JPMorgan buys stake in Robert Kraft's sports-data company
The Kraft Analytics Group, or KAGR, has more than 20 clients, including the NFL
JPMorgan Chase has bought a stake in the analytics company that helped make New England Patriots owner Robert Kraft a sports mogul.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| JPM | JPMORGAN CHASE & CO. | 246.25 | -3.47 | -1.39% |
The unusual partnership signals the growth potential JPMorgan sees in sports ownership for its wealthiest clients. The idea is to use the heaps of data that flows from legal sports betting, mobile ticketing and concession sales, among other things, to advise clients looking to buy and owners trying to wring more profit out of their teams.
"The biggest thing we realized is everyone who buys a sports team initially, they’re very focused on the field," said Mr. Kraft, whose team has won six Super Bowls. "Very few prioritize the business side, and this really helps to do that."
The Kraft Analytics Group, or KAGR, has more than 20 clients, including the National Football League, teams in all five major American sports leagues, and college athletic programs. JPMorgan is its first strategic investor. The parties declined to discuss the financials of the deal.
JPMORGAN CEO DIMON SEE INFLATION UPTICK
The proprietary data KAGR provides can give owners a better understanding about who their customers are and help them find other uses for their stadiums.
"A lot of organizations get analytics wrong," said KAGR Chief Executive Office Jessica Gelman, who co-founded the popular annual MIT Sloan Sports Analytics Conference. "We help ensure that they get it right."
JPMorgan hired KAGR last year when it was advising a group headed by former baseball All-Star Alex Rodriguez that was trying to buy the New York Mets. The group lost, but JPMorgan executives saw value in getting the data KAGR had for its clients, people familiar with the matter said.
Ms. Gelman, a former basketball star at Harvard, began working for the Kraft family in 2002, building out data operations and business strategy. Over the years, the success supplying the same type of data to other teams—including ones they competed on the field with—led them to spin off KAGR as a separate entity five years ago.
JPMorgan’s private bank, which caters to individuals with $5 million or more in investible assets, advises owners on buying and selling teams and building new stadiums and arenas. The bank is increasingly hearing from clients interested in getting a piece of a major sports team, said Vincent La Padula, the head of lending at JPMorgan’s private bank.
"I field five inquiries a week of people with interest in sports," Mr. La Padula said. "You’re going to need more complex analytics, more data and a better understanding of how much a person spends at a stadium, when do they come, how long do they stay."
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JPMorgan’s sports lending group helped finance the Rams’ new NFL stadium in Los Angeles, which also hosts the Chargers franchise. The bank had also agreed to lend $4 billion to the group of European soccer teams trying to create a new Super League, a plan that collapsed under fan and political outrage.
Mr. Kraft said KAGR was a natural outgrowth of his 1994 purchase of the Patriots, a team losing money at the time, for an NFL-record price. It was around then, he said, his business received a loan from JPMorgan.
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