Key facts
- Collaborative Fund is investing in D.C. United and Audi Field.
- Thrive Capital previously entered pro sports ownership with a stake in the San Francisco Giants.
- Thrive Capital's Thrive Eternal vehicle purchased the Lakers for $12.5 billion.
- Collaborative Fund founder Craig Shapiro views franchises as 'the ultimate consumer product'.
- Shapiro plans to use Audi Field as a showcase for Collaborative Fund's portfolio companies.
- D.C. United's valuation has risen to $785 million, including Audi Field.
Collaborative Fund, a New York-based venture firm managing approximately $1 billion, is acquiring a stake in the Major League Soccer club D.C. United and its home venue, Audi Field. This move follows a similar strategy by Thrive Capital, which has been instrumental in opening the door for venture capital firms to invest in professional sports franchises.
Thrive Capital, founded by Joshua Kushner, established a dedicated vehicle, Thrive Eternal, to hold long-term investments in "iconic franchises and cultural institutions." The firm's initial foray into sports ownership included a stake in the San Francisco Giants. Subsequently, Thrive Eternal, with former Disney CEO Bob Iger as a partner and co-owner, purchased the Los Angeles Lakers for a record $12.5 billion.
Historically, professional sports ownership has been dominated by individual wealthy investors and private equity firms. Examples include Vinod Khosla's agreement to buy the Seattle Seahawks and his family's stake in the San Francisco 49ers, as well as investments from firms like Sixth Street, Ares, RedBird, and Arctos in various leagues and teams.
Collaborative Fund's approach differs from both individual wealth plays and traditional private equity. The firm is utilizing its existing early-stage venture fund for this investment, treating it more like an infrastructure play. Craig Shapiro, founder and managing partner of Collaborative Fund, described franchises as "the ultimate consumer product" and sees D.C. United, as one of MLS's original clubs, as an institution with a strong fan base.
Shapiro's investment thesis highlights tailwinds in American soccer, including the upcoming LA Olympics and increased youth participation. The ownership of Audi Field and a talent development pipeline further support the strategy. Collaborative Fund aims to leverage Audi Field as a platform to showcase its portfolio companies, such as Whoop and Olipop, by integrating them into fan experiences and game-day concessions. This strategy capitalizes on the increasing value of live experiences in an increasingly synthetic world.
The investment also benefits from soaring sports franchise valuations, particularly in soccer. Inter Miami's value has doubled since Lionel Messi's arrival, MLS club values have risen significantly since 2019, and D.C. United's valuation, including Audi Field, has grown from $35 million in 2008 to $785 million. The deal is pending approval from Major League Soccer.