If you could buy non-voting shares in an NFL team, would you?

[MightyGiants]

I know this isn't what is currently being voted on, but if it reached the point where teams could sell non-voting shares in an NFL team, would you?  What team's shares would you purchase?

Business of Football: NFL Owners Fully Embrace Private Equity Funding-
NFL owners are turning to private equity investors to raise capital, adding even more value to their franchises.



https://www.si.com/nfl/team-owners-fully-embrace-private-equity-funding

[T200]

Yes

Dallas

[MightyGiants]

I would be torn.

From what I have seen, the investment in the NFL tends to beat an investment in the stock market.  No doubt the league is currently thriving, and things like fantasy football and gambling are only stoking the success.

There are tailwinds that concern m,e though:

CTE-  Clearly a liability issue, but it is reducing the number of young people playing tackle football

Aging population-  Less talent to draw from, beyond less parents allowing the kids to play tackle football

Aging fanbase-  Younger people are less drawn to old-school sports.  We have seen sports like baseball and boxing come and go as major sports in this country.

The logistics of international expansion are extremely challenging-  Return on investment is all about growth.   The US market seems saturated, and as I said, if anything, the potential max fanbase is shrinking.  It will be more difficult to expand into other markets.   Canada would have been a natural area to expand into, but it already has its own brand of football.

[kartanoman]

I'm already investing in my Australian Football League's club, the Collingwood Magpies Football Club, and jumped at the chance to do so back in the 1990s when it was still playing second fiddle to the Rugby League.

The NFL is going to go global, no matter what, and the manner in which they expand will determine the future of the sport and its attractiveness to invest in. As far as non-voting shares in a given team, there's risk involved based on how the NFL continues to grow the game organically in this country while also dealing with global expansion.

Global expansion, at this time, means "seeding" the NFL football concept at the grass roots level, to develop generations of fans. Sending players, past and present, as "ambassadors" of the sport, to put a face to the game, provides heroes for the new fans. Bringing NFL games to countries allows them to have the "NFL experience" brought to their homeland. Who knows but, down the road, countries may stand up their own sanctioned NFL league (e.g. NFL Britain, NFL Germany, NFL Mexico, NFL Australia?). Have the champions of those respective leagues have an opportunity to play one of the American NFL teams in a true "World Champion of NFL Football."

That type of vision might be worth investing in. Technology may have to catch up to the idea so that a flight from Los Angeles to Sydney takes only four (4) hours, Concord (on steroids) style! So, this concept will not likely be viable for a few decades, but it's going to take that long, anyway, to bring other countries up to a level of support to be able to run and maintain, successfully, their own NFL on their soil.

This is what the future entails for the sport. It will have to go global or it will stagnate, at best, here in the USA. Goodell and company can only suck so much money out of Corporations, as they have out of us, before they start pushing back or rejecting them altogether. If you do not bring a value proposition to the table that is worth investing in, you might sucker a few into your scheme, initially, but the rest will catch on quickly and run away and leave you in the dust.

Whether or not to invest depends on several short-term and long-term indicators. I wouldn't, personally, because I just don't know all the indicators which drive the financials and, being on the wrong side of five-oh, with more than enough of my portfolio tied up in middle-to-high risk assets, I would view these NFL non-voting shares questionable given I'll be going more conservative in the next three to five years. Let the kids make their millions, if they can, by doing this.

All the best if any of you decide to go in and try it.

Peace!

[Doc16LT56]

Yes. I think the next 30 years will be very good to the NFL. Even the worst run franchises increase in value.

[MightyGiants]

Yes. I think the next 30 years will be very good to the NFL. Even the worst run franchises increase in value.

Which team would you invest in?

[Doc16LT56]

Which team would you invest in?

Off the top of my head, probably Dallas and/or the Giants as my blue chips. The Lions and/or Cardinals as my growth investments. I'd be betting on the revitalization of the city of Detroit and the continued growth of the sun belt.

[kartanoman]

Off the top of my head, probably Dallas and/or the Giants as my blue chips. The Lions and/or Cardinals as my growth investments. I'd be betting on the revitalization of the city of Detroit and the continued growth of the sun belt.

Revitalization of the NFL city.

Outstanding point!

I wrote about investment risk yesterday, and you can also look for risk and opportunity here as well.

Detroit is long-time football city that's working its way back. Phoenix, AZ, on the other hand, is not, but the stadium resides in the West Valley in Glendale, is currently constructing businesses, residences and food and entertainment venues all around the State Farm Stadium as I type this. The region is a hotbed for growth but football is popular but the locals are largely transplants now so there's positives and negatives with that.

This is an area worth analyzing in the next decade or so.

Peace!

[Bob In PA]

No. It sure looks like a no-brainer (for "yes") right now, which means it's a good time to offer this option.

They've been getting big ratings & did a far better job promoting the league this year than ever before.

However, I see the league at its zenith, and believe there is a "fad" aspect to many of the circumstances that have enabled them to enjoy recent success.  I would not be an investor.

Bob

PS. The average guy simply cannot afford the NFL any more, and there is no chance prices will go down any time in the foreseeable future. The fan base of what made the NFL surpass baseball over my lifetime has shrunk, and will continue to shrink.

[MightyGiants]

No. It sure looks like a no-brainer (for "yes") right now, which means it's a good time to offer this option.

They've been getting big ratings & did a far better job promoting the league this year than ever before.

However, I see the league a its zenith, and believe there is a "fad" aspect to many of the circumstances that have enabled them to enjoy their recent successes.  I would not be an investor.

Bob

PS. The average guy simply cannot afford the NFL any more, and there is no chance prices will go down any time in the foreseeable future. The fan base of what made the NFL surpass baseball over my lifetime has shrunk, and will continue to shrink.

Well thought out, Bob

I think the last part is more than a "PS"

How many current fans have fond memories of going to a game with dad or the family?   With the cost of tickets, souvenirs, and food, it simply costs too much for a family to go to games.  That will hurt the growth of the fanbase.  I guess you could argue that many fans have similar memories of watching games on TV with Dad, but kids these days are not that bored.  They are more likely to play video games, engage in social media, or watch streaming than they are to watch TV with their dad.  Plus, with more and more night games, many of the best games are out of reach for kids whose bedtimes are well before the end of the games. 

 

[T200]

Well thought out, Bob

I think the last part is more than a "PS"

How many current fans have fond memories of going to a game with dad or the family?   With the cost of tickets, souvenirs, and food, it simply costs too much for a family to go to games.  That will hurt the growth of the fanbase.  I guess you could argue that many fans have similar memories of watching games on TV with Dad, but kids these days are not that bored.  They are more likely to play video games on social media or watch streaming than they are to watch TV with their dad.  Plus, with more and more night games, many of the best games are out of reach for kids whose bedtimes are well before the end of the games.   

The NFL doesn't care about creating memories for families. They're more interested in increasing their collective value.

Great point about the streaming. I was going to bring that up in response to @Bob In PA's comment about the NFL reaching its zenith. Think about all the new broadcast rights that have been sold to streaming companies. It's a huge plus for the overseas market the NFL is trying to grow. Can't get a game on FOX in Germany? No problem... all international games will be streamed on Hulu or Netflix or Amazon Prime or Sunday Ticket via YouTube TV.

Think about how much SB halftime commercial costs have skyrocketed over the years. To your point, Rich, rising ticket and concession prices are pushing average families out of the stadium and onto the couch. Knowing this, expect streaming services to increase accordingly.

[Doc16LT56]

Revitalization of the NFL city.

Outstanding point!

I wrote about investment risk yesterday, and you can also look for risk and opportunity here as well.

Detroit is long-time football city that's working its way back. Phoenix, AZ, on the other hand, is not, but the stadium resides in the West Valley in Glendale, is currently constructing businesses, residences and food and entertainment venues all around the State Farm Stadium as I type this. The region is a hotbed for growth but football is popular but the locals are largely transplants now so there's positives and negatives with that.

This is an area worth analyzing in the next decade or so.

Peace!

Couldn't agree more!

[Bob In PA]

Think about all the new broadcast rights that have been sold to streaming companies. It's a huge plus for the overseas market the NFL is trying to grow.

Tim: Great points as usual. My thinking on this is complicated. First, the fact that, even right now, you have to have at least three or four different services to see EVERY NFL game (for example, Direct TV, Prime and at least one other) shows that even streaming might be too much for many people. I confess I hadn't fully considered world-wide expansion (and don't know much about it). So I'll admit that THAT factor should be considered, and might be a game-changer in an investment decision. Still, if given a choice of something like Bitcoin or NFL stock, I'd take the Bitcoin, even though there are some parallels between Bitcoin and the great tulip craze of the 17th century (google that if you're not familiar with it lol). Bob

[kartanoman]

However, I see the league at its zenith, and believe there is a "fad" aspect to many of the circumstances that have enabled them to enjoy recent success.  I would not be an investor.

THIS, is one of the biggest risks of all to an investor who doesn't have money to burn.

Thank you, @Bob In PA , for articulating what I was thinking but haven't really expressed.

Peace!

[Doc16LT56]

PS. The average guy simply cannot afford the NFL any more, and there is no chance prices will go down any time in the foreseeable future. The fan base of what made the NFL surpass baseball over my lifetime has shrunk, and will continue to shrink.

This is a great point. I've found the same to be true for the NBA and NHL. It's a pretty big investment for the average family to go to a game. I think MLB is the better value if you're okay with sitting in the nosebleeds, but all of the major sports seem focused more on catering to the wealthier part of the fan base.

I know this is veering off topic, but this seems to be true in so many areas of our society. Universities and hospitals are building lavish campuses while the cost of healthcare and higher education continues to skyrocket. The little guy is being left behind in so many areas of our society. Not sure where to go with this. Just an observation/complaint.