Many of our fondest childhood memories trace back to the days playing sports as a kid: our first friends, first wins (and losses), the crazy parents on the sideline or the smirks while facing off against a rival classmate.

Things seemed so simple back then, and whether you were last involved in youth sports 10, 20 or 50 years ago, the landscape has evolved dramatically from what you may remember. 

As professional sports increasingly become a major asset class for institutional investors, all signs point to youth sports seeing (and feeling) the next major wave of capital. Historically, youth sports have been strung together by a band of parents, some town/city support, and a batch of contracted workers to ensure all logistics for a league are working smoothly. A business-first approach would say: sprinkle in few seasoned operators, and those pain points should be smoothed out in due course.

With an estimated TAM of $69.4bn by 2030 and an influx of capital, the days of Coach Smith writing the lineup in pencil right before the game based on uniform number may be gone before you know it. Institutional capital is here to make this ever-fragmented industry better… or are they?

Why it Matters: Investment in Youth Sports is at an all-time high, and we are seeing the downstream effect of it in real-time. The town or local YMCA league is no longer the only organized group around. Private Equity has swooped in, slowly taking large stakes in companies integral to the youth sports ecosystem. KKR purchased Varsity Brands, one of the premier uniform and equipment distributors in 2024 for $4.75bn. (Editors Note: Us former D3 athletes know Varsity Brands well through one of its core businesses in BSN Sports: the go-to spot to buy a pair of Nike shorts with your number on it to prove to everybody that you do/did indeed play college sports). On the tech side, Accel-KKR and Arctos Partners recently led a new round of funding for LeagueApps, a software platform for end-to-end youth sports management. There’s no other way to put it: youth sports are now run by much bigger groups than the local pizza shop sponsoring the back of a uniform.

The Big Picture:  According to Bloomberg, US youth sports now boast over 60 million participants and ~$30bn of spending annually. As the spending soars, youth sports continue to expand their reach — kids can train and play sports year round, no matter if they live in California or Maine. Indoor facilities, leagues and travel teams have put the entire country on a more even playing surface.

However, the commercialization of youth sports does have major consequences. Youth sports are sacred. Kids play for no ulterior motive other than for the love of the game. If (or when) that paradigm starts to shift, expect to see major pushback. We are seeing early cracks of such, with single-sport specialization earlier on in a kids playing career increasing — even though research shows that single-sport athletes are at much higher risk of injury than their multi-sport counterparts. This could be a much deeper problem though, as a 2023 study shows that this trend to one-sport often stems from the parents, with ~25% of parents reporting “significant pressure to encourage it [sport specialization]”.

Zoom In: As youth sports commercialize, leagues sprout to allow kids to play competitively year-round — with some even starting at 6 years old! Seems extreme? It is! But the competition only gets crazier the older kids get; as we see paid coaches, significant travel, and an expectation that you need to commit all year-round to a team in order to give your kid the best chance to succeed. To make matters more complicated, nearly 20% of kids are now playing for a team outside of the town and/or training independently:

By the Numbers:

US households as a whole are spending more and more on their child's primary sport:

Interestingly enough though, youth team sport participation across the US isn’t a universal trend, and we see cold-weather regions actually having higher team participation rates than their southern/southwest counterparts. Why is that? Well, if you look deeper than weather patterns, you’d also see a strong correlation to high earning states, and a direct link to disposable income and a cultural expectation to have organized extracurriculars be a key part of childhood development.

The Bottom Line: The investment into this ever-growing youth sports world is showing no signs of stopping. As long as participation trends remain steady, expect to see the market grow and mature. Keep a close eye on how participation does trend, as the core thesis of these investments of course centers around kids actually playing. On a more macro level, investment in girls sports — with participation at its highest since 2013 — may be where the most upside lies. No matter what, the capital and focus now will certainly lead to further consolidation across the space.

A mini investment memo on the most innovative sports tech companies

The Company: Unrivaled Sports

The Business in a tweet: Unrivaled Sports owns and operates a portfolio of youth sports leagues, venues and events to help deliver a premium experience to athletes. Founded by sports and entertainment veterans Josh Harris and David Blitzer in 2024, the holding company already sees more than 600,000 youth athletes compete at their 15+ properties a year.

The 101: 

Business Model: 

Early Traction:

They Said It: Unrivaled CEO Andy Campion to Bloomberg: “Unrivaled’s goal is to do for travel sports what Disney has done for amusement parks. “When you think about distributed mom-and-pops, you have no idea who owns it,” Campion said. “As we become more well known, we hope people go, ‘Oh, Unrivaled owns that? It’s going to be great.’”

Deep Dive:

Pros:

Cons: 

What’s Next?

A few opportunities Unrivaled Sports should take a close look at:

📶The Signal (No Huddle’s Take): Our support of Unrivaled is a bet on leadership. Harris and Blitzer are savvy veterans with a top notch resume and rolodex in the sports world. If those two want to make something work, they will. We also see the merits of streamlining an extremely large and fragmented market, as this will only open more doors for other adjacencies in the youth sports world (corporate partnerships, NIL, health & wellness, data & analytics plays, pipelines to prep schools/colleges… just to name a few). We can see a path where the vast majority of premier youth sports events have an Unrivaled sprinkle to them.

No Huddle is for informational purposes only and is not financial or business advice. The content in this newsletter does not represent the opinions of any other person, business, entity, or sponsor.