Editor’s Note: Welcome to a daily column we run here at BroBible breaking down the day’s biggest stories in sports business with commentary from the sports money and sports fanatic perspectives. It comes to us via our friends at JohnWallStreet. You can sign up here for their daily email newsletter.
La Vida Baseball Now Reaching 6 Million English-Preferred Latinos Monthly
Hispanic Heritage Month kicks off on Saturday (September 15th – October 15th) and 18-month old La Vida Baseball (LVB) will celebrate amidst record growth and new partnerships. More than 6 million English-preferred Latino’s (dominating the male 18-45 demo) read La Vida Baseball’s Latino focused baseball storytelling each month and the company’s video content generates more than 1.2 million views/month across digital platforms (think: lifestyle and culture content); MLB.com, Bleacher Report and Apple News have all syndicated their work. JohnWallStreet spoke with TeamWorks Media co-founder and CEO Jay Sharman about their target market, country pride vs. team pride and the 13 revenue streams of a digital media publisher.
JWS: English-preferred Latinos in the U.S. often choose to watch soccer in Spanish. How did TeamWorks Media identify that there was a need to deliver original baseball content in English to the Latino audience?
Jay: We looked at the marketplace and the amount of content available did not align with the statistics as to how many U.S. Latinos consume sports media in English-preferred; especially the younger demographic. There was a lot of sports content translated into Spanish, but we didn’t find any original baseball content with a Latino voice.
JWS: It would seem as if you could replicate this model with other sports. Are there plans to introduce a digital media outlet for English-preferred basketball fans?
Jay: 1 in 4 Americans are Latino, so statistically speaking it’s likely there’s a significant audience for most sports. What makes baseball unique though, is the participants. Just under 33% of Major League Baseball players are Latino. There’s just not nearly as many playing in the NBA. What we’ve also found is that country pride tops team loyalty in many cases (think: a Puerto Rican St. Louis Cardinals fans that still roots for Javy Baez); that’s a phenomenon unique to baseball. So, no we do not have any plans for horizontal expansion.
Howie Long-Short: La Vida Baseball is owned and produced by TeamWorks Media, a privately held entity.
I asked Jay to explain how La Vida Baseball generates its revenue?
Jay: We’re relatively consistent with any digital media publisher. Marketing partnerships will generate the lion’s share of our revenue, but sponsorships, revenue-sharing deals, licensing deals and events contribute; there are 13 different potential revenue streams. We’ve also created La Vida Baseball Studios as there are several brands, including MLB, that have talked to us about creating content for them; content as a service.
Editor Note: After the call, I asked Jay if he would detail the 13 potential revenue streams. You’ll notice that 3rd party platform revenues are grouped together under #5. LVB does not paywall content (#7).
- Marketing Partnerships – Custom, integrated content solutions (ex – branded video series, native content)
- Sponsorships – ROS
- Content Studio – Consulting, content creation, events for orgs/brands/media companies for their Latino baseball audience needs.
- Content Licensing – both existing content as well as commissioned content for networks/digital companies.
- Third Party Platform Revenue
- YouTube advertising
- Twitter advertising
- Facebook advertising
- Podcasting network advertising
- Content partnership revenue (content runs on media company’s platforms and LVB gets split of revenue earned)
- Events – Range from sponsor-driven, celebrity private event to potential destination baseball guided trips (Puerto Rico, Mexico, Cuba, etc…)
- Memberships (others may choose subscription model – this tends to be an either/or – not a both)
Fan Marino: Major League Baseball (which works in partnership with LVB) is on pace to draw 2.6 million fewer fans in ’18 than it did in ’17. Toronto and Miami have experienced the steepest YoY declines (-10,000 fans/game), but the Kansas City, Detroit, Pittsburgh, Baltimore and Texas are all having bad years at the gate too (all down 4,000+ fans per game). While most of the league has taken a step back, there are 10 teams on pace to outdraw last season’s attendance totals; the Brewers, Yankees and Phillies are all drawing upwards of 4,000 more fans/game this season than last.
XTECH Sales Grow +/- 400% YoY Amidst Record Adoption
XTECH Protective Equipment has increased sales by nearly +400% YoY as coaches, equipment staff and players, at the pro, collegiate and high school levels, have embraced their lightweight, durable (see: flexible, water resistant) protective padding. More than 70% of NFL players (including Odell Beckham, Khalil Mack and Von Miller) will wear XTECH padding during the 2018 NFL season, as will student-athletes on 400+ NCAA football teams (including: USC, ND and Ohio St.) and 500+ high school football teams; no player or team is paid to wear (or endorse) XTECH products. Known for shoulder pads, XTECH has introduced a line of thigh and knee inserts for the ’18 season to help college teams comply with a new NCAA rule requiring players to wear padding and pants that cover the knee.
Howie Long-Short: XTECH is the fastest growing company in the protective pads space and maintains an exclusive multi-year contract with XRD Impact Protection (for the use of its foam in NFL, collegiate and youth football pads), so the company could dominate the landscape for some time.
XTECH, which is privately held, is in the process of evaluating a new investor round.
XRD Impact Protection is owned by Rogers Corporation (ROG), a technology company focused on creating innovative solutions for power electronics, advanced foams for cushioning and protective sealing, and high frequency printed circuit materials.
ROG reported Q2 ’18 earnings in late July. While sales rose +6.6% (to $214.7 million), net income declined 17.1% YoY (to $17.3 million) as gross margins dropped by 430 basis points; CEO Bruce Hoechner blamed “additional costs for capacity and activities to reduce cost structure” for margins that failed to meet expectations. Hoechner insists ROG remains well positioned to reach 2020 performance targets though, with “significant growth opportunities in 5G wireless, advanced driver assistance systems, and electric and hybrid electric vehicles” all on the short-term horizon.
Fun Fact: Super Bowl Winning Coach Brian Billick is an investor in XTECH.
Fan Marino: Players love XTECH padding because it enables them to hit hard (or get hit hard) without feeling anything. Check out this short video of Founder Bob Broderick slamming his bare hand with a helmet and you’ll understand why Andrew Luck, Matt Ryan, Jameis Winston, Baker Mayfield, Josh Allen, Sam Darnold, and Josh Rosen all chose to switch to XTECH padding for the ’18 season.
What is JohnWallStreet?
JohnWallStreet, located at the intersection of sports and finance, is a destination for the educated sports fan.
While we won’t be publishing “hot takes” on LeBron’s relative greatness to Jordan, we will be offering up the most relevant sports related business news, in easily digestible bites, with commentary from both the sports money and sports fanatic perspectives.
We’ll cover publicly traded professional teams & stadiums (MSG, RCI, BATRA, MANU), television networks (DIS, FOXA, CMCSA, CBS, TWX, MSGN), apparel & footwear companies (NKE, UAA, ADDYY, FL, LULU), equipment companies (GOLF, ELY, FIT), ticketing companies (EBAY, LYV) content and facilities providers (CHDN, DVD, ISCA,TRK, LMCA). If it trades on Wall Street, and has a sports angle, it’s in our wheel house.
Howie Long-Short and Fan Marino will be providing their expert opinions on each story. They have slightly different areas of expertise. Fan Marino is a firm believer that the SEC is the premier football conference. Howie Long-Short knows it as the Securities & Exchange Commission. Fan Marino lives and dies with the college selection of 5 star, blue chip recruits. Howie Long-Short spends his days analyzing blue chip stocks. Howie Long-Short knows that Black Monday occurred on October 19th, 1987. Fan Marino swears it happens every January after Week 17. You get the point.