Over the past two decades, the value of North American sports franchises has increased. The NFL, NBA and MLB teams have seen assessments rising almost 1,000% according to Forbes data.
Baltimore Ravens, for example, were purchased for $ 600 million in 2004 and are now estimated at more than $ 6 billion, According to CNBC NFL assessments.
Despite this massive growth, most teams remain private, generally transmitted through generations of ultra-rich families. For many owners, these franchises are not only companies; These are cultural assets, symbols of status and influence tools.
Becoming public could offer liquidity and access to new capital, but it is also delivered with compromises. Public companies face tighter regulations, shareholders’ pressure and financial transparency. There is also the risk of tension In Try to keep the shareholders and happy fans. The owners are also faced with the potential of losing control: the sale of actions means abandoning the decision -making power.
Green Bay Packers are a unique non -profit team in public whose actions serve more memories of fans than financial assets. Most sports franchises follow a corporate property model; MSG Sports, for example, has the New York Knicks of the NBA, while Rogers Communications holds major participations in several Canadian teams such as the Toronto Blue Jays. On the other hand, the Braves of Atlanta became a team only listed on the stock market in 2023 after having separated from its former parent company, Liberty Media.
Instead, many teams are turning to investment capital and other alternative financing strategies. Companies are now authorized to acquire minority holdings, generally between 10% and 30%, in professional teams. Owner of Kansas City chiefs Clark Hunt called it “a great new source of capital”.
Some owners completely bypass the investment capital, by choosing rather to work with sports investment bankers such as Salvatore Galatioto, who connects them with rich people or limited partners ready to pay a premium for exclusivity and less control.
However, investment capital companies generally expect a possible exit, often via a sale or an IPO. This expectation could push more teams to consider becoming public over time. But for the moment, the leagues remain cautious. They are concerned about the disruptions that public property could cause, ranging from financial disclosure sensitive to more strict labor negotiations.
Watch the video above To find out more about the reasons why most professional sports teams remain private.