Sports is more than just an American pastime. Sports tends to unit cities, states, and even the country during the time of international competition. Most people enjoy at least one sport, and sports activities rake in billions of dollars collectively in the United States. If you are interested in making a larger investment at once, purchasing ownership in a sports team can bring you more money than other types of investments. There are many things to consider if you are looking for a minority ownership in a sports team. Here are three details to work through before making the sports investment of a lifetime.
Current and past team valuation
Before you purchase any investment, you should perform the legwork to determine the true value of the team. With the help of a financial planning service, you can get a current valuation for the sports team's worth. This will help you determine how much you may collect on your investment and how secure your investment may be for the future. Along with the current valuation, you should look at the past valuations in the years prior. If the value of the team has had major fluctuations, you should get a deeper analysis to determine if the value will hold long term.
History of majority ownership
Though minority ownership for the team may be open, you should look at the ownership of the team overall. Has there been a lot of fluctuation in owners, or has the roster of owners remained stable? If the ownership has remained stable, this is a good sign that the team is a good investment or is run smoothly. If the team has had a number of majority stakeholders who have left the table, you will need to determine the reason for people pulling out before putting down your own money. You want to know whom you will be working with when it comes to bettering the team. Having a core group that remains committed makes it easier to operate and increase the value of a team.
The amount of your vote or voice
Depending on the team and the amount of your minority stake, you may be able to make some pertinent decisions. In other cases, you will not perform major decision making, but you will be able to attend board meetings regarding the team. Determine whether you would prefer to be more hands-on or hands-off before you purchase a stake in a team. Knowing how much work the investment will cost in time is just as important as the monetary cost of the team investment.Share
24 May 2017
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