Intro

Today, we are breaking down The National Football League or, as most know it, The NFL. It’s a sport that dominates American Sundays from late summer into early winter. Behind what happens on the field is a $15 billion dollar business with a unique operating and ownership structure and many stakeholders. 

To help break down the NFL, Jesse Pujji is joined by Jay Kapoor. Jay is currently General Partner of venture fund VSC Ventures, and prior to his career as an investor, Jay worked in the League Strategy office at the NFL. During the conversation, we break down some of the fascinating dynamics of the NFL, including how it dominates linear TV, the unique revenue considerations for the league and its teams, and what makes the NFL stand out relative to other sports. I hope you enjoy this breakdown of the NFL.

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

[00:02:18] - [First question] - What is the NFL?

[00:03:26] - The size and scale of the NFL as a business

[00:04:55] - Points of growth on the league side and the team side

[00:06:42] - The growth rate of the NFL over the past five years

[00:07:24] - How many people are watching the NFL and the size of their audience

[00:09:53] - The structure of the NFL compared to other major sports leagues

[00:14:08] - Distribution of the revenue generated by media rights

[00:15:53] - Other factors that make the NFL’s model unique 

[00:18:11] - How the NFL came to dominate the landscape of American sports

[00:21:26] - When the NFL became bigger than the MLB and why

[00:23:00] - How viewership and media rights have changed over the years

[00:24:52] - Complexity of scheduling games and creating scarcity

[00:26:14] - How the NFL Schedule is Created

[00:27:43] - Additional sources of revenue at the league level

[00:30:54] - Major costs to operate the NFL at the national level

[00:31:50] - Contributing factors that make annual operating costs $1.5 billion

[00:32:29] - How much it costs to run an NFL game

[00:33:35] - Major drivers and ways to increase the topline of the business

[00:36:09] - How much of the league revenue share is distributed to team owners and players

[00:39:06] - Seat sales, boxes, and sponsorship revenue

[00:40:40] - Who owns stadiums and an overview from a management and cost perspective

[00:42:43] - Non-player related operating costs

[00:45:46] - Operating leverage as an owner in this business

[00:47:08] - What a commissioner is and the governance model of the NFL

[00:51:31] - Overview of an executive team beneath the owners

[00:53:01] - Collective Bargaining Agreements 

[00:57:15] - How enterprise value is created and why it’s growing so fast for the teams

[00:59:11] - His perspective on comparing teams to assets generating revenue multiples

[01:00:51] - Defining relevance in regards to the NFL and what it means for the future

[01:04:39] - Plans to embrace a D2C model and the impact streaming might have on them

[01:06:56] - How the Superbowl became such a pivotal sporting event and why they made it

[01:11:35] - What will have to go right in order to grow exponentially over the coming decade 

[01:17:34] - Potential risks and concerns that could negatively impact the NFL’s growth

[01:22:21] - A big lesson we can learn from the NFL for entrepreneurs

[01:23:29] - Lessons for investors when studying the NFL

[01:24:48] - Learn more about professional sports and the NFL; The Game Plan; Tailgating, Sacks, and Salary Caps (book)