Steve (00:00.271)
Tell me, I mean usually we do between 45 and 60. If that's too much from you, can curtail it. If you want to play it by ear.

Wayne Kimmel (00:07.458)
Yeah, it's whatever, I'm good, I'm good.

Steve (00:10.979)
Yeah, we usually do long form in the 60 minute range, but we can certainly, whatever makes you happy is goodbye me. And where you based.

Wayne Kimmel (00:22.862)
We're good.

Wayne Kimmel (00:41.698)
Got it. Got it. Okay.

Steve (00:44.813)
Yeah, by the way, Kristen, Wayne hosts his own program.

Steve (00:51.833)
there you go. So, And before we start, I always like to, first of all, thank you for joining. And I was delighted that Dave met you at the conference. We've obviously crossed paths virtually for a long time. So it's a real pleasure. Where are you based, by the way? Are you in Philly? Yeah.

Wayne Kimmel (01:00.6)
You're welcome.

Wayne Kimmel (01:14.39)
Philadelphia.

Steve (01:16.531)
And is there anything that is top of mind for you right now that would be helpful, something that's got you today that maybe is new for you that gives you lot of pause for thought that we might want to cover before I get started?

Wayne Kimmel (01:27.822)
I'll just drop this.

Wayne Kimmel (01:34.786)
Nothing that for pause. I think, I think we're, you know, I think the biggest thing is what we're going to talk about is just that this is, there's never been a better time to talk about this, you know, sports business industry, right? I mean, like, this is the asset class of sports. Here we go. So

Steve (01:45.999)
Perfect. Perfect.

Steve (01:52.719)
Okay, so again, just in case there was something that was extraordinarily sensitive to, and it usually go by as founder of what do you, your magic partner. Okay, Good, we'll get going, okay?

Wayne Kimmel (02:01.6)
a managing partner of 76 Capital.

Steve (02:10.956)
What a distinct pleasure it has.

Steve (02:22.338)
Good thing we're not live. But I used to do live four hours a day, five days a week, and that doesn't happen. It's funny. what a distinct pleasure it is to have on the transaction report someone I feel as if I know. It's been multiple years I've heard his name. And I feel actually as I've gotten to know him before this meeting today, this discussion today, because I had the good pleasure of listening.

Wayne Kimmel (02:24.27)
you

Steve (02:51.342)
to many of the shows that he hosts every several weeks through his company 76 Capital, which he is managing director of. And Wayne Kimmel, what a, again, distinct honor it is to have you on the Transaction Report.

Wayne Kimmel (03:06.222)
Steve, thanks so much for having me. I'm really excited to have this conversation with you and talk about all the exciting things that are happening across the sports industry today.

Steve (03:15.534)
And as I say to most people, we're living in the most disruptive period in the history of, let's call it the human race for a few thousand years. And one could certainly make the case beyond a shadow of a doubt that in the sports business, the business of sports, as you like to say, the $3 trillion industry, of which about hundred billion of that is coming from sports sponsorship.

We are in a very unique time. And why don't we start, I learned from you some areas of real fascinating insights that you have about the industry and I'm looking forward to getting into them. One of them happens to go under the name of Cooper Flagg and his tenure at Duke, if Wayne Kimmel had his way, perhaps, and if our good friend Cooper was all in for it. But before we get to that,

Why don't we just meander together and take a look at what is the state of the sports marketing industry, the business of sports. And I'll yield to you for anything you'd like to share with our viewers.

Wayne Kimmel (04:21.038)
I think it's really incredible to see what's happened. As you said, we talk about sports now as an asset class. And that's something that is, it's really incredible to see what has happened over the last eight or so years. It's been phenomenal to see the growth of the industry, the professionalization of the industry, the amount of tech

data and analytics that has come and become part of the overall industry. Just the overall, the fact that if you really think about it, every single person out there does one of three things. They either play sports, watch sports, or want their kid to be the next LeBron, Serena, or Caitlin Clark. And, you know, it's one of those things which is just when you sit back for a second, you're like, wow.

this is this is what it's all about. It's what it's what everyone you know, what is somehow involved in this industry. And this industry has very, very quickly grown up and very, very quickly become a one of the leading, you know, asset classes of, you know, fastest growing asset classes out there today. I mean, and it's, and then we can talk about all the things that have sort of happened in all that. But it's truly, it's truly amazing to see where things are today.

Steve (05:47.629)
And Wayne, I'm gonna apologize. Kristen, are you getting all that ambient sound? You know, I happen to be about an hour north of Jerusalem right now. And there is a whole, just coincidentally, there was a whole procession for the hostages coming.

behind my apartment building. And I'm sorry, it was glaring in the background. I turned off my mic sound and I was hoping you'd keep going so you didn't have to partake in it. But I think it just passed, so please accept my apology.

Wayne Kimmel (06:06.641)
wow.

Wayne Kimmel (06:23.104)
Yeah, no problem. will. It's

Steve (06:32.33)
Okay, I didn't want to trouble Wayne with it. I, good, good, wonderful. Okay, next time, if it comes again, second time it's come through my way in the last many months, so.

Wayne Kimmel (06:34.7)
Yeah, I didn't hear it and I didn't hear it at all.

Wayne Kimmel (06:47.158)
Now, are you normally in Israel?

Steve (06:51.95)
So again, the beauty of a post-produce program, even though we do very little editing, does a great job on the show. So actually after October 7th, I got on the first plane ride out to volunteer. And I came in for two weeks and I was able to work US hours because my team is all in the States. And then I went back to the States for a month and I came back here for another six weeks. And then I came back a year ago, March.

Wayne Kimmel (06:56.749)
Right.

Steve (07:18.952)
and I'm back between the states and Israel. I have a daughter who's in her senior year of college here, what's called IDC or Reichman University. And then my youngest son, who's just finishing Yeshiva, will be here for a gap year starting, I think, in August. And my oldest son, who's gonna be 27, will be coming in August for a few weeks with friends of his.

So I have a place in what's called Zikaron Yaakov, which is about 12 miles, it's wine country and mountain bike country. And it's about 12 miles south of Haifa, maybe three miles northeast of Kasseria, and then maybe 45 minute train ride to Tel Aviv in a car, maybe 115 to Jerusalem.

Wayne Kimmel (07:58.69)
I know it well. So that's amazing. That's amazing.

Steve (08:04.466)
I saw your background and it made me very happy when I learned about what you've done with all your activities with the various organizations. That was very comforting for me.

Wayne Kimmel (08:13.742)
That's amazing. That's really amazing. My wife and kids, they're even better.

Steve (08:22.862)
Well, you do a lot. And when I was looking at your background, you know, I don't get many guests like that. And I'm the only guy in the company who's of this type. it's nice to meet someone who puts this front and center and walks with pride and is doing important work that you're doing. So thank you. And we'll carry on. again, it's just, it is funny by the way, that you as my guest.

Wayne Kimmel (08:44.44)
Thank you. That's good.

Steve (08:49.134)
Kristin will tell you this is the first time that has ever happened. So, with that said, Kristin, with your blessing, I'm gonna pick up that there is. And I'm gonna ask you if you don't mind, just remind me, I know you had just given the overview of what's going on in the industry, and then you paused and I was gonna respond, but if you will, do you have any recollection of where you were at that point?

Wayne Kimmel (08:53.998)
Well, it's, as you said, there's a lot going on in the world.

Wayne Kimmel (09:20.3)
I think I was letting you, you were gonna come in and I of just, I stopped and then you were gonna then come in, I think with maybe.

Steve (09:37.646)
I mean...

Wayne Kimmel (09:39.32)
Whatever you want to do.

Steve (09:43.822)
I think I can pick up from where he was. think I'm... Yeah, I don't want to trouble Wayne to do that. I think that was good. And yeah, so let me just jump right back in. Thank you.

Steve (10:05.71)
You know, it's important as you express that Wayne that what's so interesting, you know, I got in this industry in 1990, fortuitously. I went over to Asia to learn Chinese. I was supposed to go to Shanghai and Tiananmen Square took place June 4th, 1989 and was going to be one year in the Republic of China, Taipei, Taiwan. And one year into my language studies at Mandarin, someone asked me if I could help them with a high school volleyball and basketball tournament business plan sponsorship.

Marketing plan I said with pleasure. I played sports in college. I'd love to help. I love sport I didn't even know there was an industry and The last 35 years. I mean what we've experienced in just the last 35 months And by the way, it is not even 35 months since CHEP GPT 3.5 was announced on November 30 2022 So the world that has changed if you will it's about 30 months

and we have seen even with your good self, were the front and center AI part of the industry. That maybe initially people were caught off guard, wasn't sure if it was a technological fad. Maybe some men said, well, it produces some beautiful imagery, but I don't really see its relevance to my life. And then to the astute investments you've made, many of them, when you look at a company,

like for example, Shot Tracker and you look at Davon Ross and how you take a young man who played hoop in college and has built up with AI an ability to literally monitor an athlete's every move, every shot. It ends up being a bonus not only for a coach but for the athlete in her herself.

And you start seeing the nuance and the deployment of what looks very single minded or if you will monolithic, but having enormous deployment opportunity. And in the simplicity comes the beauty very often.

Wayne Kimmel (12:14.07)
You're you're it right on the head. I mean, it's amazing to see how just overall technology data and analytics have really enhanced the the business of sports, the game of sports. It's it's it's phenomenal to see. And now with what's happening with AI, it's just this next level. It's a whole nother level of being able to customize and

personalize experiences for fans, being able to give coaches and players so much more than just the numbers or so much more than just do this, do that. But it's it's it's it's really it's really incredible. And it's also been really interesting over the last several years is also just how willing the willingness of executives, marketers,

athletes, coaches, general managers to put this and then bring this as part of their overall daily, their daily work or their the way they look at the way they do things, right? It's not just, there's the tech guy over there. There's the analytics thing going on. Like, no, it's like, how do you bring this all together? And I think that, you know, AI is one of the reasons way to way to make it easier and simpler.

to for for people to be able to almost like digest all this information.

Steve (13:48.943)
You know, it's interesting when you're saying that it brought me back to, if you will, Moneyball. And I don't talk a lot about Moneyball, but I want to draw what I think is perhaps an interesting analog to what you were just saying now, why the difference? Because when we had Moneyball come out of, you know, Michael Lewis's book, popularizing what happened with the Oakland A's and Billy Bean, obviously looking at how data science and the concept of how to look at sports from a much more

if you will, statistical mindset, looking at it with the ability to make decision making, if you will, actionable decisions 25 years ago, and deploying those decisions, but it was very, very ivory tower. So what you just spoke about in the investments that I've seen, many of which you have made, what we see the beauty of the deployment of AI is it literally, and I said this two years ago to my team,

Every single human being on the planet Earth who has the bandwidth will become his or her own ad agency. They'll become their own graphic design firm. They'll become their own cottage law firm. They'll become whatever they choose to become because of the access and because of the ability to implement we're seeing online. I have a connection to a lot of folk on LinkedIn who produce literally short films now with AI.

and they are truly remarkable at a Hollywood caliber. One of the great breakthroughs last week was a 60 second long clip, but there was no cut. And that was considered a big breakthrough in the AI iteration of how to do commercial film and do it in a way where I don't have to have these staggered clips, but I could run it and it was beautiful. So it is that level of trying to find the simplicity.

and go beyond the 20th century model. And I'll just leave off on one more point on what you had shared. And I liken it to the descriptive analytics in trying to understand what's going on in our world of looking at sponsorship and literally how do you optimize, maximize and measure sponsorship. And very often in our world, and I used to own professional sports events for many, many years, domestic, regional or global in their scope.

Steve (16:07.158)
and work with many athletes, it was all about coming with one number to the brand. You got $6 million in value. And I always liken it to a dartboard behind our back. And there was an intern screaming out what that number was. And it really, for a person who was selling the sponsorship, who then actually activated the sponsorship and then measured the sponsorship, we were participating in not only the greatest conflict of interest, I believe in the industry as an agency or a team or a property owner.

but also in serving analytics that in today's AI world start to look very antiquated. We're just telling you a number. It doesn't go too far today.

Wayne Kimmel (16:48.302)
Yeah, that's that's, it's so true. I mean, and that and that's what one of the things I mean, you mentioned shot tracker, and it's a great example of one of our portfolio companies that is using using AI. And in a, you know, in a tangible way that we can, we can have a really real conversation about it right now. I mean, so to just be able to take in the data, and then be able to send it, you know, give it back.

Steve (17:00.11)
you

Wayne Kimmel (17:18.04)
produce, produce content so that a coach on the bench can use that for for them in game, you know, in real time, or or something like just that they're, they're preparing for a game. And they say they just pick up their phone and they say into their phone, hey, I want to see all the out of bounds plays that UCLA does in the second half.

underneath their own basket and play it right now. And then all of a sudden, it just shows up. And you can throw it onto your screen, your big screen and talk through it with your staff and your players. Those types of things are incredible. Simply doing being able to as a player to be able to see all of your three point shots from the left hand side of the court when you know with

X amount of time left on the shot clock. mean, these are types of things that were very hard to... It was very manual. And now just by typing or saying it, it's within seconds you get all this information back. And so it's really amazing to see how it's being used. And I think what's also exciting about the overall sports industry and what's happening,

Wayne Kimmel (18:58.005)
I that's probably us these days, right? But it's the old guys who are sitting around going, yeah, I don't know. I got to go see him or I just have a feel for this. And then, you know, and he's like talking about the actual numbers.

But what's interesting about sports today and almost and quite frankly, every other industry, we're all at the same place right now. So sports has come in and started to embrace tech data and analytics because they recognize, the industry recognizes that the value of teams, the value of leagues, the value of large sports properties by using all this tech data and analytics will increase your value.

But now so they're there. like sports is there now we can say it's there. The professionalization of youth, college, professional sports, it's they're all using this now. It's not like it's a weird thing. but now what where we are on equal footing with every other industry in the world is when you as you said, when AI gets better in one day, one week, one hour, it's used not only just in

the aerospace industry or the military or somewhere else, it's being used in sports. And so that is, I believe you're gonna see this incredible growth of this asset class, of this industry, because we've already embraced the use of tech data analytics, but now with AI, it's almost like this, it's a shot on top of all of it.

to really accelerate where this industry can go.

Steve (20:43.714)
You know, in one of your conversations with Paul Salem from MGM, chairman of MGM, I was actually mountain biking today in the hills of Monashah, the biblical hills of Monashah here in Israel. And I literally was thinking, I was listening to actually your interview, a few of you. And what goes through my mind in a discussion I just had with one of our guests, whom you may know, Shrapal Shah.

who was the former chief strategy officer at the commanders or formerly the Redskins. And he was discussing the idea of how to use AI in sport. And you two touched upon something which I find really interesting. So when the LLM is being used by us all, and you're inputting a prompt, let's say, for some feedback, let's say in your case, in the betting industry, And particularly as it relates to Paul Salem.

who I had never heard of before and I have to tell you is one of the most compelling, humble individuals having built up a $60 billion business in private equity. And obviously you two have a very collegial collaborative business relationship. It was very, to me, very insightful. And the challenge, is without getting too technical on the AI side, is how does one, what is needed now?

since we are moving at hyper speed and where others will have the access to do and perform the research on a near identical level with the near identical tools. At this point, there's no preferential status, presuming one didn't evolve and iterate their own model that all of sudden it becomes, so what is that next point beyond? And again, as you are often...

apt to say what is the next next big thing. So what comes to your mind when you start looking at as we have to, particularly in your area of venture capital at 76 capital, looking at that next next. So what takes us beyond? Have you looked into that crystal ball and based on your understanding of the market and all that's happening in LLMs, as you said, daily, weekly, monthly, what?

Steve (23:00.514)
What becomes a distinguishing characteristic of usage that gives us some form of competitive advantage?

Wayne Kimmel (23:08.652)
I think the interesting thing is it's something that each and every one of the companies we invest in use this in different ways. And I think that's important part thing to think about. So when you think about, say, youth sports and how you are

now able to stream a little league baseball game, let's just say, in Israel, okay, or in the middle of the country, you know, in the United States or in the Far East, and be able to have an ESPN like broadcast by being able to bring together the the data from a

one of the one of the players, it could be a baseball game, it could be a softball game, it could be a volleyball game, but like literally take the data and what's sort of what's happening on that on that field or that court, be able to and all it is is, you know, a parent, or, or a coach or a friend, just streaming that game that and then being able to have this, you know,

you know, like you were saying, like being able to make a movie, right? But this is like literally being able to have an ESPN like broadcast, just by using your cell phone and streaming a game, and being able to pull in the information, share the stats, the data, the all all the, you know, the exciting information, how, how fast is the you know, how, how, how hard is the picture throwing? How, how hard is, know, is, how is the

you know, the exit velocity of the of the of the batter swing, being able to see how far the ball went, to be able to see how fast the runner is running, right, you know, all of this information, and then being able to then not just spit it out, but actually have it be part of the overall broadcast and be able to then create images and like to do all of that is

Wayne Kimmel (25:33.92)
and be able to do that in real time when you're you're just using your phone is is phenomenal. And that's one of the things that our co and our company's diamond kinetics does with with their sideline HD streaming product be to be able to just pop open your phone and streaming. That's pretty incredible. And that's using all of the latest technology that that's out there today.

to enable you to have that kind of experience. So you think about that on the youth side, you think about how that can be used in on the on the collegiate side of sports, the professional side of sports. It, you you talk about you mentioned, you know, sports betting, which is a big part of what we, you know, we invest in from a technology perspective at 76 capital, how that's being used to make sure that sports betting is safe, as well as fun.

So we want to create a very safe atmosphere for people to be able to to be able to bet. But at the same time, we want to make sure that it's fun. How do you how do you do this? How do you actually produce the numbers to be able to get a prop bet on how many points will Caitlin Clark Clark score in her next game? How you know how you know if you want to bet in game?

while that game's going on, how do you produce those numbers in a way that is is is fair and fun and really entertaining?

Steve (27:07.246)
By the way, did you see the news today on Genius Sports announcement of the new betting app they've come out with? I have to say, I'm not a big bettor. But I will say, when I saw it, it seemed to be quite revolutionary. And what they've done is they've actually overlaid the app.

on the live feed. So what you have is the ability, you have your bedding console literally in the screen or on the screen of the broadcast in real time. And you can, as you talked about with Paul Salem at MGM about making a bed on Rory's next putt at the Masters. Is he gonna make it or not? And so I think one of the observations going back to our initial launch to this discussion,

is that one of the disruptions, no question about it, and it's only get more pronounced, is the real time ability not only to have engagement between fan as an example and sponsor and property and athlete, but to do so and create content on an instantaneous basis to respond to the facts on the ground instantaneously. So as they're happening,

you're able to build literally messages that might have a call to action for that particular target market. And it's seamless, or it has to be seamless in a way that it's non-invasive and it's just complimentary.

Wayne Kimmel (28:35.79)
And then you start to really think about what you talked about, one of the things that we say at 76 Capital is looking for that next next thing. And we really look at augmented reality and XR. mean, that is what's next. And it's not going to be that we're going to have to put these very large devices on our face. I think it's phenomenal.

the the growth, you know what, you know, and the advances that Apple and Metta have been able to do right where they're taking things, but we're still super early. And

Steve (29:09.678)
Better,

Steve (29:16.507)
this is, if you don't mind me saying, I would call this in vitro.

Wayne Kimmel (29:23.537)
Yeah, I mean, I think I think you're you're 100 % right. And so when you really think about that, and then you bring it to back to dollars and cents, and you think about it from an investment perspective, and you start thinking about where, where this is all going to go. And we talk about Whoa, my gosh, ESPN or NBC just paid all this money for these for these broadcasting rights. No one's paid a dollar yet for the XR rights.

the AR rights, like, what will that be? What is that going to look like when you and I are able to be, you know, thousands of miles away from each other, but literally sitting next to each other at the Knicks game, or at the Sixers or Eagles game, whatever it is, like, we and be able to sit next to each other, front row. I mean, we've been talking about these things for years. But like, this is

We are super close to being able to have these experiences and not only to have them with big goggles on, but like actually just having it be part of our life or even if we're at the actual event, how do you enhance that experience with you when you're there and you're just starting to think about, you're like, wow, I would, how many threes has Brunson just hit in a row? Wait a second. I think he's gonna hit one more. And that, you know, your brain just triggers.

Right, because this opportunity for you to participate and maybe place a bet or maybe challenge your friends in ways that you've never thought about doing this before. But these types of things, which were extremely science fiction like projects, where many of them are here, but they're gonna be here in an even more accessible way very, very soon.

Steve (31:12.226)
You know, I'm so glad, Wayne, you brought that up because some of my colleagues, and you met Dave Wharton, our CMO at SportsBiz. I've shared with him some insights when he'll ask me, where is broadcasting going? I say, well, no, we're broadcasting. If the 20th century towards the end of it was the incorporation of the home theater, the 21st century will be the incorporation or the adoption.

of the home arena. And so what I see happening is ultimately, instead of going into the basement to see a screen, you're gonna actually watch in your living room or in your whatever location that you have ample room, and you're gonna watch a virtual game literally with friends.

as if you've experienced like Cosm going to a Cosm experience or going to a real game experience. I do think one other point, I'm a big, I have enormous respect for Ray Kurzweil and his vision of where this world is going. And when you look at the neural augmentation that we're getting, since you're very, very committed to the next big thing, it will be the next extension, obviously commercially deployable and safe.

And it doesn't have to be invasive the way Neuralink is. Clearly, it doesn't have to be invasive, whether it's retinal, although that's invasive, or it's actually a glass that we're wearing, glasses that we're wearing. But the reality is that our ability to have augmentation and access from a cloud intelligence distribution, business intelligence fed to us from the cloud.

That also is not so far away. So going back to this disruption we're in at this time in the industry, it is fascinating. And to your point, really, whatever you put your mind to with the right team, much of this is deliverable today.

Wayne Kimmel (33:11.342)
It's and we're getting there. We're going in. I'm saying I think one of the next steps right and one of the next things that we're going to see and we're very excited. I'll leave it at that. We're very excited about ESPN flagship and what's going to be able to what's happening there. You know, Bob Iger, Jimmy Pataro have talked about what this flagship product is going to be like.

You'll be able to on your TV screen using your regular TV control. You'll see your fan your ESPN fantasy games, contests, groups that you're in. You'll be able and it'll know that you know where you know what game you know your players that are on your team are playing it and how you can potentially

not potentially be able to go from just seeing your fantasy team, but then going and watching that game of one of the players that's on your team who's potentially about to, you who's going to start, who's going to score a touchdown. You're going to see your ESPN bet on, you know, bets down the side of the screen. You're going to be able to purchase a Jersey or a hat or some, you know, some other, you know, type of, you know, know, logoed

you know, whatever you want, whatever you'd want to, you know, buy through their partnership with, you know, one of the major retailers out there, online retailers. So, I mean, to be able to think about what that is going to look like, which is, you know, they're going to actually announce the real name very shortly.

Steve (35:00.748)
Next week, yeah, they just had that announcement yesterday. Next week, supposedly, they're announcing a pricing model and the name.

Wayne Kimmel (35:04.983)
Correct.

And this is all gonna go live. And so what, and this will be live this fall, but the underlying piece of this to enable all this to happen is technology.

Steve (35:21.134)
100%. And think about the customization and the personalization, very David Edelman-like of his recent book from Harvard Business Review entitled Personalized.

And it's all about the concept of everything is micro personalized and in personalized, I guess that's a bit redundant. So personalized, really personalized guys. So we're talking about Wayne and Steve and you being able to receive what's important to you and not necessarily what's important to me. And I think going back to ESPN for a moment, because I think about this all the time. I try to think about having been in broadcasting for 35 years.

What is the next iteration beyond streaming? Like, how are we going to consume this? What is that iterative approach? Obviously, there are feature approaches, such as personalization of camera consumption. And feed me the type of communicator I want. And maybe I want an influencer, who I think is a really Gary commentator, who's part of your portfolio now.

It's not an athlete, it's just someone who's great at commenting on sports, but does so from an vantage point, as you just said, perhaps from a singular vantage point of an athlete, who I get particularly pronounced camera angles from, on an athlete who I really want to monitor, and I want that in my feed. And not only that, maybe I want a merchandise opportunity, as we're talking about, since he is someone who's part of my goat world.

I want or she, I want that experience to be intimately part of his or her contribution as it's happening. And I'll be able to choose the angles I want, I'll be able to choose commentary I want, I'll be able to choose again, everything will be on me to guide the experience. And that's really crafting something that has lastability and obviously much more targeted results.

Wayne Kimmel (37:17.134)
You're absolutely right. that's where, you know, there's a, as you can see, I'm holding back. In a couple months, we'll have to do this again and we'll talk about some of the things that are about to happen. We're very excited about it, but I'll tell you, it's...

Steve (37:26.99)
You're on!

Steve (37:34.158)
You're saying you're excited about, and just so the viewers understand, in ESPN flagship, would you share, obviously when you're talking as a venture capitalist, your particular role or interest, is there a component part of it that you've invested into?

Wayne Kimmel (37:54.22)
I think the way to put it, to keep it at the right level certainly is the fact that we have a number of companies that are doing things with the biggest companies in sports, in media, in technology that are doing things, whether it's in AI, whether it's in augmented reality, whether it's in this customization and personalization of experiences.

Steve (38:03.662)
Hmm.

Wayne Kimmel (38:22.942)
You know, one of our one of our companies most recently just launched with LG and you literally on on their on their smart TVs where you're able to see your your teams and everything that you're interested in when you turn on your TV, it's it's part of the overall OS of the of the actual TV and they're providing you with the the information that you want to see around

the teams that you're interested in. So there's that's something that we can we can certainly share at this point. But at the same time, even in the in above my left shoulder, I mean, you can kind of see our company Quintar and what they've done as the official augmented reality provider to the PGA tour. That's really, really fascinating to see, you know, literally, you know, right right above me is one of our companies called Boomerang, which is a unbelievable company that enables

Steve (39:20.034)
You lose something in a stadium, you get it.

Wayne Kimmel (39:22.254)
stadium and arena, hotel, a casino and airport. And through the use of the latest technology through the use of AI to be able to match what you say you've lost, and what you you know, and hopefully someone's found it. And if they do what that relate with how you can get it back, right? As simple as simple as just calling an Uber.

Steve (39:28.131)
you

Wayne Kimmel (39:47.726)
right? What wouldn't it be amazing? And it's a it's incredible to see the stories of people who have, you know, lost things at Madison Square Garden, or at Fenway Park, or at Mile High Stadium in in Denver, you know, these are many of these places, airports and casinos and other places where they they lost their phone, they lost a ring, they lost, you know, a keepsake that they never thought they would ever get back, but they get it back and they get it back in a really simple, easy

way and it's an incredible way for these teams and these leagues to build even more of a relationship with their fans by using the latest and greatest technology to enhance the overall fan experience.

Steve (40:34.136)
You know, as we have talked briefly about youth sport, one thing that caught my attention just learning this last week, I had not known Henry Kravis from KKR had invested in PlayOn, 29 sports, 29,000 high schools. When I start seeing mergers and acquisitions, corporate raiders put their cash into youth sport, I know that you're very, very focused on youth sport as well.

There's no question that we fully agree this is perhaps along with women's sport, one of the hottest commodities in the industry. Before we segue out of that, let me, I know you have a point you want to make on that.

Wayne Kimmel (41:17.09)
Yeah, I mean, I look at it. It's just a simple, simple point. mean, I think on average, you know, parents are now spending $1,500 per kid per sport, you know, per season.

Steve (41:27.32)
And if it's soccer in the United States, where it's a pay for play traditionally, it can be a lot more expensive for those who are playing well.

Wayne Kimmel (41:36.106)
You got it. Whether it's soccer, lacrosse, basketball, you name it, the numbers are even higher. But on average, it's about $1,500 right now. But I mean, if your kid is playing at an elite level, a club, a travel team, that number is 20, could even be 30 plus thousand dollars a year. there's really, really, and because it's just, there's some really funny

short videos of coaches of comedians doing shows around the fact that, congratulations, your kid just joined the elite travel team, D-level, right? And what does that mean? It means you pay me more. What does that mean? Your kid is mine. He comes here every single day for five days a week. And your family will be traveling to...

all over the world, you'll be trapped and you have to give me that money up front right now and they need a uniform and they needed hotels and they I mean, but when you think about it, that's what it's what's truly happening out there today. But, you know, but bringing it back, I mean, it is it's, it's because what we said earlier, and we talked about earlier, that when you really look at what people do today, they watch sports, they play sports, and they want their kid to be an elite athlete.

and hopefully a pro or maybe even just a really high level college player that is going to get a lot of money directly from the university starting this year first time ever universities are going to be paying play their their their student athletes if I think they still call him that directly now direct money from the university not NLA not an NIL dollars from donors and sponsors, but direct pay from the university. That's a new thing. And that's something that is

Steve (43:27.278)
Thank

Wayne Kimmel (43:28.718)
really incredible when you hear about some of the budgets of some of these major power for power five conferences. When you think about what those numbers are, in some cases in football, they're between 30 and $40 million for a football to just have to pay the players.

Steve (43:45.239)
If I remember correctly, Texas A when I had looked, and I'm gonna put another 20 million on it, it's probably nearing it as an athletic department, at about $200 million as a spend. Obviously, they did just that deal with Playfly, your good friend Michael Schreiber, an advisor at 76 and chairman of Playfly, a $550 million 10-year deal in a rights deal to work in collaboration with our friends from Texas A

But yeah, the industry is extraordinary. The athletes, when you consider 98 % of all college athletes, never turn pro. They should finally have an opportunity to at least benefit from what they've generated for the school. What's fascinating too, going not to youth but high school and distinguishing it from the younger generation, and that is that you 41 states now capable or permitting NIL payments for high school students. What I learned today with my colleagues is that

Wayne Kimmel (44:38.382)
That's correct.

Steve (44:41.182)
like the number of deals outside of Brawny and a few other, Arch Manning and a few others, like they're really far and few between. I was unaware that there were so few significant deals at the high school level and they could just be early adoption and getting their feet wet. Before we segue to something that you said that is really interesting to me about Cooper Flag and Duke, I wanna just ask you, when you look at that high school engagement and NIL,

And you look at the college side of it, obviously being very significant and increasing exponentially each year. When I first thought about it, and I probably first talked about it 10 years ago at one of my kids' high school classes, and I said, it's just inevitable.

There's nothing that will stop me. Sonny Vaccaro was doing deals left and right already with the athletes. The Adidas guys got caught and there was a severe penalty for that. It was almost a Tom Brady moment of deflating a ball when quarterbacks made the ball fit their hand, which for me personally, I have no issue with. And just say we quarterbacks want this as part and parcel with our right to do because our hands might be smaller or bigger than another athlete.

With this in NIL, what I always saw being a factor, and I have no, I've never looked in due diligence at this, but it will come, I'm sure the stat is out there at some point, maybe Sponsored United might have, which is, I always saw that mid-level athletes were going to lose deals, and the law of unintended consequence of NIL at college level would be that mid-level athletes that had endorsement deals were gonna see a lot of money come out of that system.

and go into the college world because basically brands were making decisions almost like VC and were saying, look, if I can get 40, 50 athletes in a portfolio and a few of them go pro, I'm in great shape. Where am I getting some of that capital? If it's not a creative, I'm gonna get it from some of the athletes who are in the pro side at the mid level. Any knowledge you have on that side, Wayne?

Wayne Kimmel (46:46.656)
I mean, you're talking about college athletes kind of taking dollars from the pro side, it?

Steve (46:52.27)
from the pros, not talking about the elite performers, but pros at a certain level of the game.

Wayne Kimmel (46:55.234)
Yeah. Yeah. Absolutely. mean, I think, you know, it's one of the things our strategic partner on the talent side at 76 capital is a company called Rubicon Talent. Rubicon, you know, is a sports marketing firm that works with athletes that are professional athletes, Olympic athletes, broadcasters, influencers and chefs as well. And, you know, some of the, you know,

Steve (47:05.742)
Hmm.

Wayne Kimmel (47:22.456)
we've really been focused on the professional side of athletes and mainly NFL players for many years. And it's been really interesting to see what's happened. So again, working with someone like Greg Olson while he's been on the field and then now as a broadcaster at Fox to see guys like George Kittle, Devontae Smith with the Eagles.

Jaden Daniels with the Washington commanders today and really working with them on all their off the field deals. But what's what's happened is, over the last several years with the from an NIL perspective, we've now started working with some of the elite collegiate athletes. So as an example, Quinn Ewers, the quarterback at at Texas who was who was recently drafted, right? He was a really big opportunity for him to be on the cover of

the EA Sports College 2024, right? That or 2025, think it was 2024, 2025, whatever last year's was the right number. But it was phenomenal to see him and all the deals they were doing. And then also at the same time, Ashton Genti is also a client. And to see how be able to bring deals to him as a collegiate athlete, but then the lead up to the draft.

you're going to see some amazing things that the team has done with him. Now that he was, you know, such a high draft pick as well, you know, just amazing to see that. And, and again, those kind of dollars probably may have, you know, could have gone to the second or third best player on an NFL team, but are now those dollars are going to the top collegiate players on the on the football side of things. So it's

Steve (49:13.368)
So there is a consequence. There is a zero sum game, if you will, at this moment.

Wayne Kimmel (49:14.926)
So there's absolutely.

Yeah, but I think it's also been so at the highest of levels. mean, certainly it does trickle down. There's opportunities for more and more people to do more and more. But a lot of the big dollar deals are looking for wherever they can get the most bang for their buck.

Steve (49:34.263)
I mentioned to the team, to our viewers, we're gonna get into a comment you made which I thought a lot about and I really had never heard it before. And here's the scoop. Wayne Kimmel says, college sports, if he were the commissioner or if he were of one of the conferences or if he were the head of the NCAA, perhaps.

an athlete now that we've finally empowered them to earn a living, if you will, to be paid for play, to be paid a rightful living wage and beyond for what they've contributed to a school. And what I heard you say that was so interesting, I never heard it before, was when you were talking about Cooper Flatt, you gave an illustration of where college is going.

and how professional college has become in sports, that college athletic departments in your discussion with Michael Schreiber and certainly listening to Michael and I've had the pleasure of speaking with Craig Sloan and we're in discussions with them in collaborative discussions, I will say the following. No one has ever said as college becomes so corporatized and professional, maybe a college athlete

should in fact not be limited to four years of playing at the college level, but looking down the line a little bit with the monies coming into college, that maybe an athlete should have the choice to stay and play college ball, again only 2 % of athletes go pro, let them remain in the college and if I heard you correctly, it could see someone like Cooper Flagg if he so chose and if you were the head of the NCAA.

He could be a 10-year tenure at Duke and not being forced to move along after his fourth year.

Steve (51:36.04)
Explain that to us. Give us some of the colorful insights of how this actually works.

Wayne Kimmel (51:41.56)
So who made up four years of college? Like why four years? so, because an undergraduate degree is four years. But if you, what if you want to now get a, you know, a master's degree, a doctoral degree, go to law school, go to medical school, get an MBA, get a, whatever it is, right? And, but again, but then, but then I'll take it even further, Steve. It's not only about being enrolled at that school.

Steve (52:01.101)
Hahaha!

Sure.

Wayne Kimmel (52:11.704)
You're just playing for that school. These are professional sports organizations. These are not educational only. It's not just educational. It's it these are

Steve (52:23.054)
So does the player have to be a student at the school matriculating? So what's the distinction between a pro league and this league that you're establishing? At the college level, what constitutes, and that's where I was having a mind block, what constitutes college ball at that point when Wayne Kimmel was the commissioner of the NCAA and he's instituted that anyone wants to play college ball for Maryland, Wayne's alma mater, therefore undergrad,

Wayne Kimmel (52:26.626)
Going forward, I don't think so.

Steve (52:51.692)
Therefore, what happens when this student, and you're saying he doesn't have to be, or she doesn't have to be, a student of the Terps. They can come and play. The coach recruits them. They play for the Terps for the next 20 years because they've got six degrees. But you said they don't have to be a student. So matriculation is not important.

Wayne Kimmel (53:09.294)
that's what's happening. But that's literally for the most part, that's what's happening today. Right? When you really think when you really look at what's happening today, what's happened since the NCAA during COVID kind of just threw up their hands and they're like, whatever, too many lawsuits, too much going on. Every time we make a rule, we're getting lawsuits, we can't handle this anymore. And they literally said, okay, whatever, whatever goes, it's all, you know, and it's become this

complete wild wild west, where you have a transfer portal with 1000s of kids from within whatever you name the sport, there's 1000s of kids that are in these transfer portals. They you know, going from college to college. You know, there's as soon as the talk about college basketball, as soon as March Madness is over, if your team doesn't make March Madness, you jump into the portal, you're not going to class anymore. Right?

Steve (54:06.038)
Yes, the point is taken, it's sensibly professional. what's so fascinating, because it's an awesome concept, the question again is what becomes the distinguishing factor from that league and are there caps? In other words, if I'm the NBA or I'm the NFL, any major league, I'm gonna say, Wayne, I have a G League.

Wayne Kimmel (54:09.409)
It's

Steve (54:30.188)
Wayne, I have other means of training minor league players and feeding them into the system if they so fit. But I'm very, very territorial because what you're gonna tell me now is you become a competitive broadcast entity. So now you become not only a very serious competitive, very competitive sponsorship entity, ticket sale entity, big broadcast competitor.

So I'm just trying to understand, is there any nuance, and there doesn't have to be, but I come into this with no emotional equity. I'm just curious, is there anything that distinguishes the Kimmel League in college sport from the pro leagues?

Wayne Kimmel (55:00.206)
Yeah.

Wayne Kimmel (55:09.166)
I'll say it, no.

Steve (55:11.534)
I did not expect that from you. I actually thought the Kimmel League was going to have some nuance that still kept. So basically, so the motivation for you to want that, let's get to that. That's more interesting to me. What is the motivation of the Kimmel League that there would be college athletes calling themselves Duke players or Maryland players or whatever school Clemson?

And they play for Clemson, they play for Duke, they play for Maryland. Outside of playing for the New York Giants or playing for any of their local professional teams in any school around the country, I'm looking for that little bit of how to make this work. And what is it that, again, because I play for a professional team called University of Michigan, that I'm now just playing for another school? It's a school.

It is a school, and there's a benefit to the school, I imagine, financially, in the Kimmel League, if they win. And obviously, being part of a conference, there's distribution of funds. Anything, any little bone you can throw me?

Wayne Kimmel (56:21.678)
I think, well, here's the thing. It's, it is something where it is a massive issue that the professional leagues are trying to figure out right now. Because here's the here's the thing, right? If you said Michigan, you're a, you know, athlete at the University of Michigan.

You're living in Ann Arbor in a beautiful place on a beautiful campus or you can use the Cooper flag. You're down at Duke. You're in this, you know, in Durham. It's beautiful there. Beautiful campus. You're around young people. You're living around and it's just you're having the best time ever. You're playing at the at the highest of levels. You're on ESPN. You're on Fox. You're on all the all the all the networks all the time. You're get you're making the same amount of money.

that you'd be making if you were in the NFL or in the NBA, you're making a lifestyle decision, you're making a personal decision, where do I want to play? Right? Do I want to just play at Duke or at Michigan for my whole career?

Steve (57:27.896)
So what would be the competitive distinction between Cooper and other Coopers staying at the college level versus what exists in something called the MBA then?

Wayne Kimmel (57:39.788)
I think that's where it we're you know, what it comes down to is that there's going to be the who's going to be able to market better to be able to bring that level player to their league, because the colleges has been that's become a league. The NBA and the NFL is a league. They are the elite leagues. Absolutely 100 % today. That's what you you aspire to go where you aspire to go. But from a dollars and cents perspective,

you know, maybe it's an opportunity for you to make more money in, you know, at your college, in your college town, or for you personally, where you may not be good enough, you may not be the highest level player, right? You may be a really good college quarterback, but you may not be one of the top, you know, 30 quarterbacks that can make it in the NFL, right? That's a whole different, that's another level.

But you're good enough to be really, really good in college. And at that level, you just want to stay there. And that's and that's part of what is is potentially what's happening. And that's where you said it like, look, it makes sense in the old world a few years ago, that, yes, you know, you do your four years in college, and then you go to the G League. And if you're good enough, you can make it to the NBA. And that's what that was sort of set up to go do. But then the NCAA kind of took off all the rules.

And this next rule potentially of this, you only get four years if that extends, which they are talking about extending to five, we'll see what happens there. What you don't have on the college level that you have on the pro side of things is there's no unions, there's no collective bargaining, right? I mean, there's no like the players versus the...

the teams and the league, right? There's no bargaining. So how can you have a salary cap? You can't have a salary cap because no one's really barred. There's no collective bargaining for to even create that unless the president just decides, you know, he's the key crew, you know, of the United States decides that, you know, create this commission. And he says what the rules are. And, you know, he kind of takes his big fat pen out and starts writing stuff. And who knows what what happens there. But I don't know, like we don't.

Steve (59:59.991)
And that's in play right now as we understand.

Wayne Kimmel (01:00:01.814)
And that's in play, right? And that's in play and what that will really mean, you know, and how, what are the levers to basically make rules? I think he thinks he can make rules for anything. But like, but I don't know, like, I mean, we'll see what happens there. It's it's look, this is these types of things that were once like, it will never happen that the NCAA or college football will never compete with the NFL.

and they shouldn't and it's not right and it's, know, this isn't how it should be. Well, that's not, that's not reality today. It's the same thing that's happening potentially within the sports betting industry, right? Sports betting is fascinating what's happening in that industry right now. And sorry for sort of switching over there, but it's a very similar, similar point here. The sports betting industry since 2018 was a state by state thing where you had to get

licensed in every in different states, states had to pass laws to enable you to have sports betting in those states. And that's moved very quickly in the United States to have now have 38 states that have sports betting in their states. But all of a sudden, you have this company called Kalshi, you have these companies that are now like they they're they believe that they're quote unquote, they don't call it betting, they call them they're they're, you know, they they they're talking about

their contracts basically are being regulated on a federal level. Right? So all of a sudden, they're saying that you can now have sports betting on a federal basis, quote unquote, sports betting on a federal basis. What does that mean? That sort of blows up this you have to get a license by a state regulator, which is the which is the way it works today today, you know, in the United States. Will that get blown up? You know, we'll see.

that could again be blown up or be changed by a stroke of a pen, right? That's the kind of thing where we're in this really unique place right now with sports, whether it's on the college side, on the pro side, on the betting side of things, where we're not really sure what the future is gonna look like. But the one thing that goes through all of this and the reason why all these things are happening and why they're so exciting and we'll see what the future holds is because people love

Wayne Kimmel (01:02:22.804)
sports. They love to play. They love to watch and they want their kids to be the next great, great player out there. So those are the things that are constant across all of this. And that's why there's all this change. That's why there's all this innovation. That's why we're so excited at 76 capital about what's going on because who knows, because it could be the president, it could be the head of the NCA could be the idea that you can play forever in college, I don't know, the NFL and the NBA are going to try to stop that. But can they?

Steve (01:02:54.028)
Wayne, I'm gonna offer my services. When we meet one day, I'm gonna gratis, and maybe we'll call it the Kimmel-Foyerstein League. I'm back with you when you said, about all those athletes that can't make it in pro? And so I wanna propose to you, we'll sit down, we'll take out a legal pad, we'll write up the terms, and yes, those athletes who can't get into that pro league, having some type of sustained

path in life because this has been their life for the last 18 years when they come out of college. Let's call it a 21-22. For 18 years they've been playing ball and for 18 years they dreamed about playing pro and now they're not. And so the Kimmel League makes a lot of sense to me. I'll share with you one thing just to leave off on just to leave off so that we can have another discussion. If Cooper stays on the team and there are a few other Coopers and they have an average lifetime let's say depending on the sport like basketball.

where it might be eight to 12 years. All of a sudden, a lot of younger Coopers trying to get on that team and play ball don't have access to the court because all of a sudden that team with the goats on the floor might have longevity that all of a sudden it hinders and hence we have a law of unintended consequences that we in the Kimmel League have to remedy rapidly. So with that said, no, you know what? I'm gonna yield the last word to Wayne.

Please go right ahead.

Wayne Kimmel (01:04:23.416)
You you led me right into it. And I think one of the things that we're thinking about is youth and high school sports and the professionalization there. And I think that's what you're seeing. You have a shining, a shiny kind of example of like what, you know, certainly in the U.S., what a, what a top level sports academy looks like with IMG and what they're doing. But there's only one of them.

Steve (01:04:31.267)
Mmm.

Wayne Kimmel (01:04:52.014)
right, there's only one in the United States. So you start thinking about what could that look like? There's a reason why some of the smartest private equity investors are investing in youth sports and youth facilities and, really thinking about what the the opportunities are there. It's more than just the competition there. It's the media, it's the content that can get created. It's the idea of really creating brands at that level.

Steve (01:05:05.102)
Yeah.

Wayne Kimmel (01:05:19.704)
Do I think it's 100 % healthy for young people to be under that sort of microscope? As a parent, probably not. However...

Steve (01:05:27.31)
By the way, youth sports psychology will certainly gain traction.

Wayne Kimmel (01:05:33.258)
it will absolutely either but again, it's it's happening.

Steve (01:05:37.934)
And that would be, by the way, AI therapists.

Wayne Kimmel (01:05:41.718)
And so it's it's it's it's it's coming. It's coming on a global scale. We are going to be, you know, you know, the next couple of years with the World Cup coming to the US is going to be a huge moment for just global sports and to see the fandom, the amount of money, the amount of attention, the amount of interest, the brands, everybody thinking about because think about it. I mean, Steve will.

Steve (01:05:52.76)
Yeah.

Wayne Kimmel (01:06:10.122)
maybe we kind of end on something like this. mean, why? Why is all the money coming to sports is because we're this is where people focus their time. So that's where if you're an advertiser, you got to be you can't find people anywhere else. But you can you can find the best consumers, you can find all the consumers who are consuming live sports. And that's why all the money's coming here. And it's because it's the thing that we love. It's what we want to be involved with. And

That's where we are today and we can make this really special and do the right thing and make it safe and make it fun and have, take care of people, whether you said, mean, from a mental perspective, from a physical perspective, mean, from just a...

From an overall enjoyment perspective, we can do this great. mean, we can do really, really special things. And because it's like what we've always said here at 76 Capital, and I've been in this venture capital business for 26 years, and we say this all the time. We want to work with smart and nice people who want to change the world. And that's what we're doing right now. Sports is the thing that's truly changing the world. It's the thing that brings people together, hopefully making this world a better place for everybody. And that's what it's truly all about. And that's what we think about every day here.

Steve (01:07:32.142)
Wayne, what a pleasurable, truly pleasurable conversation. It was relaxed, it was substantive, it was just meaningful. And I think we all got a lot out of your presence here on the Transaction Report today. Wayne Kimmel, the managing director and founder of 76 Capital, privilege to have you on the show today.

Wayne Kimmel (01:07:55.032)
Thanks for having me, Steve.

Steve (01:07:57.219)
Well done, sir. Thank you. It was really pleasurable. Kristen, I know it just needs you for one moment to get your story recorded.

Wayne Kimmel (01:07:58.872)
Thank you. That was fun.