Dividends and Meet the banker that billionaires call when they want to buy a sports team

When you are young and nothing in the world can hold you back, if you have a talent or a passion for a sport you likely want to play that sport professionally. You love it, however as you age a little, the issue is do you have the skills to compete against the best in that sport. Most of us do not, but you can still enjoy playing and watching sports. Fortunately for the owners, there are millions of people who enjoy watching sports on TV and that is the prime reason why a sports franchise has increased in value. The TV contracts are larger and most major league teams will make money before a ticket is purchased. If you are an owner, you like that. As a fan, you want your team to be competitive and be able to challenge and possibly win the championships, but as a fan often the journey is more important than the destination.

From your dividends you make on your stocks, you have the ability to do something with the money. Some can afford to buy a sports team both for personal reasons and to increase the value of the team if and when it is sold.

In the Ghostbusters movie there was a song saying who are you going to call? If you are wealthy enough, you can call an investment firm called Galatioto Sports Partners (GSP).

In an article by Andrew Willis, the founding partner was asked during the summer at an investment conference in Manhattan, how is his business. Mr. Galatioto said, I have never been busier, capitalism is a wonderful thing, it produces more and more billionaires.

GSP received its start in the 1990’s, raising money for team owners as bankers with Lehman Brothers. They decided to leave Lehman Brothers to start their own firm. The potential owners of the teams had assets, but they were tied up and needed help in arranging loans to close the transactions. The success of the firm is they have advised team owners in every North American league and in Europe they help the soccer teams.

GSP helps owners to understand what teams can be – they are media business, a data business and real estate business rolled into one and thanks to the sports pages are always in the news.

Linking to dividend paying stocks, similar to buying an individual stock, it is important what it is and how it generates its revenues and potential revenues. Some teams have an incredibly loyal base of fans who consume tickets and merchandise. Ever watch a sporting event and it seems everyone has a home team jersey on? How much was the jersey? how much was the tickets? and you will look at the home team a little differently, although you can still cheer for them. Then you can leverage the assets to create even more.

There are more questions than answers, till the next time – to raising questions.


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