Profluence Sports by Andrew Petcash

Share this post

The Death of Individual Sports

www.petcashpost.com

The Death of Individual Sports

We're slowly seeing the end of individual sports and the rise of team sports, so what's next?

Andrew Petcash
Nov 4, 2022
31
4
Share this post

The Death of Individual Sports

www.petcashpost.com

There’s a major problem with individual sports…

They leave a few athletes extremely wealthy (and many struggling to make ends meet).

We all know Serena Williams, but what about the 50th-best women’s tennis player?

Unless you’re the best of the best, individual sports can be a tough profession.

We’re seeing the model of individual sports shift right from under our feet.

Let’s Dive In 👇

Everything is becoming a team sport

Why?

More guaranteed money, a tribe, coordination, sponsorship money, etc.

But the biggest reason…

The ability to “own” a team — hence creating another investment vehicle.

Pickleball is the perfect example.

It could be set up the same as tennis, but both the MLP and PPA decided on a team format.

Mavs' Mark Cuban announced as first team owner in VIBE Pickleball league
Mark Cuban bought a PPA pickleball team yesterday

The first round of MLP teams cost $1M — which several pro athletes bought into (Brees, Brady, Durant, Lebron, etc).

I’m a big fan of the team concept…

Looking back to the business of boxing article, the disparity between the top fighters and the bottom is insane.

Only 22% of boxers make over $10,000/year and only 4% make over $200,000.

You can see why “real" boxers get pissed when a YouTuber like Jake Paul comes along and is pulling $5-10M a fight (and uses the opportunity to promote his sports betting company Betr).

But don’t hate the player, hate the game. Jake Paul is a genius marketer, businessman, and apparently a decent fighter.

If you look at the difference between the top NBA players and their teammates — it’s not as wide.

Miami Heat 2022-2023 Salaries:

View All NBA Team Salaries Here

And what’s wild…

Most teams’ rosters look like this — a few high-end players, a handful of key contributors, and a sprinkle of role players.

So where are we headed?

The team model is in. The individual model is out.

And it’s quite ironic if you think about…

From the tech side of the equation, it’s become all about taking care of the athlete and the creator, not the team or the brand.

Yet sports are shifting to a team model, which is actually more beneficial for individual athletes:

  • Increase in money for athletes (guaranteed contracts, sponsorship money, and the ability to monetize themselves through an app or platform)

  • More investment opportunities for retail/institutions (ability to buy teams in a sport like golf that never had teams before, or to even buy an athlete’s potential)

Let’s take a sneak peek at LIV Golf’s team format.

LIV Golf is Banking on The Team Format

Sports Illustrated came out with a piece that said LIV Golf spent $784M during their first season with almost no revenue to show for it.

For reference, the NBA did over $10B in revenue with a couple of billion dollars in profit after expenses.

And it’s looking like next year is going to cost LIV Golf over $1 billion.

LIV Golf's season is over, but the question remains: Do you care?

They NEED to get a major broadcast deal (or risk some serious problems).

According to LIV, they have a saving grace…

The team format.

LIV Golf has pointed to the use of a team format as its way to profitability, with the plan being to sell off the teams as franchises.

Team captains have equity stakes in their teams and the players also share the profits.

Makes sense…

But what does this look like?

LIV Golf team names, explained: Breaking down meanings, logos for Cleeks,  Niblicks and more | Sporting News

Teams earn a small amount of the tournament prize purse, with just $5M of the $25M pots going to the teams.

The economics are shaky, but one thing is true nonetheless…

LIV Golf has put a massive strain on the current market leader: The PGA Tour.

A New Way To Do Things

LIV Golf is challenging the traditional notion that:

  1. players can only earn through performance

  2. that the league owns all of the media rights

Greg Norman is saying players on the PGA Tour are independent contractors — which is why they are using the team model we see in traditional sports as the basis for locking players into contracts.

It’s also exposing a major flaw in the current system…

The top players are massively undervalued.

No matter how it all plays out, the extra media attention is great for the game and companies building in the space.

Just like any other league, 20% of athletes will carry 80% of the league’s success.

In today’s age, fans are becoming less localized and more on the side of players. This is in large part to social media.

Before social media, you had to actually go see players in person (practice, training camp, games, events, etc).

But nowadays, you can personally interact with athletes on social media or watch HBO’s Hard Knocks and become a fan of a player (no matter what team they play on).

Detroit Lions Hard Knocks news: HBO Max to stream episodes 'around the same  time' as it airs - Pride Of Detroit

Whether they admit it or not, people for the most part go to watch players.

Why do you think the US Open was sold out with record attendance?

Because of Serena Williams.

She drives the league, tournament, and game of tennis so much revenue — none of which she is entitled to unless she wins tournaments. And yes her endorsements are massive, but she could lose all of those overnight.

The team model is in and I’m ALL for it.

Athletes are worth a lot more than you think.

How high?

We’ll see.


Have a great weekend my friend!

Thanks for reading.

Peace,

AP


Here’s a briefing I wrote 6 months ago I think you’ll find interesting (as it’s related to this post):

Profluence Sports by Andrew Petcash
Athletes Take Their Millions to Venture Capital (And Why This Is Just The Start)
Not yet subscribed? Join 27,000+ others getting educated on the business of athletes, sports, and NIL — it’s free…
Read more
a year ago · 50 likes · 1 comment · Andrew Petcash
4
Share this post

The Death of Individual Sports

www.petcashpost.com
Previous
Next
4 Comments
John Balkam
Writes Win-Win-Win
Nov 4, 2022Liked by Andrew Petcash

Good stuff as always, AP

Expand full comment
Reply
1 reply by Andrew Petcash
CJ Gustafson
Writes Mostly metrics
Nov 4, 2022Liked by Andrew Petcash

Wow I’d love to be Gabe Vincent, 13th man, with that salary

Expand full comment
Reply
2 more comments…
TopNewCommunity

No posts

Ready for more?

© 2023 Andrew Petcash
Privacy ∙ Terms ∙ Collection notice
Start WritingGet the app
Substack is the home for great writing