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Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

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Speaker 2: You are on a panel talking about valuations.

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Speaker 1: What do valuations and sports teams look to you like?

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Speaker 3: I think right now they're fully valued, but the upside

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Speaker 3: still in sports is I think the tree can go

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Speaker 3: to heaven still. And NBA teams are being valued at eight, ten,

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Speaker 3: twelve times multiple on revenues, not on EBITO or cash flow,

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Speaker 3: and NHL teams are in the five, six, seven times.

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Speaker 3: But companies like mine, which are platform companies where we

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Speaker 3: own the teams and the venue and the network, we

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Speaker 3: get a higher valuation simply because we're in a big

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Speaker 3: market and we can get some synergy by cross promoting,

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Speaker 3: you know, having one c one head of marketing for

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Speaker 3: the company. And so right now I think we'll do

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Speaker 3: three quarters of a billion dollars in revenues and we're

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Speaker 3: probably valued at seven and a half billion dollars.

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Speaker 2: That's impressive.

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Speaker 1: Your business model is actually quite impressive because you're concentrated,

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Speaker 1: of course on DC sports team.

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Speaker 2: What's next? What do you want to buy?

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Speaker 3: Well, I've declared my major. I don't want to do

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Speaker 3: a roll up. I don't want to buy a soccer

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Speaker 3: team in London. The only thing I'd be interested in

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Speaker 3: buying is what could go onto the platform and where

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Speaker 3: we could leverage our IP and our infrastructure. So there's

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Speaker 3: two baseball teams in town, the Baltimore Orioles David Rubinstein

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Speaker 3: from Carlisle now owns it, and the Nationals, and we've

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Speaker 3: been in and out of discussions there and then DC United,

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Speaker 3: which is MLS, and it would make sense to add

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Speaker 3: more scale to our platform and extend the programming to

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Speaker 3: go from winter deep into summer to fall. Especially as

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Speaker 3: you go direct to consumer with your subscriptions, it costs

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Speaker 3: a lot of money to get a customer, and then

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Speaker 3: if you don't make the playoffs so you're lose in

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Speaker 3: the first or second round like we just did, customers

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Speaker 3: will cancel because they're not going to be able to

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Speaker 3: watch games until the next season. If you had a

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Speaker 3: baseball team or a soccer team, you could extend that

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Speaker 3: and you could offer a year round pass if you will.

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Speaker 3: And I also think it's a way to be competitive

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Speaker 3: on the field or the pitch, because we're competing even

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Speaker 3: though we're a big market against LA against New York

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Speaker 3: and in baseball, the Yankees, the Mets, the Dodgers. They

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Speaker 3: can spend whatever would they want. If a baseball team

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Speaker 3: is a part of our conglomerate, if you will, we

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Speaker 3: probably could be more competitive and spend to what those

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Speaker 3: big market clubs do.

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Speaker 1: Going back to valuations, I mean you say, look, valuations

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Speaker 1: are I guess price perfection, but they still can go higher.

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Speaker 2: Why is this an increase interest in certain sports?

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Speaker 3: Well, the way the way our model works is that

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Speaker 3: we sign long term deals with the bluest chip of

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Speaker 3: companies and they have built in accelerators on them. So

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Speaker 3: our latest media deal in the NBA just round numbers.

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Speaker 3: This year is the last year of the deal, and

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Speaker 3: every team in the NBA gets one hundred and five

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Speaker 3: million dollars. The deal is for eleven years with accelerators,

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Speaker 3: and in the last year of the deal, every team

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Speaker 3: gets two hundred and eighty million dollars. So we look

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Speaker 3: like a software service business. About eighty percent of our

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Speaker 3: contracts are renewable, they're on long term, and they're with

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Speaker 3: Capital One, Amazon, Comcast, they're with blue chip companies, and

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Speaker 3: so if you look at SaaS businesses software businesses, they

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Speaker 3: can be valued at ten to twenty times. We've just

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Speaker 3: gotten to that ten times multiple, and I think where

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Speaker 3: even better than a SaaS business because in Washington, d C.

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Speaker 3: There won't be another basketball team, there won't be another

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Speaker 3: hockey team. And so that's selectivity, if you will, or

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Speaker 3: that ability to own your market, I think is very valuable.

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Speaker 2: You said you wouldn't buy a London football team. Why not?

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Speaker 2: There are so many Americans.

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Speaker 1: Actually, if everyone in the Premier league who is American

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Speaker 1: owned together, you could you know, change price caps on

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Speaker 1: salaries and even games.

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Speaker 3: Well, I think right now that you can either be

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Speaker 3: in a transactional relationship with your team and the fan

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Speaker 3: base or a long term relationship. And you know, we

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Speaker 3: played a Wizard's game against the Knicks in London and

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Speaker 3: I looked at a couple of teams and I said,

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Speaker 3: this would be very inauthentic to us. They would offend

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Speaker 3: our fan base. Oh I'm going to be spending time

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Speaker 3: going to London. I never played soccer football. How many

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Speaker 3: games am I going to get to go to? And

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Speaker 3: I think you walk into a fan base that's not

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Speaker 3: in your market, that's very skeptical. You're like a carpetbagger

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Speaker 3: if you will. And so I just said to Thine

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Speaker 3: own self be true. We want to build the world's

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Speaker 3: most valuable, most important regional sports and entertainment company. We're

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Speaker 3: in Washington, DC, a top five market. We own multiple teams,

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Speaker 3: the venue, and the network, and so we'll stick to

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Speaker 3: our knitting, even though I like to innovate and be

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Speaker 3: first to market. Baseball team or soccer team in that

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Speaker 3: market would be just fine with us.

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Speaker 1: But if you were to advise maybe an international businessman

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Speaker 1: or businesswoman who wants to get into the business of sports,

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Speaker 1: where would you tell them to go?

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Speaker 3: Women's sports right now is what stock Well. I'm very

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Speaker 3: knowledgeable about basketball, and the WNBA is growing very very fast.

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Speaker 3: We just got a new, very lucrative media deal. Attendances booming,

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Speaker 3: and the quality of the game and the way the

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Speaker 3: game is being presented is now looks like the NBA

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Speaker 3: if you will, the production value, the level of talent,

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Speaker 3: the coaching, and so I think that there's a lot

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Speaker 3: of upside still in the WNBA. There's expansion that's been

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Speaker 3: happening in a good clip. We'll bring in really really

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Speaker 3: good new owners. The quality of play in the NCAA

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Speaker 3: is very very high, and so if I were right

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Speaker 3: now looking at what would I buy be a women's

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Speaker 3: basketball team or women's soccer.

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Speaker 1: Team, And again, does this change with the quality of

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Speaker 1: playing or just fans being more drawn to these kind

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Speaker 1: of competitions.

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Speaker 3: I think the media now has given permission for if

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Speaker 3: you love basketball, it's okay to love women's basketball in

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Speaker 3: the NCAA and women's basketball in the WNBA. And now

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Speaker 3: there's these other offshoot leagues and they're getting carriage on

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Speaker 3: on the major network. So the exposure is much higher,

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Speaker 3: and the respect that the media is paying there's no

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Speaker 3: more well, they're not really good athletes. I think everyone

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Speaker 3: respects the quality of play. And you know that was

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Speaker 3: all driven by Title nine back in the seventies saying

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Speaker 3: you've got to treat women athletes and the women's departments

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Speaker 3: at universities the same way you do the men. And

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Speaker 3: it's taken a couple of generations, but now it's really

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Speaker 3: really serious athletes pursuing basketball. Hockey is going to become

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Speaker 3: a very very important sport for women. And so if

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Speaker 3: I were making a bet now, I've said Washington, DC

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Speaker 3: should be the women's capital of professional sports. Right now,

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Speaker 3: we only own a WNBA team, but I would look

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Speaker 3: at a hockey team. I would look at professional volleyball.

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Speaker 3: I would have loved to have bought the women's soccer team.

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Speaker 3: Michelle Kang, who's the greatest. She owns that. But I

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Speaker 3: think we'll see that that core four sport just developing,

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Speaker 3: and the women's game will be highly compensated, big media deals,

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Speaker 3: well attended. Young girls growing up would want aspire to

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Speaker 3: be professional athletes. That spire was going to go up

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Speaker 3: for a long, long time.

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Speaker 2: Ted, thank you so much for joining us.

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Speaker 3: Great thank you