The landscape of ownership in women’s soccer is rapidly changing, with private equity firms now playing a significant role in the industry. Unlike other major U.S. sports leagues, such as Major League Soccer, the National Basketball Association, Major League Baseball, and the National Hockey League, which have only allowed private equity investors to hold passive, minority stakes, the National Women’s Soccer League has taken a different approach by permitting these firms to take majority control of the economics of teams. This shift in ownership marks a substantial departure from traditional ownership structures in women’s sports and suggests a new era of investment and growth.
One of the first private equity firms to make a significant investment in women’s soccer was Sixth Street, which acquired the San Francisco women’s team, Bay FC, for a record $54 million. This move set a precedent for other firms to follow suit, with Carlyle recently partnering with the Seattle Sounders FC to purchase the Reign FC for $58 million. These high-value transactions highlight the growing interest in women’s soccer among institutional investors and the potential for substantial returns in the industry.
The influx of private equity investment has had a positive impact on women’s soccer revenue, with elite sports revenue projected to surpass the billion-dollar mark for the first time. Soccer accounts for roughly half of this figure, indicating the significant contribution of the sport to overall revenue generation. While women’s sports revenue traditionally comes from merchandising sales, ticket sales, partnerships, and sponsorships, the recent $240 million media deal signed by the NWSL shows the growing importance of broadcast rights in the industry. This shift in revenue sources presents new opportunities for private equity firms to capitalize on the growth potential of women’s soccer.
Challenges and Considerations
Despite the positive momentum in women’s soccer, there are challenges and considerations that come with the entry of private equity into the industry. Commissioner Berman emphasized the need for caution in navigating this new landscape, as institutional capital brings a different set of expectations and responsibilities compared to individual owners. While other major sports leagues have imposed limits on private equity ownership, the NWSL is still experimenting with the best approach to balancing investment with the preservation of the sport’s values and integrity. This ongoing debate underscores the need for transparency, accountability, and sustainable growth in women’s soccer.
As private equity interest in women’s soccer continues to grow, there are opportunities for further investment and development in the industry. The potential acquisition of Angel City FC by Disney CEO Bob Iger and his wife at a valuation of $250 million demonstrates the increasing value of women’s sports franchises and the willingness of prominent figures to invest in the sector. This trend towards higher valuations and increased interest from investors suggests a bright future for women’s soccer, with the potential for continued growth and expansion in the years to come.
The entry of private equity into women’s soccer represents a significant shift in the ownership landscape of the sport. With increasing investment, rising revenues, and new opportunities for growth, women’s soccer is poised to reach new heights in the industry. However, careful consideration must be given to the challenges and implications of private equity ownership to ensure the long-term sustainability and success of the sport. By navigating this new territory with caution and foresight, women’s soccer can continue to thrive and attract investment from a wide range of stakeholders.