By Guillermo Goñi*
In recent years, private capital funds (PE) have substantially increase their participation in professional sports leagues. Its role has been decisive in the transformation of various teams, both in the composition of its shareholders and in its sports direction and economic assessment.
This phenomenon has been promoted by the financial attraction that many professional sports represent, which have large sources of income, mainly from the transmission rights, either television or by platforms of streamingas well as the growth of the sports betting market.
An example of this is the recent sale agreement of the most important basketball team in Los Angeles, California, in the professional league of that sport in the United States, which has made this organization the most valuable sports franchise worldwide. This reflects the growing interest of PE funds to invest in this industry.
How is this change in the different sports leagues and what are the implications in the future? Next, we explore some of the benefits and challenges:
1. Expansion of private investment in sport
PE funds have found a fertile land for investment in professional sport, thanks to the increase in the valuation of teams and multimedia rights agreements, which ensure long -term sustainable income.
Although historically the property of the equipment lay in capitals of local origin in each city, there is currently a growing participation of new actors, as with the PE funds. Proof of this is that various professional leagues, such as the aforementioned case of basketball or the Professional Football League, have modified their internal regulations to allow greater control of PE funds on the shareholding of the teams.
Thus, about 40% of the teams in the main professional leagues and 33.3% in the Basketball League have at least one fund of Pe. (1)
2. Reasons for the high profitability of sports investments
Although an important part of the income comes from multimedia rights, organizations have other recurring financing sources, such as the sale of tickets, sponsorships and the trade of promotional items. These areas also represent growth opportunities that are attractive to investors.
In this sense, a central advantage of the participation of PE signatures in the sports industry is the potential to increase income and improve profitability. Through their experience in finance, management and marketing, these actors offer professional teams and leagues the ability to optimize their operations, expand their fans and diversify their sources of income.
A key element in the growth of this industry has been evolution in multimedia consumption habits. As the world has traveled towards models on demand and services of streamingsporting events have positioned themselves as one of the preferred formats for live entertainment.
Likewise, the growth of the online betting market and the development of associated real estate projects are contributing even more to the financial attraction of the sports industry.
3. Impact on the valuations of the equipment and the media market
Multimedia rights agreements have played a crucial role to boost the value of sports teams. Recently, the main professional basketball league in the US signed a new contract, valued by 77,000 million dollars, which has significantly increased its income.
Undoubtedly, this agreement has been a determining factor in the sale of the most important basketball team in Los Angeles, California, and has increased its value to 10,000 million dollars. In fact, growth has been so significant that it has exceeded the performance of S&P 500 during the last two decades.
For example, while this index has experienced a growth of 687.3% since 2002, the main sports leagues have exceeded this brand. In the case of the Professional Basketball League in the US, returns of up to 2,088.9%are estimated, a performance that has made this industry an attractive option for investors seeking profitability, diversification and low correlation against traditional financial markets. (2)
4. Risks and opportunities in the integration of PE
Although PE entry offers clear opportunities to capitalize on the growth and expansion of the equipment, it also implies certain risks, such as the possible excessive marketing of the brand, which could lead to the exhaustion of the product, as well as the need to prioritize short -term benefits above the long -term sustainability of the sports team.
In this regard, one of the pending challenges is to clearly define how these new owners will address their eventual departure from investments. In some cases there have been relocations of sports franchises towards areas with greater population density, with the aim of increasing their sources of income; However, these measures oriented to corporate performance usually neglect the emotional bond that unites hobbies with their equipment.
The above highlights the need for PE signatures to review their divestment strategies carefully, in order to guarantee the integrity of the sports brands that are disconnected.
In conclusion, the irruption of PE funds in professional sports leagues is transforming the industry, expanding access to capital and increasing the valuations of the equipment. In short, the ability of these actors to provide liquidity and support sustainable economic growth offers a solid platform for the future development of professional sports.
To take advantage of the opportunities that this phenomenon presents, having the advice of specialists can help maximize long -term value, ensuring that investments in the sports industry remain attractive and profitable.
About the author:
*Guillermo Goñi is a partner of Deal Advisory & Strategy of KPMG Mexico.
The opinions expressed are only the responsibility of their authors and are completely independent of the position and the editorial line of Forbes Mexico.
Note: The ideas and opinions expressed in this letter are those who sign the article and do not necessarily represent the ideas and opinions of KPMG Mexico.
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(1) Major league investors: Private equity’s pro sports tiesPitchBook, 2025.
(2) Private Capital in Sports: PE Is Up to BatPitchBook, 2025.
