How to Buy an NFL Team Like a Private Equity Pro

Hi, it’s Randall Williams in New York, and let’s be honest, for most of us, owning an NFL team feels like a pipe dream, right up there with colonizing Mars. But what if I told you that the path to a piece of that coveted football empire is becoming increasingly accessible, not through a lottery win, but with a little help from the shrewd minds of private equity? It’s not about writing a check for billions, but rather understanding how the big money operates, and the NFL, once famously insular, is slowly but surely opening its doors to new capital structures.

For decades, NFL ownership was largely a family affair or the domain of ultra-wealthy individuals buying teams outright. Think of it: a finite number of franchises, immense prestige, and soaring valuations driven by massive media rights deals and fan engagement. A team like the Washington Commanders recently fetched a staggering $6.05 billion, a sum that few individuals can muster without significantly diversifying their assets. This is precisely where private equity steps in. While the NFL still caps institutional ownership at just 30% of a team, with a single general partner needing to hold at least 1%, and strict rules about debt and control, it's a significant shift from the zero-tolerance policy of the past. For a private equity firm, buying into an NFL team isn't just about the cash flow, although that’s certainly appealing; it’s about a long-term bet on the continued growth of a media behemoth, and the opportunity to apply operational expertise to a very unique asset class. They're looking for value creation, perhaps through stadium development, improved merchandising, or leveraging new tech, just as they would with any other portfolio company.

Meanwhile, far from the gridiron, another high-stakes game is playing out in the world of fintech. Remember Klarna? The Swedish buy-now-pay-later (BNPL) giant was once valued at a mind-boggling $45.6 billion in mid-2021, a poster child for the pandemic-fueled tech boom. Then came the market correction, rising interest rates, and a healthy dose of reality, sending its valuation plummeting to a mere $6.7 billion by mid-2022. It was a stark reminder that even the hottest growth stories need a sustainable business model. But here’s the interesting part: Klarna is now back on the road to its IPO, reportedly eyeing a listing in the U.S. as early as this year. What’s changed? A renewed focus on profitability, tighter lending standards, and a more disciplined approach to growth. The company reported its first quarterly profit in four years at the end of 2023, a critical milestone that investors are now demanding from tech companies. The narrative has shifted from "growth at all costs" to "sustainable, profitable growth," and Klarna seems to be listening, positioning itself for a warmer reception in a more discerning market.

Speaking of market dynamics and strategic shifts, you can't talk about dealmaking without mentioning Sir Martin Sorrell. The founder of WPP, the world's largest advertising company, is still very much in the game with his new venture, S4 Capital. Sorrell, ever the disruptor, built S4 Capital on a "pure play" digital-first model, focusing on content, data, and programmatic advertising, aiming to be nimble and unburdened by the legacy structures of traditional agencies. He’s always been a dealmaker, and despite some recent headwinds for S4 Capital – including a challenging advertising market and some internal restructuring – he remains relentlessly acquisitive. His strategy is clear: acquire best-in-class digital capabilities globally to serve a select group of major clients. We’ve seen him snap up agencies specializing in everything from influencer marketing to AI-driven content generation. For Sorrell, it’s not just about buying companies; it’s about assembling an ecosystem that can deliver integrated, modern marketing solutions at speed, continuing his lifelong quest to stay ahead of the curve in an industry constantly reinventing itself. He’s certainly not resting on his laurels, and his moves continue to be closely watched by anyone in the media and marketing space.