The last two dot.coms serving the participatory sports market are merging in order to survive. Active.com, which now prefers to be known as the Active Network, is absorbing Myteam.com.
The move allows the two businesses, which have competed in online registration and other areas, to obtain more financing and realize economies of scale as the only players left in the industry. The two companies have combined to burn through about $100 million in the past four years.
With the merger, they were to raise an additional $11 million in funding from, among others, Canaan Partners and DB Capital. Despite the fact that the new company will retain the Active name and that most Myteam executives will leave, it was Myteam that provided the majority ($8 million) of the financing.
Profitability in the sports dot.com industry has proved difficult for even the most-trafficked sites, such as espn.com and sportsline.com. Just as many of the sports-content sites disappeared with the dot.com crash, so did all of the competitors offering registration and services for participatory athletic events. Along the way, Myteam and Active outlived or acquired what remained of eteamz, eosports, streetzebra, Sierra Digital and League Link.
Active Network CEO Dave Alberga said his La Jolla, Calif., company will break even by the end of next year, especially since the company is not dependent on online ad revenue. "We could be break-even now, but with new financing, we'll actually grow this company to a size that is then attractive for public offering," he said.
The two businesses have much in common. Active has made its mark in designing online registration for athletic events, mostly individual sports like road races, and software for parks and recreation departments that allows effective facility management, along with online and off-line reservations and registration.
Myteam has specialized more in kids sports. It brings relationships with Little League, Police Athletic League, AAU, the NFL and many state soccer organizations. Myteam also has developed the use of databases compiled through athletic registration as a direct-marketing platform.
Myteam founder and CEO Elliott Katzman relinquishes his day-to-day role and joins the board of the company. Myteam will lose about 20 employees, with the new company having 110 employees.
