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Speaker 1: Welcome to a special edition of the Bloomberg Business of

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Speaker 1: Sports podcast. We explore the big money issues in the

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Speaker 1: world of sports. I'm Michael Barr McClaren Racing CEO. Zach

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Speaker 1: Brown knows something about the US motorsports market. I think

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Speaker 1: racecars himself growing up in America. In this special edition

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Speaker 1: of the Bloomberg Business of Sports, Bloomberg Originals Chief correspondent

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Speaker 1: Jason Kelly sits down with Zach Brown to talk about

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Speaker 1: how Formula One is growing in the US and the

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Speaker 1: future of the sports.

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Speaker 2: For more than a decade, Formula One racing has been

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Speaker 2: completely dominated by two teams. The world championship record is

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Speaker 2: a calls Lewis Hamilton, when's the Turkyscrowing Prix? And is

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Speaker 2: a seven time champion of the world.

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Speaker 3: Delight Mercedes, Mercedes, not happy Red Bull, We'll be delighted.

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Speaker 3: I have Scheff a brilliant championship, back wonder.

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Speaker 2: Championship and for the last couple seasons Red Bull. But

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Speaker 2: another team with a rich history in racing is all

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Speaker 2: of a sudden turning heads again.

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Speaker 3: On here at Salveston, Lando, Norris Finish isn't a.

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Speaker 2: Brilliant second Louis Hamilton is thirtyo British drivers. Mclarence F

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Speaker 2: one is high speed and incredibly competitive, with winning and

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Speaker 2: losing decided by fractions of a second. But behind those

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Speaker 2: big name drivers like Lewis Hamilton, Orlando Norris are hundreds,

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Speaker 2: even thousands of team members over at McLaren. The person

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Speaker 2: lean in that effort is Zach Brown, a former racer himself,

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Speaker 2: the CEO of McLaren Racing, sat down with me to

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Speaker 2: chat about all things Formula one, from how he manages

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Speaker 2: his team, to the sports efforts around diversity, to the

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Speaker 2: US market and the future of Formula One around the world.

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Speaker 2: I'm Jason Kelly. This is a special edition of Bloomberg

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Speaker 2: Business of Sports.

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Speaker 3: Tell me about you as a manager.

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Speaker 2: You started as a driver, and you know you sort

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Speaker 2: of had this moment I have read about and heard

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Speaker 2: you talk about where you realized, all right, I'm actually

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Speaker 2: better on the business. And now you've gone obviously full

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Speaker 2: into that. How have you developed developed it as a manager.

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Speaker 2: How would you describe your style.

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Speaker 4: I'm a racer in a business businessman. I'm not very

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Speaker 4: switched on when it comes to technology. I've gotten a

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Speaker 4: lot better. That's been an area for me to learn.

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Speaker 4: I wasn't very good at math and science, which you

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Speaker 4: need to be if you're going to be in the

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Speaker 4: technology uh space. You know, I've got a great leadership team,

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Speaker 4: and I think it's about empowering knowing what you know,

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Speaker 4: knowing what you don't know, and there's a lot I

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Speaker 4: don't know, So you need to have a lot of

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Speaker 4: great people surrounded and empower them giving good direction. You know,

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Speaker 4: my job, I feel like I work for the team

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Speaker 4: as opposed to the team works for me. My job

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Speaker 4: is to give everyone in the race team the resources,

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Speaker 4: the direction and the support they need. So I think

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Speaker 4: it's like a manager of a football team. You know,

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Speaker 4: you try and get the best quarterback and the best

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Speaker 4: wide receiver and the various positions, and then you give

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Speaker 4: them the direction and what they need. And if something's

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Speaker 4: not working, the move the team around. You change up

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Speaker 4: the plays. But at the end of the day, it's

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Speaker 4: the people on the field that need to make it happen.

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Speaker 4: And so I'm one person, but I'm kind of not

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Speaker 4: on the field. I'm the biggest cheerleader.

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Speaker 2: What is the overall racing kind of ecosystem look like?

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Speaker 3: And where do you see that going.

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Speaker 4: Yeah, you know, for us, we're you know, we're a

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Speaker 4: Formula One team first and foremost. We have an IndyCar team,

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Speaker 4: and that was because we wanted to have a larger

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Speaker 4: presence in North America than our Formula One competitors. So

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Speaker 4: as much as Formula One has grown here, we still

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Speaker 4: have another slice of cake on top of that. And

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Speaker 4: you know, most of our partners, North America is one of,

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Speaker 4: if not their most important market. It's the biggest market

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Speaker 4: for our automotive business, so we wanted to kind of

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Speaker 4: double down on North America. Hen's having their ONW McLaren

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Speaker 4: IndyCar team. Sustainability is hugely important to us, as it

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Speaker 4: is to our partners, our employees, our fans. So we're

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Speaker 4: in formally e we actually acquired the Mercedes Championship team,

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Speaker 4: and then we're an extremely which is about sustainability and

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Speaker 4: gender equality because you have a male and female racing driver.

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Speaker 4: So for the first time ever, McLaren has a female

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Speaker 4: racing driver in m mc gilmour. And then we have

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Speaker 4: a great esports team and that's really for that younger

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Speaker 4: generation and you know, everyone wants to have a steerian

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Speaker 4: wheel in their hand. At some point. I know I

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Speaker 4: did as a young adult. And so that's kind of

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Speaker 4: our selection of our racing activities all very complementary to

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Speaker 4: kind of have a breadth and depth of opportunities for

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Speaker 4: our sponsor partners, our fans, and our employees to engage

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Speaker 4: in many different ways because at the end of the day,

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Speaker 4: we're in the racing business.

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Speaker 2: Talk to me about you mentioned the gender equality piece.

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Speaker 2: It feels like there's a lot more talk about this,

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Speaker 2: you know here in twenty twenty three. I know you're

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Speaker 2: investing pretty heavily in some STEM related efforts. You have

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Speaker 2: Susie Wolf coming over to run the academy, so clearly

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Speaker 2: there's some investment going on across the teams.

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Speaker 3: What needs to happen to really elevate that?

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Speaker 2: How soon will we see a woman driving in Formula one?

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Speaker 4: Well, we're seeing it now, yea. You know, there's been

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Speaker 4: Susie was a great racing driver. I think what we

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Speaker 4: need to do as a sport, and you mentioned, you know,

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Speaker 4: our initiatives around STEM. We've had sixty scholars, which is

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Speaker 4: young women eighteen to twenty three, where we're providing opportunities

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Speaker 4: for them to get involved in motor racing. Obviously, the

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Speaker 4: racing driver is kind of the most high profile position

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Speaker 4: in motor sports, but we want it to be engineers, mechanics, marketing,

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Speaker 4: racing drivers. And so I think it's about providing opportunities, educating,

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Speaker 4: getting young adults, kids excited about opportunities in the sport.

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Speaker 4: Really has to start at the grassroots level. And we're seeing,

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Speaker 4: you know, we're about twenty percent underrepresented in our workforce.

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Speaker 4: We'd like to double that by the end of the decade.

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Speaker 4: So that's it's moving at a pretty fast pace. And

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Speaker 4: I think diversity gives you so much more information and

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Speaker 4: diversity of thinking, whether again that's on the race car,

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Speaker 4: in the race car, or around the race car.

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Speaker 2: And so when you think about what needs to happen

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Speaker 2: in terms of the next level globally of you know,

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Speaker 2: widening the audience. Obviously Netflix you mentioned has had a

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Speaker 2: huge impact, certainly here in the United States. As you

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Speaker 2: look around the world, what else needs to happen, you know,

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Speaker 2: put on your your sponsorship had or your sort of

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Speaker 2: corporate development hat to keep growing the sport.

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Speaker 4: I think we need to keep doing what we're we're

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Speaker 4: doing because it's it's working, and you know, digital. We're

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Speaker 4: a technology driven sport. Our fans like to engage through technology,

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Speaker 4: So I think we need to continue to lead the

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Speaker 4: way on kind of digital engagement and connection with the

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Speaker 4: fan our sponsor partners. You know, we have some of

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Speaker 4: the best sponsor partners in the world, you know, the Googles,

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Speaker 4: the Goldman's Acts, this just goes to Dell's, the Coca Colas,

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Speaker 4: and they have such reach that they can help us

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Speaker 4: bring in new fans. So I think, you know, it's

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Speaker 4: doing more of what we're already doing and staying current

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Speaker 4: and leading the way. And I think technology plays a

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Speaker 4: big role because technology is so relevant in all of

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Speaker 4: our worlds today, whether it's our phone device, or whether

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Speaker 4: it's social media, or it's how you consume the race.

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Speaker 4: And so that's that's an area that we need to

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Speaker 4: continue to lead.

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Speaker 2: On, maybe not on the field, but with drive to

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Speaker 2: survive and much higher viewership in this country and around

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Speaker 2: the world. You know, you're now in a position to

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Speaker 2: be as famous, maybe more famous than some of the

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Speaker 2: drivers a few years ago. You know, maybe only true

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Speaker 2: Gearhead's new your name, Total Wolf's name, Christian Horner, grinther Steiner,

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Speaker 2: And now you know you're getting stopped for selfies and

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Speaker 2: all that. What's that like being a manager and not

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Speaker 2: a driver and having that sort of notoriety.

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Speaker 4: You know, I think about the impression you know you

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Speaker 4: mentioned growing up in LA My first ever race was

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Speaker 4: a Long Beach Grand Prix in nineteen eighty one, and

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Speaker 4: I remember meeting a couple of drivers and the impression

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Speaker 4: it made on me. So I think my job anytime

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Speaker 4: I see a fan is to help share the sport.

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Speaker 4: So I enjoy it. You know, anytime I want to

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Speaker 4: stop for a selfie or a chat or an autograph,

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Speaker 4: you know, I feel my job is to let them

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Speaker 4: get a little bit closer to McLaren, let them get

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Speaker 4: a little bit closer to you know, Formula one or

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Speaker 4: IndyCar or whatever they're taking in because I know what

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Speaker 4: an impression that made on me as an individual, and

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Speaker 4: so it's part of the job. But I enjoy it

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Speaker 4: because at the end of the day, we're in the

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Speaker 4: sport and entertainment business. I've seen some people that kind

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Speaker 4: of turn off and it's like, well, I'm not working.

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Speaker 4: But I think if you're going to be in the

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Speaker 4: public spotlight, you're always on. That's part of the job,

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Speaker 4: and I think there's a responsibility that goes along with that.

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Speaker 4: So I enjoy it and the fans are great.

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Speaker 2: So when you think back to your days as a

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Speaker 2: fan and then as a driver, did you.

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Speaker 3: Think this sport could ever get to the point that

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Speaker 3: it is.

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Speaker 2: Did you think it was a matter of time or

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Speaker 2: is this a surprise on the upside for you?

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Speaker 4: In North America, I think it's certainly gotten bigger quicker

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Speaker 4: than I thought it ever would, because you know, up

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Speaker 4: until Austin in twenty twelve, we didn't have a race

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Speaker 4: for a while, and if you look back at the

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Speaker 4: history of Formula One in North America, it changed venues

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Speaker 4: every three years. Then it didn't race for a while,

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Speaker 4: then it came back to Indianapolis, then it had the

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Speaker 4: tire fiasco, and then it didn't race again. So it

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Speaker 4: kind of was never here to stay, and it didn't

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Speaker 4: have date equity or location equity. So no, I think

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Speaker 4: from the sport, Yes, the sport's always been massive in

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Speaker 4: Europe and started to really grow in Asia pac But

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Speaker 4: to have the impact that's had here in the States

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Speaker 4: as quickly as it has had, I didn't see that

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Speaker 4: coming and I don't think anyone.

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Speaker 2: Did tell me about managing talent, especially in the car.

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Speaker 2: Your decisions you make obviously have huge consequences. You know,

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Speaker 2: we've seen so much attention paid for obvious reasons to

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Speaker 2: the two people who are.

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Speaker 3: In the driver's seat.

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Speaker 2: How have you evolved as a manager of that piece

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Speaker 2: of the business.

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Speaker 4: That part's felt pretty easy to me, And I think

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Speaker 4: that's because I used to race. So while I wasn't

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Speaker 4: as fast as Lando or Oscar or Fernando Alonso or

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Speaker 4: these great drivers that we've had drive for us, I

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Speaker 4: understand the mindset. You know when to talk to them

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Speaker 4: when they're highly strong, when they're stressed, when they need

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Speaker 4: a pad on the back, and so all the teams

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Speaker 4: are different, but I've tried to really create a great

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Speaker 4: garage environment, if you'd like, because these drivers they're all different.

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Speaker 4: They're they're highly strong, it's pretty stressful, and so you

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Speaker 4: need to know how to kind of get them into

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Speaker 4: a great mental space because they're all great racing drivers,

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Speaker 4: and I think with great athletes, it's about getting them

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Speaker 4: in a mindset where they're comfortable in their environment. So

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Speaker 4: you need to know kind of when and where and

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Speaker 4: how to approach them. And how to get them feeling

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Speaker 4: very comfortable. And they're all different. You know, Fernando Alonzo

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Speaker 4: when I joined McLaren, you know, he had a pretty

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Speaker 4: difficult reputation. A great working relationship with Fernando, but I

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Speaker 4: felt like I understood him and he understood me. And

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Speaker 4: how I worked with Fernando was different than Lando, different

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Speaker 4: from how I'm working with Pato Award, because they're all

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Speaker 4: they're all different, and it's about just getting into creating

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Speaker 4: an environment where they're ultimately at the end of the day,

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Speaker 4: where they're happy.

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Speaker 3: Especially in this era.

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Speaker 2: What is it like to have someone just like blow

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Speaker 2: up in terms of like their profile. I mean Ricardo

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Speaker 2: being obviously like Dania Ricardo being like the a one example.

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Speaker 2: How do you manage that when someone just goes from like, oh, yeah,

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Speaker 2: I know that guy too.

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Speaker 3: Now everyone knows that guy.

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Speaker 4: Yeah, well you know, so it's interesting. You know, Fernando Alonso,

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Speaker 4: Daniel Ricardo, they were you know, megastars before they came

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Speaker 4: to McLaren. So that's you know, then you're point, you're

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Speaker 4: kind of having to understand how to kind of bring

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Speaker 4: on this person who's already larger than life. Then you

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Speaker 4: have something like Orlando Norris who's become a Mecca star,

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Speaker 4: but was you know, young and barely had his driver's

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Speaker 4: license before he joined us, so you've kind of watched

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Speaker 4: him grow and I think it's about giving him their space,

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Speaker 4: understanding how they they work, paying respect to them, and

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Speaker 4: then you know, fun is something that I like to

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Speaker 4: have at the kind of center of everything we do

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Speaker 4: because I think, you know, first of all, we race

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Speaker 4: cars for a living, so that's even though it's stressful,

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Speaker 4: it's a lot of fun and we need to kind

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Speaker 4: of keep grounded on this as sport and entertainment, and

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Speaker 4: there's a time to be extremely serious, but then there's

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Speaker 4: time to kind of enjoy what we're doing and bring

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Speaker 4: that balance. And I think fun kind of bring stress down.

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Speaker 4: And you know, we all live on the road together

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Speaker 4: or seven days a week, you know, traveling the world together.

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Speaker 4: People like to be around fun people, So that's something

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Speaker 4: that I've kind of tried to have in common with

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Speaker 4: all the drivers. But there's a time and a place,

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Speaker 4: and sometimes they want to have fun, sometimes they don't,

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Speaker 4: But I think that's that's a key ingredient.

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Speaker 3: Zach, thank you so much.

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Speaker 4: Thank you for having me.

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Speaker 2: Thanks for listening to this special edition of Bloomberg Business

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Speaker 2: of Sports. Formula one has become one of the hottest

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Speaker 2: topics at the intersection of business, sports and culture, and

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Speaker 2: we've been all over it, including extended looks at Total

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Speaker 2: Wolf's leadership at Mercedes and the big push to capture

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Speaker 2: the US fan. Check out those Bloomberg Originals documentaries at

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Speaker 2: Bloomberg dot com slash Originals.

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Speaker 3: I'm Jason Kelly. Talk to you soon.

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Speaker 1: Our Thanks to Bloomberg Originals Chief correspondent Jason Kelly, we're

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Speaker 1: bringing us that exclusive conversation with McLaren Racing CEO Zach Brown.

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Speaker 1: Thanks for listening to this special edition of the Bloomberg

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Speaker 1: Business of Sports podcast. Tune in again for the latest

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Speaker 1: on the stories moving big old money in the world

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Speaker 1: of sports. You're listening the Bloomberg Business of Sports from

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Speaker 1: Bloomberg Radio around the world.