Insider Today: Sports investing takes off

Bullish BlackRock, and the perks of nostalgia.

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January 30, 2024 • 5 min read with Dan DeFrancesco Hi there! Trying to feed a family of six on $100 a week sounds like a game show, but this personal trainer does it. Here’s their shopping list at Costco. In today’s big story, we’re looking at the red-hot world of sports investing, with one glaring exception. What's on deck Markets: BlackRock is all-in on US stocks. Tech: Spotify’s new audiobook business has caught the attention of one rival CEO. Business: Don’t worry about watching those reruns of “The Office.” Nostalgia is actually good for you. But first, it’s more than just a game.

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Keyur Khamar/PGA TOUR via Getty Images The big story Sports! Tired: You play to win the game. Wired: You play for a return on your investment. A group of high-profile investors, including billionaires Marc Lasry and Steve Cohen, could reportedly pour as much as $3 billion into the PGA Tour, Business Insider’s Aaron Mok writes.  Fenway Sports Group — which counts LeBron James as a partner — Arthur Blank, Home Depot’s cofounder and the owner of the NFL’s Atlanta Falcons; and Gerry Cardinale, a former Goldman Sachs’ banker who’s become a top dealmaker in sports, are also involved in the proposed deal. It’s an example of how sports and their adjacent businesses have become a red-hot industry to invest in for the uber-wealthy.  Lasry and Cohen are prime examples of the intersection of Wall Street and sports. Lasry, who runs private-equity firm Avenue Capital Group, previously had a stake in the Milwaukee Bucks. Meanwhile, Cohen’s ownership of the New York Mets helped evolve his image beyond being the cutthroat hedge fund boss of Point72. PE firms have grown increasingly interested in cutting deals in sports. From the rise of legalized gambling to being an industry full of live, unscripted content, investors see plenty of opportunities in the space. And banks are happy to help facilitate deals. But it’s not just team ownership that’s hot. The startup ecosystem for sports has also exploded, with plenty of venture firms keying into the market. Patrick Smith/Getty Images; iStock; BI But the ultimate prize in sports is untouchable for all but a select few. The NFL, the most popular league in the US by a long shot, has strict ownership rules against PE firms investing. It also requires the lead investor of a group to pay for at least a 30% stake in the team.  That kind of exclusivity comes with downsides. A limited pool of potential owners equals less competition, meaning owners looking to sell might not get the best deal possible.  That realization seems to have set in after the recent sale of two teams — the Denver Broncos and the Washington Commanders. The NFL is re-examining its ownership rules, according to a September report from the Washington Post.  Potential changes to team ownership come as the NFL’s popularity is at an all-time high. Peacock reportedly nabbed 2.8 million new subscribers after primarily streaming an NFL playoff game on the platform.  This year’s Super Bowl is also shaping up to be big. The average ticket for the game has ballooned up to $11,000. The location (Las Vegas) and participating teams (Kansas City Chiefs and San Francisco 49ers) have played a part. And a certain megastar’s likely attendance at the game will drive even more eyeballs. Of course, sports ownership isn’t all fun and games. Just ask hedge fund billionaire David Tepper, whose tenure owning the NFL’s Carolina Panthers has been less than ideal.

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3 things in

Markets 🔔 Before the opening bell: US stock futures fall early Tuesday ahead of Big Tech earnings and the FOMC's two-day policy meeting.  Goldman Sachs 1. Jim Esposito is leaving Goldman Sachs after nearly 30 years. The co-head of the bank’s global banking and markets division is retiring. We’ve got the full internal memo announcing the news. While he didn’t share his next move, he told peers he’d “bleed Goldman Sachs forever." 2. BlackRock makes a bullish call on US stocks. The world’s largest asset manager issued a double-upgrade for US stocks to “overweight” as the chance of avoiding a recession increases. "We expect the rally to broaden,” BlackRock market strategist Jean Boivin said. 3. Goldman Sachs says rate cuts need to be on the menu in March. David Mericle, the bank’s chief US economist, said the Fed delaying cuts beyond March could negatively impact the labor market. Meanwhile, market watchers are now almost evenly split on whether the Fed will lower interest rates in March, according to the CME FedWatch Tool.

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Tech NurPhoto/Getty Images 1. Amazon’s Audible CEO dishes on rivalry in leaked recording. The CEO told employees in an all-hands meeting this week that "it's hard to ignore what Spotify's doing,” referring to the company’s recent launch of free audiobooks for premium subscribers.  2. It’s a bad time for Apple to be at odds with app developers. Apple needs developers on its side this week as it launches its Vision Pro. But the company’s recent App Store changes have angered the very people it needs most. 3. That didn’t take long: AI spam is already ruining the internet. Scammers are using the tech to churn out web pages and YouTube videos, and scrape media websites. Garbage results are flooding Google — and that’s bad news for the search engine.

3 things in

Business 4x6/Getty, shaunl/Getty, Javier Zayas Photography/Getty, Kevin Winter/Getty, Tyler Le/BI 1. Nostalgia is a good thing, actually. Critics have dismissed nostalgia as antithetical to progress — that instead of focusing on the past, we must always look forward. A growing body of research, however, shows that nostalgia promotes progress and encourages feelings of hope. 2. Entertainment studios are once again licensing shows to Netflix. Studios like HBO and Disney are licensing hit shows like "Sex and the City" and "Grey's Anatomy” to the streamer after a period of keeping the titles to themselves. While studios may benefit from licensing, some insiders worry it could ultimately make Netflix more dominant. 3. Walmart store managers are set to get up to $20,000 in stock every year. The amount of the grant will depend on the store’s size, with managers of smaller stores earning $10,000. The stock will push some workers’ total compensation to more than $500,000.

In other news Drone that killed US troops in attack slipped past defenses because there was confusion on whether or not it was American: reports. Elon Musk claims the first human patient has received a Neuralink brain implant. Unemployment will double by the end of the year with an economic hard landing inevitable, strategist says. TikTok's AI suggested searches are pushing sensational narratives and 'frustrating' content creators. Why the stock market will avoid a bearish 'trifecta' and continue surging to record highs. A TikToker apologizes for slamming a Gen Z worker who skipped an 8 a.m. meeting for a fitness class.

What's happening today Today’s earnings: Microsoft, Alphabet, and other companies are reporting today.

The Insider Today team Dan DeFrancesco, deputy editor and anchor, in New York. Hallam Bullock, editor, in London. Jordan Parker Erb, editor, in New York. Get in touch insidertoday@insider.com To read unlimited articles, subscribe to Business Insider. Download the Insider app Email sent to: vitor@idiot.cloudns.cc Manage your email preferences | Unsubscribe | Terms of service | Privacy policy | Advertise with us © 2024 Insider Inc. 1 Liberty Plaza, New York, NY 10006