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Pro volleyball league owns 90 clubs
A league that owns clubs
The league, written LOV and pronounced love, is technically professional, and its model is unusual because it also owns 90 youth clubs. The clubs keep their names, coaches, and leadership, so a player at Club V in Salt Lake City may now see a Love Salt Lake City pro walk into the gym. The league presents this as support for grassroots volleyball and a direct pipeline to the pros.
The company calls itself women-led and committed to empowering women both on and off the court. Its teams appear to be owned at least in part by current or former professional athletes, often women.
The money behind it
Funding comes from brand deals with Adidas, broadcast deals with USA and ESPN, and somewhere near $200 million in total investment led by the Atwater Group, with Aries Management Fund and Left Lane Capital also in. Synergy Sports Capital owns some individual teams, and the league's CEO came from Bain Capital.
What drew private equity to the league was confidence in the outlook for its youth side. Atwater's stated aim is to use its media and entertainment experience to engage fans and inspire the next generation of exceptional athletes. The league needs club dues to run, and maximizing the investors' return means those dues going up.
Why does private equity buy fragmented industries?
A common private equity approach is the roll-up: buy many small, independent businesses in one field and combine them under a single owner. The combined company can share back-office work such as billing and marketing, which lowers costs per business. Larger companies also tend to sell at higher multiples of their earnings than small ones do, a gap that roll-ups aim to capture.
Why do pro sports organizations run youth academies?
Professional soccer clubs in Europe have long run youth academies that supply players to the first team. When an academy player is sold, the club earns a transfer fee, so development works as a source of income as well as talent. In England, the Premier League's Elite Player Performance Plan, introduced in 2012, grades academies into categories based on their facilities and coaching.
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