The Era of M(B)illionare Owned Meets?

Are We Entering An Era Where M(B)illionaires Want To Own Meets?

Words Jeff Merrill

In one of my college history courses, the professor stood at the front of the class explaining to us 20 year-olds in 2008 the mindset of an eastern european serf in the 1800’s, and that they would be content to take a loss on their crop yields every single year so long as they could maintain their independence. Getting into debt meant that they would be indentured to some noble’s estate, serving his excellency's needs and not their own. This concept was dumbfounding to my classmates and I, who had been brought up in a country where profit is king and spent our time conjuring up get rich quick schemes.. If you weren’t angling in ventures that would increase your wealth, you might as well be fumbling around in the mud. The American Dream had become a belief that you were owed a life of increased wealth, if you worked hard at maximizing value.

Last week, the A’s played their final game in Oakland. John Fisher, who inherited billions from his parent’s, the founders of Gap, said in a letter shared via Twitter:

“I can tell you from the heart, we tried. Staying in Oakland was our goal, it was our mission, and we failed to achieve it. And for that, I am genuinely sorry.”

The A’s planned move to Las Vegas (there are still no financing plans in place for a stadium there) was landed on after multiple failed attempts to get various bay area communities to finance the construction of a new stadium. Fisher is estimated to be worth $2.4 billion. Every rock and stone did not extend to the ones his fortune is kept under.

So the A’s are moving away from their fanbase, Fisher, however is not. He will be staying in his home in San Francisco.

This raises the question: What now, is the purpose of owning a sport’s franchise?

Franchises are worth more than they ever have been, NFL, NBA and MLB teams valued in the billions. The Dallas Cowboys are said to be valued at $10.32 billion. Up from $150 million when Jerry Jones bought the team in 1989.

Teams have always moved. The A’s moved from Kansas City in 1968. Before that, they were in Philadelphia. Then A’s Owner Benjamin Franklin Shibe is credited with inventing a machine to automate the stitching of a baseball.

The value of teams, however, as limited quantities, are highly dependent on the value of the league as a whole, which is dependent on the most valuable teams. The most valuable teams, with a couple outliers, are the ones that have been in a single location for a very long time.

The Dallas Cowboys and the New York Yankees sit atop the Forbes list, both teams have never called any other city their home… and both teams were not worth much more than a grocery store at their founding. They began as upstart clubs, with players who had other jobs, and owners scraping together funds for overhead.

Last night, a new track meet took place in Icahn Stadium on Randall’s Island in New York City. Athlos, the first female only professional track meet, funded by Reddit founder and husband of Serena Williams, Alexis Ohanian boasted the largest prize purses for any meet in the history of the sport outside of the recent World Championships. $60,000 for first place and $663,000 in all across 6 events, not to mention a Tiffany’s tiara valued at $25,000 for the winners of each of the 6 events, as well as presumed appearance fees. Athlos also instituted a Giveback Program, where 10% of all revenues, ticketing, commercial sponsorship and broadcast was to be shared with the athletes competing. In an interview with Letsrun.com, a spokesperson for Athlos declined to comment on whether they expect the meet to be profitable.

The organizers of Athlos spared no expense when it came to production quality for the broadcast and decor for the stadium, with banners, bright multi-colored lights, spotlight, walkout music and on-screen talent. Former ESPN personality Cari Champion hosted the event from a Sportscenter-like desk above the finish line.

It was a track meet, with all the bells and whistles.

Watching it in the Sport’s Bra- the women’s sports-focused bar in Portland invested in by Ohanian. The camera found Ohanian throughout the meet, like an owner of a team on the sideline or in a luxury box. I found myself staring at him whenever he appeared, in awe of the different form of human who could decide on a whim to put on an event that gave 6 times the amount of money to winners as the Diamond League meets. Rabbitwolf Creative's Ryan Sterner and Stephen Kersh will tell you that while we were in New York last year I overheard a phone conversation where the man I saw talking casually asked into the phone: "What do they want? 5 million dollars?" That sentence stuck with me like a brain worm for the rest of the weekend. I wondered if the impact of those checks came through to casual viewers of the broadcast, and I wondered how many casual fans were tuning in.

There is a rosy-eyed belief held by fans of sports teams that tycoons and moguls who loved cities used to buy franchises to give back to their communities, and to make themselves part of the fabric of the city they loved. The Halas’s, Rooney’s and Mara’s are lionized on jerseys. Athlos had this feeling to it, like a titan of industry gifting an experience to a group of athletes and fanbase out of good will. It felt like maybe, in the absence of track franchises, we could be entering an era where m(b)illionaires own their own meets.

Phil Knight is an early adopter of this model. Like Ben Franklin Shibe who manufactured baseballs, Knight made his fortune in the sporting goods industry and then has largely funded the sport in the United States for decades, whether out of his own pocket or through Nike. Look no further than the complete teardown and reconstruction of Hayward Field, worth hundreds of millions of dollars. Could we see others dedicating millions to meets that occur once a year with the hope that cities could grow to adore them? Bread and circuses for the masses.

It would certainly take an eye for the long game, as very few things are profitable immediately, or simply out of love for the sport and the people.

The soaring franchise values in major sports have colored the outlook of what success should look like in sports. If the prospect of short-term gains isn’t there, it doesn’t make business sense to invest in them. More often than not, the impulse with any endeavor in our society is first to make things valuable, rather than making them good. Athlos was a welcome contrast. Ohanian said that it will definitely happen again next year, and that they want to keep it in New York for the community. Is the jump in investment too much too soon for a business-minded man to stomach, or can he ride the wave with us for the 30 year relationship to calcify the kind of love that would have die-hards sell kidneys for their team (meet) to stay?