Investment Opportunities in the Sports Industry: Soccer

Introduction

This is the second in a series of articles about the sports industry. The goal will be to describe investment opportunities in the sports industry as well as also providing background information and expertise about sports leagues, teams, athletes, brands, media and other relevant topics. We will examine and discuss a wide variety of sports, including amongst others the Super Bowl, NBA All-Star Weekend, 2012 London Summer Olympics, 2014 World Cup in Rio de Janeiro as well as emerging sports technology trends.

Background

In terms of global popularity in Sports, two of the biggest sports are soccer and basketball. For this piece, we will focus on soccer. As the sport of soccer continues to grow in global popularity, there will be a number of investment opportunities that will arise.

First and foremost, there is the need for well-designed and well-built soccer venues. In addition, there will be the need to help build out and improve the areas surrounding the newly built soccer stadiums.

Where is there an immediate need? One should look at the future sites of the World Cup tournaments. The 2014 World Cup will be played in Brazil, the 2018 World Cup will take place in Russia and the 2022 World Cup will be hosted in Qatar.

According to numerous press reports, there continue to be delays in Brazil in terms of soccer stadiums, surrounding infrastructure and even hotel rooms (for tourists and fans of the many matches that will be played throughout the one-month period).

Areas of Potential Chinese Involvement

This is one area where Chinese companies can leverage their experience and expertise from building sports venues for the 2008 Olympics could add great value. Both Chinese and American companies are advanced in leveraging their technologies and know-how to build world-class venues. The Brazilian executives and officials should consider this option so they can ensure the facilities are built in time for this tournament that will be viewed by over a billion people in 2014.

In terms of long-term planning, the following two World Cup locations also are terrific markets for Chinese companies to leverage their world-class capabilities to build state-of-the-art soccer venues.

Another reason this should be strategic for the Chinese companies is that the greater China markets are critically important to the global soccer teams. There is tremendous growth and upside for teams such as Manchester United, Arsenal, Tottenham, Chelsea, AC Milan, FC Barcelona, etc. in China. All of these football clubs are interested in growing their fan base -- and China presents the greatest opportunity since the market is so large and because soccer is so popular with the Chinese.

When the 2012 Olympics kick off in London in late July, there will be an Arsenal vs Manchester City match in the "Bird's Nest," or its' official name, the Beijing National Stadium. The fact that two of England's more popular clubs are playing a match in Beijing the same time as the London Olympics will kick off is clearly symbolic and shows the importance of the China market.

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There are myriad of business opportunities that will arise as these global football clubs continue to target the China market, including Social Media, E-Commerce, Corporate Social Responsibility, Civic Engagement, etc. We will drill down on these specific topics in subsequent articles.

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Jimmy Lynn

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