Are Sports Teams the Next Big Investment? | AWM Insights #239

Key takeaways

• Sports ownership falls into two camps: trophy assets, pursued for legacy and influence, and financial assets, measured by disciplined expectation of returns.

• Investing ranges from mature franchises like the Lakers to up-and-coming leagues—each shaped by location, market size, and unique risk.

• Hype can overshadow the numbers, but real value comes from clear-eyed evaluation, understanding barriers, and playing a long game.

The Real Meaning of Sports Ownership

When people talk about buying sports teams, motivation splits the field. Some want the trophy—the legacy, the seat at the owner’s table, the ability to influence a team’s future. Think of an owner buying the Lakers not only to steward capital, but to put their stamp on a legendary franchise. Here, operational headaches and ongoing involvement are part of the prize.

Others see ownership as a financial asset. Their playbook is built on risk management, disciplined investment, and strategic growth—the same qualities that guide a top-tier front office. This vantage point means every decision is weighed, every move scrutinized, every outcome measured against benchmarks and alternative uses of capital. The distinction shapes not only the experience of ownership, but also the expected returns.

From Major Franchises to Emerging Leagues

Professional sports offers a full spectrum of investment targets. At the highest level, mature teams in the NFL, NBA, and similar leagues hold high price tags. Here, market size sets the stage: the Lakers, with an immense Los Angeles fanbase and national pull, are valued far above the Kings, despite both being California franchises. It’s not just about being in a big league; it’s about access to a big, wealthy audience.

In the next layer, you’ll find leagues still building toward mainstream—think the WNBA, women’s soccer, or new sports like pickleball and women’s volleyball. These organizations gain strength from shifting cultural winds and expanding participation. With the right team, the right region, and the right timing, these investments may offer greater upside, but also increased risk and unpredictability. The challenge is recognizing if early momentum will sustain audience loyalty and revenue growth.

No two opportunities are alike. Each sport, league, and location changes the calculus, from the dependable but crowded field of the major leagues to the unscripted territory of emerging franchises.

Hype, Real Returns, and Disciplined Ownership

Sports attracts headlines—celebrity buyers, billion-dollar sales, stories of teams reborn under new owners. But beneath the surface, mature franchises often deliver returns similar to standard benchmarks like the S&P 500, once all operational costs and purchase prices are considered. The entry price into these established leagues can limit upside. Expecting a legacy franchise to triple in value quickly is wishful thinking.

The middle and lower leagues carry their own challenges—some may not survive changing trends or economic shocks, as seen with teams in lower English football leagues or one-off American start-ups. Barriers to success are real and market downturns hit smaller teams harder.

The temptation to chase hype, fueled by media coverage or a famous owner’s success, seldom delivers consistent results. Winning plays come from deep due diligence, respect for the complexity of each opportunity, and a clear understanding of where outsized risk matches expected reward.

The Value of Strategy and Stewardship

Whether you aim for legacy or steady returns, sports team ownership rewards strategy, patience, and savvy. The greatest victories come to those who approach every investment with the seriousness of a GM building a 100-year family legacy: comprehensive analysis, clarity in motivation, and a commitment to stewardship that thrives beyond a single season or headline.