At a Glance
- Ares CEO Michael Arougheti believes private equity investments have been a boon to professional sports, allowing innovation and new enthusiasm to flourish.
- Private equity investment in North American sports leagues is a relatively recent phenomenon, but there’s growing interest in flexible, creative capital.
- Ares has been at the forefront of sports investing, beginning 15 years ago and formalizing our sports investing strategy during the COVID pandemic in 2020.
Ares CEO Michael Arougheti believes private equity investments have been a boon to professional sports, allowing innovation and new enthusiasm to flourish. On the first day of the 2025 NFL season, Arougheti spoke on a panel at the Bloomberg Power Players event with Bloomberg’s Jason Kelly and Miami Dolphins CEO Tom Garfinkel.
Private equity investment in North American sports leagues is a relatively recent phenomenon. It was only six years ago, in 2019, when Major League Baseball (MLB) became the first to permit private equity investment.
“Sequentially, there was a realization that flexible, creative capital could be helpful to support team owners, growth, etcetera,” said Arougheti. “Before that, it was really wealthy people and banks and nothing in between. Every other financial market that we play in the private markets, the ecosystem of capital innovates and finds ways to support the growth of the market. That's what's happening in sports right now.”
Private Equity and the NFL
In 2024, the National Football League (NFL) was the last to allow private equity investments, meaning that all five North American major sports leagues are now open to it.
“Football is the most watched sport,” said Arougheti. “There’s huge scarcity value and increasing media rights value. The business model of the NFL is one of the most durable in sports. When we think about investing across the entire sports ecosystem, the NFL checks every box. The NFL sits at the top of the list. There was a long process just to get authorized to invest in the league. We are incredibly proud and humbled by the fact that we were one of the small handful of people to be able to do it.”
First Mover Advantage
Ares has been at the forefront of sports investing, beginning 15 years ago and formalizing our sports investing strategy during the COVID pandemic in 2020.
“The catalyst was that a lot of leagues were looking at an ownership group that was asset-rich and cash poor in many respects,” said Arougheti. “They were going to be facing acute liquidity challenges. You had live events with no spectators. It became pretty obvious to us that if we could go in as a creative liquidity provider, we would be able to do something special. So, it started off with the idea that we would effectively build a bridge through the pandemic to leagues and team owners.”
He continued: “By moving early, we were able to develop some pretty strong relationships. I think at the league level, within the ownership groups and the broader ecosystem, they understood we were there to help and not take advantage.”
Future Growth and Innovation in Sports Ownership
What’s more, Arougheti believes that this newer group of sports owners is always looking to innovate and think of the client experience, while taking the way people consume content into consideration.
“In any business, you have to wake up and say ‘what does best-in-class look like?’” he said.
With the media landscape changing, live events are also more valuable than ever to connect people and create shared experiences.
“This all comes down to live unscripted content and shared humanity,” Arougheti said. “What’s interesting about how we’re all consuming content is that it’s globalizing. China is a large market for the NBA. The NFL is beginning to expand into Europe. You have to start having a global view. As this content is globalizing, you’re creating international stars and role models. It’s good for the players, it’s good for the teams, it’s good for the leagues and it’s good for the growing valuations.”