Innovative Sports Teams
Sports and technology innovation has mostly been driven by non-sports companies for decades. Nike, Adidas and Under Armours of the world are technically apparel companies focusing on sports. With the rise of wearable technologies, these companies started to integrate technology in their products mostly for economic reasons as the consumers started to demand these new types of products. Some other sports wearables/analytics companies have been providing services to increase performance, injury prevention and scouting for professional teams in the last several years such as VERT, Catapult and Synergy. There are also many other verticals in the Sports Tech fields mostly geared towards fan engagement such as ticketing services, VR technology, social media, news apps etc.
As you can see, these companies have been trying to create an innovative product and sell it to consumers who love/play sports and sports teams. One of the few sports innovation stories that stemmed from a team is the Sports Drink company Gatorade. Gatorade was formulated in 1965 by a team of scientists at the University of Florida College of Medicine, following a request from Florida Gators Football team head coach Ray Graves to help athletes by acting as a replacement for body fluids lost during physical exertion. This was formulated to aid the Florida Gators, hence the name Gator-aid or Gatorade. Gatorade is currently a PepsiCo brand, marketed in 80+ countries and the University of Florida (UF) is believed to make north of $250 million in royalties so far and still making over $10 million per year. This probably was not the initial plan for UF but this innovation both helped their teams and created a tremendous revenue stream. Fast forward 50 years, some other teams are finally starting to take sports innovation seriously…
Philadelphia 76ers are recently known for their bad results on the court. The Process, initially lead by Sam Hinkie, seem to be finally giving its fruits. 76ers front office have been known for their high usage of analytics as Hinkie comes off from the Daryl Morey school of thought. Sachin Gupta, MIT and Stanford MBA grad, is another incredibly analytical person who is not widely known in public but is one of the masterminds behind The Process. So it is not a surprise that 76ers have been heavily relying on analytics but what is not too well known is their ownership’s approach towards the business of sports.
In 2011, a few months before the new CBA was signed and the lockout ended, 76ers was sold to a new group lead by Joshua Harris. Most of the new owners are from the finance world and are private equity investors. It is no surprise that they approach the 76ers as a business. In my opinion, one of their best moves was to hire Scott O’Neill, Harvard MBA, as the CEO. It is no surprise that such a team of investors and businessmen wanted to invest in sports innovation. Then came the Sixers Innovation Lab…
Sixers Innovation Lab lead by Seth Berger who was the founder and CEO of AND 1, is an accelerator focused on Sports Tech in the simplest form. Companies go through an application process, accepted companies temporarily move to Philadelphia where they are given free accommodation, office, mentorship, strategic help and etc. just like most other accelerators around the world in exchange for an equity in the company. Once the company is ready, since they are sports focused, using their products to co-brand with the 76ers is a great launch, yet alone all the connections and marketing power 76ers would be able to provide.
Més que un club (More than a club) is the motto of Barcelona, one of the most famous soccer teams in the world. Barcelona, is structurally different than Philadelphia 76ers in the sense that they are not owned like a company. It is a registered association where members select the President and the board to run the club. Technically they are a non-profit even though they are valued around $3.6 Billion and have annual revenues around $675 Million.
Barcelona has been innovative on the soccer field. Their style of play called “tiki-taka” has been implemented in Barcelona’s every age group for their youth academy teams at La Masia and this style of play ruled the soccer world for close to a decade now. In this span, Spanish National Team, mimicking Barcelona’s style of play, won 1 World Cup and 2 European Championships, making them the best national team in history and Barcelona has been the most successful team according to many people, thanks to the way they changed the game it self. However, since Barcelona is “més que un club” they also recently decided to be innovative off the field.
Barcelona FC President Josep Maria Bartomeu announced that he wants his club to “build the future of the sports industry” and announced the launch of “Barça Innovation Hub” which will focus on 5 main areas: medical services and nutrition, sports performance, team sports, technology and social sciences. According to Bartomeu, the goal of Barça Innovation Hub is; “help to transform the world through sporting excellence, using knowledge and innovation”.
In the next few years we might see a new company that will help athletes sleep better and fasten their regeneration stemming from the Sixers Innovation lab and another company to optimize game day fan engagement via VR/AR, accelerated by the Barça Innovation Hub. Will teams creating their own accelerator programs and innovation hubs to kill numerous birds with stone be the next trend in sports innovation? I believe that this will be a trend moving forwards. We have also seen leagues such as NFL hosting pitching competitions for sports start-ups during the Super Bowl weekend in Houston.