How to Buy a Share of a Sports Team

Many sports fans seek a deeper connection than spectating, often exploring ways to gain a direct stake in their favorite teams. While full ownership is typically limited to those with substantial resources, various pathways exist for individuals to acquire a “share” in the sports world. These include conventional financial investments, unique fan-based structures, and emerging digital opportunities. This article explores these different avenues for participating in sports ownership.

Investing in Publicly Available Sports-Related Companies

Direct ownership of an entire professional sports team remains largely inaccessible to the general public, typically requiring billions of dollars and league approval. However, individuals can invest in publicly traded companies that either own sports teams or have significant financial ties to the broader sports industry. This approach allows participation in the financial performance of sports entities through standard stock market transactions.

Several publicly traded corporations directly own sports franchises. For example, Madison Square Garden Sports Corp. (NYSE: MSGS) owns the New York Knicks basketball team and the New York Rangers hockey team. Similarly, Atlanta Braves Holdings, Inc. (NASDAQ: BATRA) allows investors to own a portion of the Atlanta Braves baseball team. Beyond the United States, clubs like Manchester United Plc (NYSE: MANU) are publicly traded, providing an avenue for ownership in international sports.

Other publicly traded companies are deeply integrated into the sports industry without directly owning teams. These include major sports apparel and footwear companies, such as Nike (NYSE: NKE), Lululemon Athletica Inc. (NASDAQ: LULU), and Under Armour, Inc. (UAA). Media companies with extensive sports broadcasting rights also offer exposure, such as Rogers Communications Inc. (NYSE: RCI), which owns the Toronto Blue Jays, Toronto Maple Leafs, and Toronto Raptors, alongside its communication services.

To acquire shares, open an investment account with a licensed brokerage firm. Fund the account, then research companies using their ticker symbols. Place a stock order through the platform. These are conventional stock market investments, subject to Securities and Exchange Commission (SEC) oversight.

Engaging with Unique Fan Ownership Structures

A rare and distinct form of direct fan ownership exists for a select few sports teams, most notably the Green Bay Packers of the National Football League. Unlike other NFL franchises, which are typically owned by individuals or small private groups, the Packers operate as a publicly owned, non-profit corporation. This unique structure allows fans to purchase “shares” in the team, a practice that dates back to 1923.

These shares are not traditional investments; they do not pay dividends, cannot be traded on any stock exchange, and do not appreciate in value. Instead, purchasing a share is primarily a way for fans to show support and connect symbolically. Shareholders receive voting rights, enabling them to participate in the annual shareholders’ meeting and elect members to the team’s Board of Directors. They also receive a stock certificate, which serves as a memento of their ownership.

The opportunity to acquire these shares is infrequent, occurring only through special stock offerings initiated by the team, often to raise funds for stadium improvements or other organizational needs. Shares were priced at $300 during the most recent offering. There is a limit to how many shares an individual can own, capped at 200 shares, including any shares purchased in prior offerings.

Purchases can be made online using credit or debit cards, or through electronic bank transfers. For physical transactions, documents can be requested by mail, with payment accepted via cashier’s or personal check. This model is unusual in professional sports, as the Packers are an exception to the NFL’s rule against corporate ownership, grandfathered in due to their long-standing structure.

Exploring Newer Fractional Ownership Opportunities

The landscape of sports asset ownership has expanded with the emergence of fractional ownership platforms. These platforms enable individuals to own a small “fraction” of high-value sports assets that would otherwise be out of reach for most investors. This approach democratizes access to valuable collectibles and, in some rare instances, portions of sports teams themselves.

Fractional ownership platforms use technology, including blockchain, to divide ownership of a single, high-value asset into numerous smaller, accessible shares or tokens. Each share represents a proportional interest, allowing multiple individuals to collectively own it. The ownership conveyed is of the specific asset held by the platform, not direct ownership of a sports team.

Examples of assets offered through fractional ownership include rare sports memorabilia like game-worn jerseys, valuable trading cards such as a 1953 Topps Mickey Mantle card, or other unique collectibles. Platforms like Collectable and MyCardShares.com facilitate these transactions, allowing users to browse catalogs and purchase shares for as little as $5 to $25 per share. The process involves setting up an account and funding it, similar to a brokerage, then selecting the fractional shares to purchase.

While fractional ownership can make high-value items more accessible, it is a relatively new and evolving space. Platforms offering these opportunities must comply with rigorous regulatory requirements, particularly if they are deemed to be offering financial products. The underlying technology, such as non-fungible tokens (NFTs) on blockchain, provides a digital record of authenticity and ownership.

Key Investment Considerations

Regardless of the method chosen to gain a stake in the sports world, several financial concepts warrant understanding. These considerations pertain to the nature of the investment itself, rather than specific financial outcomes. Recognizing these characteristics helps in approaching such opportunities with an informed perspective.

One important aspect is liquidity, which refers to how easily an asset can be converted into cash without affecting its market price. Many investments in sports teams or related assets, particularly direct or fractional ownership interests, can be highly illiquid. Unlike publicly traded stocks that can be bought and sold daily on major exchanges, these interests may lack an active secondary market, making it challenging to sell them quickly or at a desired price.

Valuation complexity also characterizes sports-related investments. Determining the economic value of a sports team or a unique collectible can be intricate, differing from the valuation of traditional businesses. Analysts may employ various methods, including income approaches that project future cash flows, market approaches that compare sales of similar assets, or asset-based approaches that value tangible and intangible assets like brand value and intellectual property. The private nature of most sports team financials can add to this complexity.

Investments in sports teams or associated assets represent long-term propositions. These are not suitable for individuals seeking short-term trading gains. The growth in value for such assets materializes over extended periods, aligning with broader economic trends, league stability, and the team’s sustained performance or cultural significance.

The nature of returns can also vary significantly from traditional financial investments. For instance, unique fan ownership models like those of the Green Bay Packers do not offer financial dividends or capital appreciation. Instead, the value derived is experiential, such as voting rights or exclusive access. Even for other sports investments, returns may not be in the form of regular cash flows or rapid appreciation, but rather long-term increases in asset value.

Finally, conducting thorough due diligence is important. This involves comprehensive research into the specific investment vehicle, the underlying asset, and the platform or entity facilitating the investment. Understanding the terms and conditions, any associated fees, and the regulatory oversight is a prudent step to ensure alignment with personal financial objectives.