By: Juan Fuentes Fernandez, SportsTech Angel Investor and FIBAN Memeber
As an angel investor and practitioner in the sports industry with a global overview (as I have worked Middle East, Asia and Europe in the last years), I have noticed how the sports ecosystems are embracing technology and innovation to further develop in order to meet the current needs of consumers, athletes and organizations.
The niche of sports tech has gained considerable popularity over the years, driven by a highly dynamic industry that must adapt to the new demands and habits of consumers in the entertainment sector, which has been disrupted by technology. Additionally, the entry of private equity and venture capital into professional sports clubs, along with the emergence of new dynamics promoting a healthy lifestyle, has contributed to its growth.
Internal forces work also as drivers, due to the competitive nature of sports leagues and championships, where clubs embracing technology and innovation could have a competitive and fair advantage over those who don´t. Start-ups have thus emerged to elevate standards in various subsegments, as outlined below.
*Own elaboration from classification from Andrew Petcash
Different hubs have consolidated globally, as per the Sport Tech X global sports tech map, with over 100 specialized funds, 15 investor networks, 28 incubation programs fostering start-ups and bringing investors together, and 17 innovation initiatives by sports organizations such as the NFL, Real Madrid, UEFA, or LALIGA. Some sports organizations are even investing directly in start-ups, like the NBA Launchpad in the US and FC Barcelona Innovation Hub in Spain. Notable athletes, such as Real Madrid legend Iker Casillas, have also launched their own accelerators, incubators, or co-investment vehicles, such as the “Sportboost” sports tech accelerator launched in 2021. Public institutions and organizations are also dedicating resources to boost sports tech ecosystems, such as the Danish Olympic Committee -with an sports tech innovation lab- or the city of Jyväskylä ; the “sports capital” in Finland- running the Nordic Health & Wellness Hub- both trying to help growing entrepreneurship.
However, the B2B market, particularly products for sports clubs/organizations, presents certain challenges. Pro sports are inherently human capital-intensive, – limiting capital to invest in tech.
Investors that can identify start-ups offering scalable premium products or services catered to professional athletes/clubs, while also able to develop democratized versions accessible to any sports enthusiast, could thrive in the sports tech realm, capitalizing both B2B and B2C segments.
Sports tech as a vertical is expansive as the sports industry develops further; it is expected to grow and consolidate in emerging markets. Start-ups in sports tech are also sometimes analyzed in other verticals (health, MedTech, FMCG, gaming…). However, in the last years; multiple specialized investors, Venture Capital or Private Equity firms, which understand the dynamics of the industry, have emerged.
According to Drake Star – global tech investment bank that has completed over 450 transactions since 2013- the deal value in sports tech reaxhed $10B in Q3 2023.
You are invited to join this webinar organized by EBAN, where as a FIBAN investor, I will discuss with key ecosystem executives in sports tech the challenges and the opportunities in this vertical.
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