WEBVTT - Chief Future Officer: Peter Biché, Monumental Sports 0:00:02.279 --> 0:00:06.000 Monuments are not built in a day. Ted Leonsis laid 0:00:06.040 --> 0:00:08.959 the foundation for his sports empire in a different era. 0:00:09.440 --> 0:00:14.240 When I first bought the Washington Capitals, no one had computers. 0:00:14.560 --> 0:00:18.599 It was a facts generated just facts as would be 0:00:18.920 --> 0:00:20.160 blow it all over the place. 0:00:20.520 --> 0:00:23.959 As analog gave way to digital, Monumental Sports and Entertainment 0:00:24.000 --> 0:00:27.760 took form. In twenty ten, Leonsis bought the Washington Wizards, 0:00:27.920 --> 0:00:32.159 along with DC's Downtown Sports Arena. Since then, Monumental has 0:00:32.159 --> 0:00:35.760 added teams, opened more venues, invested in new ventures, and 0:00:35.800 --> 0:00:40.160 broadened its reach with media networks. Financially, it's a whole 0:00:40.280 --> 0:00:41.120 new ballgame. 0:00:41.560 --> 0:00:47.080 We need very sophisticated financial management to make sure we're 0:00:47.120 --> 0:00:50.760 getting the right yield, make sure we're not too far 0:00:51.040 --> 0:00:56.480 over our skis in terms of cash investment. The demands 0:00:56.600 --> 0:01:02.639 on the CFO have heightened as the stakes have increased, 0:01:02.640 --> 0:01:07.559 the valuations have increased, the revenues have increased, The demands 0:01:07.600 --> 0:01:09.360 by the fans have increased. 0:01:10.319 --> 0:01:13.520 The executive Lyons's trust to meet these demands is Peter Bische. 0:01:14.080 --> 0:01:17.840 He's been Monumental CFO from the very beginning. The CFO 0:01:17.959 --> 0:01:20.520 role is the only one you've had here. You essentially 0:01:20.920 --> 0:01:22.920 defined created that position. 0:01:23.280 --> 0:01:26.960 I suppose some might say it's a dead end job. 0:01:27.040 --> 0:01:30.160 I've been CFO forever with absolutely no advancement or a 0:01:30.200 --> 0:01:31.160 title change. 0:01:31.880 --> 0:01:34.920 BChE serves as CFO of the Capitals, the Wizards, and 0:01:35.040 --> 0:01:38.600 the entire group of teams, facilities, and networks. Monumental owns 0:01:38.600 --> 0:01:42.440 and operates. He's instrumental to an enterprise currently valued at 0:01:42.480 --> 0:01:44.080 over four billion dollars. 0:01:44.400 --> 0:01:48.920 It's gotten larger, a lot more zeros on the numbers 0:01:48.920 --> 0:01:50.840 I deal with and have. It may have been the 0:01:50.840 --> 0:01:54.960 case in the past, and so the pressures financially are different. 0:01:55.080 --> 0:02:00.160 Peter's like a partner and not only a thought leader 0:02:00.280 --> 0:02:03.840 and help him with strategy, but he likes to spend 0:02:03.880 --> 0:02:07.520 the money like it's his. I'm more, let's scale, let's grow, 0:02:07.680 --> 0:02:12.519 let's go, go go, and Peter's more well, let's aim 0:02:12.760 --> 0:02:17.440 and target and think that through and run the numbers 0:02:17.520 --> 0:02:20.000 before we dive in. 0:02:21.280 --> 0:02:25.040 Make no mistake, ted Leonsis has Monumental moving forward. 0:02:25.360 --> 0:02:27.560 Ted is very much and has always been in his 0:02:27.639 --> 0:02:29.480 prior life, and this one sort of growth more. 0:02:29.760 --> 0:02:32.160 Let's see around the corners, what's coming. How do we 0:02:32.760 --> 0:02:34.200 take this business into. 0:02:34.000 --> 0:02:35.640 The next century or whatever. 0:02:35.840 --> 0:02:37.800 Obviously we need we have our car business, and we 0:02:37.840 --> 0:02:39.480 need to have games here and all that sort of thing. 0:02:39.480 --> 0:02:42.399 But what else can we do? How do we grow 0:02:42.440 --> 0:02:43.240 the platform? 0:02:43.280 --> 0:02:45.640 So you've had to learn to see around corners as 0:02:45.680 --> 0:02:47.400 well financially, at least. 0:02:47.160 --> 0:02:49.440 It's part of what you have to do. It can't 0:02:49.480 --> 0:02:51.680 be the same old, same old. It can't be the 0:02:51.680 --> 0:03:00.160 same as yesterday. 0:03:07.000 --> 0:03:10.840 And our mission, our goal is to build the world's 0:03:10.840 --> 0:03:14.240 most valuable regional sports and entertainment company. 0:03:14.400 --> 0:03:16.239 We've been growing double digit. 0:03:16.520 --> 0:03:20.560 Most sports teams are growing six seven eight percent. 0:03:20.840 --> 0:03:24.840 Monumental's two most valuable properties are the NHL's Washington Capitals 0:03:24.880 --> 0:03:28.440 and the NBA's Washington Wizards. They're also the most expensive 0:03:28.480 --> 0:03:33.320 to maintain. The biggest budget item player compensation, but at 0:03:33.400 --> 0:03:36.960 least that number is predictable as each team operates under 0:03:37.000 --> 0:03:39.600 a salary cap set by the league. Is the fact 0:03:39.640 --> 0:03:42.480 that you have the salary cap structure and gms deal 0:03:42.560 --> 0:03:45.320 with a lot of what that ultimate dollar figure should 0:03:45.360 --> 0:03:47.200 look like for you up to focus on the other 0:03:47.400 --> 0:03:48.320 areas of the business. 0:03:48.440 --> 0:03:52.040 Yeah, you know, tag is lead is this and I'm 0:03:52.080 --> 0:03:55.000 involved sort of set the big number for them. Spend 0:03:55.000 --> 0:03:58.080 of the cap, spend more or less whatever than numbers, 0:03:58.360 --> 0:03:59.440 how it gets spent as. 0:03:59.360 --> 0:04:00.960 Really up to that, I don't get a vote. 0:04:01.080 --> 0:04:03.160 I don't really think Ted gets a vote on who 0:04:03.200 --> 0:04:05.000 they draft or trade for. 0:04:05.160 --> 0:04:06.440 We leave that to the pros. 0:04:06.600 --> 0:04:08.280 Well, you get to sign the checks. What was it 0:04:08.360 --> 0:04:09.040 like signing a. 0:04:09.040 --> 0:04:12.360 Third signs checks anymore? It's all it's all by a wire. 0:04:12.640 --> 0:04:15.480 So so that's okay sending a wire. Then thirty four 0:04:15.520 --> 0:04:17.880 million dollar bonus check to Alex Ovechkin, what does that 0:04:17.880 --> 0:04:18.320 feel like? 0:04:19.200 --> 0:04:19.360 Now? 0:04:19.920 --> 0:04:22.360 It makes for interesting cash planning when you have a 0:04:22.400 --> 0:04:24.080 big number like that, and we have a number of 0:04:24.120 --> 0:04:27.359 players who get their salaries and very lompy amounts, but 0:04:27.440 --> 0:04:30.159 it just you plan your cash around it. 0:04:31.440 --> 0:04:34.400 Paying out massive bonuses is the cost of competing in 0:04:34.480 --> 0:04:38.000 pro sports. And when Alex Ovechkin and the Capitals hoisted 0:04:38.040 --> 0:04:41.040 the Stanley Cup in twenty eighteen, the return on investment 0:04:41.400 --> 0:04:47.159 was crystal clear. But when the cheering stops, it's back 0:04:47.160 --> 0:04:50.400 to work. Beyond salaries, Ask CFO, what are your big 0:04:50.560 --> 0:04:53.000 line items? What are you thinking about on a daily basis? 0:04:53.080 --> 0:04:54.880 The other big spends for us where I spend a 0:04:54.920 --> 0:04:56.840 lot of time thinking is really on some of our 0:04:56.880 --> 0:04:59.920 capital projects as opposed to what day to day spend 0:05:00.200 --> 0:05:03.760 on whites or whatever. And then, of course the corollary is, 0:05:03.800 --> 0:05:05.320 if we're going to spend that money, where do we 0:05:05.360 --> 0:05:06.599 get it, How do we fund it? 0:05:06.600 --> 0:05:08.640 How do we finance it? Is it from operations? Is 0:05:08.680 --> 0:05:09.400 it from borrowing? 0:05:09.400 --> 0:05:11.480 What does our capital stack look like, what is the 0:05:11.520 --> 0:05:12.760 appropriate amount of leverage? 0:05:12.760 --> 0:05:13.679 And those sorts of things. 0:05:14.520 --> 0:05:17.839 Monumental has put a lot of resources into its flagship venue, 0:05:17.960 --> 0:05:21.600 Capital One Arena. In addition to capitals and Wizards home games, 0:05:21.680 --> 0:05:25.320 it hosts college sports, concerts, and family shows over two 0:05:25.360 --> 0:05:28.640 hundred and twenty events a year. Monumental fully owns and 0:05:28.680 --> 0:05:32.600 operates the facility most of the time. That's an advantage. 0:05:32.839 --> 0:05:38.160 Basically, during the pandemic art building was shut. That was 0:05:38.279 --> 0:05:44.080 a very sobering feeling. It wasn't like the bank said, oh, 0:05:44.120 --> 0:05:46.039 you don't have to pay us the mortgage. 0:05:45.880 --> 0:05:48.359 Or pros and cons. It's a bit more expensive to 0:05:48.480 --> 0:05:53.320 own it because often in more public private partnerships, the 0:05:53.360 --> 0:05:57.600 public entity has some responsibility for maintaining. 0:05:56.960 --> 0:05:59.000 Because we own it, because we control it, a. 0:05:59.000 --> 0:06:02.360 Lot more nimble, as much as you could be nimble 0:06:02.400 --> 0:06:05.960 with a million square foot building, we're much more nimble, 0:06:06.320 --> 0:06:08.160 owning it and running it ourselves. 0:06:08.240 --> 0:06:10.760 We've had our best year ever. 0:06:10.839 --> 0:06:14.560 The concert businesses off the chart, the ben businesses off 0:06:14.560 --> 0:06:18.919 the chart. We hosted a professional boxing match. It was 0:06:18.960 --> 0:06:22.200 our best gate in our twenty five year history. We 0:06:22.320 --> 0:06:25.080 put three million people through the building. 0:06:26.440 --> 0:06:28.960 The resurgence of live sports and entertainment in the last 0:06:29.000 --> 0:06:32.440 two years has been accompanied by high infleetion, putting a 0:06:32.480 --> 0:06:36.520 spotlight on ticket pricing. That's another area that's changed for 0:06:36.600 --> 0:06:37.800 the CFO, the. 0:06:37.800 --> 0:06:41.320 Whole ticket pricing process. 0:06:41.440 --> 0:06:45.039 It used to be very yellow sheet of paper, maybe 0:06:45.640 --> 0:06:47.640 some numbers around. It was not a lot of science 0:06:47.680 --> 0:06:49.720 behind it. We're now in the world and have been 0:06:49.760 --> 0:06:52.760 for many years, as most other similar businesses are. The 0:06:52.839 --> 0:06:55.680 dynamic pricing, so our pricing for a seat may change 0:06:56.240 --> 0:06:58.880 hourly if we see demand for that. We will price 0:06:59.000 --> 0:07:01.680 aisle seats different way that lead to price center seats. 0:07:01.720 --> 0:07:04.440 We will price seats at the end where the hockey 0:07:04.440 --> 0:07:08.040 team shoots twice differently than at the end where they 0:07:08.040 --> 0:07:11.320 shoot once. So the level and the ability to change 0:07:11.360 --> 0:07:15.640 pricing is dramatic, all driven to maximize revenues. 0:07:16.600 --> 0:07:19.720 Few revenue streams and sports have as much growth potential 0:07:19.880 --> 0:07:23.680 as media rights. In twenty twenty two, Monumental acquired full 0:07:23.720 --> 0:07:27.560 equity ownership of NBC Sports Washington. It plans to rebrand 0:07:27.600 --> 0:07:30.360 the Regional Sports Network and develop it into a versatile 0:07:30.400 --> 0:07:33.640 platform for distributing games and other media products. 0:07:33.920 --> 0:07:37.680 The RSN model, where they get full distribution in a 0:07:37.720 --> 0:07:38.920 city or a state is. 0:07:38.920 --> 0:07:39.760 A broken model. 0:07:39.880 --> 0:07:44.360 Most of these local teams want to control their own consumer, 0:07:44.720 --> 0:07:49.360 build their own consumer, and control that information and the experience. 0:07:49.520 --> 0:07:53.920 My background is in digital distribution of content. There's a 0:07:53.960 --> 0:07:59.880 lot of on trend development happening direct to consumer, and 0:08:00.240 --> 0:08:02.840 I felt that it was probably a wise thing for 0:08:02.920 --> 0:08:07.120 us to do to reclaim our rights. We grow our market, 0:08:07.360 --> 0:08:09.560 we'd have freedom to innovate. 0:08:09.680 --> 0:08:13.080 What Ted has done in his Monumental team is created 0:08:13.080 --> 0:08:15.680 this flywheel where you own the team and you own 0:08:15.760 --> 0:08:18.040 the marks. You owned the logos, you own the building, 0:08:18.200 --> 0:08:21.960 you own the the RSN, you own the social sites, 0:08:22.280 --> 0:08:25.320 you own, you own all the content. And if you 0:08:25.440 --> 0:08:29.040 do that, there's a tremendous flywheel for brands and sponsors 0:08:29.280 --> 0:08:30.720 as well as the fan experience. 0:08:30.920 --> 0:08:34.240 I think it will give us the opportunity to add 0:08:34.640 --> 0:08:39.480 categories UH of product. It will offer us ways. 0:08:39.200 --> 0:08:43.679 To slice UH the product differently than when we had 0:08:43.679 --> 0:08:46.800 a single channel and a single way of distributing it. 0:08:46.840 --> 0:08:49.200 We think having it in house is critical. 0:08:49.360 --> 0:08:53.960 Peter worked with us and our investment bank at Lion Tree. 0:08:54.360 --> 0:08:58.480 We said, let's finance it. Let's show that the cash 0:08:58.480 --> 0:08:59.960 flow can pay down the debt. 0:09:01.240 --> 0:09:04.439 It dramatically grew our revenues. We were able to do. 0:09:04.559 --> 0:09:09.079 An additional equity financing and paid down the debt. And 0:09:09.200 --> 0:09:13.719 so while it looks like a smart strategic move, it's 0:09:13.760 --> 0:09:18.839 also turned into a very very good value creator top line, 0:09:18.960 --> 0:09:22.360 bottom line and for overall valuation. 0:09:22.520 --> 0:09:23.240 As an enterprise. 0:09:24.760 --> 0:09:29.480 Monumental's valuation could take another leap higher if leonce'spuys the 0:09:29.640 --> 0:09:33.319 Washington Nationals. The Washington Post reports that he's offered more 0:09:33.360 --> 0:09:36.160 than two billion dollars for the Major League Baseball team, 0:09:36.360 --> 0:09:39.640 which is not officially for sale. The purchase of another 0:09:39.760 --> 0:09:43.600 DC sports franchise would certainly fit the Monumental model. 0:09:44.040 --> 0:09:45.319 We are definitely in growth mode. 0:09:45.400 --> 0:09:48.959 We view this as a platform onto which we can 0:09:49.000 --> 0:09:51.320 add different things. So we see things all the time. 0:09:51.360 --> 0:09:53.880 People show us things all the time. I am heavily involved, 0:09:53.880 --> 0:09:57.520 particularly because of the strategy issues and funding issues and 0:09:57.880 --> 0:10:00.040 ROI calculations. 0:09:59.240 --> 0:09:59.920 And that sort of thing. 0:10:00.080 --> 0:10:03.000 We'll never go into anything that's not pretty closely related 0:10:03.240 --> 0:10:06.200 or most likely not in our region. I think we're 0:10:06.320 --> 0:10:11.400 very legionally oriented. There are other sports collectives that have 0:10:11.520 --> 0:10:14.920 properties in different locations. Our good friends at Fenwoy Sports 0:10:14.960 --> 0:10:18.400 Group in Boston on the Red Sox and the Pittsburgh 0:10:18.520 --> 0:10:25.319 Penguins and Liverpool tremendous properties with very high name recognition, 0:10:25.920 --> 0:10:29.400 but don't have the same kind of business opportunity that 0:10:29.440 --> 0:10:32.840 we have saying closer to home, so we're I think 0:10:32.880 --> 0:10:35.120 it would be have to be something very special for 0:10:35.240 --> 0:10:37.720 us to be outside of this region. 0:10:37.960 --> 0:10:40.240 Have you ever run the numbers on something like that? Though, 0:10:40.280 --> 0:10:42.440 like a European football soccer team. 0:10:42.360 --> 0:10:46.120 We have been shown more teams, more EPL teams than 0:10:46.160 --> 0:10:48.360 I might have imagined could be for sale, but we 0:10:48.520 --> 0:10:51.760 just couldn't figure out where we would add value. 0:10:51.800 --> 0:10:55.080 Monumental sports and entertainment has become a towering presence in 0:10:55.240 --> 0:10:58.400 Washington sports, with the Capitals, the Wizards, and the cities 0:10:58.480 --> 0:11:02.319 Downtown Sports Arena among the holdings. And while CEO ted 0:11:02.400 --> 0:11:05.560 Leonsis and CFO Peter Bisha both have a long history 0:11:05.600 --> 0:11:09.480 with DC as they both graduated from Georgetown University. Bishay 0:11:09.559 --> 0:11:12.200 started his professional career on Wall Street. 0:11:12.400 --> 0:11:15.080 Worked for one of the big old houses in New York, 0:11:15.160 --> 0:11:19.080 the Old Original, not the two thousand and eight bankruptcy 0:11:19.160 --> 0:11:23.600 Lehman Brothers. Ended up doing a lot of sports related 0:11:23.760 --> 0:11:25.600 work while I was there, a lot of sports related 0:11:25.760 --> 0:11:28.360 m and A work buying and selling, advising people on 0:11:28.760 --> 0:11:30.320 buying and selling sports teams. 0:11:30.360 --> 0:11:33.480 Did a lot of work with those same owners. 0:11:34.000 --> 0:11:39.520 Developing financing building arenas, and so became an expert in 0:11:39.559 --> 0:11:40.120 that area. 0:11:40.480 --> 0:11:43.600 Bija left finance to work for a Poland's Washington Sports 0:11:43.640 --> 0:11:46.959 and Entertainment Group in the mid nineteen nineties, joining Monumental 0:11:46.960 --> 0:11:48.640 at its inception in twenty ten. 0:11:49.080 --> 0:11:51.760 I'm a sports fan like many people are. 0:11:52.360 --> 0:11:55.720 So to be the CFO for a couple franchises to 0:11:55.840 --> 0:11:59.959 be built new arena was a tremendous opportunity from psychic income. 0:12:00.080 --> 0:12:02.960 In addition to come to work in an arena every day. 0:12:04.120 --> 0:12:06.360 The arena that Peter Bische comes to work in today 0:12:06.480 --> 0:12:09.240 has gone through many changes since it's opened in nineteen 0:12:09.320 --> 0:12:12.679 ninety seven. In the last five years alone, Monumental has 0:12:12.679 --> 0:12:17.320 invested nearly seventy million dollars in renovations and upgrades. 0:12:16.880 --> 0:12:20.320 That had aged z not because the building had gotten old, 0:12:20.320 --> 0:12:22.920 but because the way people consume sports, the way our 0:12:22.960 --> 0:12:25.360 fans at ten games, what they expect when they come 0:12:25.400 --> 0:12:27.960 to events has changed pretty dramatically. It used to be 0:12:28.520 --> 0:12:31.679 you know, fixed seating, sit in a line, buy a beer. 0:12:31.720 --> 0:12:34.240 And we have found, particularly with our younger fans, they 0:12:34.280 --> 0:12:37.040 expect a lot more than that. They want something more experiential, 0:12:37.120 --> 0:12:39.240 they want something more targeted towards them. 0:12:39.400 --> 0:12:42.520 It wasn't about making it shiny and new. It was 0:12:42.520 --> 0:12:43.320 about utility. 0:12:43.520 --> 0:12:46.160 It was about operational and revenue. 0:12:46.200 --> 0:12:49.280 Of course, some of the enhancements are shiny and new, 0:12:49.679 --> 0:12:51.559 like the huge center hung. 0:12:51.440 --> 0:12:53.840 Scoreboard sort of has two purposes. 0:12:53.840 --> 0:12:56.640 One is information to fans, scores, stats, and that's the 0:12:56.679 --> 0:12:59.199 middle and video in the upper middle. The other big 0:12:59.240 --> 0:13:02.280 part of it you can see elsewhere, is advertising sponsorship 0:13:02.360 --> 0:13:04.480 for us, my sponsors obviously love it. 0:13:04.480 --> 0:13:05.840 It's bright, it's high depth. 0:13:06.040 --> 0:13:08.160 Now that you have all of this, how much has 0:13:08.200 --> 0:13:11.040 your revenue per game in terms of advertising gone up 0:13:11.080 --> 0:13:11.679 because of all of this. 0:13:11.960 --> 0:13:14.320 So whenever we do a major spend like this, and 0:13:14.400 --> 0:13:16.439 this is about ten million dollars for the center hung 0:13:16.480 --> 0:13:18.559 and all the signage. We of course run an uri, 0:13:18.679 --> 0:13:21.040 not any typical thing to do, and I think our 0:13:21.080 --> 0:13:24.040 return on this in terms of incremental dollars, not just 0:13:24.080 --> 0:13:25.479 existing but incremental. 0:13:25.760 --> 0:13:26.760 Was about two years. 0:13:27.040 --> 0:13:30.080 So we added about five million dollars of revenue to 0:13:30.120 --> 0:13:31.240 get a two year payback. 0:13:31.280 --> 0:13:33.800 So it's it's a no brainer for us to do. 0:13:35.000 --> 0:13:38.280 Investing in the fan experience inside the arena qualifies as 0:13:38.280 --> 0:13:41.360 a no brainer, but Monumental has made other bets with 0:13:41.559 --> 0:13:42.440 longer odds. 0:13:42.840 --> 0:13:47.000 I just had a firm belief that the sports industry 0:13:47.040 --> 0:13:50.440 would continue to grow the value of the teams would 0:13:50.480 --> 0:13:55.319 continue to grow, and we should invest while everyone else 0:13:55.440 --> 0:13:56.920 was trying to hoard. 0:13:57.200 --> 0:13:59.559 We first made an investment in a company called sport 0:13:59.640 --> 0:14:04.040 Radar back in twenty fifteen, prior to when sports betting 0:14:04.080 --> 0:14:06.319 was legal in the United States. As we learn more 0:14:06.320 --> 0:14:09.320 and more about the European markets, how they were regulated, 0:14:09.320 --> 0:14:12.000 in the success that they've driven, we really became an 0:14:12.000 --> 0:14:16.920 evangelist in the United States for the legalization of sports betting. Generally, 0:14:17.000 --> 0:14:19.920 we held hearings on Capitol Hill with sports Radar to 0:14:20.000 --> 0:14:20.920 advocate for it. 0:14:22.560 --> 0:14:25.280 A Supreme Court decision in twenty eighteen struck down the 0:14:25.280 --> 0:14:28.320 federal ban on sports betting, the District of Columbia made 0:14:28.320 --> 0:14:31.880 it legal in twenty nineteen, and in twenty twenty, Capital 0:14:31.880 --> 0:14:35.160 One Arena became the first US sports venue to officially 0:14:35.520 --> 0:14:36.760 open a sports book. 0:14:37.080 --> 0:14:38.480 It's driven by fan engagement. 0:14:38.520 --> 0:14:40.920 How do we engage with our fans in ways beyond 0:14:41.160 --> 0:14:43.040 just sitting at a seat and watching our game. 0:14:43.280 --> 0:14:46.160 Since we've opened it, there's been almost three hundred million 0:14:46.240 --> 0:14:51.440 dollars that's been bet downstairs. And it feels like an 0:14:51.480 --> 0:14:56.560 Apple Genius bar or something. It's very all Bloomberg. It's 0:14:56.600 --> 0:15:00.520 got terminals everywhere, it's got TV screens everyek, and so 0:15:00.560 --> 0:15:04.160 I'm very proud of making those kinds of investments when 0:15:04.600 --> 0:15:07.960 it seemed very dark and dire, and now it's paying off. 0:15:08.000 --> 0:15:10.800 I think sports betting is going to be dominant here 0:15:10.920 --> 0:15:13.440 in the US because it's fun and so if Ted, 0:15:13.640 --> 0:15:17.080 which very smartly put a sports book in his arena, 0:15:17.560 --> 0:15:21.160 that's another way to connect with your consumer. 0:15:20.720 --> 0:15:22.720 And I believe that's going to be a very good 0:15:22.720 --> 0:15:23.320 business to be. 0:15:24.640 --> 0:15:28.000 Under NBA and NHL rules, the company can't receive revenue 0:15:28.000 --> 0:15:31.800 directly from betting that's entirely handled by its partner, Caesar's 0:15:32.280 --> 0:15:35.600 Monumental's profit comes from food and beverage sales, and the 0:15:35.680 --> 0:15:38.440 venue brings customers to the facility year round. 0:15:38.760 --> 0:15:40.400 You can come here whether we have an event or not, 0:15:40.480 --> 0:15:43.040 a game or not eat Wager. 0:15:44.320 --> 0:15:47.840 In early twenty twenty three, Monumental opened District Eat, a 0:15:47.880 --> 0:15:51.520 live event theater focused on esports. Is another avenue for 0:15:51.560 --> 0:15:55.800 fan engagement and another indicator of Monumental's appetite for innovation. 0:15:56.200 --> 0:15:59.360 We made an investment in that just because we knew 0:15:59.400 --> 0:16:01.520 that was the that it was not as big in 0:16:01.520 --> 0:16:03.760 the US as it has been in Asia, but it 0:16:03.920 --> 0:16:05.240 was common and in a big way. 0:16:05.320 --> 0:16:07.760 People are really starting to understand that gaming as a 0:16:07.800 --> 0:16:12.840 platform is looking more like traditional sports entertainment postht pandemic. 0:16:12.880 --> 0:16:15.640 People want to get back to in person gathering and 0:16:15.720 --> 0:16:20.360 being more digitally focused, tech savvy, even more aggressive. Doubling 0:16:20.440 --> 0:16:23.160 down on a lot of our already existing commitments made 0:16:23.200 --> 0:16:25.360 a lot of sense to us, and I think District 0:16:26.040 --> 0:16:26.960 fits that mold. 0:16:27.120 --> 0:16:30.880 Monumental in particular exceptionally brilliant at ensuring they own kind 0:16:30.880 --> 0:16:33.840 of the vertical revenue streams that can exist with having 0:16:33.920 --> 0:16:37.720 both facility those in person events, their teams that can 0:16:37.760 --> 0:16:40.600 compete in that facility as well as other events and 0:16:40.640 --> 0:16:47.000 opportunities to monetize not just with their team and their competitions. 0:16:47.320 --> 0:16:51.200 You have any sports NBA team and coffee team, they 0:16:51.240 --> 0:16:54.440 require their own infrastructure and support. I would imagine what 0:16:54.480 --> 0:16:56.160 are those inflows and outflows like. 0:16:56.560 --> 0:17:00.200 So it's not quite on the scale of an NBA team's, 0:17:00.240 --> 0:17:01.360 at least in this market. 0:17:01.760 --> 0:17:05.120 But we have players, We draft players, we trade for players, 0:17:06.240 --> 0:17:09.800 we signed players, and then there's a whole business process 0:17:09.840 --> 0:17:11.399 around it as well. You have the team side, but 0:17:11.720 --> 0:17:14.280 they're sponsorship. You look around, you'll see a lot of 0:17:14.280 --> 0:17:17.240 the same sponsors that have signage. 0:17:16.800 --> 0:17:17.359 In the building. 0:17:17.800 --> 0:17:20.520 So it fits in really well with what we're trying to. 0:17:20.480 --> 0:17:23.479 Do with a Washington Capital Stanley Cup in twenty eighteen 0:17:23.560 --> 0:17:27.159 and a Washington Mystics WNBA title in twenty nineteen. The 0:17:27.160 --> 0:17:30.560 Monumental sports and Entertainment family of teams has delivered great 0:17:30.560 --> 0:17:33.560 moments on the ice and on the court, and as 0:17:33.560 --> 0:17:36.200 an investment, it's returned solid value. 0:17:36.320 --> 0:17:39.240 I paid eighty five million dollars for the Capitals. You know, 0:17:39.280 --> 0:17:42.240 maybe it's a billion and a half plus. 0:17:42.760 --> 0:17:44.480 I paid three. 0:17:44.240 --> 0:17:47.919 Hundred and fifty million, four hundred million for the Wizards. 0:17:48.160 --> 0:17:52.440 Maybe it's four billion. So now these have become growth stocks, 0:17:52.520 --> 0:17:53.480 if you will. 0:17:53.560 --> 0:17:56.480 With the exception of corporate giants like Madison Square Garden, 0:17:56.680 --> 0:17:59.760 it's been rare for US sports organizations to go public, 0:18:00.359 --> 0:18:03.320 but that might be changing. Do you see a future 0:18:03.359 --> 0:18:05.520 for Monumental as a public company? 0:18:05.640 --> 0:18:06.439 Yeah, I think so. 0:18:06.840 --> 0:18:11.399 I think what we found is the leagues have opened 0:18:11.480 --> 0:18:14.000 up to new pools of capital. Over the last year 0:18:14.119 --> 0:18:19.080 or two, both the NBA and NHL have allowed professional 0:18:19.080 --> 0:18:21.600 investors to come in, not as individual owners, but as 0:18:21.680 --> 0:18:23.760 fund So that's a whole new pool of capital it 0:18:23.800 --> 0:18:26.520 didn't exist before. Sort of shows a whole new asset 0:18:26.560 --> 0:18:30.360 class opening up for professional sports, not just caves, but 0:18:30.480 --> 0:18:32.760 professional sports enterprises. 0:18:32.880 --> 0:18:37.359 I think the sophisticated analysts will be looking at this 0:18:37.520 --> 0:18:40.600 industry and as our revenue start to get in the 0:18:40.640 --> 0:18:43.359 billions of dollars, yeah, I think that you'll see a 0:18:43.440 --> 0:18:47.239 wave of companies go public, whether we will or not. 0:18:48.880 --> 0:18:53.080 There's a big responsibility when you're a public company, and 0:18:53.119 --> 0:18:57.280 I tell people where a public company already. The scrutiny 0:18:57.359 --> 0:19:01.879 that you're under and running a sports team is I 0:19:01.920 --> 0:19:06.639 think much higher than a public company. CEO has to 0:19:06.720 --> 0:19:09.480 live with we'd be prepared to do it. 0:19:09.640 --> 0:19:11.240 Just the mark would have to be right. 0:19:11.520 --> 0:19:16.440 We'd have to emotionally be ready to do something like that. 0:19:16.560 --> 0:19:20.720 But I think Monumental will be one of the three 0:19:20.840 --> 0:19:24.680 four five best in class organizations that if the time 0:19:24.800 --> 0:19:26.240 was there, sure we could go public. 0:19:27.680 --> 0:19:31.320 For now, Monumental is focused on reaching a milestone one 0:19:31.400 --> 0:19:35.399 billion dollars in annual revenue. The CFO has confidence his 0:19:35.520 --> 0:19:38.000 team will get there, but he sees work to do 0:19:38.480 --> 0:19:40.320 beyond the numbers, to. 0:19:40.200 --> 0:19:44.480 Do the things that we taught acquisition going public. CANi Lee, 0:19:44.480 --> 0:19:47.280 we need up our game a little bit. We've we've 0:19:48.280 --> 0:19:50.760 the business has changed a lot in the last twenty years, 0:19:50.760 --> 0:19:53.440 but I won't say, at least in my area, we're 0:19:53.440 --> 0:19:58.160 the most cutting or cutting edge organization from a financial 0:19:58.240 --> 0:20:00.320 planning and analysis part of it. We need to up 0:20:00.320 --> 0:20:02.840 our game there. We've uped it in certain areas. I 0:20:02.880 --> 0:20:04.720 think we can up in my area as well. 0:20:04.960 --> 0:20:07.080 So I'll put it on me. I won't point fingers 0:20:07.080 --> 0:20:07.760 in anyone else. 0:20:09.600 --> 0:20:12.240 Peter bishe has his eyes on the big picture, not 0:20:12.359 --> 0:20:16.200 just charging forward, but seeing around corners. I asked him 0:20:16.320 --> 0:20:19.919 what that future looks like. What is the opportunity for 0:20:20.000 --> 0:20:23.240 Monumental in the next five years that most excites. 0:20:22.880 --> 0:20:29.040 You an acquisition to be personally CFO of an NBA team, 0:20:29.520 --> 0:20:34.919 CFO of an nhlteam, CFO of a wnbaight, CFO of 0:20:34.960 --> 0:20:39.320 another major league team, that would be that would be 0:20:39.359 --> 0:20:44.600 pretty exciting. So personally, I think also taking advantage of 0:20:44.640 --> 0:20:47.600 the platform, proving the case that we could plug something 0:20:47.640 --> 0:20:51.280 in and have it create value beyond just whatever. 0:20:50.960 --> 0:20:51.600 We paid for it. 0:20:52.040 --> 0:20:53.840 I think that would be exciting as well, sort of 0:20:53.880 --> 0:20:57.680 proof of concept that the platform has value and can 0:20:57.720 --> 0:20:58.399 create value. 0:20:58.400 --> 0:20:59.760 I think that would be exciting as well. 0:21:00.040 --> 0:21:02.680 About what worries you? What are challenges that the organization 0:21:02.800 --> 0:21:04.840 faces in the next five years that keep you up 0:21:04.840 --> 0:21:05.160 at night? 0:21:05.320 --> 0:21:08.160