As I start my 12th year as a partner with Sapphire Ventures, I couldn’t be more excited about the evolution of our venture platform and our newest initiative, Sapphire Sport — a $115+ million investment platform that will invest in primarily Series A and B-stage technology companies at the intersection of sport, media and entertainment.
We at Sapphire Ventures have always challenged ourselves to stay innovative as investors and create new strategies that we believe create long-term value. As my partner, Nino Marakovic, wrote two years ago, Sapphire’s “multi-faceted approach to venture capital investing seeks to leverage our insights, expertise, deal flow and global network across the entire technology VC landscape, not only enterprise (software).”
It is through this lens that we started exploring the sport, media and entertainment markets, and realized that these markets exhibit the exact attributes you look for as a venture capitalist – massive, rapidly-growing markets being disrupted by technology. This disruption is creating new consumer experiences, new business models, and new, investible platforms such as esports, digital fitness and sports betting/data analytics. This is the good news.
The bad news – which often happens – is that markets like this attract significant investment capital. As an investor, it can be difficult to differentiate yourself from the other money and deliver a unique value proposition to the top-tier entrepreneurs and companies. As any sports-team owner, stakeholder or front-office executive knows, if you are going to enter a market, you’d better have a strategy to win.
Fortunately for us at Sapphire, we had already created an investment platform that we believed could be extended into the sport and media domain and give us a competitive advantage. This strategy is based on 3 main pillars:
1. Value-add Limited Partners from the broader Sport ecosystem
We knew that in order to differentiate ourselves as investors we needed an investment strategy informed by a limited partner (LP) base that included value-add, strategic investors from all parts of the sports, media and entertainment ecosystem.
We started this process with our anchor investor, City Football Group, owners of English Premier League (EPL) Champions Manchester City, and added complementary LPs with a similarly long-term, global approach toward embracing technology disruption in the sport marketplace. Today, Sapphire Sport is the first-of-its-kind venture capital platform that brings together owners and stakeholders from all major US sports leagues (NFL, MLB, NBA, NHL and MLS), the EPL, and leading global consumer, media and entertainment companies.
Sapphire Sport investors include, adidas; Anschutz Entertainment Group; Bank of Montreal; City Football Group; the ownership of the Indiana Pacers; Intersect Ventures; Jeremy Jacobs, owner of the Boston Bruins and Delaware North; Major League Baseball; New York Jets; the funds affiliated with the owners of the San Francisco 49ers; San Jose Sharks; SAP; Sinclair Broadcast Group; Jeff Vinik, owner of the Tampa Bay Lightning; and WISE Ventures, an investment fund led by the Wilf family, real estate developers and professional sports team owners.
2. Leverage Sapphire Ventures’ established technology venture-capital platform
When Sapphire assesses an investment opportunity, we believe it is critical to cast as wide a lens as possible. With over 1000+ global start-ups in our direct and indirect Sapphire Partners portfolio of investments, we believe Sapphire has built the most robust global-sensor network on innovation in the industry.
Once we make an investment, we have a dedicated Portfolio Growth team whose job is to make that portfolio company successful through business development introductions with Global 2000 CXOs, access to our executive talent network, sharing best practices, or marketing and communications support.
This 2-pronged approach – on the diligence side and the post-investment side – has helped us succeed with more than 50 IPOs and M&A exits since Sapphire became independent in January 2011.
Sapphire Sport launches having already made five investments in exciting technology companies:
- Tonal, a digitally connected home fitness system;
- mycujoo, a long-tail, global sports streaming platform;
- Overtime, a next-generation digital sports network;
- Fevo, a social-enabled payments solution; and
- Phoenix Labs, an independent gaming studio and the creators of Dauntless
We look forward to leveraging Sapphire’s tried-and-true investment platform to help our current and future companies grow into companies of consequence.
3. Dedicated Team of Professionals
At Sapphire, we pride ourselves in our team approach and are excited that everyone at the firm will be involved in Sapphire Sport at some level. However, it was extremely important for us to find a dedicated investment partner with early-stage, consumer-oriented investing experience and domain expertise. Above all else, we also needed someone who shared Sapphire’s values, our enthusiasm for the sport opportunity and embodied our culture.
This person is Michael Spirito. Michael is a media veteran, having worked as an operating and equity partner for the New York Yankees, helping them sell the YES Network to Fox in an industry-defining deal in 2014. Michael is also an active early-stage investor.
I am thrilled to have Michael join me on this journey and look forward to adding more to our team over time.
In subsequent blogs, we will outline our thoughts and ideas on areas we are evaluating. For example, you’ll see in an upcoming blog by Michael, the opportunity to invest in the global sport marketplace is vast and we will constantly be assessing which areas we believe are most attractive for investors.
On a final and personal note, I am eternally grateful for the support entrusted in Sapphire Ventures by some of the most innovative and successful sport stakeholders in the world — all of our investors and entrepreneurs share Sapphire’s focus on being long-term, value-add partners with a global outlook. The partnerships we’ve created are based on real relationships, not transactions, and we can’t wait to see what is in store for the Sapphire Sport portfolio in the years to come.
To learn more about the Sapphire Sport approach, team, portfolio and investors visit our website
Game on!
