Get ready for sports to be the next big investment asset class

Jerry Jones bought the Dallas Cowboys in 1989 for $140 million, and today the NFL club’s valuation sits at about $8 billion. While an NFL team is very rarely up for grabs, newer sports teams, leagues, and adjacent companies are increasingly being seen as hot investment opportunities.

Angel City Football Club founder and managing partner at Upfront Ventures Kara Nortman told the audience at Fast Company’s Innovation Festival that opportunities are ripe in sports, particularly because of the proliferation of streaming services. She said because of the ever-increasing demand for sports content, emerging leagues in emerging sports have an opportunity to find a broader audience. CBS, for example, bought multiyear broadcast rights for the American Cornhole League in 2020. CBS also broadcast Pro Pickleball this summer, streaming it on Paramount Plus.

“As someone who spent my entire career investing in tech, I’m really moving all of my energy and focus over to sports,” said Nortman, who shared the stage with Thirty Five Ventures cofounder Rich Kleiman, and EA Sports COO Laura Miele. “I think it’s the beginning of it turning into its own asset class, even for institutional investors.”

In 2020, Nortman founded Angel City, which made an immediate splash, thanks to an ownership group that includes actor Natalie Portman, tennis legends Billie Jean King and Serena Williams, Reddit cofounder and venture capitalist Alexis Ohanian, and 13 former U.S. national women’s soccer team members.

“Angel City’s done an impeccable job of building a brand that’s, in some ways, bigger than the NWSL right away, but it benefits the league and there’s a rising tide effect,” Kleiman said. He said the success and brand-building done by Nortman’s Angel City helped spark his company’s investment in fellow NWSL club Gotham FC in May.

Kleiman said that part of the reason these new sports entities are becoming more attractive to investors is the new generation of ownership. “You cannot just walk into owning an NBA team or an NFL team, but the ability to have great CEOs and great entrepreneurs who are leading these [new] teams now and leading these organizations, that’s going to be what the difference is.”