:25:47,160 Speaker 2: it comes against the backdrop of sports overall growing into 404 00:25:47,240 --> 00:25:50,719 Speaker 2: a major asset class that has become an important alternative 405 00:25:50,720 --> 00:25:52,840 Speaker 2: investment for many portfolios. 406 00:25:58,720 --> 00:26:01,240 Speaker 8: The rate of change has been pretty incredible. 407 00:26:01,800 --> 00:26:05,800 Speaker 2: Nicole Pullen Ross lead Sports and Entertainment Solutions in Private 408 00:26:05,840 --> 00:26:07,359 Speaker 2: Wealth for Golden Sachs. 409 00:26:08,080 --> 00:26:13,080 Speaker 11: Whether it is the growth in women's basketball starting from 410 00:26:13,119 --> 00:26:17,439 Speaker 11: college through the WNBA, or whether it's the valuations that 411 00:26:17,480 --> 00:26:21,720 Speaker 11: we're seeing across various leagues, or whether there's the viewership 412 00:26:21,880 --> 00:26:24,800 Speaker 11: that we're seeing, all of those things have converged in 413 00:26:24,840 --> 00:26:27,439 Speaker 11: a way that has led our clients to think, I 414 00:26:27,480 --> 00:26:30,679 Speaker 11: want to have exposure. I want to participate in this growth, 415 00:26:31,200 --> 00:26:35,440 Speaker 11: both from a passion perspective but also from a profitability perspective. 416 00:26:36,160 --> 00:26:38,920 Speaker 2: As big as investing in sports is today, it wasn't 417 00:26:38,960 --> 00:26:42,760 Speaker 2: always that way. It grew out of agents representing athletes 418 00:26:43,200 --> 00:26:47,400 Speaker 2: and the related businesses that grew around them. George Pine 419 00:26:47,480 --> 00:26:50,680 Speaker 2: was one of those at the iconic IMG and watch 420 00:26:50,760 --> 00:26:53,080 Speaker 2: the private equity business grow around it. 421 00:26:53,520 --> 00:26:55,439 Speaker 1: When you kind of take a step back and you 422 00:26:55,480 --> 00:26:59,920 Speaker 1: look at sports, it's primarily been run by governing body 423 00:27:00,640 --> 00:27:04,359 Speaker 1: and families, and they were very conservative in the application 424 00:27:04,480 --> 00:27:06,880 Speaker 1: of capital and the use of capital, and so therefore 425 00:27:07,280 --> 00:27:10,280 Speaker 1: outside sources of the capital didn't see this as a 426 00:27:10,359 --> 00:27:13,760 Speaker 1: viable entry point. But as time has gone by and 427 00:27:13,840 --> 00:27:17,600 Speaker 1: the meteorites have increased in sports and the audience and 428 00:27:17,640 --> 00:27:20,560 Speaker 1: the abidity of sports of increase, so has the value 429 00:27:20,600 --> 00:27:23,040 Speaker 1: of the teams. So is the value of the industry, 430 00:27:23,080 --> 00:27:25,919 Speaker 1: and so has the opportunities within the sport. 431 00:27:26,480 --> 00:27:29,919 Speaker 12: Early in my career I was involved in one of 432 00:27:29,960 --> 00:27:36,120 Speaker 12: the sort of archetypal sports businesses, IMG Worldwide, my mentor 433 00:27:36,359 --> 00:27:38,920 Speaker 12: Ted Forceman, acquired in the early part of the art. 434 00:27:39,760 --> 00:27:43,199 Speaker 2: Josh Empson is another IMG alone. He is now the 435 00:27:43,280 --> 00:27:46,480 Speaker 2: new co head of Sports at investment and advisory firm 436 00:27:46,640 --> 00:27:49,919 Speaker 2: Sixth Street, owner and investor in sports teams such as 437 00:27:50,040 --> 00:27:54,280 Speaker 2: FC Barcelona, Real Madrid and the San Antonio Spurs. 438 00:27:54,960 --> 00:27:57,119 Speaker 12: And the fascinating thing about the history of IMG is 439 00:27:57,160 --> 00:28:01,560 Speaker 12: that the founder, Mark McCormick, was effectively the financial advisor 440 00:28:02,080 --> 00:28:05,480 Speaker 12: for Arnold Palmer and then Jack Nicholas, and as he 441 00:28:05,520 --> 00:28:10,840 Speaker 12: looked at this, he realized that Palmer and Nicholas were 442 00:28:10,880 --> 00:28:13,439 Speaker 12: the value, not the league, not the tour that was 443 00:28:13,520 --> 00:28:17,040 Speaker 12: organizing them. And McCormick realized and built that entire business, 444 00:28:17,160 --> 00:28:20,040 Speaker 12: which became a multi billion dollar business, on the idea 445 00:28:20,200 --> 00:28:22,879 Speaker 12: that they could be their own brand, they could bring 446 00:28:23,119 --> 00:28:26,200 Speaker 12: the unique value to events, and I think that actually 447 00:28:26,240 --> 00:28:30,480 Speaker 12: allowed in some ways gender parity at an earlier stage. 448 00:28:30,600 --> 00:28:32,359 Speaker 12: And I think a lot of that is about the 449 00:28:32,400 --> 00:28:36,320 Speaker 12: sponsorship ecosystem, right that they didn't have to win just 450 00:28:36,400 --> 00:28:39,800 Speaker 12: on the court for the purse, you could find someone 451 00:28:39,840 --> 00:28:44,200 Speaker 12: whoever was the charismatic number one in the world in 452 00:28:44,240 --> 00:28:47,520 Speaker 12: either sport, could command a global audience for the period 453 00:28:47,600 --> 00:28:50,440 Speaker 12: of their ascendancy and monetize it. 454 00:28:51,080 --> 00:28:54,160 Speaker 2: Sports and investing in sports have come a long way 455 00:28:54,200 --> 00:28:57,200 Speaker 2: from the days of representing Arnold Palmer and Jack Nicholas 456 00:28:57,560 --> 00:29:03,080 Speaker 2: in their size and scope geographic scope. Yield Street estimates 457 00:29:03,120 --> 00:29:05,760 Speaker 2: the sports universe to be a five hundred billion dollar 458 00:29:05,880 --> 00:29:11,040 Speaker 2: market worldwide, with revenue coming from media rights, ticket sales, licensing, 459 00:29:11,480 --> 00:29:12,680 Speaker 2: and sponsorships. 460 00:29:13,120 --> 00:29:16,480 Speaker 1: So sports aggregates millions of people in a way that 461 00:29:16,760 --> 00:29:17,440 Speaker 1: nothing else does. 462 00:29:17,480 --> 00:29:19,440 Speaker 10: As a Super Bowl at one hundred and twenty. 463 00:29:19,280 --> 00:29:22,239 Speaker 1: Six million viewers, it's very few things in America that 464 00:29:22,280 --> 00:29:25,360 Speaker 1: bring one hundred and twenty six million people together. And 465 00:29:25,360 --> 00:29:28,479 Speaker 1: then you have people that are passionate like Philadelphia Eagles fan. 466 00:29:28,720 --> 00:29:32,120 Speaker 1: Though you have big audiences in a world that's fragmenting, 467 00:29:32,560 --> 00:29:35,000 Speaker 1: that zero in around something that they love and have 468 00:29:35,040 --> 00:29:38,200 Speaker 1: a passion for. That's what makes sports unique. And then 469 00:29:38,560 --> 00:29:42,040 Speaker 1: being more global. So for all of those reasons, sports 470 00:29:42,120 --> 00:29:45,360 Speaker 1: is becoming more and more attractive. And it wasn't that 471 00:29:45,520 --> 00:29:49,440 Speaker 1: complex or sophisticated twenty years ago. 472 00:29:49,520 --> 00:29:50,920 Speaker 10: In terms of capital markets. 473 00:29:51,680 --> 00:29:54,960 Speaker 2: It's bigger and broader. But what is it that investors 474 00:29:55,000 --> 00:29:57,520 Speaker 2: are looking for when they seek to own a piece 475 00:29:57,600 --> 00:30:00,600 Speaker 2: of the sports pie ranges? 476 00:30:00,840 --> 00:30:05,520 Speaker 11: I would say some of our clients who are long 477 00:30:05,600 --> 00:30:09,479 Speaker 11: term investors in the space have been investing as a 478 00:30:09,640 --> 00:30:16,480 Speaker 11: private family for generations, and those families have really leaned 479 00:30:16,520 --> 00:30:20,560 Speaker 11: in mostly around passion, and we're seeing them look not 480 00:30:20,600 --> 00:30:22,760 Speaker 11: only to the sport that they may have started with, 481 00:30:23,120 --> 00:30:26,320 Speaker 11: but look at multiple sports, potentially in the same city 482 00:30:26,840 --> 00:30:28,920 Speaker 11: or potentially across the world. 483 00:30:29,120 --> 00:30:31,440 Speaker 8: And we see new investors. 484 00:30:30,800 --> 00:30:33,280 Speaker 11: Who are trying to put a toe in the water, 485 00:30:33,880 --> 00:30:38,000 Speaker 11: and they're doing that through some of the many growing 486 00:30:38,120 --> 00:30:42,480 Speaker 11: number of private equity and institutional investors who have exposure 487 00:30:42,560 --> 00:30:46,960 Speaker 11: to the space, or they're doing it through a minority interest. 488 00:30:47,400 --> 00:30:49,840 Speaker 2: It seems to me that owning a team might be 489 00:30:49,880 --> 00:30:52,640 Speaker 2: a very different investment from having a minority interest in 490 00:30:52,680 --> 00:30:55,680 Speaker 2: a team. Are they really different investment propositions? 491 00:30:56,160 --> 00:30:58,600 Speaker 8: They cost a lot more, that's for sure. 492 00:30:58,960 --> 00:31:02,520 Speaker 11: The average NFL team, for example, when the CBA was signed, 493 00:31:02,600 --> 00:31:05,760 Speaker 11: was worth one point three billion or something like that. Today, 494 00:31:05,920 --> 00:31:08,400 Speaker 11: the average team is worth more than nearly one and 495 00:31:08,440 --> 00:31:12,240 Speaker 11: a half times that value. And so although there's been 496 00:31:12,240 --> 00:31:13,640 Speaker 11: a lot of growth of billionaires. 497 00:31:13,720 --> 00:31:15,120 Speaker 8: That's a much smaller list. 498 00:31:14,920 --> 00:31:18,560 Speaker 11: Today than it was twenty years ago, and so when 499 00:31:18,600 --> 00:31:22,040 Speaker 11: individuals are coming together to invest in this space, they're 500 00:31:22,200 --> 00:31:25,160 Speaker 11: very much doing it in partnership. What they get for 501 00:31:25,240 --> 00:31:30,760 Speaker 11: that investment very significantly. It could be great seats, good parking, 502 00:31:32,000 --> 00:31:36,520 Speaker 11: really increased engagement with the team. But in many cases 503 00:31:36,640 --> 00:31:39,920 Speaker 11: it's not control, it's not the ability to direct where 504 00:31:40,040 --> 00:31:42,600 Speaker 11: the team is going. So there's a very big difference 505 00:31:42,640 --> 00:31:45,360 Speaker 11: between majority shares and minority shares. 506 00:31:47,400 --> 00:31:50,320 Speaker 2: And it's not just team ownership in whole or in 507 00:31:50,400 --> 00:31:54,440 Speaker 2: part that provides sports businesses to invest in. A host 508 00:31:54,480 --> 00:31:57,520 Speaker 2: of ancillary businesses have grown up around teams that can 509 00:31:57,560 --> 00:32:01,680 Speaker 2: provide attractive investment opportunities, which is at the center of 510 00:32:01,800 --> 00:32:03,440 Speaker 2: Pine's private equity business. 511 00:32:04,240 --> 00:32:06,960 Speaker 1: There are different ways you can look at sports today. 512 00:32:07,000 --> 00:32:10,400 Speaker 1: So the traditional has been investing in teams or leagues, 513 00:32:10,440 --> 00:32:15,040 Speaker 1: which are very safe investments, typically ill liquid and the 514 00:32:15,080 --> 00:32:18,920 Speaker 1: longer holds, but have a certain return threshold. So we've 515 00:32:18,920 --> 00:32:23,080 Speaker 1: invested in data companies. We've invested in webs apps and streamings. 516 00:32:23,160 --> 00:32:26,240 Speaker 1: I own a company in Amsterdam that lights the pitch 517 00:32:26,320 --> 00:32:29,080 Speaker 1: and creates a software so we can predict on the 518 00:32:29,080 --> 00:32:31,239 Speaker 1: pitch or the field, whether the moss is going to grow, 519 00:32:31,320 --> 00:32:34,000 Speaker 1: what the conditions are, and you know, as the media 520 00:32:34,080 --> 00:32:37,120 Speaker 1: rights go up and the team valuations the pitch is 521 00:32:37,400 --> 00:32:38,360 Speaker 1: the quality. 522 00:32:37,960 --> 00:32:40,000 Speaker 10: Of your product and the safety of product. 523 00:32:40,400 --> 00:32:44,480 Speaker 11: I think the revenue landscape and the diversity of revenue 524 00:32:44,480 --> 00:32:48,040 Speaker 11: has certainly grown over the past several years. You talk 525 00:32:48,120 --> 00:32:51,800 Speaker 11: to team owners about having the best experience for their 526 00:32:51,840 --> 00:32:55,800 Speaker 11: clients and their players, and then there's everything around the 527 00:32:56,000 --> 00:33:01,520 Speaker 11: stadium or the arena. The ability for vesters to participate 528 00:33:02,040 --> 00:33:06,840 Speaker 11: in the revenue in the surrounding area has certainly been important. 529 00:33:07,240 --> 00:33:09,080 Speaker 8: We have seen a community impact. 530 00:33:09,200 --> 00:33:11,480 Speaker 11: A lot of the owners with whom we work talk 531 00:33:11,520 --> 00:33:15,200 Speaker 11: about their investment and their team as a community investment, 532 00:33:15,240 --> 00:33:19,880 Speaker 11: a civic investment because they are prominent players in the community. 533 00:33:20,560 --> 00:33:24,520 Speaker 2: But given the dramatic expansion and diversification in the sports business, 534 00:33:25,160 --> 00:33:28,640 Speaker 2: is there a danger of dilution? Typically when I think 535 00:33:28,680 --> 00:33:31,320 Speaker 2: about value, I think about supply and demand. But it 536 00:33:31,360 --> 00:33:34,840 Speaker 2: seems like there is an unending new supply of sports. 537 00:33:34,880 --> 00:33:37,040 Speaker 2: How can it be that the value keeps going up 538 00:33:37,080 --> 00:33:38,280 Speaker 2: when there's more and more supply. 539 00:33:38,640 --> 00:33:42,160 Speaker 1: People are thirsting for great storylines, right, and of course 540 00:33:42,640 --> 00:33:46,040 Speaker 1: there are sports Formula One think about UFC didn't exist 541 00:33:46,080 --> 00:33:47,200 Speaker 1: almost twenty years ago. 542 00:33:47,400 --> 00:33:48,880 Speaker 10: Look how popular that is today. 543 00:33:48,920 --> 00:33:51,520 Speaker 1: So there are sports that can break in in ways 544 00:33:51,560 --> 00:33:53,160 Speaker 1: that nobody have an envisioned. 545 00:33:53,400 --> 00:33:55,120 Speaker 10: And of course women's sports. 546 00:33:54,760 --> 00:33:57,920 Speaker 1: As attraction today that it's never had before. 547 00:33:58,840 --> 00:34:01,440 Speaker 2: Is expansion your enemy as an investor? 548 00:34:02,840 --> 00:34:05,160 Speaker 12: I think expansion is your enemy as an investor, but 549 00:34:05,200 --> 00:34:09,120 Speaker 12: it's really more your opportunity. And that's because every time 550 00:34:09,160 --> 00:34:12,360 Speaker 12: you expand, you light up fandom in a new market. 551 00:34:12,640 --> 00:34:16,680 Speaker 12: Was Las Vegas a big hockey market before the Golden Knights? 552 00:34:17,320 --> 00:34:17,799 Speaker 4: Probably not. 553 00:34:18,239 --> 00:34:22,920 Speaker 12: Is Las Vegas or Nashville now a pretty enthusiastic hockey market. 554 00:34:23,080 --> 00:34:23,360 Speaker 10: Yeah. 555 00:34:23,840 --> 00:34:25,839 Speaker 4: If you look at the historical. 556 00:34:25,320 --> 00:34:29,880 Speaker 12: Returns in sports, they've been surprisingly good, and some of 557 00:34:29,920 --> 00:34:34,400 Speaker 12: that's been driven by scarcity, but not necessarily scarcity of 558 00:34:34,440 --> 00:34:37,520 Speaker 12: franchises because all the leagues have expanded through this, but 559 00:34:37,640 --> 00:34:41,720 Speaker 12: just a scarcity of other forms of content that are 560 00:34:43,040 --> 00:34:46,840 Speaker 12: as engaging and energizing to such large fan bases. 561 00:34:47,280 --> 00:34:51,400 Speaker 2: Sports competes with every other investment opportunity, and its status 562 00:34:51,440 --> 00:34:54,480 Speaker 2: as an alternative investment doesn't stop it from keeping up 563 00:34:54,520 --> 00:34:58,960 Speaker 2: with the main asset classes. Sports franchise valuations have outpaced 564 00:34:58,960 --> 00:35:02,120 Speaker 2: the s and P five hundreds returns, especially in the 565 00:35:02,120 --> 00:35:05,920 Speaker 2: past decade. But sport is a very different beast in 566 00:35:06,000 --> 00:35:09,319 Speaker 2: a very different jungle. As we look at sports as 567 00:35:09,320 --> 00:35:12,919 Speaker 2: an asset class, how does it differ from other alternative 568 00:35:13,200 --> 00:35:14,239 Speaker 2: asset investing. 569 00:35:14,880 --> 00:35:16,120 Speaker 5: Nobody's ever asked me that. 570 00:35:16,120 --> 00:35:17,000 Speaker 10: It's a great question. 571 00:35:17,400 --> 00:35:20,400 Speaker 12: I think one thing that's really different about sports as 572 00:35:20,440 --> 00:35:24,680 Speaker 12: an asset class versus other forms of alternatives is the 573 00:35:24,760 --> 00:35:29,000 Speaker 12: multiple layers of partnership. So when you invest in a 574 00:35:29,000 --> 00:35:34,080 Speaker 12: sports franchise in the US, you have a partner who's 575 00:35:34,120 --> 00:35:37,240 Speaker 12: going to be the control owner, and that's a person 576 00:35:37,239 --> 00:35:40,720 Speaker 12: who has needs and ambitions that you're trying to support. 577 00:35:41,040 --> 00:35:45,759 Speaker 12: You also exist within the framework of a league that 578 00:35:46,000 --> 00:35:51,280 Speaker 12: has very particular rules and has its objectives and its goals. 579 00:35:52,160 --> 00:35:55,279 Speaker 12: And then beyond that, and most importantly, you have this 580 00:35:55,520 --> 00:36:01,560 Speaker 12: universe of fans and they care passionately about their team, 581 00:36:02,239 --> 00:36:05,520 Speaker 12: and they are stakeholders in that equation, just the way 582 00:36:05,560 --> 00:36:08,160 Speaker 12: the league and the owner is. And there is that 583 00:36:08,239 --> 00:36:10,560 Speaker 12: implicit compact that if you're coming in, you're going to 584 00:36:10,719 --> 00:36:14,360 Speaker 12: make this better for them as well as for the league. 585 00:36:14,080 --> 00:36:14,680 Speaker 2: And the owners. 586 00:36:15,280 --> 00:36:18,160 Speaker 12: And it's interesting to be in a dynamic where you 587 00:36:18,239 --> 00:36:20,520 Speaker 12: have those multiple layers of stakeholders and you're trying to 588 00:36:20,520 --> 00:36:24,839 Speaker 12: deliver value as an investor for all levels of that, 589 00:36:24,920 --> 00:36:28,920 Speaker 12: and that feels pretty different from other forms of alternative investment. 590 00:36:28,960 --> 00:36:31,319 Speaker 12: It's pretty satisfying when you get it right. But there's 591 00:36:31,320 --> 00:36:36,760 Speaker 12: something special about investing in something that you can watch 592 00:36:36,880 --> 00:36:40,040 Speaker 12: every Sunday, that you can come together with your family 593 00:36:41,200 --> 00:36:44,040 Speaker 12: and sort of share what you're trying to do. 594 00:36:44,719 --> 00:36:48,520 Speaker 2: Alternative investing may be different when it's not your sports team. 595 00:36:49,239 --> 00:36:51,600 Speaker 2: To what extent are your investors who are looking for 596 00:36:51,760 --> 00:36:54,280 Speaker 2: psychic benefits in addition to monetary benefits. 597 00:36:54,400 --> 00:36:58,239 Speaker 11: Yeah, it's an interesting part of the equation, right, So 598 00:36:58,360 --> 00:37:02,880 Speaker 11: there is a joy element to the return that you 599 00:37:02,920 --> 00:37:06,880 Speaker 11: can't necessarily quantify, and what we ask our clients to 600 00:37:06,920 --> 00:37:10,680 Speaker 11: do is not just focus on the joy part of 601 00:37:10,680 --> 00:37:14,319 Speaker 11: the return, but to think about the overall picture. And 602 00:37:14,360 --> 00:37:17,680 Speaker 11: for some clients that joy component is going to be 603 00:37:17,920 --> 00:37:21,239 Speaker 11: at a higher on the list of things that are 604 00:37:21,239 --> 00:37:25,000 Speaker 11: important in the return and for others. For institutional investors, 605 00:37:25,400 --> 00:37:28,759 Speaker 11: it's lower on the list. And so making sure that 606 00:37:28,840 --> 00:37:33,200 Speaker 11: we're helping our clients think through how to set return 607 00:37:33,320 --> 00:37:37,960 Speaker 11: expectations for themselves in terms of liquidity, etc. Is something 608 00:37:38,000 --> 00:37:42,120 Speaker 11: that we feel is our opportunity to do to help 609 00:37:42,160 --> 00:37:46,960 Speaker 11: them navigate the space. Alternatives in general are an area 610 00:37:47,080 --> 00:37:50,759 Speaker 11: of significant interest for our clients, and the type of 611 00:37:50,800 --> 00:37:54,120 Speaker 11: exposure that they're interested in is quite broad, and so 612 00:37:54,239 --> 00:37:57,319 Speaker 11: this is only a piece of that for most of 613 00:37:57,360 --> 00:38:00,279 Speaker 11: our clients. For some they really want to live and 614 00:38:00,680 --> 00:38:02,920 Speaker 11: look at this as a primer investment that. 615 00:38:03,000 --> 00:38:04,879 Speaker 2: Does it for us. Here at Wall Street Week, I'm 616 00:38:04,960 --> 00:38:07,640 Speaker 2: David Weston. This is Bloomberg. See you next week for 617 00:38:07,760 --> 00:38:22,120 Speaker 2: more stories of capitalism.