Steve (00:00.454)
Okay, good. So youth, women's sports. I'm familiar with your background from when I've read from the investment banking side. And just one last question on youth before we get into it. When you say you're involved in youth, we're talking about from a business standpoint. This is a.

Chris Russo (00:18.412)
Yeah, so I basically represent buyers and sellers of businesses in the sports industry, including in the youth sports space and women's sports and media and all related areas of sport.

Steve (00:25.158)
Correct. Perfect. Perfect.

Love it. Right. I just wanted to make sure that was not your an express personal passion and link that to your fifth generation sports. Great. And your name. Where are originally from by the way? You're originally are you out?

Chris Russo (00:35.404)
Right. Right.

Chris Russo (00:45.262)
I grew up in Chicago and then I've been in New York the last 30 years.

Steve (00:49.19)
Okay, so you got obviously Mike and Mad Dog all the time. Okay, so I might have to make a declaration about that just to make sure, do you get that all the time?

Chris Russo (00:53.486)
Different Chris Russo, yeah. Yeah, yeah. Sometimes, sometimes, less so these days, but yes, I have had that.

Steve (01:04.326)
Which is interesting because he's on a bigger platform. with that said, I hope you don't mind if just for our New York viewers they don't confabulate. Okay, beautiful.

Chris Russo (01:12.012)
No problem.

Steve (01:26.202)
Just give me a moment. I want to just process you for a moment and get my sense of... So we keep this, by the way, I should mention, as I always do, we keep this very free flowing. It's very unscripted, very much just will go with where the wind takes us. And we'll just, from what I understand from Michael, and from what I've heard, and from what I've read, you know, it will be seamless. So with that said...

What a pleasure it is to have on the transaction report today. Chris Russo. Chris is the CEO of Fifth Generation Sports.

We'll learn together about his background that extends all throughout the industry. And for our New York based regional viewers, please note there's no association with Mike and the Mad Dog. That's Chris Michael Russo. And today it's Christopher Russo, who is an investment banker among other things. And with that said, Chris, welcome to the program.

Chris Russo (02:31.97)
Thank you, Steve. It's a pleasure to be here.

Steve (02:34.413)
So it's really interesting when someone studies your background. You're a man for all seasons, but certainly not a jack of all trades. You're someone who's put on a hat in many capacities. You were ahead of your time in the 90s when you were at the NFL leading its digital enterprise, which says a lot that you were pre-Web 1.0. So first and foremost, what is it, and if you could be very tactical here, what did you see in the 90s?

that you knew this was the future of

Chris Russo (03:08.248)
Well, I think it was really the opportunity to connect with fans directly that leagues and teams and media companies had really never had before. They had always really been selling their content to networks or distributors. But when the nineties arrived and certainly at the NFL, we could have NFL.com and we could directly program to our fans. That to me was a breakthrough moment. And obviously since that time,

We now have streaming and we have other outlets where properties can directly interact and engage with their fans. But back then, to me, that was the real revolution, that direct connection between the leagues and the fans.

Steve (03:50.32)
So interesting, I was in it at the same time you were working with athletes. We had one of the top two or three online sports agencies in the world with 400 athletes across a broader array of sports. But when you got involved and I got involved, but much more to your case, because I was 99, 2000. First of all, dial up was the only thing broadband was not even spoken about when you first entered the industry.

And to be frank, it was really a website that was being proffered with, at the time, best case, scores, information, perhaps content in article form. There wasn't a whole heck of a lot of transactional information taking place, meaning transactional in the form of acquisition at the time. So I appreciate that you had, but I'm very interested in your mindset.

that I understand that NFL could for the first time and other leagues could for the first time interact with fans. But you came in as I understand, and please correct me if I'm wrong, that you came into the NFL and you rapidly assumed the role of leading its digital campaign, which says that there's something how you were able to, if I could, in a Jeff Bezos way, have the foresight.

to see the power of the tool when virtually the entire world did not in the mid to, you know, middle of the 90s.

Chris Russo (05:27.694)
Yeah, I got to the NFL in 1999 and my prior experiences had been at NBC and marketing and at New Line Cinema in program development. And so what the NFL was looking for was not a technologist. They were looking for somebody who understood programming and marketing, who could bring those disciplines to a new technology or a new distribution outlet. And the reality of the way the early days of NFL.com were focused

is a lot of the usage was really around Sunday. It was around live scores, live stats. That experience was really the first big experience. And then the second major experience that I brought on, and I believe it was 2000, was fantasy football, which became a huge phenomenon, but was really a way for fans to engage in their leagues with their friends and with their coworkers and become general managers themselves. So the big usage elements

of NFL.com in the early days were the Sunday experience where you're watching on TV and then you're online looking at data and stats and then also playing fantasy sports. So I saw those as big drivers. Later we saw streaming, later we saw other applications, but that was really where we were in the early days. Yeah. Yeah. Yeah. Yeah. Yeah.

Steve (06:43.781)
So it was a marketing mindset and thanks for correcting me on the timeline. So 99 makes sense to me. was a time because I saw as a tipping point the 98-99 year was a real tipping point of where sports marketing had a new found look at how to, with a bit of vision, understand that the business of sport was gonna be in dramatic and disruptive.

Chris Russo (06:54.531)
Mm-hmm.

Steve (07:07.319)
change from that time, know, time immemorial, if you will. And it makes a lot of sense with your NBC background, coming in with that marketing mindset. And then, of course, although this is not a this is your life, Chris Russo, we don't do that here. But I do want to just get this foundation for the viewers. You you with your fantasy background, you then parlayed that into your own business as an entrepreneur. So you came again from a media background, NBC, you come over to the property side.

Chris Russo (07:21.902)
Mm-hmm.

Steve (07:37.26)
at obviously the NFL, and then you end up building foundationally one of the most powerful online entities in sport at the time, which was called fantasy sport, and then it became big league sports. You 25, if I read correctly, 25 different platforms. Yeah.

Chris Russo (07:51.726)
Fantasy sports ventures, Yeah, yeah, yeah, yeah. yeah, yeah. What I basically noticed, and again, through my six years at the NFL, we helped grow fantasy football and fantasy sports, but what was happening is consumers fans were playing their games at big websites like nfl.com and Yahoo, but then they were going to all these mom and pop websites to get.

content information, rankings, and I saw an opportunity to roll up a lot of the niche companies that were providing this ancillary information. And so I created Fantasy Sports Ventures. We ultimately had about 500 properties that we either owned or that we represented for ad sales. And we built that into a fairly big network and then ultimately sold the company to USA Today about five or six years later. But it was really noticing that there was a whole ecosystem

that had been overlooked of these mom and pop companies that could be brought together.

Steve (08:54.455)
And you had 500,000, again, what I read according to the announcement, when you sold to USA Today, you had 500,000 active paying subscribers.

Chris Russo (09:02.412)
Yeah, we had that, but we had sort of like 20 million unique users overall in terms of just people who were visiting the websites.

Steve (09:10.533)
So the reach at that time, which was all about eyeballs, eyeballs, eyeballs. I mean, you hit the jackpot with respect to recognizing that at that time in the evolution of this online entity for those who don't know, we have been in a remarkable evolution as we talked about from dial-up to broadband that last mile, getting the pipeline so we could seamlessly serve. And when Chris had the foresight to build fantasy sports at the ventures at that time, I mean, keep in mind, everything is an entrepreneur.

Chris Russo (09:13.868)
Yep. Yep. Yep.

Steve (09:39.885)
was about you being told, just get his eyeballs.

Chris Russo (09:42.83)
Yeah, I would say that was certainly true in the beginning. think as things evolved and we, we've unfortunately or fortunately had a ride out 2008 to 2011, which was a tough time to be an entrepreneur, but we did, we got to the other side of that. And I'd say monetization started to become more important and we, certainly worked hard on ad sales and subscription and, even now, you know, fast forward 10, 12 years now, you know, monetization matters a lot.

And so it's, you we were in the early days where it was, yeah, I get a lot of users, but now I think it's really about the monetization. Yeah. Yeah. Yep. Yep.

Steve (10:17.605)
Oh, 100%, 100 % or at least 99 % if you will, on monetization business model, making money. I mean, I forget which year it turned, but the annual discussion on Bezos was for the first, what was it, 12 plus 14 years, he never turned a profit. He had the foresight to ride out. That's a tough model. lot of young, it's very interesting by the way, that a lot of young entrepreneurs who were just getting off the ground in the aughts.

Chris Russo (10:33.73)
Yeah.

Steve (10:45.825)
used to think they could just be a Jeff Bezos model, was, don't have, remember, I don't have to make money. I just have to have people come into my site and offer something compelling. But making money, there was a phase we went through in, again, the business building commercial side of life online, where a good six to 10 years, there were a lot of people who actually thought business was not about making money.

Chris Russo (10:50.926)
Yep. Yeah.

Steve (11:10.713)
Business was about driving interaction at my site in some content oriented way. So it's interesting, you know, that again.

Chris Russo (11:17.362)
Yeah. And then, the hope was that someone would eventually either buy that or that you could continue to raise capital to fund the losses. And I think what happened certainly around 2000, there was obviously the mini issue in the 99, 2000, but then in 2008, it became a lot tougher to raise capital. So those models where you were just continuing to lose money.

Steve (11:27.429)
100%.

Chris Russo (11:42.446)
sort of were very difficult to sustain. So again, we've gone through these cycles, even, you know, in the mid teens, where things are hot, and then they slow down. I think you're always better as a business being able to control your own destiny, obviously, making money be profitable. And I say that to entrepreneurs today, who some still absorb or adopt the model, Steve, that you're talking about, which is let's just get big and see if someone can buy us. That's a pretty risky strategy.

Steve (12:09.549)
You know, it always, I was shocked actually because I was so wrong in my assessment, which was during the dot com burst of March 2000, NASDAQ crash. The reset were literally at the time in my business, we had about 110 staff, 400 athletes, 10 offices, 50 million in committed B round financing being raised by Price Waterhouse. And within three months after March 2000,

there were certain folk in private equity, they'd literally disappeared. Their phone numbers were not functional. The folk that actually represented us, we couldn't find them. And so I was always amazed when we went through that period after the dot-com era, that the human being in business with money, with other people's money, could get us back into a situation

where the foundations of business principles, the foundational Warren Buffett style, good old stool investing had been jettisoned again for again that sense of we can make quick money. And it is fascinating to see it on a cyclical level.

Chris Russo (13:22.67)
It doesn't happen, Steve. There actually is some rationality to some of that, which is if you're in a high growth industry and you need to scale quickly because there's three or four other competitors that have a similar product, there is some value sometimes to getting big fast. And there are some entrepreneurs who screw up the other way, which is they don't want to give up any equity. They want to stay small. They don't want to raise any money. And all of a sudden somebody blows them out of the water.

But there's a balancing act there and you sort of have to look at the particular industry you're in. You're always better off if you can make money, but there are some instances even today and probably the AI space may be an example where getting scale and getting resources is important because there's a lot of other people competing.

Steve (14:09.891)
And the interesting part of that, by the way, is in today's AI world and our main business, sports biz, is in the sports AI space, is that they're accomplishing both. Most AI players today are bringing to the table some very, very attractive balance sheets that speak a lot to the compelling nature for the first time ever of 60 years of.

AI development, you going back to Minsky, who was the mentor of Ray Kurzweil, the god, I would call him not Jeffrey Hinton in the sense of the godfather of AI, he's certainly up there with Hinton, and easily could have won a Nobel for his foresight. But he's more of a futurist in many ways, but he's also a developer in many ways of deployment of AI, and he was way, way back in the 60s and late 50s, point being that

We are so interestingly in the AI space, having this moment of time where actually VC demand if you're in the AI space. know, unless you're a name brand entity who has had numerous exits or built up such big properties before, big companies before, that it's an attractive halo effect. I want to invest in you because you've done it so well before I can't miss it. It's you know, kind of that was...

fear of missing out, FOMO. But for the most cases, in the most cases, what we see in the AI universe today is companies who have hit it, as you said, really fast, building, while we're not yet at the unicorn, everyone's looking out for the first unicorn billion, unicorn single person business, right? So Ilya Suskova, who left OpenAI as a chief scientist about a year plus ago,

had a three man, two billion dollar business, now worth 30 billion, it's valued at 30 billion. So it'll be interesting to see, but it, and by the way, just to go back and contradict myself, Ilya has yet to sell anything. So he's got a 30 billion dollar business in the AI world. So going back to your point, it's never all or nothing. And there are these balancing acts.

Steve (16:17.269)
and putting over the halo effect on Ilya Suskovor, who started his new company in AI, having left OpenAI as one of them, who led Sam Altman's ouster and ended up on the wrong side of it. So he left along with the other major chief, many of the executive officers in top management. We're at that time in business that what I wanted to really set the foundation for is you have a lot of passions.

And sports, as I tell everyone, the human race is in disruption right now, but sports in every aspect of the business of sport is in disruption, from professional to collegiate and to high school and youth. So help us understand in times like these with your eye as an investor, entrepreneur, business owner, you've sold and exited a successful business.

Let's flip it for the moment. A lot of conversation is about the really tumultuous times we're in with tariffs, the economy, the instability, consumers don't like instability. Where is, and not in an opportunistic way, but in a smart, commercially savvy way, where do you see in business, in sports today, certain gaping or small holes that you think will expand in size?

the way you saw digital back in the late 90s. What is happening to us right now in the business of sports with all the instability, with an industry that supposedly is recession proof? What is it that most of us are reading about the downside of the economy right now, the fears that you see, again, opportunities for people to excel?

Chris Russo (18:06.36)
Sure, Steve. One of the areas that I'm spending a lot of time in right now is the youth sports space. And part of the reason that space is so exciting is it's, number one, very large. It's a $38 billion industry, if you believe some of the research reports that have been put out there. It's a space where parents, again, seem to be willing to spend as much as is necessary for their kids to participate, to get an edge, to grow in their particular sports.

where you see new innovations happening in terms of technology, services, events. And so there are a lot of companies that are looking to get involved in that space. There are a lot of private equity firms that want to invest and there's a lot of deal volume. So it's one of those areas where I think we're still at the early stages. 10 years ago, youth sports was kind of a graveyard because it was so fragmented and there were so many small entities that

It was hard to actually make money because it was hard to get your arms around it. Fast forward 10 years, there's now a lot of companies that have aggregated a whole bunch of events around the country that have aggregated scheduling and registration platforms that have come up with new ideas to help, you know, youth players train, get recruited. So I think it's one of the best areas today. And I see a lot of deal volume there. I'm very bullish on that space.

Steve (19:29.889)
Interesting, you know, I must say it must have been about a year or two ago, maybe two or three years ago. I came across a technology that was in the youth sports space and I said to some of my colleagues, sheer genius. And that was they were able to deploy in a single camera-esque fashion, the ability to now broadcast youth sport. And the deployment was not this big.

OB-BAN-esque, let's set up, you know, six cameras to capture what's taking place. The technology itself was able to capture in a single, very affordable technology and very easy to deploy where the teams, literally a single team can bring it with them to a field and broadcast to all their loved ones.

that are literally not able to make the game and people who just want to watch their kid or neighbor play ball, which seems to me, remarkably at a youth sport level, all of a sudden you're in a small way replicating a bigger macro system, a macro entity, which is professional sport by bringing the broadcasting into it, which makes it a lot more accessible, which means there's gonna be a lot more money coming to it.

Chris Russo (20:42.326)
Yeah, that is one of the biggest developments in the last decade is the streaming opportunities of live youth sports events. You're right. It's become more affordable because some of these cameras have become better, cheaper, AI infused. There have been companies that have done a good job distributing that video. think COVID got people even more focused on delivering these products because parents maybe couldn't go to games as much or grandparents couldn't go. So there was advancement there.

Steve (21:04.346)
Mmm.

Chris Russo (21:12.142)
And so now you see almost, I shouldn't say almost every game, but so many games can now be streamed so that you can see your kids, even if you're traveling or you're on business or you're a grandparent. So that's been an amazing development. I think that's all been very positive. The other thing that's happened, Steve, is there's been a lot of focus on data collection, performance enhancement. So now when you're playing as a young kid, there's a lot of data around your

Steve (21:35.013)
You

Chris Russo (21:40.972)
batting average around your goal scoring and that is both good but it also raises the bar and the pressure and becomes now you're like everybody's looking at everybody else's stats and so there are some downsides to that psychologically and otherwise but it's available.

Steve (21:56.304)
What are the ages just to, for the viewers, what is our, and for me, how do you define youth sports?

Chris Russo (22:02.67)
Well, I I define youth sports as somebody playing somewhere between the ages of eight and 18. College is kind of its own thing, but I'd say somebody playing sports between eight and 18. When you're sort of in that eight to 12 year old realm, it's probably more casual and fun. As you start playing, you know, in the 13 to 18 range, a lot of youth players are thinking about how do they get a scholarship? How do they compete at the next level?

And so it gets even more serious in terms of the kind of tools and technologies and the amount of money parents are willing to spend because they're looking at it in many cases as a path to a college scholarship. that raises the stakes.

Steve (22:42.309)
Thanks

So the investment side, let's go to two areas. Let's not say investment, let's first, well actually no, let's call it investment side. So there's an investment side of your investment banking expertise. And used to actually lead up the media division at Hullahan Loki. Is that correct?

Chris Russo (22:53.71)
Mm-hmm.

Chris Russo (23:06.254)
I led the sports &A practice there within the TMT group. Yep.

Steve (23:11.909)
So you have this pedigree, a long-standing pedigree, investment. So I want to be clear on when I say investment side, one is capital coming in through the likes of an investment banker or funding element, whether that's high net worth, angel, family office, venture capital, private equity, or again, mergers and acquisitions, investment banks. And then there's another investment.

where we spend our exclusive time, which is an investment of the money that comes from those who are stewards, custodians of brands, who've been entrusted by their shareholders, if they're a public company, otherwise by their employers or unless they are the employer, to actually spend their money wisely in associating with an athlete team, league, a stadium, an association or an event. And in this case with youth sport,

Can you unpack for us the two sides of when you said you were excited professionally about the youth sport opportunity? Where would we both on the side of the corporate brand who's associating brands put in, I don't have the expertise here to say is it billions or is it high hundreds of millions in America investing into youth sport?

out of the 100 billion spent globally on sports sponsorship, I would have to imagine there's somewhere between on the sponsorship side, eight to 10%, I would just take a layman's hurl at it, I'll yield to you on that. So if we have, let's just say for the sake of discussion, a billion dollars being spent by brands into youth sport. First of all, what is the opportunity for them today? Where do you see it manifesting?

And then as an investor, where you raise capital funds, you invest capital, or you guide other people's money to make wise investments in this arena.

Steve (25:15.013)
What might be an example of a successful investment, first on the financial side, in the investment banking side, that you could illustrate for us that over the last, say, since COVID five years, might be a clear example of an opportunity that came about and you capitalized on it. And as a result, some of your clients are pleased they met you.

Chris Russo (25:38.198)
Yeah. Well, I'll give you a couple of sort of general industry transactions over the past couple of years that have been highlighted and kind of drive the excitement in the space. One is a company called KKR, very prominent private equity firm. They acquired a company called PlayOn, which is one of those streaming services that you mentioned or referred to, which basically streams high school sports games and lets parents and grandparents

see those games. And so for many years PlayOn was independent. They were funded by various venture capital. But a few years ago, KKR bought them and really kind of brought them to the big leagues and they bought a ticketing company. Then they bought some other businesses. They recently bought a media company from CBS in the youth sports space. So you see KKR with their prominence stepping into the space. And that's really a signal to a lot of other folks about the strength of the space.

There's another group, Harris Blitzer, two high net worth team owners who have started to roll up sports facilities, particularly in baseball, but some other sports. So they're starting to aggregate. bought the Ripken, Cal Ripken company. They bought a baseball field facility around Cooperstown. And so they're focused on the facility side of the business. There's another private equity firm called a Genstar, which has acquired a lot of payments and software businesses.

So there's a lot of different companies approaching the space, but when private equity and team owners of that stature get involved and make purchases, everybody stands up and takes note. And I'm getting calls every other week, that's a little bit of an exaggeration from private equity firms saying, hey, we want to do something in youth sports, what should we do? And so I see some of those big investments that I mentioned as really driving a lot of interest. On the brand side,

Steve (27:33.509)
So, please.

Chris Russo (27:36.206)
It is really more of a recent dynamic that brands are getting more involved in youth sports because previously it was a very fragmented space and it was a very dispersed space. But now you see brands that might be advertising on some of the youth sports websites or sponsoring some of the local events. But the thing that I think is important to recognize about brands and youth sports is that

It's not just advertising to kids. It's really thinking about youth sports as a place where parents and families get together with their kids. And so there's a lot of folks in categories like travel and automotive and insurance that are starting to get more involved because it's really about a family experience, not just, want to sell kids an extra baseball bat or some beverages or things like that. It's really kind of broad.

Steve (28:35.095)
You know, I want to be emphatic on your point. We did some work for Geico through one of its agencies on its high school football game sponsorship, the kickoff games. I think there were seven of them. And again, I had no idea prior to this. hadn't worked in that space before. And when you look at the streaming of those games or even the broadcast on ESPN of those games, they were really catering to exactly what you said. It was a much older market. It was an adult market they were catering to.

Obviously you have some of the folk who are coming to the games are younger from their schools, depending on where those games are played. But by and large, it is using in a meaningful way, not exploitive way, youth sport to reach a demographic that has keen interest in that sport. And that's just effective sports marketing. There's nothing wrong with that. So what's interesting to me, if you could school us a little bit with KKR and you look at a guy like Henry Kravis,

who I gather at this point, he's gotta be pretty close to early 80s or late 70s. What would be the motivation for a KKR to acquire a youth sports entity like, and the business I was thinking of that was doing the broadcast at time was Pixalot. I think they had a first in Pixalot. So obviously PlayOn, as you described it.

When you get that type of capital from a KKR, it's a game changer. They're putting together a portfolio, a holistic portfolio. What does a group do with that ultimately? Is that a build to run business or is that a build because KKR has responsibilities to other people who expect to return on their investment? And one day that would be a sale of asset for a KKR when they're getting so involved in e-sport.

Chris Russo (30:21.368)
Well, I'll talk generally about about how private equity views the space and in general, private equity is in business to ultimately buy assets, improve them and ultimately sell them. Again, I don't know what KKR's particular timeline or strategies on that front, but I would say more generally, a lot of the private equity firms that are looking at youth sports believe that they can buy those assets, they can enhance them, they can fund them, they can grow them. Maybe they could roll up some of the smaller players in the space.

And ultimately, again, most private equity look at four, five, six year hold periods and want to then make the next transaction. So I think it's a very commercial opportunity more than anything. I think people see the growth, they see the opportunity, and that's really what's driving a lot of the interest, the investment interest.

Steve (31:13.381)
You mentioned as well that another area, by the way, I should just for the record, when you were at Hullahan, if I remember correctly, you were responsible for the sale of Sports Illustrated from Time when it was going through the Meredith acquisition. And that went over to our friends from a authentic brand, right, GBG. So authentic brands, which again, I'm learning every day in my...

Chris Russo (31:27.502)
Correct. Correct.

Chris Russo (31:34.51)
authentic brands, ABG, yeah.

Steve (31:41.644)
in my pursuit of knowledge that I had no idea. Actually, I had lunch with Jamie Salter's brother, Mark, not too long ago in Boca. And he's such a humble guy, never mentioned anything about his brother. I didn't realize that that authentic is now a $32 billion entity, annual sales of $32 billion. You sold Reebok, you were involved in the sale.

Chris Russo (31:48.985)
yeah.

Chris Russo (32:00.622)
Yeah. Yeah.

Chris Russo (32:08.398)
Yeah, I was not a Reebok. I sold Sports Illustrated to ABJ. Yeah, to ABJ.

Steve (32:10.967)
excuse me, Sports Illustrated, Authentic also acquired Reebok. I stand corrected. What I meant to say is Authentic acquired Reebok, and we just are about to announce that the former president and CEO of Reebok just joined Sports Business Board. So we're very pleased about that. Uli Becker is on our team now. But in reading about Reebok's sale,

Chris Russo (32:16.12)
Correct. Correct.

Steve (32:35.621)
and Sports Illustrated's act, because it's a completely different model from what had been historically under time. So with your expertise, again, in seeing how you've been involved in the sports space, another area that you've identified, which is kind of hard to miss on the radar, but I'm interested where within this bigger space of women's sports, you see perhaps what others might not see and what a lot of people see.

Chris Russo (32:37.806)
Mm-hmm. Yep.

Steve (33:04.525)
is they see the Caitlin Clark face of it, right? They see the Caitlin effect and they see the tipping point in women's sports, which had been so worked upon in earnest for so long to get to this point where we are seeing far more capital come in and that can be quantified and it's increasing incrementally, quarterly.

What is it that you see above and beyond what we would call the daily routine publication of the impact on WNBA with Caitlin, some of the soccer expansion opportunities in women's soccer, obviously professional volleyball in women's volleyball, what we've seen at Nebraska with I think 60,000 live fans, if I remember the number correctly, for a women's college volleyball?

What do you see right now in women's sports and is it pro college youth or is there a particular vantage point you have and where that begins?

Chris Russo (34:07.522)
It really is across the board and I think it's broader than most people recognize. I'll give you an example. A couple of years ago, I sold the legacy women's hockey league, the PHF, to Mark Walter and Billie Jean King. And as part of that sale, they then launched a new women's hockey league, which has been very successful. a couple of Canadian cities, US cities, they're now expanding into other markets and they've gotten great turnout, great attendance.

great coverage. And so we've seen sports like hockey, which you wouldn't necessarily think of as the top area to be considering in women's sports. And it's done very well. As you mentioned, volleyball, very popular at the pro level, but also at the college level, at the youth level, that's become a phenomenon. Soccer, we've talked about, but again, it's not only US, there's tremendous interest in women's soccer.

Globally, we have a number of US investors who've wanted to get involved in women's soccer teams overseas. Obviously with the WNBA, you've got some big stars like Caitlin, now Paige Becker is going into the league. So I think all of that is happening. So it's fairly multi-dimensional. think I've heard somebody the other day say to me, well, it's all started with Caitlin Clark. I really don't think, I think she's amazing, but I really don't think that's true. think part of this was even

Three or four years ago when Michelle Kang bought the Washington NWSL team for a price no one thought was conceivable, I think it was $35 million, that was really a beginning. There were other beginnings in terms of deals that got done or games that got great ratings. So I think Caitlin has accelerated it. I think Paige Becker's will accelerate it further, but I think it's a broader movement and a broader opportunity that people are taking advantage of.

Steve (36:01.541)
Yeah, I mean, certainly if you had asked me the question, when did it all begin? I mean, you probably have some legacy athletes who would say it began way before even Billie Jean King or Chrissy Evert or Navratilova or on the LPGA side. I mean, when you think about when I was a kid growing up, what did we have in women's sports? If there was something to be watched on a broadcast level, what would it be? would be women's tennis? Was tennis?

Chris Russo (36:27.756)
with tennis, predominantly tennis and LPGA to some degree. And Nancy Lopez was an early star in LPGA and you had some women's tennis players who were superstars.

Steve (36:29.957)
in somewhat golf. And at the time...

Steve (36:38.341)
But the LPGA at that time, think about it, the consumable broadcast side of it was very, very much an American oriented playing field, right? As whereas today, I believe you have somewhere around 50 % of the field, an international field, which for many in the States,

Chris Russo (36:50.286)
Yeah.

Steve (37:02.617)
can be very hard to consume at times when it's hard, frankly, for people to pronounce names of athletes. It's not these, now again, I'm gonna contradict myself where I can. In basketball, you have a lot of hoop players whose names are really multi-syllabic and not the, Giannis, I'll just call him Giannis because I don't want to malign the man. There are a lot of athletes where it does get quite difficult in hoop, but they get accepted.

Chris Russo (37:23.832)
Yeah.

Steve (37:31.494)
And so I want to let's probe this together because I've never thought about this in the business of sport because this is all about the business of sport in the context of and I've had this thought because I lived 13 years in the Far East. I went over to learn Chinese in 1989 and then started my company there in 1990.

and having worked with a lot of Korean, Japanese, mainland Chinese, Hong Kong, Taiwan, Southeast Asia, et cetera, athletes. I always marveled at the LPGA that you, I mean, when there was one of the Lee players from Korea winning the US Women's Open in golf, the announcer said Lee number six has just won the US. And I said, it's so unfair to her for two reasons. If she were Diane Lee, just like we have Michelle Wee.

Right? Now, if Michelle Wee were Wee Long Park, or Wee Long Hall, she wouldn't be the same woman. She wouldn't, from a marketing standpoint, be the same woman. So it's interesting that we, back in the 60s and 70s and 80s, you had a very different demographic in women's golf. And in some ways, there was a certain consumable nature that made it more user-friendly, if you will, to quote unquote, the average American audience.

Chris Russo (38:24.142)
Yeah. Yeah.

Steve (38:45.285)
Obviously it's grown to be a much bigger entity, it's very powerful, and it's a beautiful product, and it's only, in my opinion, can go up, up, and up. But as you said, there were two properties, mostly tennis, and then on a secondary level golf, but golf was strong.

Chris Russo (39:00.108)
I would, I would amend that to say one other thing though. I think the, Olympics has been for, for decades, a property that includes a variety of athletes and obviously gymnastics and other. I think that, yeah. So that is. So it's always been there. think it's what we've really seen recently has been the team sports side of it with soccer and basketball specifically. Now I think extending into soccer, hockey and volleyball and some of these other sports that I think are, are.

Steve (39:02.351)
Please.

Mmm.

Great job. Brilliant.

Steve (39:12.845)
Mary Lou Retton, Nadia Komenich.

Steve (39:28.581)
I want to interject just because such a, first of all, let me thank you for that. That is really solid insight. And I was remiss not mentioning that. 100%. So let's dissect that for a second. So go back to my youth, in my early teens, think, Nadia Comaneci from Romania, right? And if you will, look at the sports where the women were so successful and they became household names.

These were headline gold medalists, Mary Lou Retens of the world. And look at the interesting side of the sports in which they excelled. There was almost no commercial maximization of what they engaged in. So once they left the Olympic, if you will, rings and got off the platform and left with their medals outside of some commercial integration for some smart brands that put them on a Wheaties box.

There was not last ability from an athletic expression standpoint. It was very small concentration. It was not a mass marketed opportunity.

Chris Russo (40:40.152)
Yeah, yeah. No, I think that that's right. And I think we saw a little bit of growth with the women's World Cup, the Mia Ham era with women's soccer and the women's national team. And I think that was later. look, I think right now, investors, again, from a commercial standpoint, look at women's sports and believe there is significant amount of growth ahead. There is increasing amounts of sponsor and brand dollars being invested.

Steve (40:51.973)
That was kind of coming along.

Chris Russo (41:09.474)
fans are going to the games, fans are watching, you know, the NCAA women's tournament in a way that they never have before. So I think that's, when I think about areas of real growth and excitement in sports, youth sports is in that category, women's sports is in that category. And what we started talking about earlier on, you know, AI, whatever that's ultimately going to mean for sports is certainly a hot area. So those are areas that are very,

I'd say some areas are not as strong right now. The media space, the traditional media space feels a little challenged and that's. I know what I mean. What I mean is sort of digital media, digital publishing, businesses that are sort of the legacy sports websites, maybe fast forwarded in certain ways. would say anything that is just purely ad support.

Steve (41:45.273)
You're saying, just to be clear about that, media space being the allocation of media to coverage.

Chris Russo (42:06.414)
is challenged these days because, you know, on the digital side, the big entities like Google and Facebook and others have taken a lot of the ad dollars and then even Amazon. so the digital, so there aren't as many digital publishing deals as there were where someone was selling, you know, Bleacher Report back in the day or the company I created, which was largely ad supported, Big Lead Sports, Fantasy Sports.

There aren't as many transactions out there these days with sort of independent sports. We saw a bar stool about four or five years ago get bought by Penn National. Then that got sold back to Dave Portnoy. And so that's been a more challenged space. I would say where, again, where the energy right now is youth sports, women's sports, and certain areas of tech. And that's putting aside the whole team space where at the high end, people can't seem to pay enough.

Steve (42:59.333)
you

Chris Russo (43:05.783)
for the teams, but that's a whole different market.

Steve (43:09.221)
You know, do you make of the 25 ratings, Caitlin off court from college to 2024 when she was on court for obviously the finals and literally you have 110,000 viewership differential between women's NCAA March Madness 24 and 25.

Is that any, does that come up in your discussions? Is that a statistic? Is it matter at all? Is there any consequence that an investor would raise to you as their guide in making a savvy investment that I'm concerned that this was too heavily anchored on a personality?

Chris Russo (43:50.114)
There are some people that look at that, but I would say there are other stars and there are other games and other talents. And I think these leagues are in and these colleges are doing a better job of building stars. And again, Paige Becker's is a big star and she was in the finals and, there were others around that group that I think will be the next folks to take that mantle. So yeah, I think, look, in a lot of these sports, whether it's the NBA with Michael Jordan,

It's hard to match the ratings that NBC had the 90s when Michael was playing, but yes, there's the next generation of stars. So I don't think there's any panic about it. And I think people are excited that that that that Caitlin and Paige and others are in the WNBA and and unrivaled was what you know that three on three league got off to a good start on Turner. So I think there's a lot of good momentum.

Steve (44:44.047)
You know, again, you triggered something else that I'm so grateful to have this conversation together. When Nicole Metzger, who is the head, believe, chief revenue officer, please forgive me, Nicole, if I've misremembered your exact title, she runs all sponsorship at the LPGA. And we were talking a lot, and this was back in the fall, we were talking a lot about what you just said, and you nailed it. In the digital era today, and there's no question,

and what we can come to in just a moment, what's going to happen in the AI world with content creation. But she spoke a lot about brand building for the athletes, storytelling that one of the most important facets of her life was how do we get out this messaging about Anelie Korda and all the others that are on the LPGA who have some remarkable stories about their life?

And it seems that one of the most successful ways to build leagues is obviously you to have a great product. Number two, in this increasingly cluttered world of opportunities to sponsor A plus sports properties, A, A minus, B plus, all the way down, you all of sudden have this enormous pressure on the

the owner, the league association owner, the event owner, to be an unbelievable storyteller, to take to the fore in any level, and by the way, this extends to the youth level, right? That the ability to talk about a 12-year-old athlete in a way, I mean, that's in many ways the story of Bronnie James, right?

that you're able to communicate effectively that makes it interesting, that grows your fan base, that increases interest, increases ticket sales, increases merchandise sales, increases broadcast interest, et cetera, et cetera, et cetera. And it takes time depending on the property. So you nailed it. A big part of this too is investing. If I were coming to you and if I had the associated funds,

Steve (46:53.037)
I'd want some guidance to know that whoever you're channeling my, wherever you're channeling our money, the steward, the custodian of that particular entity that we're investing into, better be one of the darnedest storytellers on the planet to take my capital.

Chris Russo (47:09.07)
Yeah. Well, look, I think it is, it is about storytelling. is about the authentic engagement with these athletes and it's about doing it on different medium. And again, it may need to be, what can you do in 40 seconds on TikTok that is going to engage, you know, younger fans. And so it is about the storytelling and it's about using all the tools that are available. And as you were sort of saying that what was kind of running through my mind is

How much can a league do that versus how much of that is really driven by an individual personality athlete that is authentically just great. And you just as the league need to make sure that person is exposed rather than you think you're going to craft that in some way that you're the master of the marketing message. so I don't know, it's an interesting, know, cause in a way it's like, I mean, I think back again to the nineties and I'll again, it was a big bulls fan.

think about the Gatorade commercial, Be Like Mike, that had, mean, the NBA did a great job of marketing the league, but that was Gatorade and Michael. And that was, you know, some of the things that happened are about the league. And then some of them are about the individuals and the brands.

Steve (48:23.077)
So since I understand you're also a professor at Northwestern, this is where I say Professor Russo, the famous GMAT answer, answer C, all the above, or E, all the above. So yes, yes, and yes, and yes. And very often athletes, unfortunately, it's very hard for them, right? And sometimes if they're big enough, they have third parties who are hired within their sports agency organization that literally run for them and have that ability to just...

Chris Russo (48:26.166)
Yeah.

Yeah. Yeah. Yeah. Yeah. Yeah. Yeah.

Steve (48:51.907)
manage the image, manage the brand, manage the message, and manage the medium, right? So with that, tell us if we were a sponsor today, and you were guiding us on all your research that you do in making investments into sports properties in the women's space, if they could put their money into one sponsorship entity, where would you guide them? You have one choice on all the, in the entire spectrum. And again,

Chris Russo (49:17.638)
Mm-hmm.

Steve (49:19.823)
It's not going to affect your regular business. How would we, where would you, I understand there are a lot of criteria, a lot comes down to how much money, take me just to this singular prototypical case of what you've seen and where if you had to pinpoint college pro youth, women's to girls, you've got 20 million to invest. Where am I channeling that 20 million?

Chris Russo (49:21.442)
Yeah, yeah, yeah.

Chris Russo (49:45.774)
I have too many clients that I don't want to offend, but I would say, and again, I'm going to give you a very rote answer. think the WNBA is going to continue to get more interesting. think with some of the players that are coming into the league this coming year, with I think that the second year of Katelyn and with some of the other ownership groups that are now getting involved in the WNBA, I actually think it is...

on the verge of, you know, it's obviously already a great league established, but I think it's on the verge of accelerating even further. A, because the product is good. It's a global entity, basketball. And I just think there are things there that even though it's been, you know, there's a lot of sponsors already in the mix. I think there's a lot more that can be done there. And again, I think it's not to take anything away from the, you know, volleyball and hockey and NWSL. I just think the WNBA is

you know, already good, on the verge of really some amazing heights. And so I would, I would look there, whether it's at the league level or team or individual players, I think they're, really poised at this point.

Steve (50:53.827)
Why would you take that over? You brought up Unrivaled, the three on three format just launched. Katelyn did not play this year. There was a lot of lobbying to make it happen. One of the guys who was kind of the, if you will, gray eminence, but in some ways very front and center, but just not the owner of the league. And that was David Levy, used to be president of Turner Broadcasting. And purportedly six year deal could be an extension to the three year deal signed with Warner Brothers, WBD.

For $100 million, again, what was written in Sports Business Journal, $100 million deal for a first year property, three on three women's basketball. May I ask why would you go WNBA and what would lead you there versus over getting in at the most embryonic stage of a new found league with enormous potential out to prove itself? What would yield, why wouldn't you have taken that capital?

Chris Russo (51:49.9)
Yeah, yeah, no, I don't think there's, don't think there's a right or wrong. I think that league has a lot of promise and I have great respect for David and know him and think that they're going to be successful. I just, you know, I like the five on five game. I think, you know, the stadiums that, that Caitlin and others are filling up with 10, 15, 20,000 people, I think is sort of a touch point for fans that I think is really important, hard to replicate that.

in a three on three format. think the three on three format is great. It's great to keep an opportunity for the women to play in the U.S. instead of going overseas in certain parts of the year. I think it's good television, but I think the totality of the WNBA experience and also the collective resources of all the owners that are now involved in it and want to get involved in it is just very powerful. But again, I think David's done a nice job and they will be successful in my opinion.

Steve (52:44.173)
It's a great, again, you're a man who knows his business, great point. When you look at three on three unrivaled women's basketball, it's a production studio of 850 seats. So this is a made for television entity that has a short lifespan in its seasonal, several months of play. Fascinating, fascinating, fascinating, Chris. Final query.

Chris Russo (52:55.106)
Yeah. Yeah.

Yeah, yeah, yeah.

Steve (53:13.987)
The greatest surprise that you're seeing, and I do want to end off on just one thought on AI and how it affects your life, if at all, from an investment banking standpoint. Maybe let's go there first. Does it affect your life in any capacity at this point?

Chris Russo (53:32.95)
I would say from a, from the perspective of just being a tool to do advanced searches, to organize information, to basically help me do my job better day to day, not so much the job of, of advising clients or all the thought oriented work around what's the right partner for you or what's the right strat. But I think just a lot of the nuts and bolts are done a lot easier using AI. So on the.

sort of more technical side, there's a benefit. But I'd say more importantly over time, I think there are going to be business opportunities in sports that are going to result in transactions that I'll be a part of, whether it be companies that are using AI to better assess and simulate or assimilate data from athletes and performance, whether there are AI companies that want to be big sponsors in sports and as a result want to buy assets.

I think there's a lot of opportunity going forward that will result in transactions. There hasn't been much of that yet, but I think there will be some of that. So I'm keeping tabs with those companies, getting to know them. And I do think going forward beyond just making my job easier day to day, I think there'll be some deals there.

Steve (54:49.189)
You're a lean machine. There was an article in one of the big financial papers out of London, just about some of the attrition that's gonna take place in bigger investment banks, where just what you said about so much research-based activity in the junior level is gonna be rendered obsolete. And they think perhaps, and maybe they're wrong, but by the end of 2025. Interesting. Yeah, the tool aspect for you obviously is a monster time saver and great insights.

Chris Russo (55:14.177)
Mm-hmm.

Steve (55:19.875)
If you had to pinpoint where we are a year from now, if there's any passion play you see in the sense of what would you look in, just give us that sense of, mean, here, let me take you down one path. I think because of COVID and I think because of the leveraging of the almost monopolistic leagues that we have.

Chris Russo (55:27.214)
You

Steve (55:46.214)
And I'm not saying this in a bully fashion. They get fair market value and people pay it. It's not a mandated, there's freedom of choice from a broadcaster standpoint. But as you know, the higher the broadcast rights go, the more expensive it gets for the common folk and for the sponsors, right? It means that networks have to charge more.

for the similar offering that they had before when their rights fees go up, they got to pay the bill. And particularly as a broadcaster, that bill comes from the corporate corporation, the advertiser, the corporate sponsor. So with all the leagues that are getting so expensive that so many brands simply can't afford anymore, you see the advent for many reasons, but the advent of a lot of new sports leagues since COVID, right?

think we've had 12 launches in the last 18 months of new bonafide, legitimate, compelling sports leagues. Where do you see from your side, does it continue to remain a very fertile investment banking environment where you see a lot of people priced out of the bigger properties, they just can't afford them anymore, and you see a different strata of customer coming in? Can you still see the high net worth billionaire playing a space in your sandbox?

Chris Russo (57:08.814)
Yeah. So a couple of things. One is I, uh, I agree that there has been a lot of emerging leagues that have, uh, launched in the last 12 to 18 months. some ways, those emerging leagues are good for brands that want to maybe get a bigger slice of the exposure more affordably. They're also good for high net worth people that maybe can't afford a $5 billion NBA team now, and, still want to be an owner of something, whether it's a franchise in one of these emerging leagues.

or it's owning a piece of the league itself. So I see that trend continuing going forward. And I'd say the way people think about ownership in sports, I think is also broadening. And maybe you own a major league team and maybe you own a minor league team and maybe you own a piece of a sports data business. And maybe, again, you're an owner of a team, but now you create a family office where you invest in a lot of ancillary businesses around the sports space.

So I see the momentum continuing and I see the variety of investment opportunities broadening because they're just all these other dynamics that either are being driven by technology, driven by new innovation, driven by new entrants. So I'm optimistic. think, you know, certainly the overall macro economy will have an effect. Things like the regional sports network challenges will have an effect. There's some...

negative things out there. But then there's also really bullish that, you look next year, the World Cup is coming to the US. I think that's going to spur a whole lot of new opportunities in and around the soccer space. getting people thinking more globally. So every year there's something kind of new, dry and then 28, there's the Olympics in LA. So there's a lot of good things on the horizon. So I do think you'll see more variety in the kind of investments people can take advantage of.

Steve (59:02.949)
Anyway, I don't have an earpiece in, but if I did, I would hear my CMO Dave Wharton say to me right now, you can't let Chris go without asking him this final query. Yesterday's news, Eli Manning, supposedly, purportedly interested in acquiring the New York Giants from the Mara and Tisch families. And obviously it's been in the Mara family since 1925. Wellington Mara's father was the, I think, bought the Giants for $500.

Chris Russo (59:13.005)
Okay.

Steve (59:30.357)
and Wellington's son John is the owner at this point. So with that said, Eli comes out, at least he's in the press, and there's news that Eli Manning wants to buy the New York Giants. The New York Giants, according to Sportico and our good friend Kurt Badenhausen, who codified the rankings over and valuations over at Forbes, who's now over at Sportico for several years, put out recently, the Giants valuation today is at $8 billion.

Where does Eli come up with that money?

Chris Russo (01:00:03.734)
Yeah, you know, I didn't see the heard about it. So I don't know if Eli was talking about buying the whole team or he was just talking about buying a small stake in it. So I'm not sure about that. But, but obviously if he wanted to buy the whole team, I don't think he made that much money in his, in his playing days. And I don't know if Peyton did well, but I don't think he has that money either. So I think he would have to find a high net worth billionaire who wanted to back him and partner with him.

Certainly that's been done before where a lead who's got some interest in a team has been able to cobble together or in this case, pull together a big check. But I don't know for sure whether that was buying the whole team or he just wanted to buy a piece of it and get involved, which is a lot of athletes do. They put in some number of millions of dollars and then they become brand ambassadors and they become very involved in the team. But he's been very successful in his post-playing career, so I wouldn't put anything.

past him.

Steve (01:01:02.181)
Clear, Chris Rousseau, what a pleasure. It's a real honor to have you today on the Transaction Report. with your investment banking, NBC media, sale of very successful fantasy sports group, NFL, I could go on and on, professor over at Northwestern, we'll do this again sometime. And again, a fascinating world of looking at the business of sports from an

Chris Russo (01:01:05.944)
Thank you.

Steve (01:01:32.081)
eye of finance and also just where are we heading overall in the trends of sports and sports sponsorship and sports investing and I thank you again for joining us here on the Transaction Report.

Chris Russo (01:01:46.126)
Thank you, Steve. I appreciate it. I enjoyed it.

Steve (01:01:49.231)
Chris will just have you for one last minute and your uploading should come okay.

Okay.