Dec 31, 2024 - Sports
The new economics of NFL ownership
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Illustration: Gabriella Turrisi/Axios
The National Football League's biggest rule change in 2024 was about ownership, not kickoffs, as it allowed private equity into the ranks.
The big picture: NFL clubs have become too valuable for most billionaires to buy on their own.
- Adding private equity could cause more teams to change hands by expanding the pool of potential buyers and prompting some owners to hang "for sale" signs.
By the numbers: The average NFL franchise is worth $5.7 billion, according to Forbes. And teams typically sell for more than the Forbes valuation.
- There are fewer than 200 Americans with net worths of at least $5.7 billion — around a dozen of whom already are NFL owners, per Forbes.
- Now subtract those whose wealth is mostly illiquid or who have no interest in the NFL (e.g., Robert Smith). The universe of viable NFL owners gets very small, very fast.
- For context, only two NBA teams and one Major League Baseball team are valued above $5.7 billion by Forbes.
Zoom in: Enter private equity, which now can own up to 10% of each club.
- That's a significant chunk, on top of other financing alternatives like bank loans and cobbling together groups of other wealthy individuals (e.g., how Josh Harris bought the Washington Commanders).
- In the meantime, private equity's two initial forays into NFL ownership have provided partial liquidity for existing owners, who can use that money for everything from refurbishing stadiums to buying new yachts. Expect many more of those deals.
The bottom line: NFL ownership has long been dominated by individuals and their families. Times are changing.
