October 31, 2024 • 49 mins
In this episode of The Deal, Alex Rodriguez and Jason Kelly talk with Bruin Capital Founder and CEO George Pyne about how he reinvented institutions like NASCAR and IMG before pivoting to investing. Pyne explains what he looks for in a founder, why the risk-reward ratio is important in deal-making and the opportunities he sees for growth in college sports.
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Episode Transcript
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Speaker 1 (00:03):
Bloomberg Audio Studios, Podcasts, radio News.
Speaker 2 (00:13):
Hi, I'm Jason Kelly. I'm Alex Rodriguez, and on this
episode of The Deal, George Pine. So George Pine, Alex.
He is the former CEO of NASCAR, former president of IMG,
now the founder of Bruin Capital. This is a guy
that if you are in the sports world, you are
one degree from him because he's everywhere. He's got a
(00:33):
speed dial like no one else, has been involved in
major deals and is looking around the corner constantly for
what's happening next in sports.
Speaker 3 (00:42):
Yeah.
Speaker 4 (00:43):
I think in many ways, Jason, guys like you and
I we looked up to Warren Buffett and other great CEOs.
I think this is a guy that if you're a
young entrepreneur you should study.
Speaker 3 (00:50):
Yeah.
Speaker 4 (00:51):
And the reason why he has a perfect trifecta, I mean,
you said it best. He's a wonderful family man. He's
built an incredible business in Bruin Capital, and he's got
old class relationships with an amazing culture.
Speaker 2 (01:02):
Here's George Pine. All right, George. Should we start the
show always by having people introduce themselves, their names and
what they do.
Speaker 3 (01:21):
George Pine, founder and CEO Brewin Capital, now I could
use the Boston accent. George Pine, I.
Speaker 2 (01:28):
Realized, listen, when you use a Boston accent, it gives
this guy PTSD.
Speaker 5 (01:31):
So your audience.
Speaker 2 (01:35):
Yeah, so use that, use that to your advantage. I mean,
if you don't like it, question, if you don't like
a question you asked, just answered, and the boss, you know,
we're wondering how to start the conversation with you, you know,
looking at all the stuff you've done for your career,
what would you say so far? Is your signature deal?
Speaker 3 (01:54):
Signature deal? You know, I do? You know, I don't
really look in terms of that. I think the thing
probably if you ask you what am I most proud of?
Maybe you know deal. Earnhardt passed away on the last
lap of the Daytona five hundred weeks before I was
promoted to run the company. Having to lead the safety
initiatives at NASCAR through a very difficult period, it's probably
(02:14):
the thing I'm most proud of. And then, of course
that had two avenues. One was actually putting in safety
policies and procedures and creating an R and D center,
the first of its kind in the world, and then
also too navigating the communications challenges of that because overnight
NASCAR became so much more popular at that time. So
that of all the things I'm most proud of, I
(02:35):
think it is that error and dealing with that challenge,
and luckily they've had almost perfect safety record since then.
Speaker 2 (02:43):
What was that moment, like, I mean, that was a
I mean that was a similar moment in the sport.
Speaker 3 (02:48):
It was to lose your greatest driver of all time,
and we had lost three other guys in last eighteen months,
and then when the greatest of all time passes away,
it just it shook the whole industry right to the core.
And of course we were leading the nightly news three
nights in a row and we are The scrutiny on
(03:10):
the sport was off the charts, So that rattled you.
It really rattled you to your course. So having to
kind of stabilize and kind of like sports getting out,
you got to go back and play the next day
and dig in there and find your way through it. It
was really probably one of the most challenging things, but
we came out the other end and made great strides
(03:30):
and had a real impact over a long period of time.
So if you look at ask me what I'm most
proud of. It's that effort.
Speaker 4 (03:37):
Let's talk about that, George, Because obviously, when the returns
are great and you're returning capital to investors and all,
that is all wonderful, But in a very very difficult
moment leadership wise, what were some of the things that
you did over those three days to thirty days to
make everybody feel better about themselves?
Speaker 3 (03:55):
Wow? I think you have to lead by example and
taking tough positions. I mean, we installed hans device, which
was very unpopular at the time. We put data recorders
in the cars, which was also controversial. So pushing through
a number of changes that culturally and for other reasons
the organization had never done before. But you had to
do it right. So what was your option? So having
(04:17):
the courage to push through change at a difficult moment
and sticking with it and believing it and standing up
was really what I took away from that. So I
think a leader has to take a stand, do things
that are uncomfortable, and be thoughtful at that is, you
don't really want to go against the grand to go
against the grain, but you know, you to lead, you've
got to take a stand and do what you believe in.
Speaker 2 (04:40):
So over the course of this conversation, we're going to
talk a lot about your leadership and candidly like your
operational expertise and your operating experience and how that translates
into your investment world. But I feel like I have
to go all the way back. And Alex knows this
because I've known you for a long time. I mentioned
when I was basically a kid in Atlanta for our
mutual friend Billy, and right, he started out in the
(05:01):
real estate where you come out of Brown. What's the
quick story of how you get from there me meeting
you and Helene, like on club Drive in Atlanta to today.
Speaker 3 (05:11):
As I tell everyone, there's no way to replicate my journey. Right,
I moved to Atlanta, I had five thousand dollars. My
wife had a car with ninety thousand miles in no
air conditioning. My car had one hundred and seventy thousand
miles and only two of the four doors worked right,
and we literally had to use our credit credit cards
to pay the bills we had. Our friend Billy came
over to our apartment and said, I feel like I'm
(05:33):
in a college JOm. I said, yeah, this is all
my stuff for my college JOm So it was a journey,
but again I come from a family of athletes and
didn't want to fail. Like I never really cared about winning,
but I never wanted to lose, right, And so I
moved away went to this new place, Atlanta. Atlanta was great.
It was having the Olympics in the Super Bowl, and
I worked in a big real estate company and had
(05:55):
built twenty seven buildings in downtown Atlanta. And I was like, hey,
we should get in the sports business. And my boss
thought I was crazy. But on the side, I built
a little sports business, signed up NASCAR in nineteen ninety five,
and people forget today. When I went to NASCAR, it
was called Winston Cup. Sixteen races were on the Nashville
Network and the company had one office and it was
very small. You know, when we left here on Fox.
(06:16):
At NBC we had nine offices.
Speaker 2 (06:18):
Hold on, I want to stop you there. It was
not called NASCAR.
Speaker 3 (06:22):
It was Winston Cup Racing right as a tobacco sponsor,
and people referred to Winston Cup. The NASCAR brand at
that point didn't really exist, and NASCAR at the time
when I went there was a company that sanctioned the
races and administered the races. It wasn't supposed to be
in the commercial side, and so they let myself and
Brian France were anointed to go try and develop a
(06:43):
commercial business. And man, we took off. You hit it hard.
I knew we had a big opportunity and it worked out,
and so it was an amazing run. The industry was great,
but I wasn't a car give so, you know, I
was forty years old. It had a little itching me
and I want to do something else. And so I
had a frantic oldman Sacks and said, hey, you know
you should go see this guy Ted Forceman, he just
bought IMG. And I was like, all right, I didn't
(07:06):
know who Ted was, and I thought I went by
I saw Ted. I thought it was go me thirty minutes.
It was two hours. And Ted, when he wanted something
was pretty compelling. And the notion of good IMG worked
for a guy who is a leader in private equity
to me was legend in private He said he invented it.
I'm not sure that too, but I felt like working
(07:27):
for him I could learn a lot, which I did.
And obviously IMG was in thirty countries and so running
a company that operated in thirty countries that was in
wide array of sports. Working for a guy like Ted,
for me was like, all right, that sounds good.
Speaker 4 (07:40):
So I like when you mentioned Ted force me because
the first time I heard of him was when he
bought twenty four hour Fitness from my partner, Mark Mastrow,
and I think they did that deal for about a
billion eight marchers loved working with him.
Speaker 5 (07:51):
But tell us a little bit about Ted.
Speaker 4 (07:52):
Our listeners, probably a little bit younger, don't know much
about Ted, but he's a legend. Tell us what he
meant to you and what were some of the attributes
unless as you learned from him.
Speaker 3 (08:01):
I had really three great mentors. And Atlanta, a guy
named John Portman who was one of the great American
architects at twenty five million square feet of real estate,
and I work with him through a financial restructuring, and
then working at NASCAR for Bill France. Bill France was
another billionaire, very successful guy, and then working for Ted Forsman.
So I learned different things from different people. Ted what
(08:21):
I really learned was he was very conservative and a
little bit negative. But boy, if he was able through
structure to come up with an idea to minimize the risk.
Like the guy was all in right away. And so
what I really learned from him was, and I tell
my kids, the risk reward ratio, what's the upside, what's
the downside? Is it worth it? And if it's worth it,
(08:42):
you go for it. That's what I took away from Ted.
The other thing from these three guys all highly successful,
they all worked, they worked hard, They're smart. I'll tell
you one of the funny one is, so my last
day at NASCAR, I'm going to lunch with Bill France
and Jim France, two billionaires. Where do we go? We
go to stake and shit, and they're wearing like short
sleeves and we're driving home and I said, I go, guys,
(09:06):
can you give me one piece of advice? It's great advice.
They said, no, when to squeeze and no when not
to squeeze, And that was it, right, But that was
kind of having the judgment of knowing when to push
and when not to push. So like watching these guys
Dan and Dale for me was a great, great learning experience.
Speaker 2 (09:24):
I mean, what's the transition like from what I mean
you go from these two like iconic people in American
business and finance. Was there any sort of transition from
working for the Frances, you know, you know pretty well
codified family business to Ted Force, I mean barbarians at
the gate. How do you sort of adjust mentally like
(09:45):
what are you going home and saying to Helene of like, okay,
this is this is a different world.
Speaker 3 (09:50):
Yeah. So NASCAR was because it was a family business.
Really all you had to do was convince the family
of the right thing to do, and you're doing immediately
no politics, which I love, and there was no kind
of political maneuvering and so that was great for me.
And I was kind of a guy that went out
there in the fields and did the work and you know,
brought the goods home and did it again and did
(10:11):
it again. And when you went to Ted, Ted was
an investor, not an operator. And investors sometimes when they
don't know a business, there there are a lot of
different inputs, and when you're running a global company, there's
a lot more politics. And I was not When I
first went to I'MGA i was forty years old. I
was like, hey, if you're doing a good job and
you're driving results, that should be good enough. And what
(10:31):
I learned in that environment was that may not be
the case. So it's you know, I tell people, you know,
you need good style, but also up in substance, and
I was more substantive I think at NASCAR, and I
needed to work on the style kind of the presenting
and being a little more political, which I didn't like
quite honestly, and we don't have it brewin today. But
that was if you said to me, what was different?
(10:52):
You know, working for a global financier who has a
lot of inputs, you've got to be a different set
of management skills working for a family business and delivering results.
Speaker 2 (11:03):
And so what was the like you get to IMG
and what's the biggest challenge that you took on there?
Speaker 3 (11:09):
Well, the biggest challenge is trying to reinvent and grow
the company, which you know, one of the things with Ted,
which was great training for me and I knew it
when I took the job, was all right, you know,
my job is to grow earnings. Right, Scale doesn't matter, profitless,
volume doesn't matter, growing earnings.
Speaker 2 (11:24):
Because he's an investor.
Speaker 3 (11:25):
He's an investor, and so how to grow ibadah is
was the thing that you know, we got trained in
and measured, but ironically, you know the one thing that
I learned a long time although I going back to
Portman when I made a huge mistake, I used to
criticize people for not having a plan. When I went
ran my first business, I didn't have a plan. I
got really taken to the woodshed on that. I said,
(11:45):
I'll never run a business without a plan. And so
how's a guy that you know his wife taught him
how to drive a six shift, run NASCAR and set
rules and so forth. Because that I was a very
big three year plan guy. So we had to write
a business plan and you checked in on a business
plan a month on strategy and numbers. And when what
happened NASCAR, Bill Frantz is like, you know what, it's
(12:06):
working pretty good on the commercial side. Why don't we
take this discipline and put it over to the core business.
And that's what got me on the racing side from
just the commercial side, and that has served me well.
It served me really well working for TED because I
have a very diligent planning strategy. It's not I look
at it this way like numbers are like your blood pressure,
cholesterol or whatever. They'll tell you what's right or wrong
(12:28):
with the business, but they're not going to solve it. It's
the strategy drives the numbers. The numbers can firm the strategy.
I always been a big believer in that. Even yesterday
I was in a staff meeting. I'm like, hey, guys,
you know, let's make sure we have a collaborative approach
with our companies and just someone doesn't show up in
December and presents me a business plan. Let's start now
digging in with people and let's go through the drafting
(12:50):
of it. So I found that working with people, developing
a strategy and then having the numbers check the strategy
has really worked well for me for thirty years. I
learned that at Portman. Actually, so I.
Speaker 4 (13:00):
Specifically on IMG you said one of the things you
were looking to do from Teddy's kind of from the top.
Speaker 5 (13:05):
Is grow ibadat right.
Speaker 4 (13:07):
Maybe one or two examples of what strategy did you
take and how did you move that number in the
right direction.
Speaker 3 (13:13):
Well, you know, one of the ones I'm really happy
about is IMG Academy. When you take about IMG Academy
was they were really great at training athletes, the lead athletes,
you know, Kobe Bryant, Serena Williams, Maria shrup of a
really great athletes had been through there, but for thirty
years it had never been profitable. Right, So I put
in a guy today who's at the Barclay Center and
(13:34):
running the Nets. Sam's ustman. He was well educated, he
went to Stanford Business School, Tel Aviv Law School. Sam
came in as my chief of staff and I put
him in to run IMS Academy. And Sam's a brilliant guy,
but he had worked at McKinsey in yield management and
running a sports academy is like running a hotel or
in Sam's case, understanding the yield management in the airline industry.
(13:56):
So we took IMG from not being very profitable too
profitable in a very short amount of time, turning it
into more of a place where you could go to
go to college versus where we're going to get the
next Maria Sharapova. And I was really proud of that.
We bought this amazing IMG Academy just SILD for I
think roughly one point two billion dollars, like ten or
eleven years ago. We bought forty percent. We only owned
(14:18):
sixty percent of it when I got there. We bought
forty percent of IMG Academy for six million dollars and
a two year payment plan. And it was hard because
we did it during like nine and you know, cash
we were managing cash tight. I had to go to
the wall. That was like moving a mountain to get
six million dollars to buy forty percent of the academy.
They never been profitable for but you know, recently just
(14:40):
SILD for like one point two billion dollars. So anyway,
so that's one. And then you know, we had a
lot of fun building the college business. We'd never been
in college. And one thing I learned from Ted which
served me well today, was we had to go around
and find places to grow earnings that didn't exist. And
so we did this. We looked, I looked at everything.
We looked at all these different sports. And I had
one of my buddies who used to be my CMO
(15:02):
at NASCAR. I started getting these numbers on college sports.
It was like one hundred and ninety million fans number
one with young people, ethnically diverse, a wealthier audience than golf. Right,
think about most CEOs went to college, right and gender neutral.
I call my guy, I said, his name's Roger Vandersink,
he's at the colts now, I said, Roger, I go,
(15:24):
where did these numbers come from? He goes, oh, George,
we never compared ourselves to college sports, and so we
made investments in college sports and it turned out to
be a real at IMG, I'm a real growth engine
for us, and that was probably in two thousand and ten,
and we were the first really guys that got the
ball moving there.
Speaker 2 (15:44):
What does that look like when you're investing into college sports,
Like so many things that you've done, they seem so
obvious now, but they were not obvious at the time.
So how did you invest in college Well, so the
idea was I took a look at those numbers. I
was a gas, right, and then you start looking at
our Take Atlanta. You have the Atlanta Falcons and the
Georgia Bulldogs. Now we lived in Atlanta, so you know, like,
(16:05):
who's more popular, truthfully the Georgia Bulldogs, it's not really,
it's not close.
Speaker 3 (16:11):
And so like when you look at all, right, what
revenue does the Falcons generate and what revenue does the Bulldogs?
And all of a sudden, the Falcon's away up here
and the Bulldogs are down there. So I'm not the
smartest guy, but I was like, you know what I
want to do, I'm going with those guys and we
should be and try to sell sell like the like
the Falcons, And so we had. It was a big restructuring.
(16:33):
I mean we I think we had. Unfortunately, we had
a reploy had four hundred salespeople replaced three hundred and
eighteen months, and so you had it was you had
to replace people because you were selling differently. We wanted
to sell like the Falcons, not like the Bulldogs, and
we had to go out and get guys from the
other leagues to come in and help us.
Speaker 4 (16:52):
You know, Georgia, I'm sorry you lost me a little bit.
Take me step back. So you're invested in to the Bulldogs,
the Georgia Bulldogs, But what does that mean. I mean
that you're managing sponsorships or you're investing into the university
walking through that.
Speaker 3 (17:05):
So there were companies, small companies at the time that
had the marketing rights to these companies, and what we
did is we rolled them up and when we left
were representing eighty five universities WOW on sponsorship and local
media rights, and then two hundred universities in licensing.
Speaker 2 (17:21):
So you were repping the schools and essentially replacing an
infrastructure that was probably like local or regional right like.
Speaker 3 (17:28):
We were trying to That was kind of the whole,
ye whole, So your point makes sense now, But transformation
at that time, Oh yeah, go ahead of the cur
that was the big driver of growth during the IMG time.
Speaker 2 (17:47):
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(18:07):
dot com slash Bloomberg Podcast Today. It's really interesting to
think about that sort of trifectave experiences. But what were
you seeing in the business of sports that you found
so compelling as you moved along.
Speaker 3 (18:26):
Well, when you think about sports anywhere in the world,
it's the only thing that aggregates hundreds of millions of
people together around something as a statement of who you
are and what you stand for. So that connection, which
at NASCAR, those fans were loyal in college is you're
loyal Yankees fan, very loyal, and so what you really
want to do is try and tap into that loyalty
that's unmatched. And you know, in this world now where
(18:48):
media consumption is fragmented, there are very few things that
pull people together, right, And then when you think about
all these new devices that can deliver content, you're really
tapping into the consumer. I look at sports today like
in a fragmented world, sports become more valuable. And where
I think sports is going is this whole concept of
the lifetime value of the consumer, right, because really it's
(19:10):
a one to one relationship and I'm going to you know,
I'm a Yankees fan. I want Yankees content. I want
to know everything about the New York Yankees. And having
that one to one relationship might give me permission to
suggest products and services that are relevant, you know, to
the Yankees. And by the way, you can take that
to Europe. It's the same thing in any of those
football clubs or leagues. It's the passion of sports and
(19:33):
that one to one connection that's unlike anything else and
will become more valuable because the media and the way
we communicate so much more fragmented today than it was
ten years ago.
Speaker 2 (19:44):
So take us through, you know, arguably the biggest sort
of personal deal you make, which is you've been working
for these like big companies. You've had these incredible, like
iconic business figures you've worked for, and then you decide like,
I'm going to do my own thing, and not just
I'm going to do my own thing, but I'm going
(20:05):
to move from being an operator to being an investor.
Like what's that thought process?
Speaker 3 (20:11):
Like the thought process was you had success in growing
earnings and I could now apply this to a different
area for myself. And I think we had talked a
little bit about you know, the transitions. You know, when
you're in a company, it's political, and I wanted to
have a more horizontal, entrepreneur, results oriented kind of situation.
(20:31):
So that was appealing to me. And you know, I
was forty eight years old, and I was like, hey,
if i'm forty years old, i fail, you know, I'll
be fifty two or fifty three and I'll come back
and take a job. Right But I said, you know what,
I'm going to wait till i'm sixty to take my shot.
I was like, it's the age always meant a lot
to me. You know, I was forty years old at NASCAR.
I'm like, yeah, do I see myself here? Twenty years old?
I want to take a shot at something else. You know,
(20:53):
I'm forty eight years old. You know, now's the time
to take a shot. I'm twenty five, I'm going to
move away from home. I have no money, so what
if I feel like can always move back home again? Right,
So like I'm forty years old, it's time to take
a shot now. It was a big difference. You know,
I'm in the one hundred and eighty eight dollars a
square foot forty fourth floor of the GM building with
all the great trappings, and you know, I'm in white
(21:13):
planes at the Regis temporary office. I didn't even have
a secretary. I mean I had, I didn't everyone to
answer the phone. So really, literally was that journey. And
I have to say, forty years old, it was nice
to know that I was still that scrappy, you know
that I still I still could get in there and go.
And we built this thing from nothing, right, and we
built it up, and yeah we're you look at Bruin today.
(21:34):
We operate in seventy one countries. We have people on
the ground in twenty countries. You know, we work with
every major League of federation in the world. And you know,
I literally started from regis temporary office in White Plans,
New York.
Speaker 4 (21:47):
So, George, let's go back to when you were forty
eight you said you want to take your shot. Now
you talked about a three year plan. Walk us through
your three year plan. How much are you raising, what
are you trying to invest in? And there's for in
laymans terms for viewers and listeners who don't know much
about brow and walk us through that a little bit.
Speaker 3 (22:04):
Yeah, So what the idea was was to invest in
things that were very similar to the businesses that we built.
You know, NASCAR, we came in, there were four people
in the commercial division. When we left, there were hundreds.
I don't know how many, but a lot of people, right,
And so we built a media capability, We built a
pure capability under scrutiny, you know, we built a sponsorship capability,
(22:24):
a licensing capability, of marketing capability. Right then and then
at IMG we're in thirty countries or in wide ranges
of sports. We had to do a lot of restructuring,
which I hadn't done a lot of NASCAR was more
organic growth, and IMG was restructuring and then investing right
working for a demanding guy who was really quite bright.
(22:46):
So the idea was I did good at that for
other people. You know. I had a friend of mine
and said, hey, why don't you do it for yourself
and your partners? I said, well, how do you do that?
He goes, I'll help you do it, and you know,
here we are.
Speaker 2 (22:57):
Can you tell us who that friend was?
Speaker 3 (22:59):
Cave Cars thro Shi at Allen Company. Cave was like,
in the day that it was announced that Endeavor was
buying IMG, called me up. He said that you're ready
to go yet, And of course I wasn't ready at
the time, but he you know, I had been I
knew IMG was going to sell, and so I had
to think about, like what do I want to do?
What's the next step for me? And so I had
been thinking about this probably two years prior to the sale,
(23:20):
and Cavet was like, hey, man, you got to do it.
And I was, you know, first of all, when you
were at least I and I work, I loved the company.
So it's always hard to lead like when I left NASCAR,
I cried right, and it's like it's hard leaving these
places when you give everything you have. But it was
just an itch I needed to scratch. Whatever that was
saying is.
Speaker 4 (23:37):
So, George, I want to go back to when you
were forty eight. I'm forty nine, so I'm obsessed to
this time of your time.
Speaker 3 (23:44):
There.
Speaker 5 (23:45):
There's nothing harder than raising a first time fund.
Speaker 4 (23:48):
You're an entrepreneur, you're an operator, but you haven't really
raised a lot of capital at that point.
Speaker 5 (23:54):
A how scary is it?
Speaker 4 (23:56):
How big of a fund were you trying to raise,
and how difficult was it for you or how easy
was it for you to raise that money?
Speaker 3 (24:02):
Well, by the way, it was a lot harder. It's
a lot harder than I realized when I started. I
was lucky that my friend Cave essentially went to his
clients and said, believe in this guy. And if it
wasn't for Cave, I would not have I wouldn't be
sitting here right now. And if I knew how hard
it was to raise money, I think stupidity in this
case was a real asset for me. And if I
(24:24):
knew how hard it was, I probably wouldn't have done it,
but uh, but having surrounding myself with good people and
uh and people that believed in me. You know, Cave
really delivered. And I have to think you know Martin
Cerell too. Martin Crell is the CEO of w PP,
and he came up to me and said, hey, I'm
in for a third of the raise as w PP,
no matter what the amount of money. Wow, you raised it.
(24:45):
And of course, of course for me that was helpful
in the race. So between you know, Martin Cerell and Cave,
those two guys really, you know, meaningful. And you can
hear my voice, I'm very appreciative of those two people,
you know, to this very day.
Speaker 5 (24:59):
How much was it I'm going to take here.
Speaker 3 (25:01):
It didn't take very long. It was like six or
nine months and we raised two hundred and fifty million. Nice, Holy,
so amazing. Well, you know, Alex, you transitioned from you know,
really probably as well as anyone. I know. What was
it like transitioning from being a successful athlete to being
a successful entrepreneur? And how are you able to Why
do you think you're able to do that? Because you've
(25:21):
done amazing?
Speaker 5 (25:22):
Thank you, George.
Speaker 4 (25:23):
You know, First of all, I think I've had some
incredible mentors, you know, starting with George Steinbrener. So watching
George Steinbrenner execute what I call VCP that he had
the vision hit the capitol and he has great people,
and those people have been there for north of twenty
five years, so continuity was really important. I saw there
was a great arbitrage in people and duration of those people.
(25:44):
When I thought about my career, I said, well, if
I can surround myself with the best people and take
a forty or fifty year outlook in my business versus
my competition was about the next five months or the
next year, more transactional, I felt that was something that
was really good. And then kind of staying in my
circle of competence sports and real estate is what I
know best, and I'm pretty dangerous in those spots, and
(26:05):
I'm pretty like I don't know much about much else
after that, and I just try to stay in those
two places, bring in the best people, and just you know,
run the heck out of these companies and do the
best I could.
Speaker 3 (26:15):
Well it's amazing. I think it's amazing what we did
in baseball, obviously, but I think the real estate, and yeah,
what you've done in business is more amazing because there
are a lot of amazing baseball players and athletes out there,
but there aren't people that were the best at the
athlete and being able to transition and do what you've
done in business. So congrats man, thank you. Because I've
been around this thing a long time.
Speaker 2 (26:34):
Yeah, you've seen it not go that way. And so
one of the things that's so interesting, and we sort
of alluded to this at the top, is you're getting
into the sports ecosystem, which again seems so obvious now.
And listen, we look around. We see all these funds
that have been created. We see your friend Roger Goodell
(26:55):
at the NFL like embracing private equity, which we never
thought might happen. But you clearly saw something from an
investment perspective in the broader ecosystem early. What was it, Well.
Speaker 3 (27:06):
You know what I saw with TED and IMG. Ted
was early an early adapter. Maybe there's one or two
others where he invested. He was a private equity guy
that invested in IMG. Yeah, which at the time was
unheard of and somewhat controversial. And what I saw was
if you could deploy capital against good ideas and sports
you could get great results. And so the idea was, Okay,
(27:28):
we've done that a few times at IMG ted deployed capital.
We deployed capital and got great results. You know, now
we can do you can do this on your own.
Speaker 2 (27:36):
And you're thinking of like IMG Academy, like specific initiative.
Speaker 3 (27:40):
IMG College or other businesses that we bought along the
way and saying, hey, we had a lot of success
with that. You know, there's more opportunity here. And of course,
you know when you kind of look back on me, now,
what was unique was IMG was in thirty countries, and
so we have a globe at Bruin, we have a
global network. You know, we have fourteen Bruined advisors, many
guys who had work with me at IMG, some people
(28:01):
who compete with me at im G or now brew
an advisor. So we have a global network. And sports
there are investment opportunities literally in sports all around, all
around the world. So when you look at it from
a global standpoint or international and so there's a there's
a big world out there.
Speaker 2 (28:17):
And what's interesting is you're not buying teams, or at
least not yet. You have you know, really invested it again,
I'm over using this, but like in the in the ecosystem,
in some of the adjacencies. So what's the underlying theory there.
Speaker 3 (28:32):
Well, I think when you look at lower middle market,
private equity traditionally has huge growth potential and you can
take these businesses and really grow them. And so when
we come in there, we're able to We've been through
this now, we've we've experienced growing companies now brewing a
fair amount. So we go into these middle market companies
at you know, one stage and can add a lot
(28:53):
of operational expertise and then obviously with our network now
we open up markets and we can take these companies
around the world that you know, quite honestly, they couldn't
do it on their own. An example would be Delta Trade.
When we acquired Delta Tree and had no US business.
When we sold Delta Tree, half the business was was us.
What does that company? They do? Webs apps and streaming
(29:16):
and so you know, when you look at you look
at us, we're able to open up new markets, whether
it be you know, I said, we do business in
seventy one countries, but we're big in Europe, we're big
in the United States, and we have a big presence
in Australia and we're able to cross sell, so that's
a real value add on opening markets. And then you know,
we have a team of people that really work in
operations and I'm an operator, right, so like, you know,
(29:38):
we're still I'm still pretty hands on, you know, I was.
I was talking to a CEO yesterday. We had a problem,
and I'm a little I'm a little more polished than
they used to be. But h we had a pretty
substantial problem, and I, you know, knowld ME might have
been a little more progressive. I was like, look, you know,
you got a great business and doing great things. And
then I said, look, I've made a lot of mistakes
and here's a list of all my mistakes. So let's
(29:58):
be honest with one another. Let's work to figure it out.
Our guys like that. So if you talk to our CEOs,
we do because they're our best sales. When we buy
a company, like, they're happy. And it's quite different than
other forms of private equity because typically because the people
that lead the deals or deal guys, they're not subject
matter experts. So like when you do something with us,
(30:18):
there are no boards, there are no committees, Like, we
actually know what we're doing now. I have it the
advisors and experts, but we have people that actually have
done it, right, not somebody like I know two people
that used to do it. So they're gonna whisper in
my ear and I'm gonna they're gonna tell me what
to do. Like, we know what we're doing, and we're not.
We're not doing healthcare, we're not doing these that we're
doing sports and media and entertainment.
Speaker 4 (30:40):
So George talking about Brun, if Jason was selling you
on a pitch, right, walk us through what is the
perfect what I call the two oh fastball right down
the meadow for Brun meaning here's a space and we
can make it up. Here's the earnings, here's the ibadah,
and walk us to what excites you about that and
how you think about growing and helping Jason as a found.
Speaker 3 (31:00):
Yeah, so it would be if somebody earning ten or
twenty million of EBITDA right that you know we've invested
mostly in technology, not always well why technology, because the
growth fundamentals are in technologies. Right. So occasionally we'll see
things on location proof in the putting, we'll see a
few things along the way where we think through our
(31:22):
expertise we can add a lot but most of its technology.
So it would be probably a check or data related
company that had on its own great growth fundamentals and
really you really like the CEO. And what the lens
I always look through is can this company grow or
not on its own? And if I don't believe in
the growth, we can't touch it. Then the other lens
(31:44):
we look at is through our network, can we add value?
And it's important because if you have a great investment,
then we can make it even better. And if, by chance,
which happens, we're wrong, we can prop it up.
Speaker 4 (31:57):
Okay, So in this case, Jason's company is throwing off
ten minutes dollars of ibadah most of a free cash flow.
Speaker 5 (32:03):
He wants ten times, you want five times. How do
you land on?
Speaker 2 (32:08):
Like?
Speaker 5 (32:08):
Is it seven and a half?
Speaker 2 (32:09):
Is it six?
Speaker 4 (32:10):
Obviously depends on the growth trajectory. Walk us a little
bit through how you think about it? Yeah, well I
like this company.
Speaker 2 (32:18):
This is great.
Speaker 3 (32:19):
You're just doing the number. Yeah, exactly. Well, usually there's
a there's a margin of what what the multiple is.
Now I will say for us, like, we don't want
to be with someone who if it's all about I
want to get the last nickel. Ironically and thankfully most
a lot. I think you know, more than half our
deals are one on one deals where people have just
(32:40):
sought us out. There's not really a process because if
you think about it, if you do your diligence on us,
and you're a founder, like we're quite compelling if who
you sell to matters, right, because like I've worked my
whole life, I've built this company up, and now you know,
I want to take a little cash off the table
and I'm probably going to take more risk because we'll
deploy CAW to do acquisitions, we'll open up markets, and
(33:02):
of course we're going to be pushing for growth. So
then if you're a founder like, well, who do I
want to do that with the guy who said listed
all his mistakes when someoneent wrong before we get into
what went wrong, or somebody who's highly educated wagging their
finger at you that's never run a business, And that's
really where So that with our discussions not so much
about the multiples, it's about hey, do we culturally agree?
(33:26):
And I always tell the guys because I am a
bit of a salesman like, I'm not and I don't
want to sell it. I'm not selling anything. Like once
we acquire your company, we can never part ways, so
I don't want to convince you to do something you're
going to do. So I'm always like, hey, if we
buy a company, these are the expectations. Are you comfortable
with it? And if you're comfortable with it, this is
how we roll. And you know that's kind of how
(33:46):
it works. So we don't the price thing. You know
that there's a range of the price. We're going to
pay a fair value whatever that might be. But if
you're about the last nickel, it's probably not a guy
that I want to spend the next X amount of
years with.
Speaker 2 (34:01):
I'm not about the last night. I'm not about it
the last night.
Speaker 3 (34:04):
I'm Mike.
Speaker 4 (34:04):
I'm gonna give it back to you. But it sounds
a lot like the Berkshire Hathaway. Yeah, Charlie Munger Wander.
Speaker 2 (34:26):
One of the areas obviously very near and dear to
us is the media world. You know, we're sitting here
on our podcast. You invested in Box to Box, I
believe not too long ago, which we I mean everyone,
I'm guessing listening to or watching this show has consumed
something that Box to Box made, especially Drive to Survive,
which I feel like revolutionized the way we think about
(34:49):
sports and sports media. Talk to us about that deal,
how it came about.
Speaker 3 (34:54):
What you saw at this moment with that deal, Well,
a couple of things. I see two great CEOs, James
and Paul are very talented people. I have a good
friend of mine, David Hill, who used to run Fox Sports,
and I called Dave and he raved about them. It
meant a lot to me. And then their product is
(35:14):
really good. They do drives in full swing. They do
kind of the behind the scenes for sports, you know,
around the world. They're a market leader, and they fit
well with us because they're they're global, right. We're helping,
you know, we've been able to add some relationships and
contacts with them as well. But I felt like I
always wanted to get in media if I could find
a smart way to do it, and where we see
(35:36):
growth for them. You know, they podcast short form media.
They haven't really done they haven't invested capital, they've never
taken risk on the deal, they've never done acquisitions. I
think there's opportunities for branding content so we saw four
or five things that we think we could add, but
again we were it was guys we believed in and
(35:56):
guys we felt like we could add add something to
In terms of a few client doors for them. They
don't need too many because they're very global themselves. But
they're great at what they do. And I love being
with them because you get on a phone with them
and like zoom, and they want to be great. I mean,
I'll give you a little example. So one of the things,
you know, my companies are very under leveraged. It's good
(36:16):
in one way, but we have to be a little
better at that. And so we put brought all our
companies together in London, and I brought in an expert
on debt because I'll never I don't I learned a
long time ago making adults do things they don't want
to do probably not going to work out too good
for you. So I brought in this expert on capital
markets and had them talk to the companies and these
(36:36):
guys like embrace it and we just got our first
credit facility for the company. But it was because they
were interested and as I say, the guys, look, we're
not going to lever it up will below lower leverage
than everybody else, but let's be the best we can be,
and they want to be the best they can be.
And it was kind of a new area. So like,
that's somebody that wants to be great at everything they do.
They want to embrace new things and they're just hungry
(36:59):
and they're really are and creative. So I'm really happy
with those guys.
Speaker 2 (37:03):
And so what is it So when you're assessing when
you're getting to know as CEO or a founder, like,
what's that process like? Because I know you to be
like incredibly personable, very humble, great family man. What's your vibe? Like,
how are you getting.
Speaker 3 (37:19):
To know someone? Well? You got to often you go
to dinner with them and try to socialize. And what
I'm really trying to decide is is the person driven?
What's the team?
Speaker 2 (37:28):
Like?
Speaker 3 (37:30):
Do I believe in the growth fundamentals of that business?
And if I believe the growth fundamentals of the business
and I really believe in the CEO, then it's you know,
it feels good? And can I add value? Can we
can we add value? If we don't? If we can't
add value, then all we are is placing a bet
on something and I'm not. I'm not a better I
got to know, like I can add value to something
(37:51):
great or if it goes wrong, can I add value?
Speaker 2 (37:54):
I want to go back to college sports if we can.
Because one of the really interesting things about you I'm
totally like taking advantage of, like knowing a lot about
you I'm here is that you obviously you know, have
been involved with college sports from a business perspective, but
also as a dad. Your son Drew is a very
successful quarterback on the college level. I do wonder like
(38:17):
being able to wear those different hats. What's your perspective
on sort of college sports at this moment, because it
feels like such a revolutionary and kindidly like sort of
fraught moment for college sports. How does it feel to you?
Speaker 3 (38:34):
Well, I think it's going through change, right, it's going
through change because it's very successful, and it's so successful
that the money became so significant that you know you
have to share it with the players. I mean, you know,
when you think about the college football playoff game, one
game eighty four million dollars in meteorites before all the
other things. If you have eighty thousand people paying one
(38:55):
hundred bucks a ticket and all the concessions.
Speaker 2 (38:57):
Yeah, so one game is worth eighty four million million dollars.
Speaker 3 (39:00):
Do you think for two or three hour game? Three
hour game, If that game's generating over one hundred million
dollars for three hours, don't you think the guys on
the field should participate? I estimated to be six to
eight billion dollars a year generating college sports. Shouldn't the
play people that are on the field at play. And
so what's happened is the courts used to be deferential
(39:21):
to the college model, but in this amount of revenue,
the courts have now sided with the players. And so
you're going to have to change. And by the way,
change isn't easy, and it's hard in college because nobody's
in charge. There's you know, everyone's their own independent person.
If you know, USC and UCLA were part of a
conference till they weren't right, right, So you have a
bunch of competitors that work for their self interest. And
(39:43):
so with no one in charge in a highly successful industry,
you're going to have a little bit of turbulence. But
I think at the end of the day, it'll all
work itself out. You know, we went through all this
with the Olympics, right, Oh, we shouldn't play the athletes,
So we shouldn't play the athletes. Boy, I thought the
Paris Olympics were amazing, unbelieva right, So like, and those
are everyone's making money, No, nobody cares. In five or
(40:04):
ten years from now, this thing will you know, make
its way through. And you know, I have a little
bit of laughter about this because I you know, semi
knowledgele on football and my family's been playing college football
for over one hundred years. You know, those playoff games
last year Michigan and Alabama, you know it went down
to the last play. Yeah, right, Like the product on
the field pretty good. Yeah, So all this talk about
yeah you're gonna blow it's the Florida State game was
(40:25):
a blowout and then whatever bullet was. But so what
there are always blows but those playoffs yeah amazing. So
like the off field stuff of how what the player
movement is, do the players get paid? It'll get figured
out and it won't be easy.
Speaker 2 (40:38):
I mean. One of the things that I know, Alex
and I both admire about you and have watched over
the years in various venues, some of which you've been
you know, the convenor of you know everyone, I mean,
you really have like cultivated and unbelievable that there's no
one that I talked to in sports who's more than
(40:58):
like two degrees and often one degree away from you.
Is that purposeful? Like, what's the what's the method to that?
Speaker 3 (41:05):
Well? I think a couple of things. There's a little
bit of a track record, right, NASCAR was a good job, right,
and then at IMG a lot of people we were
their clients. But I think truthfully, you know, like an
old shoe, you know, if you're around long enough and
you're a good person and you deliver results and you
do what you say you're going to do, you know,
it pays out for you. Now everyone's got their angle, right,
that's my angle, you know if I tell you, and
(41:26):
I learned it from Bill Bill Frantz when he hired me,
because I got three things where you said, tell the truth,
work hard, don't embarrass the company. I'm still quoting it today, right, Yeah,
And I knew that if I told somebody and ask her,
we were going to do it. We were going to
do it. And so like that had an influence on me.
And even Ted was honorable and so to me. It's like, hey,
you know, tell someone you're going to do something, you
(41:46):
do it. Yeah, you try and do it in a
nice way. I try to emulate Roger Penske. I told
Roger I was with them this summer. I'm like, you know,
some of these guys had impact on me. You know,
So I think that is the basis from which you
build out trust and respect over decades, right, And that's
what you're seeing in the benefit. That's my stick. Doesn't
mean it's everybody's stick, but that's my stick.
Speaker 2 (42:09):
And so, you know, one of the things that's fascinating
about you, George too, is that, like you're so tight
at the highest levels of all the major sports in
the US and abroad. You're one of the only people
I know who I feel like can call every commissioner
of every league and like, get on the phone. What
do you hear from those folks these days about sort
of the state of the sports leagues? Because obviously that
(42:29):
has a big direction in terms of your own investment
thesis of where things are going, Like take us inside,
some of those conversations.
Speaker 3 (42:37):
Really have to be kind of bullish right now, because
when you look at the NBA to get two and
a half times on their media deal is really amazing.
Adam did an amazing job there. When you look at
the NFL with all the contracted television revenue, they have
really strong. NHL's got a long term deal, strong, Baseball's
doing well. Everyone seems to be doing I mean, NASCAR
(42:58):
did a great TV deal. Like all this stuff about
how the media is changing and the fragmentation, nevertheless, the
sports have held up really strong. So I don't know.
I think I think the big issue in sports today
is that you do see institutional investors coming into sports.
Capital is going to change the game. And so my
advice to someone is, hey, if I'm running a sports team,
(43:21):
I'm running a league in an organization, I need a
capital plan to differentiate myself from my competitor number one,
number two, I need a defensive capital plan. So whether
I want to act on it, I need I need
a phone call like, hey, if I'm if something's coming
in with capital is going to disrupt my sport, what
am I going to do about it? So I don't
think you can just sit back, maybe like you used to,
(43:42):
and say, well that's not for us. You have to
have a capital plan and look at golf. I mean,
I'm not going to make any commentary on what's good
or bad. But look, somebody with capital showed up and
the game changed. The other guy, I do he had
to go out and raise capital, right, and a lot
of it and a lot of it, and so like,
if you're in sports, whoever you are, you better have
a capital plan to go on offense and defense.
Speaker 2 (44:06):
Yeah, that's an interesting but I hadn't thought about it
exactly that way. But you know, you think about the NFL.
If private equity is going to come into you know,
even a half a dozen franchises, that doesn't just change
those franchises, It changes the other twenty six is what
like in terms of them, you know, having to figure
out what their plans are going to be in terms
of they're spending or.
Speaker 3 (44:26):
Well, it's going to change it, right, So you're you know,
I think they've done a really good job of limiting
it right and making sure that you know that the
investors have really no say right, right, and so they're
not their life's not really changing for the NFL, but
they're benefiting from an influx of institutional capital into the industry.
That money is going to go to provide liquidity for
(44:48):
limited partners that might have had a hard time getting liquidity,
might solve some family issues on some of these teams
that are family owned. And it's going to provide capital
perhaps for real estate investment and reinvent in the franchise.
In lastly, it's going to increase the value of the
franchises because you have more bidders. So again, the institutional capital,
well controlled in this case, is changing the game, right
(45:11):
and so, and probably over time will change it more.
As you know better than I that other sports, the
number is higher than ten percent. And in order for
these franchises to keep growing and growing in value, you're
going to have to look at different outlets for capital.
I mean, to buy an NFL team, now you need
two three billion dollars. Ear gets a little thin, and
think about what rights you get. You know, if you're
(45:33):
one of the guys in the Commanders that put four
or five hundred million year for no rights, right, so
that's getting harder and harder.
Speaker 2 (45:40):
That's a pretty expensive season ticket and it's a nice.
Speaker 3 (45:43):
Problem to have, but you're the victim of your own success.
So you're going to have to understand the capital markets
and have a long term capital plan. But again, it's
all against the backdrop of success, right, everybody would love
to have these problems.
Speaker 2 (45:56):
I think, all right, so let's do a quick rapid
fire around. So this is the only thing I'll say
is like, keep it tight. We'll bounce it back and forth.
What's one word to describe your deal making style?
Speaker 3 (46:14):
Decisive?
Speaker 4 (46:15):
What's more important to you your instant gut or data
instant gut.
Speaker 2 (46:20):
Who's your dream deal making partner?
Speaker 3 (46:23):
Someone's well capitalized and smart.
Speaker 2 (46:25):
What's the best piece of advice you've received on deal
making or business? No?
Speaker 3 (46:29):
Whe to squeeze and when no, not to squeeze.
Speaker 5 (46:31):
What's the worst piece of advice you ever received?
Speaker 3 (46:34):
I don't know. I didn't pay attention.
Speaker 2 (46:37):
Do you have a hype song before you go into
a big meeting or negotiation?
Speaker 3 (46:41):
No? But a good work. It's a good substitution.
Speaker 5 (46:43):
If you can only watch one sport for the rest
of your.
Speaker 2 (46:46):
Life, what's sport?
Speaker 3 (46:47):
What it be football? Football? American football?
Speaker 5 (46:50):
And what's your favorite team?
Speaker 3 (46:51):
Uh? Patriots? My dad play for the Patriots. I have
to go for Patriots.
Speaker 2 (46:55):
What team do you want to see win a championship
more than any?
Speaker 3 (46:58):
Missouri tires.
Speaker 5 (47:00):
There you go, go for your son answer.
Speaker 4 (47:02):
One fun fact about George Pine that if your colleague
chart about it, they would be shocked.
Speaker 2 (47:07):
They're surprised I played the veal. O. Wow. Listen, this
was really, really fun. I feel like it's decades in
the making. So thank you so much for doing this.
It's great to see you and great to be with you, guys.
Thank you so much for the opportunity. Thanks, thanks, sure,
thanks so much for listening to the Deal. If you
(47:27):
never want to miss a story, become a Bloomberg dot
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Speaker 1 (47:49):
The Deal is a production from Bloomberg Podcasts and Bloomberg Originals.
The Deal is hosted by Alex Rodriguez and Jason Kelly.
Our producers are Anamazarakis, Stacey y Wong, Lizzie Phillip, and
Victory Veyees. Original music and engineering by Blake Maples. Our
managing editor is David E. Ravella. Our executive producers are
(48:10):
Jason Kelly Brendan, Francis Newnham, Jordan Opplinger, Trey Shallowhorn, Kyle Kramer,
Andrew Barden, Kelly Laferrier, and Ashley Hoenig. Sage Bauman is
our head of podcasts, Additional support from Rachel Scaramazzino and
Elena Los Angeles. Joshua Devaux is our director of photography.
(48:32):
Rubob Shakir is our creative director. Art direction is from
Jacqueline Kessler. Casting by Julia Manns. Our associate producer is
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(48:55):
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Speaker 2 (00:13):
Hi, I'm Jason Kelly. I'm Alex Rodriguez, and on this
episode of The Deal, George Pine. So George Pine, Alex.
He is the former CEO of NASCAR, former president of IMG,
now the founder of Bruin Capital. This is a guy
that if you are in the sports world, you are
one degree from him because he's everywhere. He's got a
(00:33):
speed dial like no one else, has been involved in
major deals and is looking around the corner constantly for
what's happening next in sports.
Speaker 3 (00:42):
Yeah.
Speaker 4 (00:43):
I think in many ways, Jason, guys like you and
I we looked up to Warren Buffett and other great CEOs.
I think this is a guy that if you're a
young entrepreneur you should study.
Speaker 3 (00:50):
Yeah.
Speaker 4 (00:51):
And the reason why he has a perfect trifecta, I mean,
you said it best. He's a wonderful family man. He's
built an incredible business in Bruin Capital, and he's got
old class relationships with an amazing culture.
Speaker 2 (01:02):
Here's George Pine. All right, George. Should we start the
show always by having people introduce themselves, their names and
what they do.
Speaker 3 (01:21):
George Pine, founder and CEO Brewin Capital, now I could
use the Boston accent. George Pine, I.
Speaker 2 (01:28):
Realized, listen, when you use a Boston accent, it gives
this guy PTSD.
Speaker 5 (01:31):
So your audience.
Speaker 2 (01:35):
Yeah, so use that, use that to your advantage. I mean,
if you don't like it, question, if you don't like
a question you asked, just answered, and the boss, you know,
we're wondering how to start the conversation with you, you know,
looking at all the stuff you've done for your career,
what would you say so far? Is your signature deal?
Speaker 3 (01:54):
Signature deal? You know, I do? You know, I don't
really look in terms of that. I think the thing
probably if you ask you what am I most proud of?
Maybe you know deal. Earnhardt passed away on the last
lap of the Daytona five hundred weeks before I was
promoted to run the company. Having to lead the safety
initiatives at NASCAR through a very difficult period, it's probably
(02:14):
the thing I'm most proud of. And then, of course
that had two avenues. One was actually putting in safety
policies and procedures and creating an R and D center,
the first of its kind in the world, and then
also too navigating the communications challenges of that because overnight
NASCAR became so much more popular at that time. So
that of all the things I'm most proud of, I
(02:35):
think it is that error and dealing with that challenge,
and luckily they've had almost perfect safety record since then.
Speaker 2 (02:43):
What was that moment, like, I mean, that was a
I mean that was a similar moment in the sport.
Speaker 3 (02:48):
It was to lose your greatest driver of all time,
and we had lost three other guys in last eighteen months,
and then when the greatest of all time passes away,
it just it shook the whole industry right to the core.
And of course we were leading the nightly news three
nights in a row and we are The scrutiny on
(03:10):
the sport was off the charts, So that rattled you.
It really rattled you to your course. So having to
kind of stabilize and kind of like sports getting out,
you got to go back and play the next day
and dig in there and find your way through it. It
was really probably one of the most challenging things, but
we came out the other end and made great strides
(03:30):
and had a real impact over a long period of time.
So if you look at ask me what I'm most
proud of. It's that effort.
Speaker 4 (03:37):
Let's talk about that, George, Because obviously, when the returns
are great and you're returning capital to investors and all,
that is all wonderful, But in a very very difficult
moment leadership wise, what were some of the things that
you did over those three days to thirty days to
make everybody feel better about themselves?
Speaker 3 (03:55):
Wow? I think you have to lead by example and
taking tough positions. I mean, we installed hans device, which
was very unpopular at the time. We put data recorders
in the cars, which was also controversial. So pushing through
a number of changes that culturally and for other reasons
the organization had never done before. But you had to
do it right. So what was your option? So having
(04:17):
the courage to push through change at a difficult moment
and sticking with it and believing it and standing up
was really what I took away from that. So I
think a leader has to take a stand, do things
that are uncomfortable, and be thoughtful at that is, you
don't really want to go against the grand to go
against the grain, but you know, you to lead, you've
got to take a stand and do what you believe in.
Speaker 2 (04:40):
So over the course of this conversation, we're going to
talk a lot about your leadership and candidly like your
operational expertise and your operating experience and how that translates
into your investment world. But I feel like I have
to go all the way back. And Alex knows this
because I've known you for a long time. I mentioned
when I was basically a kid in Atlanta for our
mutual friend Billy, and right, he started out in the
(05:01):
real estate where you come out of Brown. What's the
quick story of how you get from there me meeting
you and Helene, like on club Drive in Atlanta to today.
Speaker 3 (05:11):
As I tell everyone, there's no way to replicate my journey. Right,
I moved to Atlanta, I had five thousand dollars. My
wife had a car with ninety thousand miles in no
air conditioning. My car had one hundred and seventy thousand
miles and only two of the four doors worked right,
and we literally had to use our credit credit cards
to pay the bills we had. Our friend Billy came
over to our apartment and said, I feel like I'm
(05:33):
in a college JOm. I said, yeah, this is all
my stuff for my college JOm So it was a journey,
but again I come from a family of athletes and
didn't want to fail. Like I never really cared about winning,
but I never wanted to lose, right, And so I
moved away went to this new place, Atlanta. Atlanta was great.
It was having the Olympics in the Super Bowl, and
I worked in a big real estate company and had
(05:55):
built twenty seven buildings in downtown Atlanta. And I was like, hey,
we should get in the sports business. And my boss
thought I was crazy. But on the side, I built
a little sports business, signed up NASCAR in nineteen ninety five,
and people forget today. When I went to NASCAR, it
was called Winston Cup. Sixteen races were on the Nashville
Network and the company had one office and it was
very small. You know, when we left here on Fox.
(06:16):
At NBC we had nine offices.
Speaker 2 (06:18):
Hold on, I want to stop you there. It was
not called NASCAR.
Speaker 3 (06:22):
It was Winston Cup Racing right as a tobacco sponsor,
and people referred to Winston Cup. The NASCAR brand at
that point didn't really exist, and NASCAR at the time
when I went there was a company that sanctioned the
races and administered the races. It wasn't supposed to be
in the commercial side, and so they let myself and
Brian France were anointed to go try and develop a
(06:43):
commercial business. And man, we took off. You hit it hard.
I knew we had a big opportunity and it worked out,
and so it was an amazing run. The industry was great,
but I wasn't a car give so, you know, I
was forty years old. It had a little itching me
and I want to do something else. And so I
had a frantic oldman Sacks and said, hey, you know
you should go see this guy Ted Forceman, he just
bought IMG. And I was like, all right, I didn't
(07:06):
know who Ted was, and I thought I went by
I saw Ted. I thought it was go me thirty minutes.
It was two hours. And Ted, when he wanted something
was pretty compelling. And the notion of good IMG worked
for a guy who is a leader in private equity
to me was legend in private He said he invented it.
I'm not sure that too, but I felt like working
(07:27):
for him I could learn a lot, which I did.
And obviously IMG was in thirty countries and so running
a company that operated in thirty countries that was in
wide array of sports. Working for a guy like Ted,
for me was like, all right, that sounds good.
Speaker 4 (07:40):
So I like when you mentioned Ted force me because
the first time I heard of him was when he
bought twenty four hour Fitness from my partner, Mark Mastrow,
and I think they did that deal for about a
billion eight marchers loved working with him.
Speaker 5 (07:51):
But tell us a little bit about Ted.
Speaker 4 (07:52):
Our listeners, probably a little bit younger, don't know much
about Ted, but he's a legend. Tell us what he
meant to you and what were some of the attributes
unless as you learned from him.
Speaker 3 (08:01):
I had really three great mentors. And Atlanta, a guy
named John Portman who was one of the great American
architects at twenty five million square feet of real estate,
and I work with him through a financial restructuring, and
then working at NASCAR for Bill France. Bill France was
another billionaire, very successful guy, and then working for Ted Forsman.
So I learned different things from different people. Ted what
(08:21):
I really learned was he was very conservative and a
little bit negative. But boy, if he was able through
structure to come up with an idea to minimize the risk.
Like the guy was all in right away. And so
what I really learned from him was, and I tell
my kids, the risk reward ratio, what's the upside, what's
the downside? Is it worth it? And if it's worth it,
(08:42):
you go for it. That's what I took away from Ted.
The other thing from these three guys all highly successful,
they all worked, they worked hard, They're smart. I'll tell
you one of the funny one is, so my last
day at NASCAR, I'm going to lunch with Bill France
and Jim France, two billionaires. Where do we go? We
go to stake and shit, and they're wearing like short
sleeves and we're driving home and I said, I go, guys,
(09:06):
can you give me one piece of advice? It's great advice.
They said, no, when to squeeze and no when not
to squeeze, And that was it, right, But that was
kind of having the judgment of knowing when to push
and when not to push. So like watching these guys
Dan and Dale for me was a great, great learning experience.
Speaker 2 (09:24):
I mean, what's the transition like from what I mean
you go from these two like iconic people in American
business and finance. Was there any sort of transition from
working for the Frances, you know, you know pretty well
codified family business to Ted Force, I mean barbarians at
the gate. How do you sort of adjust mentally like
(09:45):
what are you going home and saying to Helene of like, okay,
this is this is a different world.
Speaker 3 (09:50):
Yeah. So NASCAR was because it was a family business.
Really all you had to do was convince the family
of the right thing to do, and you're doing immediately
no politics, which I love, and there was no kind
of political maneuvering and so that was great for me.
And I was kind of a guy that went out
there in the fields and did the work and you know,
brought the goods home and did it again and did
(10:11):
it again. And when you went to Ted, Ted was
an investor, not an operator. And investors sometimes when they
don't know a business, there there are a lot of
different inputs, and when you're running a global company, there's
a lot more politics. And I was not When I
first went to I'MGA i was forty years old. I
was like, hey, if you're doing a good job and
you're driving results, that should be good enough. And what
(10:31):
I learned in that environment was that may not be
the case. So it's you know, I tell people, you know,
you need good style, but also up in substance, and
I was more substantive I think at NASCAR, and I
needed to work on the style kind of the presenting
and being a little more political, which I didn't like
quite honestly, and we don't have it brewin today. But
that was if you said to me, what was different?
(10:52):
You know, working for a global financier who has a
lot of inputs, you've got to be a different set
of management skills working for a family business and delivering results.
Speaker 2 (11:03):
And so what was the like you get to IMG
and what's the biggest challenge that you took on there?
Speaker 3 (11:09):
Well, the biggest challenge is trying to reinvent and grow
the company, which you know, one of the things with Ted,
which was great training for me and I knew it
when I took the job, was all right, you know,
my job is to grow earnings. Right, Scale doesn't matter, profitless,
volume doesn't matter, growing earnings.
Speaker 2 (11:24):
Because he's an investor.
Speaker 3 (11:25):
He's an investor, and so how to grow ibadah is
was the thing that you know, we got trained in
and measured, but ironically, you know the one thing that
I learned a long time although I going back to
Portman when I made a huge mistake, I used to
criticize people for not having a plan. When I went
ran my first business, I didn't have a plan. I
got really taken to the woodshed on that. I said,
(11:45):
I'll never run a business without a plan. And so
how's a guy that you know his wife taught him
how to drive a six shift, run NASCAR and set
rules and so forth. Because that I was a very
big three year plan guy. So we had to write
a business plan and you checked in on a business
plan a month on strategy and numbers. And when what
happened NASCAR, Bill Frantz is like, you know what, it's
(12:06):
working pretty good on the commercial side. Why don't we
take this discipline and put it over to the core business.
And that's what got me on the racing side from
just the commercial side, and that has served me well.
It served me really well working for TED because I
have a very diligent planning strategy. It's not I look
at it this way like numbers are like your blood pressure,
cholesterol or whatever. They'll tell you what's right or wrong
(12:28):
with the business, but they're not going to solve it. It's
the strategy drives the numbers. The numbers can firm the strategy.
I always been a big believer in that. Even yesterday
I was in a staff meeting. I'm like, hey, guys,
you know, let's make sure we have a collaborative approach
with our companies and just someone doesn't show up in
December and presents me a business plan. Let's start now
digging in with people and let's go through the drafting
(12:50):
of it. So I found that working with people, developing
a strategy and then having the numbers check the strategy
has really worked well for me for thirty years. I
learned that at Portman. Actually, so I.
Speaker 4 (13:00):
Specifically on IMG you said one of the things you
were looking to do from Teddy's kind of from the top.
Speaker 5 (13:05):
Is grow ibadat right.
Speaker 4 (13:07):
Maybe one or two examples of what strategy did you
take and how did you move that number in the
right direction.
Speaker 3 (13:13):
Well, you know, one of the ones I'm really happy
about is IMG Academy. When you take about IMG Academy
was they were really great at training athletes, the lead athletes,
you know, Kobe Bryant, Serena Williams, Maria shrup of a
really great athletes had been through there, but for thirty
years it had never been profitable. Right, So I put
in a guy today who's at the Barclay Center and
(13:34):
running the Nets. Sam's ustman. He was well educated, he
went to Stanford Business School, Tel Aviv Law School. Sam
came in as my chief of staff and I put
him in to run IMS Academy. And Sam's a brilliant guy,
but he had worked at McKinsey in yield management and
running a sports academy is like running a hotel or
in Sam's case, understanding the yield management in the airline industry.
(13:56):
So we took IMG from not being very profitable too
profitable in a very short amount of time, turning it
into more of a place where you could go to
go to college versus where we're going to get the
next Maria Sharapova. And I was really proud of that.
We bought this amazing IMG Academy just SILD for I
think roughly one point two billion dollars, like ten or
eleven years ago. We bought forty percent. We only owned
(14:18):
sixty percent of it when I got there. We bought
forty percent of IMG Academy for six million dollars and
a two year payment plan. And it was hard because
we did it during like nine and you know, cash
we were managing cash tight. I had to go to
the wall. That was like moving a mountain to get
six million dollars to buy forty percent of the academy.
They never been profitable for but you know, recently just
(14:40):
SILD for like one point two billion dollars. So anyway,
so that's one. And then you know, we had a
lot of fun building the college business. We'd never been
in college. And one thing I learned from Ted which
served me well today, was we had to go around
and find places to grow earnings that didn't exist. And
so we did this. We looked, I looked at everything.
We looked at all these different sports. And I had
one of my buddies who used to be my CMO
(15:02):
at NASCAR. I started getting these numbers on college sports.
It was like one hundred and ninety million fans number
one with young people, ethnically diverse, a wealthier audience than golf. Right,
think about most CEOs went to college, right and gender neutral.
I call my guy, I said, his name's Roger Vandersink,
he's at the colts now, I said, Roger, I go,
(15:24):
where did these numbers come from? He goes, oh, George,
we never compared ourselves to college sports, and so we
made investments in college sports and it turned out to
be a real at IMG, I'm a real growth engine
for us, and that was probably in two thousand and ten,
and we were the first really guys that got the
ball moving there.
Speaker 2 (15:44):
What does that look like when you're investing into college sports,
Like so many things that you've done, they seem so
obvious now, but they were not obvious at the time.
So how did you invest in college Well, so the
idea was I took a look at those numbers. I
was a gas, right, and then you start looking at
our Take Atlanta. You have the Atlanta Falcons and the
Georgia Bulldogs. Now we lived in Atlanta, so you know, like,
(16:05):
who's more popular, truthfully the Georgia Bulldogs, it's not really,
it's not close.
Speaker 3 (16:11):
And so like when you look at all, right, what
revenue does the Falcons generate and what revenue does the Bulldogs?
And all of a sudden, the Falcon's away up here
and the Bulldogs are down there. So I'm not the
smartest guy, but I was like, you know what I
want to do, I'm going with those guys and we
should be and try to sell sell like the like
the Falcons, And so we had. It was a big restructuring.
(16:33):
I mean we I think we had. Unfortunately, we had
a reploy had four hundred salespeople replaced three hundred and
eighteen months, and so you had it was you had
to replace people because you were selling differently. We wanted
to sell like the Falcons, not like the Bulldogs, and
we had to go out and get guys from the
other leagues to come in and help us.
Speaker 4 (16:52):
You know, Georgia, I'm sorry you lost me a little bit.
Take me step back. So you're invested in to the Bulldogs,
the Georgia Bulldogs, But what does that mean. I mean
that you're managing sponsorships or you're investing into the university
walking through that.
Speaker 3 (17:05):
So there were companies, small companies at the time that
had the marketing rights to these companies, and what we
did is we rolled them up and when we left
were representing eighty five universities WOW on sponsorship and local
media rights, and then two hundred universities in licensing.
Speaker 2 (17:21):
So you were repping the schools and essentially replacing an
infrastructure that was probably like local or regional right like.
Speaker 3 (17:28):
We were trying to That was kind of the whole,
ye whole, So your point makes sense now, But transformation
at that time, Oh yeah, go ahead of the cur
that was the big driver of growth during the IMG time.
Speaker 2 (17:47):
Hey, everyone, Bloomberg wants to hear from you. Help make
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(18:07):
dot com slash Bloomberg Podcast Today. It's really interesting to
think about that sort of trifectave experiences. But what were
you seeing in the business of sports that you found
so compelling as you moved along.
Speaker 3 (18:26):
Well, when you think about sports anywhere in the world,
it's the only thing that aggregates hundreds of millions of
people together around something as a statement of who you
are and what you stand for. So that connection, which
at NASCAR, those fans were loyal in college is you're
loyal Yankees fan, very loyal, and so what you really
want to do is try and tap into that loyalty
that's unmatched. And you know, in this world now where
(18:48):
media consumption is fragmented, there are very few things that
pull people together, right, And then when you think about
all these new devices that can deliver content, you're really
tapping into the consumer. I look at sports today like
in a fragmented world, sports become more valuable. And where
I think sports is going is this whole concept of
the lifetime value of the consumer, right, because really it's
(19:10):
a one to one relationship and I'm going to you know,
I'm a Yankees fan. I want Yankees content. I want
to know everything about the New York Yankees. And having
that one to one relationship might give me permission to
suggest products and services that are relevant, you know, to
the Yankees. And by the way, you can take that
to Europe. It's the same thing in any of those
football clubs or leagues. It's the passion of sports and
(19:33):
that one to one connection that's unlike anything else and
will become more valuable because the media and the way
we communicate so much more fragmented today than it was
ten years ago.
Speaker 2 (19:44):
So take us through, you know, arguably the biggest sort
of personal deal you make, which is you've been working
for these like big companies. You've had these incredible, like
iconic business figures you've worked for, and then you decide like,
I'm going to do my own thing, and not just
I'm going to do my own thing, but I'm going
(20:05):
to move from being an operator to being an investor.
Like what's that thought process?
Speaker 3 (20:11):
Like the thought process was you had success in growing
earnings and I could now apply this to a different
area for myself. And I think we had talked a
little bit about you know, the transitions. You know, when
you're in a company, it's political, and I wanted to
have a more horizontal, entrepreneur, results oriented kind of situation.
(20:31):
So that was appealing to me. And you know, I
was forty eight years old, and I was like, hey,
if i'm forty years old, i fail, you know, I'll
be fifty two or fifty three and I'll come back
and take a job. Right But I said, you know what,
I'm going to wait till i'm sixty to take my shot.
I was like, it's the age always meant a lot
to me. You know, I was forty years old at NASCAR.
I'm like, yeah, do I see myself here? Twenty years old?
I want to take a shot at something else. You know,
(20:53):
I'm forty eight years old. You know, now's the time
to take a shot. I'm twenty five, I'm going to
move away from home. I have no money, so what
if I feel like can always move back home again? Right,
So like I'm forty years old, it's time to take
a shot now. It was a big difference. You know,
I'm in the one hundred and eighty eight dollars a
square foot forty fourth floor of the GM building with
all the great trappings, and you know, I'm in white
(21:13):
planes at the Regis temporary office. I didn't even have
a secretary. I mean I had, I didn't everyone to
answer the phone. So really, literally was that journey. And
I have to say, forty years old, it was nice
to know that I was still that scrappy, you know
that I still I still could get in there and go.
And we built this thing from nothing, right, and we
built it up, and yeah we're you look at Bruin today.
(21:34):
We operate in seventy one countries. We have people on
the ground in twenty countries. You know, we work with
every major League of federation in the world. And you know,
I literally started from regis temporary office in White Plans,
New York.
Speaker 4 (21:47):
So, George, let's go back to when you were forty
eight you said you want to take your shot. Now
you talked about a three year plan. Walk us through
your three year plan. How much are you raising, what
are you trying to invest in? And there's for in
laymans terms for viewers and listeners who don't know much
about brow and walk us through that a little bit.
Speaker 3 (22:04):
Yeah, So what the idea was was to invest in
things that were very similar to the businesses that we built.
You know, NASCAR, we came in, there were four people
in the commercial division. When we left, there were hundreds.
I don't know how many, but a lot of people, right,
And so we built a media capability, We built a
pure capability under scrutiny, you know, we built a sponsorship capability,
(22:24):
a licensing capability, of marketing capability. Right then and then
at IMG we're in thirty countries or in wide ranges
of sports. We had to do a lot of restructuring,
which I hadn't done a lot of NASCAR was more
organic growth, and IMG was restructuring and then investing right
working for a demanding guy who was really quite bright.
(22:46):
So the idea was I did good at that for
other people. You know. I had a friend of mine
and said, hey, why don't you do it for yourself
and your partners? I said, well, how do you do that?
He goes, I'll help you do it, and you know,
here we are.
Speaker 2 (22:57):
Can you tell us who that friend was?
Speaker 3 (22:59):
Cave Cars thro Shi at Allen Company. Cave was like,
in the day that it was announced that Endeavor was
buying IMG, called me up. He said that you're ready
to go yet, And of course I wasn't ready at
the time, but he you know, I had been I
knew IMG was going to sell, and so I had
to think about, like what do I want to do?
What's the next step for me? And so I had
been thinking about this probably two years prior to the sale,
(23:20):
and Cavet was like, hey, man, you got to do it.
And I was, you know, first of all, when you
were at least I and I work, I loved the company.
So it's always hard to lead like when I left NASCAR,
I cried right, and it's like it's hard leaving these
places when you give everything you have. But it was
just an itch I needed to scratch. Whatever that was
saying is.
Speaker 4 (23:37):
So, George, I want to go back to when you
were forty eight. I'm forty nine, so I'm obsessed to
this time of your time.
Speaker 3 (23:44):
There.
Speaker 5 (23:45):
There's nothing harder than raising a first time fund.
Speaker 4 (23:48):
You're an entrepreneur, you're an operator, but you haven't really
raised a lot of capital at that point.
Speaker 5 (23:54):
A how scary is it?
Speaker 4 (23:56):
How big of a fund were you trying to raise,
and how difficult was it for you or how easy
was it for you to raise that money?
Speaker 3 (24:02):
Well, by the way, it was a lot harder. It's
a lot harder than I realized when I started. I
was lucky that my friend Cave essentially went to his
clients and said, believe in this guy. And if it
wasn't for Cave, I would not have I wouldn't be
sitting here right now. And if I knew how hard
it was to raise money, I think stupidity in this
case was a real asset for me. And if I
(24:24):
knew how hard it was, I probably wouldn't have done it,
but uh, but having surrounding myself with good people and
uh and people that believed in me. You know, Cave
really delivered. And I have to think you know Martin
Cerell too. Martin Crell is the CEO of w PP,
and he came up to me and said, hey, I'm
in for a third of the raise as w PP,
no matter what the amount of money. Wow, you raised it.
(24:45):
And of course, of course for me that was helpful
in the race. So between you know, Martin Cerell and Cave,
those two guys really, you know, meaningful. And you can
hear my voice, I'm very appreciative of those two people,
you know, to this very day.
Speaker 5 (24:59):
How much was it I'm going to take here.
Speaker 3 (25:01):
It didn't take very long. It was like six or
nine months and we raised two hundred and fifty million. Nice, Holy,
so amazing. Well, you know, Alex, you transitioned from you know,
really probably as well as anyone. I know. What was
it like transitioning from being a successful athlete to being
a successful entrepreneur? And how are you able to Why
do you think you're able to do that? Because you've
(25:21):
done amazing?
Speaker 5 (25:22):
Thank you, George.
Speaker 4 (25:23):
You know, First of all, I think I've had some
incredible mentors, you know, starting with George Steinbrener. So watching
George Steinbrenner execute what I call VCP that he had
the vision hit the capitol and he has great people,
and those people have been there for north of twenty
five years, so continuity was really important. I saw there
was a great arbitrage in people and duration of those people.
(25:44):
When I thought about my career, I said, well, if
I can surround myself with the best people and take
a forty or fifty year outlook in my business versus
my competition was about the next five months or the
next year, more transactional, I felt that was something that
was really good. And then kind of staying in my
circle of competence sports and real estate is what I
know best, and I'm pretty dangerous in those spots, and
(26:05):
I'm pretty like I don't know much about much else
after that, and I just try to stay in those
two places, bring in the best people, and just you know,
run the heck out of these companies and do the
best I could.
Speaker 3 (26:15):
Well it's amazing. I think it's amazing what we did
in baseball, obviously, but I think the real estate, and yeah,
what you've done in business is more amazing because there
are a lot of amazing baseball players and athletes out there,
but there aren't people that were the best at the
athlete and being able to transition and do what you've
done in business. So congrats man, thank you. Because I've
been around this thing a long time.
Speaker 2 (26:34):
Yeah, you've seen it not go that way. And so
one of the things that's so interesting, and we sort
of alluded to this at the top, is you're getting
into the sports ecosystem, which again seems so obvious now.
And listen, we look around. We see all these funds
that have been created. We see your friend Roger Goodell
(26:55):
at the NFL like embracing private equity, which we never
thought might happen. But you clearly saw something from an
investment perspective in the broader ecosystem early. What was it, Well.
Speaker 3 (27:06):
You know what I saw with TED and IMG. Ted
was early an early adapter. Maybe there's one or two
others where he invested. He was a private equity guy
that invested in IMG. Yeah, which at the time was
unheard of and somewhat controversial. And what I saw was
if you could deploy capital against good ideas and sports
you could get great results. And so the idea was, Okay,
(27:28):
we've done that a few times at IMG ted deployed capital.
We deployed capital and got great results. You know, now
we can do you can do this on your own.
Speaker 2 (27:36):
And you're thinking of like IMG Academy, like specific initiative.
Speaker 3 (27:40):
IMG College or other businesses that we bought along the
way and saying, hey, we had a lot of success
with that. You know, there's more opportunity here. And of course,
you know when you kind of look back on me, now,
what was unique was IMG was in thirty countries, and
so we have a globe at Bruin, we have a
global network. You know, we have fourteen Bruined advisors, many
guys who had work with me at IMG, some people
(28:01):
who compete with me at im G or now brew
an advisor. So we have a global network. And sports
there are investment opportunities literally in sports all around, all
around the world. So when you look at it from
a global standpoint or international and so there's a there's
a big world out there.
Speaker 2 (28:17):
And what's interesting is you're not buying teams, or at
least not yet. You have you know, really invested it again,
I'm over using this, but like in the in the ecosystem,
in some of the adjacencies. So what's the underlying theory there.
Speaker 3 (28:32):
Well, I think when you look at lower middle market,
private equity traditionally has huge growth potential and you can
take these businesses and really grow them. And so when
we come in there, we're able to We've been through
this now, we've we've experienced growing companies now brewing a
fair amount. So we go into these middle market companies
at you know, one stage and can add a lot
(28:53):
of operational expertise and then obviously with our network now
we open up markets and we can take these companies
around the world that you know, quite honestly, they couldn't
do it on their own. An example would be Delta Trade.
When we acquired Delta Tree and had no US business.
When we sold Delta Tree, half the business was was us.
What does that company? They do? Webs apps and streaming
(29:16):
and so you know, when you look at you look
at us, we're able to open up new markets, whether
it be you know, I said, we do business in
seventy one countries, but we're big in Europe, we're big
in the United States, and we have a big presence
in Australia and we're able to cross sell, so that's
a real value add on opening markets. And then you know,
we have a team of people that really work in
operations and I'm an operator, right, so like, you know,
(29:38):
we're still I'm still pretty hands on, you know, I was.
I was talking to a CEO yesterday. We had a problem,
and I'm a little I'm a little more polished than
they used to be. But h we had a pretty
substantial problem, and I, you know, knowld ME might have
been a little more progressive. I was like, look, you know,
you got a great business and doing great things. And
then I said, look, I've made a lot of mistakes
and here's a list of all my mistakes. So let's
(29:58):
be honest with one another. Let's work to figure it out.
Our guys like that. So if you talk to our CEOs,
we do because they're our best sales. When we buy
a company, like, they're happy. And it's quite different than
other forms of private equity because typically because the people
that lead the deals or deal guys, they're not subject
matter experts. So like when you do something with us,
(30:18):
there are no boards, there are no committees, Like, we
actually know what we're doing now. I have it the
advisors and experts, but we have people that actually have
done it, right, not somebody like I know two people
that used to do it. So they're gonna whisper in
my ear and I'm gonna they're gonna tell me what
to do. Like, we know what we're doing, and we're not.
We're not doing healthcare, we're not doing these that we're
doing sports and media and entertainment.
Speaker 4 (30:40):
So George talking about Brun, if Jason was selling you
on a pitch, right, walk us through what is the
perfect what I call the two oh fastball right down
the meadow for Brun meaning here's a space and we
can make it up. Here's the earnings, here's the ibadah,
and walk us to what excites you about that and
how you think about growing and helping Jason as a found.
Speaker 3 (31:00):
Yeah, so it would be if somebody earning ten or
twenty million of EBITDA right that you know we've invested
mostly in technology, not always well why technology, because the
growth fundamentals are in technologies. Right. So occasionally we'll see
things on location proof in the putting, we'll see a
few things along the way where we think through our
(31:22):
expertise we can add a lot but most of its technology.
So it would be probably a check or data related
company that had on its own great growth fundamentals and
really you really like the CEO. And what the lens
I always look through is can this company grow or
not on its own? And if I don't believe in
the growth, we can't touch it. Then the other lens
(31:44):
we look at is through our network, can we add value?
And it's important because if you have a great investment,
then we can make it even better. And if, by chance,
which happens, we're wrong, we can prop it up.
Speaker 4 (31:57):
Okay, So in this case, Jason's company is throwing off
ten minutes dollars of ibadah most of a free cash flow.
Speaker 5 (32:03):
He wants ten times, you want five times. How do
you land on?
Speaker 2 (32:08):
Like?
Speaker 5 (32:08):
Is it seven and a half?
Speaker 2 (32:09):
Is it six?
Speaker 4 (32:10):
Obviously depends on the growth trajectory. Walk us a little
bit through how you think about it? Yeah, well I
like this company.
Speaker 2 (32:18):
This is great.
Speaker 3 (32:19):
You're just doing the number. Yeah, exactly. Well, usually there's
a there's a margin of what what the multiple is.
Now I will say for us, like, we don't want
to be with someone who if it's all about I
want to get the last nickel. Ironically and thankfully most
a lot. I think you know, more than half our
deals are one on one deals where people have just
(32:40):
sought us out. There's not really a process because if
you think about it, if you do your diligence on us,
and you're a founder, like we're quite compelling if who
you sell to matters, right, because like I've worked my
whole life, I've built this company up, and now you know,
I want to take a little cash off the table
and I'm probably going to take more risk because we'll
deploy CAW to do acquisitions, we'll open up markets, and
(33:02):
of course we're going to be pushing for growth. So
then if you're a founder like, well, who do I
want to do that with the guy who said listed
all his mistakes when someoneent wrong before we get into
what went wrong, or somebody who's highly educated wagging their
finger at you that's never run a business, And that's
really where So that with our discussions not so much
about the multiples, it's about hey, do we culturally agree?
(33:26):
And I always tell the guys because I am a
bit of a salesman like, I'm not and I don't
want to sell it. I'm not selling anything. Like once
we acquire your company, we can never part ways, so
I don't want to convince you to do something you're
going to do. So I'm always like, hey, if we
buy a company, these are the expectations. Are you comfortable
with it? And if you're comfortable with it, this is
how we roll. And you know that's kind of how
(33:46):
it works. So we don't the price thing. You know
that there's a range of the price. We're going to
pay a fair value whatever that might be. But if
you're about the last nickel, it's probably not a guy
that I want to spend the next X amount of
years with.
Speaker 2 (34:01):
I'm not about the last night. I'm not about it
the last night.
Speaker 3 (34:04):
I'm Mike.
Speaker 4 (34:04):
I'm gonna give it back to you. But it sounds
a lot like the Berkshire Hathaway. Yeah, Charlie Munger Wander.
Speaker 2 (34:26):
One of the areas obviously very near and dear to
us is the media world. You know, we're sitting here
on our podcast. You invested in Box to Box, I
believe not too long ago, which we I mean everyone,
I'm guessing listening to or watching this show has consumed
something that Box to Box made, especially Drive to Survive,
which I feel like revolutionized the way we think about
(34:49):
sports and sports media. Talk to us about that deal,
how it came about.
Speaker 3 (34:54):
What you saw at this moment with that deal, Well,
a couple of things. I see two great CEOs, James
and Paul are very talented people. I have a good
friend of mine, David Hill, who used to run Fox Sports,
and I called Dave and he raved about them. It
meant a lot to me. And then their product is
(35:14):
really good. They do drives in full swing. They do
kind of the behind the scenes for sports, you know,
around the world. They're a market leader, and they fit
well with us because they're they're global, right. We're helping,
you know, we've been able to add some relationships and
contacts with them as well. But I felt like I
always wanted to get in media if I could find
a smart way to do it, and where we see
(35:36):
growth for them. You know, they podcast short form media.
They haven't really done they haven't invested capital, they've never
taken risk on the deal, they've never done acquisitions. I
think there's opportunities for branding content so we saw four
or five things that we think we could add, but
again we were it was guys we believed in and
(35:56):
guys we felt like we could add add something to
In terms of a few client doors for them. They
don't need too many because they're very global themselves. But
they're great at what they do. And I love being
with them because you get on a phone with them
and like zoom, and they want to be great. I mean,
I'll give you a little example. So one of the things,
you know, my companies are very under leveraged. It's good
(36:16):
in one way, but we have to be a little
better at that. And so we put brought all our
companies together in London, and I brought in an expert
on debt because I'll never I don't I learned a
long time ago making adults do things they don't want
to do probably not going to work out too good
for you. So I brought in this expert on capital
markets and had them talk to the companies and these
(36:36):
guys like embrace it and we just got our first
credit facility for the company. But it was because they
were interested and as I say, the guys, look, we're
not going to lever it up will below lower leverage
than everybody else, but let's be the best we can be,
and they want to be the best they can be.
And it was kind of a new area. So like,
that's somebody that wants to be great at everything they do.
They want to embrace new things and they're just hungry
(36:59):
and they're really are and creative. So I'm really happy
with those guys.
Speaker 2 (37:03):
And so what is it So when you're assessing when
you're getting to know as CEO or a founder, like,
what's that process like? Because I know you to be
like incredibly personable, very humble, great family man. What's your vibe? Like,
how are you getting.
Speaker 3 (37:19):
To know someone? Well? You got to often you go
to dinner with them and try to socialize. And what
I'm really trying to decide is is the person driven?
What's the team?
Speaker 2 (37:28):
Like?
Speaker 3 (37:30):
Do I believe in the growth fundamentals of that business?
And if I believe the growth fundamentals of the business
and I really believe in the CEO, then it's you know,
it feels good? And can I add value? Can we
can we add value? If we don't? If we can't
add value, then all we are is placing a bet
on something and I'm not. I'm not a better I
got to know, like I can add value to something
(37:51):
great or if it goes wrong, can I add value?
Speaker 2 (37:54):
I want to go back to college sports if we can.
Because one of the really interesting things about you I'm
totally like taking advantage of, like knowing a lot about
you I'm here is that you obviously you know, have
been involved with college sports from a business perspective, but
also as a dad. Your son Drew is a very
successful quarterback on the college level. I do wonder like
(38:17):
being able to wear those different hats. What's your perspective
on sort of college sports at this moment, because it
feels like such a revolutionary and kindidly like sort of
fraught moment for college sports. How does it feel to you?
Speaker 3 (38:34):
Well, I think it's going through change, right, it's going
through change because it's very successful, and it's so successful
that the money became so significant that you know you
have to share it with the players. I mean, you know,
when you think about the college football playoff game, one
game eighty four million dollars in meteorites before all the
other things. If you have eighty thousand people paying one
(38:55):
hundred bucks a ticket and all the concessions.
Speaker 2 (38:57):
Yeah, so one game is worth eighty four million million dollars.
Speaker 3 (39:00):
Do you think for two or three hour game? Three
hour game, If that game's generating over one hundred million
dollars for three hours, don't you think the guys on
the field should participate? I estimated to be six to
eight billion dollars a year generating college sports. Shouldn't the
play people that are on the field at play. And
so what's happened is the courts used to be deferential
(39:21):
to the college model, but in this amount of revenue,
the courts have now sided with the players. And so
you're going to have to change. And by the way,
change isn't easy, and it's hard in college because nobody's
in charge. There's you know, everyone's their own independent person.
If you know, USC and UCLA were part of a
conference till they weren't right, right, So you have a
bunch of competitors that work for their self interest. And
(39:43):
so with no one in charge in a highly successful industry,
you're going to have a little bit of turbulence. But
I think at the end of the day, it'll all
work itself out. You know, we went through all this
with the Olympics, right, Oh, we shouldn't play the athletes,
So we shouldn't play the athletes. Boy, I thought the
Paris Olympics were amazing, unbelieva right, So like, and those
are everyone's making money, No, nobody cares. In five or
(40:04):
ten years from now, this thing will you know, make
its way through. And you know, I have a little
bit of laughter about this because I you know, semi
knowledgele on football and my family's been playing college football
for over one hundred years. You know, those playoff games
last year Michigan and Alabama, you know it went down
to the last play. Yeah, right, Like the product on
the field pretty good. Yeah, So all this talk about
yeah you're gonna blow it's the Florida State game was
(40:25):
a blowout and then whatever bullet was. But so what
there are always blows but those playoffs yeah amazing. So
like the off field stuff of how what the player
movement is, do the players get paid? It'll get figured
out and it won't be easy.
Speaker 2 (40:38):
I mean. One of the things that I know, Alex
and I both admire about you and have watched over
the years in various venues, some of which you've been
you know, the convenor of you know everyone, I mean,
you really have like cultivated and unbelievable that there's no
one that I talked to in sports who's more than
(40:58):
like two degrees and often one degree away from you.
Is that purposeful? Like, what's the what's the method to that?
Speaker 3 (41:05):
Well? I think a couple of things. There's a little
bit of a track record, right, NASCAR was a good job, right,
and then at IMG a lot of people we were
their clients. But I think truthfully, you know, like an
old shoe, you know, if you're around long enough and
you're a good person and you deliver results and you
do what you say you're going to do, you know,
it pays out for you. Now everyone's got their angle, right,
that's my angle, you know if I tell you, and
(41:26):
I learned it from Bill Bill Frantz when he hired me,
because I got three things where you said, tell the truth,
work hard, don't embarrass the company. I'm still quoting it today, right, Yeah,
And I knew that if I told somebody and ask her,
we were going to do it. We were going to
do it. And so like that had an influence on me.
And even Ted was honorable and so to me. It's like, hey,
you know, tell someone you're going to do something, you
(41:46):
do it. Yeah, you try and do it in a
nice way. I try to emulate Roger Penske. I told
Roger I was with them this summer. I'm like, you know,
some of these guys had impact on me. You know,
So I think that is the basis from which you
build out trust and respect over decades, right, And that's
what you're seeing in the benefit. That's my stick. Doesn't
mean it's everybody's stick, but that's my stick.
Speaker 2 (42:09):
And so, you know, one of the things that's fascinating
about you, George too, is that, like you're so tight
at the highest levels of all the major sports in
the US and abroad. You're one of the only people
I know who I feel like can call every commissioner
of every league and like, get on the phone. What
do you hear from those folks these days about sort
of the state of the sports leagues? Because obviously that
(42:29):
has a big direction in terms of your own investment
thesis of where things are going, Like take us inside,
some of those conversations.
Speaker 3 (42:37):
Really have to be kind of bullish right now, because
when you look at the NBA to get two and
a half times on their media deal is really amazing.
Adam did an amazing job there. When you look at
the NFL with all the contracted television revenue, they have
really strong. NHL's got a long term deal, strong, Baseball's
doing well. Everyone seems to be doing I mean, NASCAR
(42:58):
did a great TV deal. Like all this stuff about
how the media is changing and the fragmentation, nevertheless, the
sports have held up really strong. So I don't know.
I think I think the big issue in sports today
is that you do see institutional investors coming into sports.
Capital is going to change the game. And so my
advice to someone is, hey, if I'm running a sports team,
(43:21):
I'm running a league in an organization, I need a
capital plan to differentiate myself from my competitor number one,
number two, I need a defensive capital plan. So whether
I want to act on it, I need I need
a phone call like, hey, if I'm if something's coming
in with capital is going to disrupt my sport, what
am I going to do about it? So I don't
think you can just sit back, maybe like you used to,
(43:42):
and say, well that's not for us. You have to
have a capital plan and look at golf. I mean,
I'm not going to make any commentary on what's good
or bad. But look, somebody with capital showed up and
the game changed. The other guy, I do he had
to go out and raise capital, right, and a lot
of it and a lot of it, and so like,
if you're in sports, whoever you are, you better have
a capital plan to go on offense and defense.
Speaker 2 (44:06):
Yeah, that's an interesting but I hadn't thought about it
exactly that way. But you know, you think about the NFL.
If private equity is going to come into you know,
even a half a dozen franchises, that doesn't just change
those franchises, It changes the other twenty six is what
like in terms of them, you know, having to figure
out what their plans are going to be in terms
of they're spending or.
Speaker 3 (44:26):
Well, it's going to change it, right, So you're you know,
I think they've done a really good job of limiting
it right and making sure that you know that the
investors have really no say right, right, and so they're
not their life's not really changing for the NFL, but
they're benefiting from an influx of institutional capital into the industry.
That money is going to go to provide liquidity for
(44:48):
limited partners that might have had a hard time getting liquidity,
might solve some family issues on some of these teams
that are family owned. And it's going to provide capital
perhaps for real estate investment and reinvent in the franchise.
In lastly, it's going to increase the value of the
franchises because you have more bidders. So again, the institutional capital,
well controlled in this case, is changing the game, right
(45:11):
and so, and probably over time will change it more.
As you know better than I that other sports, the
number is higher than ten percent. And in order for
these franchises to keep growing and growing in value, you're
going to have to look at different outlets for capital.
I mean, to buy an NFL team, now you need
two three billion dollars. Ear gets a little thin, and
think about what rights you get. You know, if you're
(45:33):
one of the guys in the Commanders that put four
or five hundred million year for no rights, right, so
that's getting harder and harder.
Speaker 2 (45:40):
That's a pretty expensive season ticket and it's a nice.
Speaker 3 (45:43):
Problem to have, but you're the victim of your own success.
So you're going to have to understand the capital markets
and have a long term capital plan. But again, it's
all against the backdrop of success, right, everybody would love
to have these problems.
Speaker 2 (45:56):
I think, all right, so let's do a quick rapid
fire around. So this is the only thing I'll say
is like, keep it tight. We'll bounce it back and forth.
What's one word to describe your deal making style?
Speaker 3 (46:14):
Decisive?
Speaker 4 (46:15):
What's more important to you your instant gut or data
instant gut.
Speaker 2 (46:20):
Who's your dream deal making partner?
Speaker 3 (46:23):
Someone's well capitalized and smart.
Speaker 2 (46:25):
What's the best piece of advice you've received on deal
making or business? No?
Speaker 3 (46:29):
Whe to squeeze and when no, not to squeeze.
Speaker 5 (46:31):
What's the worst piece of advice you ever received?
Speaker 3 (46:34):
I don't know. I didn't pay attention.
Speaker 2 (46:37):
Do you have a hype song before you go into
a big meeting or negotiation?
Speaker 3 (46:41):
No? But a good work. It's a good substitution.
Speaker 5 (46:43):
If you can only watch one sport for the rest
of your.
Speaker 2 (46:46):
Life, what's sport?
Speaker 3 (46:47):
What it be football? Football? American football?
Speaker 5 (46:50):
And what's your favorite team?
Speaker 3 (46:51):
Uh? Patriots? My dad play for the Patriots. I have
to go for Patriots.
Speaker 2 (46:55):
What team do you want to see win a championship
more than any?
Speaker 3 (46:58):
Missouri tires.
Speaker 5 (47:00):
There you go, go for your son answer.
Speaker 4 (47:02):
One fun fact about George Pine that if your colleague
chart about it, they would be shocked.
Speaker 2 (47:07):
They're surprised I played the veal. O. Wow. Listen, this
was really, really fun. I feel like it's decades in
the making. So thank you so much for doing this.
It's great to see you and great to be with you, guys.
Thank you so much for the opportunity. Thanks, thanks, sure,
thanks so much for listening to the Deal. If you
(47:27):
never want to miss a story, become a Bloomberg dot
com subscriber today. Check out our special intro offer right
now at Bloomberg dot com Slash Podcast Offer or click
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Speaker 1 (47:49):
The Deal is a production from Bloomberg Podcasts and Bloomberg Originals.
The Deal is hosted by Alex Rodriguez and Jason Kelly.
Our producers are Anamazarakis, Stacey y Wong, Lizzie Phillip, and
Victory Veyees. Original music and engineering by Blake Maples. Our
managing editor is David E. Ravella. Our executive producers are
(48:10):
Jason Kelly Brendan, Francis Newnham, Jordan Opplinger, Trey Shallowhorn, Kyle Kramer,
Andrew Barden, Kelly Laferrier, and Ashley Hoenig. Sage Bauman is
our head of podcasts, Additional support from Rachel Scaramazzino and
Elena Los Angeles. Joshua Devaux is our director of photography.
(48:32):
Rubob Shakir is our creative director. Art direction is from
Jacqueline Kessler. Casting by Julia Manns. Our associate producer is
Natasha Abelard. Camera operation by Ryan Cavtero, Jesse Ridner, and
Suma Hussain. Our gaffer is Alex Brown, and our grip
is Max Garstak. Our production assistant is Gabriella Demataes. Alex
(48:55):
Diacanis is our video editor. Listen to the Deal on
Apple Podcasts or wherever you get your podcasts. You can
also tune into The Video Companion on Bloomberg Originals and
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