Private Equity in the NFL, Alibaba’s AI Bet & Apple’s Budget iPhone💰🏈

Money Masters' Market Pulse Week 8

February 21, 2025

Dear Money Master,

This week, the San Francisco 49ers 🏈 explore selling a minority stake, marking a shift as the NFL opens its doors to private equity💰. Alibaba’s stock jumped on strong AI-driven earnings🚀, while Apple unveiled the iPhone 16e, a budget-friendly model with AI features.

In our Deep Dive, we explore how private equity is reshaping NFL ownership, providing teams with liquidity while investors gain access to one of the most exclusive assets in sports.

📰 Your Daily Financial Digest - February 21st, 2025

🌍 Economics:

  1. Pentagon Orders $50 Billion Budget Revamp for Defense Priorities 💰
    The U.S. military is identifying $50 billion in cuts from the 2026 budget to reallocate funds toward President Trump’s national defense goals. Read More

  2. Forever 21 Considers Second Bankruptcy Amid Financial Struggles 🛍️
    The retailer is in talks with liquidators after failing to secure a buyer, as competition from Shein and Temu, higher tariffs, and declining brand appeal take a toll. Read More

  3. San Francisco 49ers Explore Selling 10% Stake in Franchise 🏈
    The NFL team is considering selling a minority stake to private equity or wealthy investors, valuing the franchise at nearly $9 billion. Read More

  4. Japan’s inflation hits 4% in January, highest in two years 📈
    The core inflation rate climbed to 3.2%, exceeding expectations, while the yen strengthened 0.15% following the news. The data strengthens the case for BOJ rate hikes. Read More

  5. Nikola’s Fall: From Wall Street Darling to Bankruptcy 🚛📉

    Once valued at $30 billion, Nikola has filed for Chapter 11 bankruptcy after failing to secure funding. The EV startup now plans to auction off its assets. Read More

💻 Technology:

  1. OpenAI surpasses 400 million users despite competition 🤖
    The AI giant saw a 33% user growth since December, with enterprise adoption doubling to 2 million paying users. Developer traffic also surged fivefold for its latest AI model. Read More

  2. Microsoft Unveils Majorana 1: Its First Quantum Computing Chip ⚛️
    After two decades of research, Microsoft has created a quantum chip using a new topological state of matter, aiming for a future with millions of qubits. Read More

  3. AI Startup Baseten Raises $75 Million to Power AI Model Deployment 🚀
    Baseten, which helps businesses run AI inference efficiently, secured funding at an $825 million valuation as demand for cost-effective AI infrastructure grows. Read More

  4. Apple Launches Budget-Friendly iPhone 16e with AI Features 📱
    Priced at $599, the iPhone 16e supports Apple Intelligence, ditches the home button, and debuts Apple’s first in-house cellular modem. Read More

💹Earnings:

  1. Alibaba Reports Strong Q3 Earnings, Stock Jumps 🚀
    Alibaba’s net income soared to $6.72 billion, surpassing expectations, driven by double-digit growth in cloud and e-commerce. AI-related revenue posted triple-digit growth for the sixth straight quarter. Read More

  2. Walmart shares drop after disappointing outlook 🛒
    Despite a 4% rise in holiday-quarter revenue and 20% e-commerce growth, full-year earnings guidance fell short of Wall Street expectations, leading to a selloff. Read More

  3. Etsy Stock Drops After Revenue Miss and Declining Sales 📉
    Etsy reported lower-than-expected revenue and a 6.8% drop in gross merchandise sales as consumer spending slowed. The company anticipates similar declines in the current quarter. Read More

  4. Carvana Surprises with Record Q4 Profits, Stock Falls 🚗
    Carvana posted record revenue of $3.55 billion, up 46% YoY, with net income of $159 million. Despite the strong results, shares declined. Read More

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🔍 Deep Dive: Private Equity’s Play for NFL Teams 🏈💰

Owning a piece of an NFL team is no longer just a billionaire’s dream—it’s now an investment opportunity for private equity (PE). In 2024, the NFL became the last major U.S. sports league to allow PE investment, following the NBA, MLB, and NHL. However, the league is taking a cautious approach, imposing strict limitations on PE ownership.

How Private Equity Investment Works in the NFL

NFL team owners can now sell up to 10% of their franchise to select PE firms, with individual stakes being no smaller than 3%. These investments are passive, meaning PE firms won’t have a say in team decisions like drafting players or hiring coaches. The league has approved a shortlist of major investors, including Arctos Partners, Ares Management, and a Blackstone-led consortium, with potential expansion in the future.

Why Teams Need Private Equity

Unlike other major businesses, NFL teams aren’t cash-rich enterprises. While media rights bring in billions, much of that revenue is tied to revenue-sharing agreements and lump sum payments. Teams need liquidity for operations, player salaries, and stadium upgrades. PE investment offers an alternative to taking on debt or selling to a full owner.

The Bigger Picture

The high cost of franchise ownership has made it difficult for individual buyers to enter the market. With team valuations soaring, the average NFL team is now worth $6.49 billion, allowing PE investment provides liquidity while maintaining family ownership structures. It also positions the NFL to potentially expand PE involvement in the future, mirroring European soccer and other U.S. leagues.

To your financial empowerment, The Money Masters Team

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Disclaimer: This information is for educational purposes only and should not be construed as financial advice. Always conduct your own research or consult with a financial advisor before making investment decisions.