Questions re Evenepoel Move; Managing a Team of Superstars; Private Equity and College Sports; August Opportunities for Stagiaires; Implications of NFL-ESPN Deal ..
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Key Takeaways:
● Questions Around the Evenepoel Move …
● … And Alternative Uses for Those Funds?
● Private Equity Eyeing College Sports
● How to Manage a Team Full of Super-Stars
● The August Racing Window: Opportunities for Stagiaires?
● Implications of the NFL-ESPN Deal
The rapid conclusion to the “will he or won’t he” expected transfer of Remco Evenepoel materialized with his somewhat surprising move to Red Bull-Bora Hansgrohe.
That Evenepoel would transfer has been rumored for years, and was perhaps a matter already settled in public opinion; the rider and his incumbent team, Soudal, didn’t seem to see eye-to-eye for the past two seasons, even with double Olympic golds and a couple of World Championships to his credit. And while there are myriad reasons and permutations for why Evenepoel would pull the ejection cord, and for how Red Bull caught the supremely gifted Belgian star, there are also many different potential outcomes and challenges. For example, will a change of scenery, training preparation, and race direction input help him find the extra gear he needs to truly challenge Tadej Pogacar? Will his presence stunt the emerging career of his new teammate and Tour de France white jersey and best young rider, Florian Lipowitz? How will he and the team’s last blockbuster acquisition, Primoz Roglic, share team leadership responsibilities? There are many questions and it will be entertaining to watch Evenepoel strive for next-level glory in his new kit.
The challenges of managing a team that may be overloaded with superstars, as we discussed two weeks ago in reference to the UAE team, are not insignificant – and Red Bull team boss Ralph Denk may have his hands full there.
And despite all these ifs, ands or buts, there is one point no one seems to be discussing at length: for the money invested to buy out his legacy contract and consecrate a new multi-year, multi-million Euro agreement, Red Bull could have stood up a Women’s WorldTour Team, poached an entire deep roster of gifted riders who are underpaid and/or under-raced in their current WWT arrangements, and instantly entered the fray as a top team in the fastest growing viewership and marketing segment in pro cycling. Placing Red Bull-adorned helmets on select riders in the women’s peloton is nice, but a team would be a truly impactful and welcome investment as the WWT grows in prestige and global reach.
With both the men’s and women’s Tour de France concluded, the road cycling season barreled headlong into its traditionally chaotic wind-up towards the World Championships.
No fewer than four significant stage races ran through or concluded this past weekend, with the Tour de l’Ain (France), Arctic Tour of Norway, Volta a Portugal, and Tour of Poland each commanding the attention of WorldTour, ProTeam, and even Continental upstarts. (The re-launched Tour of Colombia is also taking place in South America.) As with every recent August cycle in UCI road racing, the timing and accessibility of race content was all over the map, with some on TNT Sports and most others limited to local feeds and intrepid signal piracy. As an aside, the TV viewing list published by the Escape Collective is a valuable resource to stay on top the (legal) live feeds. Each of the events has a strong local market – enough to be included in the UCI calendar and have requisite broadcast production – and the racing was at a high caliber. From Israel-PremierTech’s Corbin Strong’s aggressive racing in Norway and spirited defense against Q36.5’s Tom Pidcock’s late challenge, to UAE’s Brandon McNulty’s time trial blitz and overall win in Poland, there was live action for every fan. That is, if you could access the coverage online in your geographic region and maintain multiple player streams on your smart device.
As the investment frenzy to buy into sports continue to proliferate, there is more and more talk about private equity investors getting involved in college sports.
But few yet understand exactly how this would work, and many observers are concerned about how private investment in college sports may impact or disrupt the institution’s primary educational objectives. And in a broader sense for elite-level “professional” sports like cycling, the consequences could further destabilize the governance controls of oversight bodies through economic levers, up to and including the UCI. PE executives suggest that financial injections will help universities make NIL payments under the new system, help to improve ticketing, marketing and other business-oriented decisions, provide funds to renovate older or declining stadiums, unlock hidden or under-valued assets and create stronger brand recognition. In return, the PE firms would take their cut by somehow sharing in increased ticket revenues or perhaps the monetization of media rights.
This potential new private equity reality is relatively uncharted territory so far, and different schools are approaching the challenge/opportunity with notably different angles; while the Big Ten conference and Boise State are said to be aggressively seeking PE investment, both Penn State and UCLA have publicly voiced concerns.
The pitch by private equity to move into college sports is roughly the same as it has made across all other sectors of American business …. “we’re really smart guys, we’ll figure out how to run your business more efficiently, and we’ll all share in the spoils.” In some industries, this has worked; in others, it has been a disaster. But, for the university community, this represents a significant crossroads and critical longer-term decision. While the promise of increased revenue may be alluring, the potential consequences are far-reaching, complex and still poorly understood.
Earlier criticism of cycling’s crowded August calendar aside, one of the most important narrative threads of this period isn’t just the showcase for talented riders who didn’t earn a spot in their respective Tour de France teams, or the similarly hungry racing by their ProTeam and Continental peers.
In general, everybody who didn’t get a chance to race in France is going full gas to up their stock for next year’s team selections. Rather, this last semester of the season is when teams take on “stagiaires” – AKA, neo-professional riders not currently under a contract – and give them a chance to race at a level or two higher than their current elite/amateur standing. This period is understated and underrated as riders who haven’t necessarily been brought up in a WT or WWT team development program get their first opportunity to shine – or conversely, get a shock to their system when they discover just how fast a WT-level race can be from start to finish. But as we’ve pointed out in our previous commentary on the WorldTour’s “youth movement” – the modern trend is towards well-capitalized teams identifying and securing ever-younger talented riders, even before they’ve raced at a national team level. Rider development continues to stratify into two tiers: teams with the resources to monopolize the best physical specimens, and everybody else below that line.
This quandary creates talent homogeneity and a bottleneck. For example, UAE is arguably loaded with the best stage racers in the sport, but they are mostly lined up to pace their team leader, Pogacar. Furthermore, some riders may take longer to physically mature and get lost in the talent identification shuffle before they’ve had a chance to shine in competition, which is a problem faced by talented men and particularly women seeking space in the elite-level amateur peloton. Therefore, the stagiaire period may be an opportunity to refresh the talent identification game – a space for pro road cycling to create a competition within this period to track and highlight the performance of stagiaires, not just in a single race and perhaps on a points system that provides fans with an insightful look into the ranks of the unpolished gems in the global road scene. Perhaps with a tie-in to the prestigious Tour de l’Avenir in France – long considered the platform for next-generation stars – the term stagiaire could become more than just a rite of passage, but also a race-within-the-race that elevates the level of competition and enlivens an otherwise crowded and forgettable stretch of the calendar to highlight the journey of new cycling heroes.
The rumored sale of the NFL’s key media assets to Disney in return for a 10% stake in ESPN was confirmed this week, continuing the somewhat concerning trend of broadcasters actually investing in or owning the sports that they cover. Under the still-pending deal, “ESPN would pick up NFL Network and the rights to distribute RedZone to pay-TV operators. The NFL would continue to own RedZone and retain digital rights.” Other similar recent deals include the purchase by Fox of a one-third interest in the IndyCar Series, ESPN’s commitment of a “minority equity investment” in the Premier Lacrosse League and Warner Bros. Discovery’s TNT purchase of an undisclosed equity stake in the new 3-on-3 Unrivaled women’s basketball league Unrivaled. Warner Bros. Discovery’s TNT reached a deal that included both an undisclosed equity stake in, and media rights for, upstart 3-on-3 women’s basketball league Unrivaled.
As Front Office Sports put it, “Getting into bed financially with league partners gives networks more of a say on the cost of their media-rights fees. It helps guard them against being outbid for those rights by competitors—and a guaranteed stream of content for their channels. They also get a chance to actually capitalize on the financial success if a league like the PLL explodes in popularity.” In effect, the broadcasters are attempting to own the “means of production.” Clearly, these types of deals may help to cement media rights deals, but we have to wonder about the longer-term impacts of broadcasters potentially controlling the strategic and competitive decisions made within the sports they broadcast. Just as importantly, such moves continue to reduce the broadcast space available for niche sports in the increasingly constrained sports marketplace. These market forces could further depress the value of cycling’s live content; on the other hand, they could also present an opportunity for an intrepid aggregator to acquire, and offer at scale, pro cycling’s content at a better value than fans experience today.
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