In a bid to jump-start sales, Medallion Financial Corp. has formed Medallion Sports Properties, which will sell sponsorships for its two sports holdings, Richard Petty Motorsports and Major League Lacrosse’s New York Lizards.
As part of the move, the company has hired former NASCAR and Madison Square Garden executive Sean Downes to be MSP’s chief executive officer. Downes, who will start Feb. 2, had been managing director of business development for NASCAR since 2011. Including Downes, MSP has five employees, with plans for that to grow to 15 in the next three years.
Based in New York City, MSP will sell strictly for the two Medallion-owned properties but eventually could take on outside business, said Andrew Murstein, president of Medallion Financial.
Murstein said that Medallion Financial created the sponsorship-selling arm because his company not only thinks the value of sports properties will continue to rise, but that there’s room for cross-team deals and synergy between the two properties. He conceded that it will be a challenge to sell sponsorships for two properties that come from such different worlds and command such drastically different sponsorship fees.
“We’re making a big push to invest in the sports sector,” Murstein said. “We’re very bullish on the sports-business side and think values are going to go up a lot in the next five, 10, 20 years. We’ve already seen it with the L.A. Clippers recently, so we’re making a more focused effort to invest on sports.”
Richard Petty Motorsports, which is set to field two teams in the NASCAR Sprint Cup Series this year — the No. 43 driven by Aric Almirola and the No. 9 driven by Sam Hornish Jr. — as well as a NASCAR Xfinity Series entry, has sponsorship revenue in the $40 million range annually, Murstein said. He wants that to grow to $50 million in the first year of MSP. He also hopes to eventually expand the operation to four Sprint Cup teams.
Murstein said that RPM is “more or less sold out” of inventory for the No. 43 car for this year, but added, “The No. 9 is more challenging.” Still, he said RPM is close to signing deals with three major sponsors. He also said that the only two companies that have been approached about doing cross-team sponsorships were both open to the opportunity.
Murstein said he spent about a year trying to hire Downes and ultimately convinced him to take the job by offering him stakes in both teams — less than 5 percent to start, per team, with the ability to jump to as high as 15 percent if certain incentives are hit.
Among Murstein’s ultimate goals for the new sales arm is to raise enough revenue to stave off the sort of talk of RPM’s demise that has popped up in past years. “The one thing about the Pettys — they’re like a Whac-A-Mole,” Murstein said. “Every time you hit them, they pop back up.”
