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SPORTS TECH
INDUSTRY UPDATE
JUNE 2020
PROVEN TRACK RECORD IN THE SPORTS TECH SECTOR
Contact The Sports Tech Deal Team
Gregory Bedrosian, CEO & Managing Partner
+1 212 508 7111
950 Third Avenue, 20th Floor, New York, NY 10022
Mathilde [email protected]
Eric Ward, Partner
+44 20 7112 7777
16 Berkley Street, London, W1J 8DZ
James [email protected]
2
Drake Star Partners is the marketing name for the global investment bank Drake Star Partners Limited and its subsidiaries and affiliates. In the USA, all securities are transacted through Drake Star Securities LLC. In the USA, Drake Star
Securities LLC is regulated by FINRA and is a member of SIPC. © 2016 Drake Star Partners. This report is published solely for informational purposes and is not to be construed as an offer to sell or the solicitation of an offer to buy any
security. The information herein is based on sources we believe to be reliable but is not guaranteed by us and we assume no liability for its use. Any opinions expressed herein are statements of our judgment on this date and are subject to
change without notice.
Michael Metzger, Partner
+1 310 696 4001
1100 Glendon Ave., Suite 905, Los Angeles, CA 90024
SPORTS TECH KEY HEADLINES
3
• Investors remain bullish with a handful of large deals announced, totaling 12 deals in June and 21 YTD1
• DAZN Group is in final stage talks to sell the popular soccer website Goal.com to the investment firm
TPG for $125m• Lululemon Athletica is buying at-home fitness company Mirror for $500 million, a deal that aims to
capitalize on the pandemic-fueled upheaval in the fitness and retail industries
M&A
• Fundraising has shown signs of revival with 13 rounds closed in June, totaling 62 YTD1
• Epic Games is raising a $750m investment round at an estimated valuation of $17bn, with existing
investors KKR and new investors T. Rowe Price Group and Baillie Gifford reportedly participating
• Hudl announced a $120m investment from Bain Capital, alongside existing investors, to further
accelerate the Company's growth
Fundraising
• Traditional sports has seen record high viewership levels despite being played behind closed doors
• PGA Tour +50% vs. last year’s final tournament
• Premier league (UK) +94% vs. Sky TV’s season average
• NASCAR +38% vs. the last race on March 8, 2020
Sports Tech Industry News
• Esports continue to thrive under COVID-19 with multiple new partnerships announced
• WarnerMedia properties ELEAGUE and Fullscreen have partnered to provide the one-stop shop for
brands who want to connect with gamers
• Online bookmaker Pinnacle announced a partnership with Abios, a B2B provider of esports data
Esports Industry News
(1) Pitchbook and Drake Star Proprietary Research
SPORTS TECH KEY HEADLINES
4
RIGHTS HOLDERS
AND BROADCASTERS
▪ Bundesliga pockets €4.4bn in
Sky and DAZN domestic TV
rights deal
SportsProMedia, June 22, 2020
▪ Bain Capital has made a €3bn
preliminary offer for a 25% stake
in top-flight Italian soccer league
Serie A, rivalling CVC and
Blackstone, to value the league
at €12bn
SportsProMedia, June 12, 2020
▪ MLS facing US$1bn revenue
loss due to the coronavirus
pandemic
SportsProMedia, June 5, 2020
OTT PROVIDERS
▪ FloSports testing social watch
feature that can generate in-
venue crowd noise
SportsProMedia, June 12, 2020
▪ Tencent in early negotiations for
buyout of video streaming rival
IQiyi
SportsProMedia, June 22, 2020
▪ Amazon’s Premier League games
to stream on Twitch for free
SportsProMedia, June 18, 2020
DIGITAL MEDIA PLATFORMS
▪ Manchester City debut on new
Dugout live OTT platform,
offering behind-the-scenes
coverage and live esports events
SportsProMedia, June 22, 2020
▪ NFL, NBA and ESPN expand
Snapchat content deals
SportsProMedia, June 15, 2020
▪ Opening week sees a viewership
surge in key sports
Octagon, June 24, 2020
BY SUB-SECTOR
▪ FuboTV strikes ESPN carriage
deal with Disney
SportsProMedia, June 26, 2020
▪ Juventus roll out new Deltatre-
powered digital ecosystem
SportsProMedia, June 25, 2020
5
SPORTS SERVICE PROVIDERS ESPORTS
▪ Stats Perform and ChyronHego
developing in-stadia AI-driven
graphics to help boost fan
engagement
SportsProMedia, June 19,
2020
▪ Manchester City and Arsenal
among clubs set to trial
Prenetics’ digital health passport
to bring fans back to stadia
SportsProMedia, June 17,
2020 ▪ Microsoft is shutting down Mixer
to merge with Facebook
Gaming
Forbes, June 23, 2020
▪ F1 Virtual Grands Prix pulls in
30m total viewers
SportsProMedia, June 19,
2020
▪ Top-slight English soccer side
Wolverhampton Wanderers are
looking to enter Rocket League
SportsProMedia, June 24,
2020
SPORTS TECH KEY HEADLINES
▪ ELEAGUE partners with
Fullscreen to add advertising
opportunities
Esports Insider, June 30, 2020
DATA & ANALYTICS
▪ FanDuel and Sportradar sports
betting app will now include life
NFL data
Sporttechie, June 18, 2020
▪ NBA players to wear smart ring
to track COVID-19 symptoms
as season resumes
Forbes, June 25, 2020
▪ Pinnacle bets on Abios with
data partnership
Esports Insider, June 30, 2020
BY SUB-SECTOR
1.6bnHours
Watched
2.3mAverage Concurrent
Viewers
TWITCH ESPORTS VIEWERSHIP
JUNE 2020
6
7.4mActive
Streamers
Hours Watched by Game/Esport
(Last 7 Days)Just Chatting 1
10.9%
9.2%
7.0%
6.2%
5.5%
5.0%
3.3%1.1%
All Other
Games
Combined
51.8%
(1) The ‘Just Chatting’ category is intended for casual streams that don’t fall
under ‘talk shows’, or for intermissions between gameplay when a streamer
is taking a break to chat to their viewers
93.5KAverage Concurrent
Channels
Source: Twitch Tracker
Concurrent Viewers & Hours Watched
(billions)
June 2019 – June 2020
4% 7% 6% 3%
939 917999
878 901 880 880
1,010 982
1,218
1,790 1,756
1,629
0.0
0.5
1.0
1.5
2.0
2.5
3.0
0
500
1,000
1,500
2,000
Jun-19 Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20
Hours Watched Concurrent Viewers
7
NEW YORK
KEY PERSONNEL
Brynn Putnam - Founder, CEO
& President
KEY SHAREHOLDERSBUSINESS DESCRIPTION
Mirror’s connected fitness platform streams
live and on-demand classes offering
personalized content in real-time using a
combination of feedback and biometric data
DATE
June 2, 2020
SALE TO
DEAL DESCRIPTION
Giants Gaming Esports, the parent company of
Vodafone Giants, have acquired Spanish esports
team x6tence, a “strategic movement that brings
together in one company two of the most important
emblems in Spain of the esports sector”
DATE
June 12, 2020
DEAL DESCRIPTION
HOF Village, the owner of the multi-use sports,
entertainment and media destination has
acquired a majority interest in the assets of The
Crown League, to enter the high-growth vertical
of the fantasy sports market
DATE
Announced on June 29, 2020
$500m
DEAL DESCRIPTION
Lululemon announced plans to acquire home
exercise startup Mirror for $500m, following its
$1m investment in Mirror last year. The purchase
fits with its ambitions as an experiential brand with
a focus on health and wellness
BUSINESS DESCRIPTION
The Crown League operates the first
investment gaming platform
revolutionizing the way fans experience
fantasy sports
MALAGA
KEY PERSONNEL
Adrian Gomez - CEO
KEY SHAREHOLDERS
KEY CLIENTS / PARTNERS
BUSINESS DESCRIPTION
Leading Spanish Esports Club
which manages and promotes e-
sports events through online
ticketing, viewing and rating facilities
SELECT M&A DEALS OF THE MONTH12 DEALS AND $505M IN DISCLOSED DEAL ACTIVITY IN JUNE-20
SALE TO
Source: Similar Web, Pitchbook, LinkedIn, Company Websites
KEY SHAREHOLDERS
2004
50
Esports
B2C
n.a.
2016
83
Wellness &
Fitness
B2C
510kWeb
Traffic
2018
9
Fantasy Sports
B2C
39mWeb
Traffic
Web
Traffic
BOCA RATON
KEY PERSONNEL
Dan Nissanoff, Founder & CEO
Derek Siskin, Founder & CCO
Matthew Sposta, Founder &
CROSALE TO
8
NEW YORK
KEY PERSONNELDavid Graff - Co-founder & CEO
Brian Kaiser – Co-founder & CTO
John Witz – Co-founder & CPO
KEY SHAREHOLDERSBUSINESS DESCRIPTION
A leading performance analysis company
revolutionizing the way coaches and athletes
train, offering a complete suite of products
that empower sports teams
DATE
June 15, 2020
DEAL DESCRIPTION
Singapore-based sports media company Group
One Holdings raised $70m, bringing the
company’s total capital to $346M. Group One
Holdings operates as ONE Championship and
specializes in mixed martial arts entertainment
DATE
June 30, 2020
DEAL DESCRIPTION
The Chat app Discord raised $100m led by Index
Ventures at a $3.5bn valuation, up from $2.05bn
18 months ago. The new funding round will help
the company to expand beyond video games and
diversify its user base
DATE
June 3, 2020
$120m
DEAL DESCRIPTION
Hudl announced an investment from Bain Capital
Tech Opportunities, along with existing investors,
to further accelerate the Company's growth
BUSINESS DESCRIPTION
An online gaming chat application, with
over 300m registered users who can
communicate whilst playing online
games
SINGAPORE
KEY PERSONNEL
Chatri Sityodtong - Chairman & CEO
Saurabh Mittal - Vice Chairman
KEY SHAREHOLDERS
KEY CLIENTS / PARTNERS
BUSINESS DESCRIPTION
ONE Championship is Asia's largest
global sports media property with a
broadcast to over 2.6bn viewers
across 140+ countries
SELECT M&A DEALS OF THE MONTH13 DEALS AND $315M IN DISCLOSED FUNDRAISING IN JUNE-20
Source: Similar Web, Pitchbook, LinkedIn, Company Websites
2011
359
Rights Holders
B2C/B2B
n.a.
2004
1,257
Athlete
Performance
B2B
2018
9
Fantasy Sports
B2C
884mWeb
Traffic
Web
Traffic
SAN FRANCISCO
KEY PERSONNEL
Jason Citron – Co-Founder,
Board Member & CEO
KEY CLIENTS / PARTNERSLed By
KEY SHAREHOLDERS
KEY CLIENTS / PARTNERS
PRIVATE PLACEMENT
Led By
PRIVATE PLACEMENT
$100m
Undisclosed
PRIVATE PLACEMENT
$70m
9
TOP 10 DICLOSED M&A TRANSACTIONS
1 JANUARY – 30 JUNE
Company Country Sub-Sector Deal Size Acquirer Acquirer Country Date
Sports Betting, Gaming $648m Draft Kings April-20
OTT $610m Facebank Group April-20
Coaching & Preparation $500m Lululemon Jun-20
Broadcasting / Media Platform $250m Spotify Feb-20
Digital Media Platform $163mPenn National
GamingFeb-20
Fan Engagement $100m Apple May-20
Esports $37.7m Better Collective Feb-20
Digital Sports Agency $30.0m Team Whistle May-20
Digital Media Platform $15.0m Minute Media Jan-20
Data & Analytics $1.0m Torque Esports Jun-20
21 Deals and $2.4bn Disclosed YTD
10
1 JANUARY – 30 JUNE
62 Deals and $875m Disclosed YTD
Advised By
TOP 10 FUNDING ROUNDS
Company Subsector Country Deal amount Lead Investor(s) Date
Coaching & Preparation$285m
Series E
L Catterton, Apax
PartnersJan-20
Coaching & Preparation$120m
PE GrowthBain Capital June-20
Esports$100m
Late Stage VCIndex Ventures June-20
Digital Media Platform$55.0m
Series DBedrock Jan-20
Esports$40.0m
Series ANTWRK April-20
Esports$33.0m
Series BHuya Mar-20
Fantasy Sports$20.0m
Series BUndisclosed May-20
Sports Service Provider$16m
Series CShamrock Capital
AdvisorsJune-20
Data & Analytics$15.0m
Series AKhosla Ventures May-20
Esports$13.5m
Early Stage VCVækstfonden May-20
38.0%
22.2%
17.5%
-18.2% -18.8% -19.6%
CURRENT SPORTS TECH ENVIRONMENT
SHARE PRICE PERFORMANCE
Source: Capital IQ as of June 30, 2020. Market Cap weighted(1) Represents the Stock Price Change Between May 29th – June 30th.
Digital Media = Catena Media, Better CollectiveOTT/Content = WWE, MSG Networks, The Madison Square Garden Company, RokuSports Franchises = Manchester United, Ajax, Juventus, Borussia Dortmund, Formula One GroupAthlete Performance = Catapult Sports, FitbitEsports / Fantasy Sports = Enthusiast Gaming Holdings, Draft Kings, Scout Gaming, Flutter Entertainment, Gfinity, Super League Gaming
Esports / Fantasy SportsDigital MediaAthlete Performance Sports FranchisesOTT / Content
Top 3 Risers & Fallers
June 1 - June 29 (1)
11
-80%
-40%
0%
40%
80%
120%
Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20
NASDAQ
• Esports / Fantasy Sports recorded its first
negative month since March driven by
DraftKings (-16.2%) issuing additional stock
following its strong performance since IPO
• Sports Franchises weakened across the board,
notably Formula One (-8.5%)
• Better Collective (+38.0%) was the notable
outperformer, building on recent gains following
its pivot to esports in response to the pandemic;
MSG Networks dropped c.20% with several
institutional investors exiting their positions
KEY HIGHLIGHTS
• Esports / Fantasy Sports continue to trade
at high multiples despite recent weakness,
given the industry’s bullish outlook and
strong growth forecasts
• Athlete Performance continues to trade at
the lowest EV/Rev multiple (1.6x), mainly
driven by Catapult’s 20% drop in share
price in June; however the index still
trades at one of the highest EV/EBITDA
multiples (17.2x) given its high-growth,
early stage nature
• OTT/Content saw a sizeable drop in its
EV/EBITDA multiple driven by noticeable
underperformance in MSGS and WWE
whose content offering is heavily reliant on
providing live events
• Our Digital Media index saw valuations
rise across the board following the
significant outperformance of Better
Collective, and continues to trade above
traditional media platforms
• Valuations for Sports Franchises remained
at year-long lows with the resumption of
live sports still not permitting crowds
Median EV / 2020E Revenue
Median TEV / 2020E EBITDA
CURRENT SPORTS TECH ENVIRONMENT
TRADING MULTIPLES
Source: Capital IQ as of June 29, 2020
Digital Media = Cantena Media, Better CollectiveOTT/Content = WWE, MSG Networks, The Madison Square Garden Sports Corp, RokuSports Franchises = Manchester United, Ajax, Juventus, Borussia Dortmund, Formula One GroupAthlete Performance = Catapult Sports, FitbitEsports / Fantasy Sports = Enthusiast Gaming Holdings, Draft Kings, Scout Gaming, Flutter Entertainment, Gfinity, Super League Gaming
12
3.9x
9.4x
3.2x2.5x
3.3x
4.6x
7.4x
2.9x
1.6x
3.2x
Digital Media Esports/Fantasy Sports OTT/Content Athlete Performance Sports Franchises
29-May-20
29-Jun-20
9.1x
16.8x15.1x
23.1x21.3x
10.8x
17.6x
9.9x
17.2x
20.0x
Digital Media Esports/Fantasy Sports OTT/Content Athlete Performance Sports Franchises
KEY HIGHLIGHTS
Drake Star Partners is a global investment banking firm serving the technology, media and communications sectors. All securities in the USA, are transacted through Drake Star Securities LLC. In the USA, Drake Star Securities LLC is
regulated by FINRA and is a member of SIPC.
© Copyright 2016 Drake Star Partners.
SPORTS TECH INDUSTRY MARKET MAP 2020
Rights Owners
Digital Media
Platforms /
Content
Venue / CRM /
Organizational
Software
Commerce
Data /
Analytics
Performance
Analytics
Digital Sports
Agencies
Sponsorship
Measurements
Wearables
Consumer
Sports
Esports /
Fantasy
Sports
Sports OTT
Content
Owners
FanEngagement
ContentProviders
FanEngagement
ServiceProviders
B2C B2B
Sports
Service
Providers
13
TRANSACTIONS COMPLETED SINCE 2014
350+CROSS-BORDER
DEALS
70%BANKERS
95+OFFICES GLOBALLY
9
NEW YORK
LOS ANGELES
SAN
FRANCISCO
MUNICHLONDON
PARIS GENEVABERLIN
Drake Star Partners is the marketing name for the global investment bank Drake Star Partners Limited and its subsidiaries and affiliates. In the USA, all securities are transacted through Drake Star Securities LLC. In the USA, Drake Star
Securities LLC is regulated by FINRA and is a member of SIPC. © 2016 Drake Star Partners. This report is published solely for informational purposes and is not to be construed as an offer to sell or the solicitation of an offer to buy any
security. The information herein is based on sources we believe to be reliable but is not guaranteed by us and we assume no liability for its use. Any opinions expressed herein are statements of our judgment on this date and are subject to
change without notice.
DRAKE STAR PARTNERS
14
A LEADING GLOBAL TMC M&A INVESTMENT BANK
AMSTERDAM
