NOW is the Time to Build a Sports Company (Here's Why)
Discover more from Profluence Sports by Andrew Petcash
NOW is the Time to Build a Sports Company (Here's Why)
If you're ever dreamed of doing it, now is one of the best opportunities the market will present in a long time.
Over $1 billion in funding through Q1 of 2023.
What am I talking about?
That’s the amount of funding that has flowed into sports investment funds in the first three months of 2023.
And when you really break it down…
Sports is just getting started.
Let’s dive in 👇
Unicorns Are Built During Recessions
Inflation sucks and we’re in a recession, but that’s typically the best time to build a company.
During a downturn, there is less competition, more creativity, and driven people looking to start something new.
Here are successful companies that launched during the Great Recession:
If you can survive (and garner traction over the next year) — money will be abundant for your next milestone.
❌ And you know who wasn’t investing in companies during the 2008 downturn? Athletes.
❌ And you know who didn’t have huge social media followings and influence during the 2008 downturn? Athletes.
✅ Do you know who is investing in companies right now and has massive social influence? Athletes.
Athlete investors are a massive marketing advantage — they will help propel companies to the next level in the years to come.
Sports-Themed Companies Are the Future
When you break it down…
2022-2024 has similarities to 2008-2010 (which is both scary and optimistic at the same time).
Many people have said that “sports are recession proof” — which I hope is the case.
When you look at the most successful companies that formed during the Great Recession…
They may have had segments in sports, but they certainly didn’t start there.
When you look at new companies in 2021-2023 — many are testing their product-market-fit (PMF) in sports.
Why’s this important?
It enables sports-themed investors the chance to invest in the early stages of these future behemoths.
And according to Amerco Research, the global sports technology market size is expected to be worth roughly $61.6 Billion by 2030, growing at a CAGR of more than 19.8% during the projected timeframe of 2022-2030.
That’s massive! And it makes sense…
NIL is a huge market because it reaches into youth sports and formally commercializes sports at all ages (for better or worse).
Web3 is a community enabler that will provide software upgrades, fan engagement, transparency, and integrations with AR/VR.
Artificial Intelligence (AI) encompasses much of sports with its video component, software, etc.
Leagues like pickleball are taking off thanks to athlete investors.
Fitness tech is now moving many of its applications into sports tech.
Many robotics and sensor companies are starting in sports, whether it’s to replace referees or automatically paint the lines on a field.
And many more verticals as well…
Where Sports is Headed
I see ~10 new companies a week and have come to an interesting realization.
Many of these founders think they’re building “sports companies”, but in reality, they’re just starting in sports.
This is exciting for many reasons…
The ground floor of current innovation touches sports.
The future of tech can be noticed in sports.
Sports is setting the stage for most other industries.
Nearly all consumer companies are beginning their marketing efforts in sports because it takes 1 big athlete to believe in them.
Time to Build
To those creating a better future in sports 🥂
Let’s keep building — I’m here to help:
Podcast 🎙
I had a great conversation with a quick riser in the sports media world, Adam Breneman.
His journey from a 5-star recruit to a heart-wrenching NFL story
The challenges of building a media business (and how he did it)
What he’s doing in the NIL space
And a ton of other sports business topics you don’t want to miss
Check out the podcast episode here.
Thanks for reading.
Have a great day!
Peace,
AP