Record-Breaking Plays: The Unprecedented Surge in Sports M&A
Oaklins Q1 2025 Report Shows How Private Equity is Transforming the Sports Landscape
Hello sports tech enthusiast! šš¼ Welcome to Regen Sports, your twice-weekly deep dive into the intersection of sports and technology. Every Monday, catch up on the week's most important developments in sports innovation, and every Thursday, explore in-depth analysis of trends, companies, and technological breakthroughs reshaping the future of sports.
Best believe Iām diving into yet another report, this time from the global M&A advisory firm Oaklins', with their Q1 2025 sports newsletter, which reveals some fascinating trends in the business side of sports. If you thought the action was exciting on the field last year, wait until you see what happened in boardrooms across the industry. šø
The Sports M&A Boom: A Record-Shattering Year
2024 was nothing short of historic for the sports business world, with M&A (mergers & acquisitions) activity reaching unprecedented heights. The numbers tell a compelling story:
410 total transactions completed (a staggering 44% increase from 2023)
Private equity deals nearly doubled from 96 in 2023 to 190 in 2024
45% of all transactions were private equity platform investments
This surge wasn't just about quantityāthe quality and diversity of deals demonstrate a fundamental shift in how investors view sports assets.
Private Equity: The New Power Players in Sports
The unprecedented surge in sports M&A activity during 2024 was largely fuelled by private equity's growing appetite for sports assets. This wasn't just a minor uptick - private equity investments nearly doubled year-over-year, jumping from 96 deals in 2023 to a staggering 190 in 2024. š
To put this in perspective, nearly half (45%) of all sports transactions last year involved private equity platform investments. That means almost one in two deals had a PE firm establishing or expanding their foothold in the sports world - and this figure doesn't even include additional acquisitions made by companies already backed by private equity.
What's driving this intense interest you ask?
For starters, sports assets offer something increasingly rare in today's volatile market: predictable, recession-resistant revenue streams. When a PE firm looks at a sports property, they're seeing multi-year media contracts, loyal fan bases, and brand licensing opportunities that provide stability even during economic downturns.
The investment targets reveal an interesting strategy. While traditional powerhouse sports like soccer and American football saw significant activity (with deals like Ares Management's investment in the Miami Dolphins, the first in the NFLs history), PE firms are increasingly betting on emerging sports. Padel and pickleball, for instance, received substantial backing as investors looked to capitalise on these rapidly growing activities before they hit mainstream status.
Beyond direct team ownership, private equity is reshaping sports technology ecosystems. Digital solutions that enhance fan engagement have become particularly attractive investment targets, with firms like Tiga Investments acquiring Dream Sports to capitalise on the intersection of tech and fandom.
Looking ahead to 2025, all signals point to continued strong interest from private equity. With substantial capital still waiting to be deployed and a robust pipeline of premium sports businesses expected to come to market, private equity's influence in reshaping sports ownership is expanding to new territories. And with the National Football League (NFL) now accepting investment from PE firms - a decision only made official a couple months ago, it signals a significant policy shift that follows the path of peer leagues like Major League Baseball and the National Basketball Association, which began allowing PE investments back in 2019. This opening of America's most valuable sports league to institutional investors signals that private equity's role in sports finance is becoming firmly established across all major sporting properties.
Fan Engagement: The Fuel Behind Sports' Financial Boom
Shouldnāt come as a surprise that fan engagement emerged as a critical driver behind the record-breaking M&A activity we witnessed in 2024, transforming from a mere marketing metric into a fundamental valuation factor for sports businesses.
What's changed?
Today's sports investors aren't just buying teams or leaguesāthey're acquiring direct relationships with passionate communities. This shift in perspective has fundamentally altered how acquirers value sports properties and where they're placing their bets.
The modern sports fan experience extends far beyond game day. Year-round engagement across multiple platforms has created new revenue streams that didn't exist a decade ago. Teams and leagues with robust digital ecosystems connecting them directly to fans are commanding premium valuations, as these relationships represent predictable, recurring revenue opportunities through merchandising, content subscriptions, and personalised experiences.
This evolution explains why sports teams and leagues have become increasingly attractive targets for investment. Their stable revenue streams from brand rights and media deals are now supplemented by direct-to-consumer business models that bypass traditional intermediaries. A team with a million highly engaged fans represents not just ticket sales, but a million potential subscribers, merchandise buyers, and betting participants.
The tech sector has recognised this opportunity, with significant investments flowing into digital platforms designed specifically to deepen fan connections. From innovative sports gaming experiences to personalised content delivery systems, technology companies are racing to create the tools that will define the next generation of fan engagement. These investments aren't merely about enhancing the viewing experienceāthey're about transforming passive spectators into active participants in the sports ecosystem.
What's particularly notable is how this trend crosses traditional boundaries. While established leagues continue to benefit from their massive fan bases, emerging sports are using digital engagement to accelerate growth and attract new audiences. The success of these strategies is evident in the valuation multiples we're seeing for properties with strong digital fan connections.
Looking ahead to 2025, analysts expect fan engagement to remain a cornerstone of investment decisions in the sports sector. As traditional media models continue to evolve and direct-to-consumer relationships become even more valuable, the ability to cultivate, measure, and monetise fan engagement will likely determine which sports properties command premium valuations in the acquisition market. If you want to know more about fan engagement and monetisation in sports for 2025, I broke down a report by Stats Perform and OptaAI that you can find here.
Sports Technology: The Digital Revolution Changing the Game
The rise of sports technology has emerged as perhaps the most transformative force driving the M&A boom of 2024, reshaping how sports are played, consumed, and monetised in fundamental ways.
The numbers tell a gripping story: the sports media and technology sector alone accounted for a remarkable 39% of all cross-border deals last year. This isn't just about isolated innovationsāit's about a comprehensive digital transformation touching every aspect of the sports ecosystem.
What makes sports technology such an attractive investment target?
Unlike traditional sports assets with limited scalability, tech platforms can expand globally with relatively minimal incremental costs. An app that enhances fan engagement or a platform that streamlines facility bookings can scale from thousands to millions of users without proportional cost increasesācreating the kind of margin expansion that investors crave.
The diversity of deals in 2024 illustrates just how wide-ranging the sports tech revolution has become:
Betting and Gaming: DraftKings' acquisition of Simplebet and Allwyn's purchase of Logflex MT highlight the massive opportunities in the regulated sports betting market
Fan Engagement Tools: Brave Bison acquired Engage Digital Partners to enhance live video distribution and monetisation capabilities
Sports Management Platforms: Five Elms Capital invested in 360Player, addressing the growing demand for comprehensive team and league management solutions
Fitness Technology: EQT Ventures' investment in Gympass and funding rounds for PushPress and Gymdesk signal confidence in digital fitness solutions
Data and Analytics: Hudl's acquisition of StatsBomb represents the growing importance of advanced analytics in performance improvement
Stadium Innovation: SkyView Innovations acquired OMM Technology to expand digital marketing capabilities for sports venues
Broadcast Enhancement: TGI Sport's acquisition of Supponor for digital billboard replacement technology demonstrates how tech is transforming the viewer experience
What's particularly notable is how these technologies are increasingly interconnected. The modern sports tech stack creates virtuous cycles where better fan engagement drives increased betting activity, which generates more data, which enhances broadcast experiences, which attracts more fansācreating multiple revenue streams from the same sporting event.
What this surge in sports tech M&A also reveals is an industry embracing digital transformation out of necessity, not just opportunity. As younger fans consume sports in fundamentally different ways than previous generations, technology investments have become essential for capturing and monetising audience attention in an increasingly fragmented media landscape.
With venture capital and private equity firms increasingly viewing sports tech as a distinct investment category rather than a niche subset of either sports or technology, we can expect this trend to accelerate in 2025. The companies developing solutions that bridge the physical and digital sports experience will likely continue commanding premium valuations in the M&A market.
Market Stability Return: Reliable Valuations Signal Investor Confidence
After years of post-pandemic volatility that saw wildly fluctuating valuations and uncertain market conditions, 2024 marked a welcome return to stability for publicly traded sports companies. Despite some market turbulence in early 2024, sports-related businesses demonstrated remarkable resilience, suggesting that investors have regained confidence in the sector's long-term fundamentals.
This stability is most clearly reflected in the consistent trading multiples across different segments of the sports industry. Sports apparel and equipment brands settled at valuations of approximately 10.0x EV/EBITDA (Enterprise Value to Earnings Before Interest, Taxes, Depreciation, and Amortisation). In simple terms, this means investors were willing to pay about 10 times a company's annual earnings for businesses in this categoryāa premium that reflects expectations of steady growth but isn't inflated by speculative exuberance. (Think of it as paying $10 for every $1 a company earns in a year - which indicates investors expect significant future growth to justify such premiums.)
Meanwhile, sports retail businesses stabilised at around 6.0x EV/EBITDA. This lower multiple compared to apparel brands makes sense given retail's typically thinner margins and greater susceptibility to economic headwinds. To put this in everyday language: if a sports retail chain generated $10 million in annual earnings, investors were valuing the entire business at about $60 million. This represents a return to rational pricing based on actual business performance rather than pandemic-driven disruptions or overhyped growth projections.
What makes this stability particularly significant is that it occurred despite broader market uncertainty. While many sectors experienced significant valuation swings throughout 2024, sports businesses maintained relatively steady multiples, suggesting that investors view these assets as having dependable cash flows regardless of short-term economic conditions.
This newfound stability also helped facilitate the record M&A activity we've discussed. When buyers and sellers can agree on reasonable valuation expectations based on consistent market benchmarks, deals are much more likely to close successfully. The days of pandemic-related discounts and premiums appear to be behind us, replaced by a more mature market where prices reflect fundamental business value.
For sports business operators and potential market entrants, this stability provides a clearer roadmap for strategic planning. Companies can make investments with greater confidence that the market will reward successful execution at predictable valuation levels, rather than being subject to the extreme sentiment swings that characterised the immediate post-pandemic period.
Looking ahead to 2025, this return to market stability suggests we've entered a more sustainable phase for sports business valuationsāone where performance matters more than narrative, and where consistent execution is likely to be rewarded more than speculative promises.
Final Thoughts
The unprecedented surge in sports M&A activity reflects a fundamental transformation in how the industry is valued and operated. Private equity's growing influence is reshaping everything from ownership structures to revenue models, while technology continues to blur the lines between sports, media, and entertainment.
What's particularly striking is how this transformation extends far beyond traditional powerhouse sports. While soccer and American football saw significant activity, the growth in niche sports suggests investors see untapped potential across the entire sports landscape.
For sports technology companies and startups, this environment creates unprecedented opportunities to access capital and strategic partnerships. The question isn't whether investment will continue flowing into sportsāit's how that investment will reshape the fan experience and business models across the industry.
You can find the full report from Oaklins here.
I'll see you in your inbox on Monday with our regular weekly recap of all sports tech developments and news.
Track the Trends. Spot the plays. Shape the game.
Thanks for reading,
Dean
P.S. If you found this newsletter valuable, please share it with colleagues who might benefit from these insights. The sports tech industry grows stronger when we learn together.