Family offices: over 75 billion invested in sport across clubs, media and tech
Research by Goldman Sachs shows that one in four family offices has already invested in sports assets or related activities, such as ticketing, infrastructure and facilities, whilst a further 25 per cent are considering entering the sector.
From a niche investment to a structural component of asset allocation. In the world of high net worth individuals, sport is undergoing a transformation similar to the one already seen with private equity or venture capital. The rise in the value of franchises, the growth in revenue from television rights and the expansion of the sports-tech ecosystem are driving family offices to increase their exposure to the sector. Today, a quarter of these firms have already invested in the sector and another quarter say they are interested in doing so, whilst family offices with roots in sport and the media manage a combined total of over 75 billion dollars.
Trend data
The figures paint a picture of a well-established trend. According to Fintrx, a firm specialising in private wealth analysis, around 3% of the global family office sector has built its wealth in the sports and media sectors, with a total value of 75 billion dollars. This segment is still relatively small in numerical terms, but is characterised by substantial assets and a strong propensity for alternative investments.
Interest in the sector, however, extends far beyond first-generation family offices linked to sport. Research by Goldman Sachs shows that 25 per cent of family offices have already invested in sports assets or related activities, such as ticketing, infrastructure and facilities, whilst a further 25 per cent are considering entering the sector. This growing interest is fuelled by the prospect of achieving returns that are not directly linked to the performance of traditional markets and of benefiting from effective inflation hedging thanks to the structural growth in the sports industry’s revenues.
The investment profile of these entities confirms their focus on private assets. Globally, over 78 per cent of family offices invest in private equity, 71 per cent make direct investments in companies and 60 per cent hold real estate. In the case of family offices that have built their wealth in sport and the media, this specialisation is even more pronounced: 90 per cent invest in private equity, 88 per cent make direct investments, 72 per cent are active in venture capital and 70 per cent in property. Only 44 per cent maintain a predominantly long-only strategy in listed markets.
The geographical distribution of the phenomenon also appears to be well defined. 83% of family offices whose wealth originates from sport and the media are based in North America, whilst 15% operate in Europe. Asset sizes are often substantial: the most common bracket is that with assets of between 2 and 5 billion dollars, followed by the 50 to 100 million bracket.
