Investment Landscape within Sports, Media and Entertainment

Q: How many teams or leagues are there — isn’t it a limited investment universe?

— Financial Advisor, Florida

A: The total addressable market (TAM) across the global sports, media and entertainment ecosystem is much broader than many people might realize.

While sports teams, clubs and leagues often draw much of the attention, we believe the broader potential ecosystem of sports, media and entertainment investing is significant and underpenetrated. In fact, we estimate the total investment opportunity in adjacent strategies could be five times larger than the teams and leagues themselves ($2.5T vs $500B).¹

Among these are:

• Sports-related products and services: athletic gear, merchandise, ticketing platforms, facility operators and youth sports
• Media companies: broadcasters, streaming and subscription services and analytics
• Entertainment businesses and assets: live content, talent agencies, production management, data analytics and digital media

To highlight some specific examples of opportunities within sub-sectors of sports, media and entertainment:

• Equipment and Athletic Gear ($150-200B TAM): Characterized by consistent professional and recreational demand, benefitting from a growing consumer focus on health and wellness.²
• Youth Sports ($35-50B TAM): Deeply embedded in the American culture and viewed as one of the most important discretionary spend categories with long-term, recurring low correlated demand.³
• Stadium Services ($30-40B TAM): Experiencing a period of aging assets requiring modernization paired with a history of steady and predictable consumer demand.⁴
• Music ($75-100B TAM): A globally underpenetrated and uncorrelated market benefiting from the rise of streaming and technology.⁵
• Golf and Country Clubs ($30-35B TAM): Underpinned by significant real estate assets with membership-driven models that drive strong revenue visibility.⁶

When considering the sports, media and entertainment investment universe, we believe one should think beyond the headline sports teams and look to adjacencies across the ecosystem. Expanding or considering the sports investing asset class may generate increased opportunities to generate alpha and create value.

Disclosure:

1 Goldman Sachs “Changing the Game – Unlocking New Opportunities in Sports.”

2 Statista. Global sports equipment market size in 2022. Sporting goods industry in the U.S. - statistics & facts. D Tighe. May 2024.

3 Statista. Size of the youth sports market worldwide in 2022 and 2030. Youth Sports Outlook: Historical & Future Findings. Altman Solon. December 2022.

4 BofA Equity Research, Media Funflation, September 2023

5 Goldman Sachs, Music in the Air. June 2023. 

6 IBISWorld. November 2024. 

Investing involves risk including the loss of principal. An investment in Sports Media Entertainment entails a significant degree of risk, and, therefore, should be undertaken only by investors capable of evaluating the risks of that investment and bearing the risks it presents. General risks include, but are not limited to, a lack of liquidity; a high degree of regulation within the sports leagues, teams and related companies; additional authority of certain regulatory bodies in respect to operations; personal investments or ownership interests from senior management; success of sports teams; cancellation and disruption of events; portfolio concentration and lack of industry diversification; use of leverage; need to deploy capital quickly; no market for units and restrictions on transfers; potential effects of the repurchase program; potential difference in valuations of underlying assets; errors in NAV and that the strategy(ies) have a limited operating history. These are not the only risks and potential investors are encouraged to refer to the private placement memorandum of the corresponding strategy prior to investing.

There are inherent differences between public and private equity. On the whole, public equity is more liquid, represents direct ownership in a company, has more stringent reporting, and has historically had higher volatility and lower fees. Private equity has historically had lower volatility relative to public equity, but operates under less stringent reporting requirements, is generally more illiquid and designed for more sophisticated investors with a longer time horizon. Indexes designed to track the public markets are different from private equity in that data is derived from trade data and reporting requirements. Indexes are not available for direct investment, do not include the fees, expenses or reinvestment of any investments. 

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