Cleveland Cavaliers owner Dan Gilbert and advertising giant WPP have combined to contribute $35 million into a new investment fund they’re calling Courtside Ventures.
The venture capital fund will work with Bruin Sports Capital in a partnership to invest in early stage technology and media companies with a focus on sports. Bruin founder George Pyne will serve as non-executive chairman for Courtside Ventures and work with a management team to identify investment targets in the sports technology and media sectors.
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Cavaliers owner Dan Gilbert (right) helped launch Bruin Sports Capital.
Photo by: GETTY IMAGES
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Courtside could come in as a lead investor or co-investor, and it will consider early stage businesses, as well as companies with more established revenue. Investments could range from six figures up to $3 million or so.
WPP and Gilbert helped launch Bruin a year ago with their investments — WPP put up a third of the $250 million that Bruin raised to start the fund. Those initial talks led to discussions about a sports technology-focused fund.
Gilbert, who founded Quicken Loans and Rock Ventures, is characterized as the anchor investor, although financial specifics were not disclosed.
“It’s an extension of the original vision,” Pyne said. “Dan has been a leader in digital and technology with Quicken Loans, and WPP has the insights into what advertisers want. They saw this as a natural opportunity to look for innovative and disruptive technologies.”
That technology could range from virtual reality products to e-sports, data analytics platforms or other forms of video distribution.
Courtside’s management team will be based in Detroit and includes Deepen Parikh, founder of NYVC Sports; Vasu Kulkarni, founder of sports analytics company Krossover; and Brian Hermelin, managing partner at Rockbridge Growth Equity and founding partner at Detroit Venture Partners, two investment arms within Gilbert’s portfolio of companies.
They will run Courtside’s day-to-day business, explore business prospects and negotiate investments into companies. Pyne also brought on veteran media executives Brian Bedol and Doug Perlman, both of whom will be advisers for Courtside.
“You’ve often seen sports at the forefront of innovation,” Perlman said. “This group brings together a unique set of talents and experiences to the mix to capitalize on this.”
Pyne said four to five sports technology investment opportunities cross his desk each week, and that was before announcing the formation of Courtside. Those companies need capital or perhaps connections in sports to push their products onto a bigger stage.
“Sports has gatekeepers — leagues, teams, rights holders,” Bedol said. “If you’re not able to break through the gatekeepers and put your technology inside the stadium, it becomes a significant barrier to entry. Someone who has the experience and the relationships to break through the gatekeepers is a significant advantage.”
Bruin has made three acquisitions since being launched in January 2015. It bought the NFL’s On Location and added to it Jon Bon Jovi’s Runaway Tours, creating a global sports and entertainment hospitality firm. Bruin also acquired experiential marketing agency Engine Shop.
Courtside, however, presents a very different opportunity because unlike Bruin, which is seeking more established businesses, Courtside will be investing in early stage technology companies, meaning there will be swings and misses along the way. But Pyne is eager to develop a third platform — sports technology — to go with what Bruin already has in place with marketing services and hospitality.
“We’re creating diversified platforms and we’re assembling the best team,” he said.
