Financial Insights into Building Padel Clubs

This is Dom Cooke and today’s breakdown is a little different. Last week we looked at the most popular sport in the world in Football. Today, we break down the business behind a sport in its relative infancy - Padel. This racket sport started in the late 60s in Mexico and became big in many Spanish speaking countries. It then got a significant COVID bump and momentum has remained strong since.

To break down this burgeoning sport, I’m joined by Alan Flatt, CEO and President of EEP Capital. We look at the dynamics of the sport that are making it popular, the investment characteristics of Padel Clubs, and how sustainable its recent growth is. We also cover the differences to a sport that has become big in the US, Pickleball. Please enjoy this business breakdown of Padel.

For the full show notes, transcript, and links to the best content to learn more, check out the episode page here. 

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Show Notes

(00:02:41) - (First question) - A background on the sport of Padel

(00:03:38) - The size and scope of Padel today

(00:05:35) - The origins of the sport and its growth around the world up until now

(00:06:31) - Covid and Pickleball’s impact on the growth of Padel over the last 5 years

(00:07:08) - The main differences between Padel and Pickleball

(00:09:12) - Padel’s universal attraction being its ease of entry for beginners

(00:10:41) - Alan’s story of how he became involved with Padel as an investment

(00:12:16) - Investing in Padel clubs and looking at Padel’s previous growth in other territories 

(00:15:53) - What makes an attractive location for a Padel club

(00:18:14) - The costs involved with starting a Padel club

(00:21:53) - A look at the Padel Brooklyn location’s business model

(00:25:12) - The margin profile of a Padel club

(00:26:51) - Other sports and businesses with comparative models

(00:28:55) - How the current supply issue can be resolved

(00:33:06) - The current state of the US Pro League and how it might change

(00:37:50) - A breakdown of the teams and schedule of the US Pro League

(00:39:32) - The makeup of a Padel Pro League team

(00:40:49) - The strategic priority list for the Pro League in order to meet its growth goals

(00:44:28) - As a whole, how the sport of Padel can grow and the target markets for adoption

(00:46:07) - How close the sport is to becoming an Olympic sport

(00:48:20) - The risks that Padel faces

(00:51:46) - The lessons Alan has learned and can share with operators and investors