Sports market in the money

THE next decade could see sports evolve from a passion asset into a portfolio cornerstone, with investors increasingly treating clubs, leagues and even emerging formats as strategic holdings rather than vanity plays.

That is the central thrust of a new report from Deutsche Bank, led by chief investment officer Ulrich Stephan, which argues that the sector’s mix of growth, resilience and global appeal positions it as one of the more compelling asset classes in today’s shifting investment landscape.

At the heart of the argument is scale – and momentum.

“Today, the global sports market has estimated annual revenues of over US$460bil and these are projected to nearly double by 2033,” Deutsche Bank notes, pointing to a transformation that goes beyond simple expansion.

“This remarkable expansion will not be just about numbers: it will also reflect a fundamental shift in how sports is consumed, monetised and valued as an asset class,” it adds.

That shift is being powered by a convergence of forces: digitalisation, globalisation and a rapidly diversifying investor base.

More people are watching sport than ever before, not just through traditional broadcasting but via streaming platforms, social media and mobile ecosystems that have widened access and deepened engagement.

As Deutsche Bank puts it, “Digitalisation and globalisation have made watching sports accessible to more people.”

This democratisation of access has also broadened the fan base, pulling in audiences who may not have been drawn to traditional formats.

At the same time, niche and emerging sports have professionalised their online presence, while entirely new formats – often built for digital-native audiences – are gaining traction.

For investors, this translates into a steadily expanding addressable market and rising valuations across the ecosystem.

New investors

Unsurprisingly, capital has followed. “New investor groups have identified sports as an investment area with increased market attractiveness and a growing addressable consumer market,” the report states.

Private equity, sovereign funds and wealthy individuals are increasingly active, particularly given that “most companies in the sports industry are not publicly-listed, so investment is mainly done via private capital”.

The appeal is not uniform, however. One of the more striking themes in Deutsche Bank’s analysis is the breadth of opportunity across the risk-return spectrum.

Established franchises, major leagues and broadcasters tend to offer predictable income streams, underpinned by long-term media rights deals and sponsorship agreements.

In contrast, smaller or emerging assets – from niche sports to technology platforms – may deliver outsized capital appreciation, albeit with higher risk.

Media rights remain a cornerstone of the investment case. The report highlights how broadcasters and technology firms are willing to commit vast sums to secure premium content, noting that agreements can stretch over a decade and reach “as much as US$100bil”. These deals not only underpin financial stability but also reinforce the scarcity value of top-tier sports assets.

Revenue diversification is another key strength.

Clubs and leagues generate income from a wide array of sources, from sponsorship and merchandising to ticket sales and player transfers. Commercial revenue, particularly sponsorship, is seen as a major growth driver, with global sports sponsorship and in-venue advertising valued at US$52bil in 2025.

Meanwhile, digital and licensing deals – including apps and gaming – are opening new monetisation channels.

Strong investor confidence

Even so, the report cautions against complacency.

“Idiosyncratic risks such as bad governance and lack of convincing, future-proof strategy need to be monitored when investing in single companies,” Deutsche Bank warns.

Emerging segments, in particular, may struggle if they cannot sustain revenues or achieve profitability over time. Despite these risks, dealmaking activity suggests strong investor confidence.

Sports has been a relative bright spot in an otherwise volatile mergers and acquisitions environment, with more than US$50bil in disclosed deals globally in the first half of 2025 alone.

Transactions have ranged from record-breaking franchise sales to consolidation in media rights and sports technology.

Geography plays a crucial role in shaping investment dynamics.

North America and Europe dominate activity, but for very different reasons.

In the United States, closed, franchise-based systems provide revenue visibility and downside protection. Long-term media contracts, centralised league structures and the absence of relegation help stabilise cash flows. The report notes that “these arrangements ensure high visibility on future cash flows and should reduce earnings volatility”.

Europe, by contrast, offers a more complex and potentially volatile landscape. Open league systems, promotion and relegation, and reliance on sporting performance create a wider dispersion of outcomes.

However, this also opens the door to value creation through operational improvements and on-field success.

For investors, this translates into a clear trade-off. “North America offers greater revenue stability and downside protection, while Europe provides a higher dispersion of outcomes and opportunities for value creation,” Deutsche Bank observes.

Beyond geography, the distinction between mainstream and emerging sports is becoming increasingly important.

Established leagues continue to benefit from structural tailwinds, particularly the rapid escalation of media and streaming rights. But much of the future growth story lies in newer segments.

Sports such as padel, esports and women’s competitions are attracting growing interest due to their expanding audiences and relatively low valuations.

Deutsche Bank highlights how “emerging/niche sports offer a different investment thesis centred on participation growth, fragmentation, and professionalisation”. Women’s sport, in particular, is gaining momentum, with revenues in the United States growing more than four times faster than men’s sport between 2022 and 2024.

At the same time, entirely new formats are emerging, often designed for younger audiences with shorter attention spans and digital-first habits. These include creator-led leagues that integrate social media influencers and prioritise engagement over tradition. Such innovations, the report suggests, could lower fan acquisition costs and accelerate growth.

Varying options

Underlying all of this is a powerful demographic shift. Younger generations are consuming sport differently, blending it with gaming, social media and other forms of entertainment.

“For many in Generation Z, Esports and gaming are becoming viable career options,” Deutsche Bank notes, underscoring the blurring lines between sport and digital culture.

Structural factors also enhance the sector’s long-term appeal. Sports benefit from strong brand value and emotional resonance, creating loyalty that is difficult to replicate in other industries.

Moreover, the report points out that “few sports that were popular fifty years ago have experienced a decline”, highlighting the sector’s durability.

Barriers to entry further strengthen incumbents. “History suggests it is rare for rival leagues to successfully overtake profitable existing leagues,” Deutsche Bank states, reinforcing the defensive qualities of established assets.

For those looking to gain exposure, options vary. Direct investment in publicly listed sports entities is limited and often characterised by small-cap dynamics, including lower liquidity and higher volatility.

Indirect routes – such as investing in sportswear manufacturers or media companies – offer greater scale and transparency but are influenced by broader economic factors.

Ultimately, Deutsche Bank’s analysis points towards a blended approach.

“For investors, the most attractive strategies may increasingly involve blending both dimensions – using stable core assets to anchor portfolios while selectively allocating capital to emerging sports and formats,” it points out, reflecting a view that sport is no longer just entertainment, but an evolving financial frontier.