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Athletes and SPVs: How Sports Icons Invest Wisely

Sunday, October 1, 2023
Written by Adisa Hidic
Industry News
Athletes and SPVs: How Sports Icons Invest Wisely

The world of sports boasts a multi-billion-dollar industry, captivating millions of fans worldwide. Athletes who excel in popular sports often ascend to the status of new-age celebrities, securing multimillion-dollar incomes and lucrative endorsement deals with global brands like Nike and Adidas. Savvy athletes and their managers know that partnering with companies at early stages to leverage celebrity influence can yield incredible returns.

Athletes are increasingly turning their attention to investments in various business ventures to diversify income off the field or court. These investments offer a way to cohesively and lucratively build a company around the athlete’s brand, and these deals are almost always done through SPVs.

Early Bird Gets the Worm - Startups:

Early stage companies offer a unique position for athletes because they have the opportunity to own stock in the company early and directly participate in the growth. These offer some of the greatest returns of any asset class.

Because each deal is unique to the brand of the athletes, these are structured as one-off investments via Special Purpose Vehicles. SPVs offer a way for multiple athletes to invest as one entity, pooling capital and resources, and for there to be one reporting source like Venture360 to track the information and report changes.

These structures are quick to spin up and easy to manage going forward making them ideal.

Startups offer exciting business prospects, often at a lower initial investment compared to established brands. A prime example is Michael Jordan's annual earnings of approximately $400 million from his partnership with Nike are a testament to the immense impact he has had on the brand's success. This collaboration is more than just a business deal; it's a true partnership that has helped propel Nike to the pinnacle of the sports apparel industry. Jordan's influence extends far beyond the basketball court, and his endorsement has become synonymous with excellence and achievement. It's a remarkable example of how the right partnership can lead to success in the world of sports and marketing.

Always Know Where Your Money is Going:

While managers and agents source, structure and facilitate these investments among clients, it is crucial for the athlete to have a way to view and track where their money is going. Venture360’s investor portal offers both a way for managers to keep up with their client account and for their clients to directly login and review the holdings. It’s this level of service and attention to detail that makes Venture360 the preferred partner in the market.

Established Brands:

Another avenue that athletes explore is investing in well-established brands known for their solid reputations. While this path may yield lower profit percentages compared to startups, it offers a more stable and reliable investment opportunity. This strategic investment not only ensures consistent returns but also diversified income streams beyond the realm of sports.

In the ever-evolving landscape of sports and finance, athletes are proving that their prowess extends beyond the playing field. By venturing into the world of business and investment, they are securing their financial futures and building legacies that transcend their athletic achievements.

Utilizing Technology with Investments:

Data and technology is not an essential anymore, but a necessity to those investing, athletes, celebrities, or any private investor. Historically, private assets were shrouded in mystery, lacking structured data tracking. However, this is rapidly changing. Venture360 is a prime example. The ability to seamlessly track investments on a platform along with reporting measures is the due diligence necessary to understand your investment. The evolution of private investing is inextricably linked to technological advancements. Social media fostered transparency, standardized deal structures reduced friction, the VC Tech Stack enhanced operational efficiency, and data-driven insights are poised to revolutionize the industry. Technology, while transformative, remains a tool to empower investors to make smarter, more informed investment decisions.