The Deal with Alex Rodriguez and Jason KellyHow Paul Rabil Is Transforming Lacrosse Into a Major League Sport
In this episode of The Deal, Alex Rodriguez and Jason Kelly sit with former professional lacrosse player Paul Rabil to discuss the evolving business of the sport. Rabil tells the hosts how he managed to develop a new lacrosse league, why he's investing in its digital media presence and how he plans for the league's future growth.
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Hi, I'm Jason Kelly and I'm Alex Rodriguez on this episode of The Deal.
Paul Rabel. All right, Paul Rabel, Alex.
Is I dare say an a Rod or the a Rod of the lacrosse world.
I mean this guy.
You talk to anyone in the lacrosse world, they know who he is. But here's the next step that he took. He not only played the game, then he created his own league when there was another league in existence. Can you even imagine that?
Hell? No, he is so impressive.
But Jason, when you and I co founded this program to Deal right this podcast a couple of years ago, and.
You said, what is the perfect guest look like?
Yes, Paul, and I don't think I would ever say this about anyone else but Paul. He reminds me of a combination of these three folks, Adam Silver, Roger Goodell, and Tom Brady.
He's an athlete, He's a champion. It's awesome. He's unbelievable.
And what's interesting is he's done some really big deals over the course of his career. One of the things that's also really interesting about him is he knows that even six years in, this is a nascent league. It's got to make big moves, bold moves in order to secure the media rights, in order to grow the audience, in order to grow the game. They're looking ahead to the twenty twenty eight Olympics when lacrosse is going to be a part of it. So a lot of runway for lacrosse as a game. And I mean, you can't bet against Paul Rabel.
You definitely can't. I would never do that either, would you.
So here's a guy that has big belief, big ambitions, and the tireless work ethic and surrounding himself with great people.
I think he's gonna win big here on this episode of the Deal.
Paul Rabel, all right, we like to start the show by having the guests introduce themselves and what they do, So go ahead.
First of all, I love your show. Thank you.
I am co founder and president of the Premier Lacrosse League, former professional athlete. I'm a writer, I'm a producer, and I'm an investor.
And did you come to all of those just organically or is this what you set out to do?
Is this what you imagined you'd be doing? No, absolutely not. I Actually, most of my.
Adolescence into adulthood, I've just been hyper focused on the task at hand and trying to be the best at that. So for most of my life it was lacrosse so much that I didn't even realize that the professional league while I was playing in high school in college was dying on a vine. I just wanted to win a high school championship, and then in college just win a college championship. I wanted to win four of them, and I came up short. Most of the time, you come up short on those big goals that you set for yourself, but there's no way of getting those big goals if you don't set them. I would consider myself project based. As a worker, I like to think that I can drive pound for pound a lot of value, intellectual curiosity and focus at any moment on any side screen. So if that's the movie business, I want to first understand its history. If that's being a great writer, I know it comes down to practice and reading other great writers business, same thing. So no long goal of saying, hey, I want to do a bunch of stuff, because most people would say, hey, if you're gonna do a bunch of things you're not gonna be good at anyone.
Right, this whole concept about not whine and shallow but narrown deep, it sounds like you do it very well. My question is, when you were in high square, college or even in the pros, when was that moment that you said, uh, huh, this is what I want to do next.
Well, it came at an inflection point where I was just about to bail on pro lacrosse because my rookie wage was sixty five hundred dollars. I was drafted number one to the Boston Cannons in two thousand and eight. I had just played in front of fifty five thousand fans at Chollette Stadium in a National Championship game against Syracuse, and my first game into the pros was in front of about four hundred fans at a backfield at Rutgers University. So yeah, that was sort of That was the little did I know business reaction like, huh, that doesn't seem to work out. But my immediate reaction, as any twenty two year old who's looking to advance their lives and careers are now on their own without the support of the university of parents, I had to get a job. So I get a job as an analyst for a real estate firm called Cassidy and pinkered. I did that for seven months, and then I left because I realized that I wasn't and finished with pro lacrosse. And I knew in my heart of hearts that if I wanted to be the greatest lacrosse player ever, which was just my goal, I don't believe I am that that I needed to go all in and not be distracted by wages or income and that type of stuff. If you go all in and anything, I believe figures itself out.
So I want to pick up on something you said because I'm seeing a little some parallels here. It's my job to sort of do a little pattern recognition as a journalist. And you know, I have two people who were, you know, widely considered the best at the game that they've ever played, certainly among the best of the game that they ever played.
And so Alex talks a lot.
About, you know, these moments where you realized, oh, I can only be a professional athlete.
I could be a top tier professional athlete. Yeah, he obviously had that.
I mean, you had that moment what with your high school coach or was it before.
Probably fifteen sixteen, I thought I saw a real vision. Always say back the future, you see that blurry picture. The picture started getting more clear once I went back to back years to play in the US Olympic team and playing for the US Olympic team, it wasn't just Miami. It was the greatest players across the whole US. And I looked around as a rising junior, I was like, hey, I can hold my own. And then when I went back as the only you know, those only rising junior, everybody else was rising seniors.
The following year I came.
Back, I said, holy smokes, like these guys that are my age, they look like kids because I was so used to playing with kids older than me. That's the moment ago, I have a real path to the big leagues. Yeause, when was that moment for you?
Yeah?
There was a midfielder at Landon, which is sort of the one of the top perennial high schools in Maryland, and they ranked number one in the country and lacrosse. For you know, as long as I was playing, and his name is Peter Lammitdy, and I would study the way that he played, even the way that he cradled, the way that he'd run and shoot on the run, and when I was out practicing on my own, I wanted to not only.
Get his skill set, but beat him.
And there we used to have this base state tournament, which sounds similar to what Alex was referring to. If you made the base state team, you were among the best high school lacrosse players in Maryland. And then there was another one in New York and the two would play. It was called Empires in New York. So I was on the field with Peter and then him and I essentially going back and forth. I came home that day going all right, I'm here, I've got a chance to be the best midfielder in the state. That mindset carried me all the way through my career. When I was signed to go play at Johns Hopkins and I was a freshman, I would look at Kyle Harrison, Greg Pizer, and Matt Rakowski, the top three midfielders on the team, and I would just practice every single day to acquire what I saw them doing and ultimately beat them. You know, I grew up playing Rex sports. We don't see much Rex sports today, right, And I'm sure, we'll get to that in a second.
Yeah.
I mean because just to be I mean, I think it is interesting for you to hear this as a lax dad, which.
You know that I am.
I mean, the infrastructure that exists today did not exist when you were coming.
You weren't playing travel pros and cons of both.
It's incumbent on leaders at the premier lacrosse league to what I would say, revitalize REX Sports. So that means privately, out of our balance sheet, invest in it. You create a shift in momentum by making something that you're investing in cool, which I think is part of the challenge you're talking about eleven, twelve, and.
Thirteen year olds.
Yeah, and what I learned in the business world is most people aren't like Alex and I that want to be the best of the best.
That's like sort of one percent. A lot of people just love to play sports.
It's fun, it's competitive, you learn, you interact with your friends, there's social status.
There's a lot of peer pressure on young boys and girls right now, and.
So REX sports is the lowest barrier opportunity to learn all these skills. So that has been impinged by you know, privatized sports over the last ten to fifteen years.
You know, from our history together, I'm an existing fan, I'm a lacrosse dad, I'm a collegiate lacrosse player in my household.
And so we crowdsourced, like what do these guys want to know?
And interestingly enough, one of the questions that kept coming back was this idea of accessibility to the game. And interestingly, these are you know, these are college players who you know, we're fortunate to play the game growing up, but they're also really smart future business people and they see that for the game to grow, you've got to grow the top of the funnel too, in terms of the players and the fans.
So how do you do that?
Well, Kevin Durant, Rich Climb and our investors out of thirty five V and when they came in, they said, let's build a property together, just solve this problem. So we launched Street Lacrosse. And Kevin and I both grew up in the DMV playing hoops. Because you have the access to a court outside of every neighborhood like you do a baseball diamond, and I believe that you're going to get more participants and you also get more fans because through osmosis, you see a baseball diamond, you go cool, I know what that is when I just see it on TV. How many people still in the grand scheme of things around the world know what lacrosse is and looks like. So Street Lacrosse said, let's take what we have and make something out of it. So we built a version of the game with just a stick and a tennis ball can be played on any surface, but we focus on basketball courts, and we want to invite communities of all shapes and sizes in any look from around the country because we're good at promoting and capturing that media to say, oh, I don't have to have a helmet, gloves, elbow pads, cleats and sign up for my club team to play this game, and I want more sticks and hands. Top of funnel is like is everything, and lacrosse stereotypically has this image as if it's this Northeast private school sport. Ironically, it is the first team sport of North America, indigenous game and it was played without pads and the sticks were shaped from hickory tree. So what happened along the way is I think what you've seen America evolve into from class to race to accessibility, and we are not different than hockey or golf. In fact, we have more black and indigenous players in our league than both of those pro leagues. However, we have reputational challenges. The sport that I left out is actually American football. It's an expensive sport to play, but in the early nineteen hundreds a couple presidents really liked it, so they went the path of working with local government to subsidize our equipment. So when we played pee wee football, we didn't have to play for a helmet. If you have to pay for pads to play football, you're going to see participation or what we have today, the NFL won't be what it is today. And so understanding the participation game is important. And then the last thing is understanding the entertainment game. Because none of us sit around and talk with Dana White about mixed martial arts participation. They've bought an entertaining product. They're a gladiator sport, and so you can't draw a business model, which is I think what our processors did wrong in MLL around number of participants to number of attendants and viewers on screen you've got to work both angles right, all.
Right, So let's pivot to arguably the biggest deal that you do, which is you decide which I can't even describe to you, but because you're going to get the magnitude of it wild, the idea of starting an entirely new league, win a league exists. So it's literally a Rod saying, Hey, Steinbrenner's this has been great. I'm going to go start my own league, though, and we'll see you down the line. Tell us about that moment when you and your brother Mike decide to do that.
Well, it was about ten years into my professional across careers, so I'd been learning about the business of sport along the way in the business media because I didn't want to be arrant in the approach. My brother is a serial entrepreneur, so we had the chops between the two of us and the diversity around what we had learned, his on the management and financial structuring side and me on the media, marketing and athletics side. So I say that because if pro lacrosse was working, I would have built a strategy much like we see a lot of professional athletes doing in the Big four sports of owning a team one day. It's far more difficult and challenging and a lot of easier ways to make money than starting a new league, especially in the face of an existing one.
So we study it. We studied it, study.
We actually first went the private equity route to get a bunch of overhead capital to acquire the existing league. Because sports are full of context, we knew that lacrosse not just in its twenty years prior to pro history, but at thousands of years of history. Starting from scratch was going to be really difficult to capture that narrative. But I wanted to own twenty years of pro lacrosse history, even if the wages were low and there wasn't a lot of network games. We ended up putting together an offer for about thirty five million dollars, which was a mixture.
Of cash and stock. And this is for Major League lacrosse.
Every team was losing money, the league was losing money at the top co. This was in twenty seventeen, so it was before like the real craze that we see here today around pro sports. And I'm not sure whether they were trying to negotiate or if they were really like and some of this is my stuff that I've learned to unpack in therapy and sports psychology as a as an athlete grown up, you're told that you're dumb, dumb jock, And I think if I put on my empathetic hat, you walk into a room with a bunch of seasoned business executives. Right, Jim Davis bought New Balance for fifty grand has built it into a multi billion dollar empire. He owned four of the teams.
What is this athlete doing walking in here? What does he know? He hasn't own abilities? Now hard, this is I can feel the nodding by the way hunting event.
Yeah right, And so however that process, they didn't say shoo. They said, okay, let's go into what the entrepreneurs listening is a data room. So we went into diligence, and we learned about the business, and we learned more about what didn't work and why because there wasn't a lot that was working. We had a few more attempts at striking a deal. The Achilles heel of Major League lacrosse myself included. Of the two hundred and fifty players or so, ninety five percent of us were under a one year deals, so sort of like you know, a team getting picked up overnight out of Baltimore moved Indianapolis. There was a moment in time where we knew, oh, we could actually start a new league and sign all the players overnight, and our investment strategy had to shift from private equitya comes in and buys a distressed asset and fixes it to venture. So then we rent a whole new fundraising path to start what now is the poll And we struggled because how can you value something doesn't exist? So we at first put together a safe note, which is essentially a simpler version of convertible note.
We went out to market and people are like, I get it.
But since nineteen ninety, about two hundred pro sports leagues have started with a one percent success rate, and that's based on making it.
Beyond three years. So I know. We've talked a lot about spring football.
It's a decent business, but it turns over because the cost structures too heavy. They get a million people watching a game. You can figure that out, but it's just hard. There's been a huge moat around pro sports for decades because of broadcast cable, and then once that gets democratized through streaming in the Internet and social media, the attention economy opens up to nascent stage sports like the UFC, MLS and WSLWNBA. All this over the last thirty years. So we couldn't get the term sheet signed. We decided to go a price round, went to rain Ventures. I want to give a shout to Colin Neville was on our board. Now, Colin played lacrosse at Yale. That's why he took the meeting, but he will admit he had the same thought like, we'll see anyway. That meeting was scheduled for thirty minutes whent about two and a half hours. They were still hesitant. Incomes Drew McKnight, who now runs Fortress Investment Group, and he played lacrosse at EVA and he loved it.
He saw the same thing like, hey, if this is.
Working at the high school level, college level was once an Olympic sport, it's the fastest growing on the participatory side, ages nine to eighteen boys and girls.
Why can't we figure this out the pro level.
So he actually wrote our first term sheet personally, not out of Fortress, knowing that hey, this might help get as you know, an actual term shoot over the goal line we brought it to Rain, Rain said.
We'll do it.
Drew came on as a personal investor. That was our first seed round, but it was not enough to run the first season. They were like, we got to put some triggers in front of this and then we can go do a Series A. And that was get a network deal, sign the players to MoU's at the time, because we were all still under our MLL contracts MOUs in this case, memorandum of understanding, right, so it was like, this is what we're going to do, and if.
You're meaning the players will commit yep. Okay.
So we had them UNDERMUS and then they said court some sponsors.
We were able to get those three done. That led to our Series A.
Income Joe Tie, who I consider the godfather of lacrosse, co founder of Ali Baba runs the Brooklyn Nets, also played lacrosse at Yale.
We had conversations with him going back to twenty sixteen on this.
But Joe, as many like really top tier executives, they want to stay out of the crossfire, especially if it's unnecessary. So he knew that this was going to be a little bit of a heated battle out of the gates. And wanted to see as if Mike and I could get out, and once we did, he came on, and we've had subsequent rounds and brought on folks like Arctoscia, Churning Group.
Right and Paul.
Before you get into like those blue chippers, going back to the safe note, can you share or at least what you could share, what were the terms on that note versus when you brought in CIA and Churnin Group and others.
Yeah, Well, what you do is you put a.
Cap on the convertible note and you say like, okay, look we want to raise I'll give you ballpark numbers. We weren't raising away from three to ten million bucks so that we can build the structure of this company. We don't know what the valuation is and that's why you put a cap on. How it converts, and so then you agree around like what the cap is, or you disagree. That didn't work. So our price round was like we raised X amount of dollars, but I can give you ballpark around when it's multiple since about fifteen x sixteen x since our Wow, those who came in.
The seed round, So it was a low valuation.
But again we hadn't brought in any revenue yet, and you think about the nearest comparisons, probably TGL that has been selling teams at really high prices.
Which is the new golf concept.
Yeah, run by Mike who's his former NBC executive ran the Golf Channel's great dude. He has been able to tell a really good story and also pull on case studies of other leagues since then to say, hey, this is what it's worth without playing a match yet, right, which is extraordinarily difficult to do and really high risk because in the end, like we're all playing the long game, the PLL is not going to be my last business, right, you know.
So you're going in as an athlete, you've got to tell a story that says not just I think there's a lot of potential here, but like I know what I'm doing. Like, how did you convince people that you know this was the right path forward?
Well?
I looked at the history of inflection points in pro sports, and you go all the way back to Major League Baseball, and we asked the question too, like why are team sports home and away while they have stadiums, what are the revenues tied to such Baseball and nearly nineteen hundreds was a ticket sales business a lot of games. For that reason, it became an RSN media business, and then it became a concessions business merchandise business. But you play one hundred and sixty two games, a lot of games.
He's aware, I'm just making sure s yeah.
So so you get to a business that was built around very much. So even even the day to day worker was born in New York City and lived their life in New York City. And there's so much community that actually lives today right, And it's important to get that right in pro sports. If you look at what the turning point was the NFL for Pete Roselle in the nineteen sixties, it was deciding to go on broadcast cable, which seems like, oh, home run. Wasn't the case then because the worry was in a ticketing business. If you broadcast games, people won't.
Go, they won't show up.
They jumped the TV faster and Major League Baseball did. I think the NBA and David Stern and Adam Silver in the eighties and nineties better than anyone else, has created culture and entertainment and this connectivity around the NBA that is star led for team sports. So what we said is like, okay, cool, this is twenty seventeen.
We're raising money.
I'm a testament to this as an athlete that's built a profile because those wages didn't change, by the way, but my income did. Because I got sponsors signed up, because I started a YouTube channel, a podcast, I was active on social. I knew modern media what I felt better than anyone else. So I was like, these are the leagues of X, Y, and Z. We're going to be the league of digital. And that's why you're going to invest. We know how to leverage the new attention economy, we know how to storytell. Our large business unit at the poll from day one is going to be our production house because right now every team and league outsources media and marketing. We're gonna take that inside. We're gonna make us fast and more agile. And we believe we're not building CrossFit or slam ball, which are new sports really from scratch. This is a sport that already has product market fit. Our job is to get it to the red zone and then over the goal line.
So just to expand on that a little bit, if you go back a little bit, Paul, tell us a little bit about the two or three things that you thought that the prior league that you played in was underachieving, and what was your thesis to the investors, besides what you just mentioned with the media, that you can do better and ultimately build a successful, sustainable business.
Number one is your most important part is your network. You have to have a media company, not only invested, which, by the way, one of our board members is David O'Connor, who used to be a partner at CA, was running MSG at one point and now is co founder of Arctos YEP.
Brilliant Doc o'kind love Doc.
As everyone knows, and Doc told us about a few years ago, the most difficult thing to do in sports is get a media rights deal. Most of those two hundred leagues that I had mentioned from the nineties that started all the way through, they're in revshare deals or time buyse We were a revshare partnership with NBC Sports when we first launched. Why would they give us a media rights deal? It's not tested yet, and so the former league really struggled with that chicken and egg theory, which is you sort of need a network to develop an audience and score rating, but they have all the leverage until you score rating and then whether it's entertainment, which I always referenced Seinfeld to Cheer where Seinfeld got its first pilot, big rating on the heels of that fifty million audience, and so entertainment you test new shows. We don't really see pilots anymore based on lead ins.
Sports.
With a great network, you get a good lead in, you get introduced to a new audience, which is really important for a sport like lacrosse. So we knew we needed to get that and we might have to fight to get that and really dig in as a network partner to drive viewership. And that's what NBC noticed, and they decided to invest into the production.
We did a revshare.
It was a profitable business at the time, which three years later led to that media rights deal with the Gang at ESPN.
So one of the things that fascinates me and Alex has this too.
You just have this ability and willingness to just walk in to these meetings with these massive executives and just be like, here, I am, I've got this idea, I believe in it.
You should too.
Let's do that and then you're so, where does that engine come from? Because that's different. That's different from like being good on the field.
I think that, you know, I had mentioned the stereotype that I felt for most of my career and still do at times.
You don't have that.
When you meet with sports executives, they love they love it, they understand that. And sure, another thing that we had to work on that the former league didn't have is get real corporate partners in that are willing to spend. And we had Gatorade and Adidas in Capital one in our first year and now it's stretched like Ticketmaster and cash App and Progressive and so many different categories. Now, going into those meetings is hard. But when you sit with Jeff Carney, who was one of the three Jeffs at Gatorade, who knows what it's like to sit for a meal with Abby Wombox, Aerena Williams and Michael Jordan. They know that work ethic. Yeah, I don't feel pressure there. I actually feel welcomed. I feel community. But make no mistake, I think what we've learned and you go next, is that, oh man, we can defy odds.
If we were to look at the.
Percentages of becoming a Major League baseball player, a professional acrosse player, or an international player in whatever sports. Love it's under one percent. So when you do it, you sort of trick your mind into believing that you can manifest in anything. And I believe in manifestation, by the way, So that's not enough on its own.
You've got it and do the work. And so man, I study.
I study you guys before even walking in here, and I know both of you, so I think it's just so important to come prepared. And that's another sport attribute. Yeah, I mean does that resonate with you?
I mean, what's your mindset when you go in Well, I think it's two things.
I think Paul and I are not afraid of the work, and the numbers will tell you that over our long careers. But the other thing is we've proven that we're able to surround ourselves, check the ego at the door, and surround ourselves with the best.
Minds in the world.
So when you go and talk to these titans, that's exactly what they've done. Now, they have fancier degrees, they have better returns and all that, but when you look at our resume or you look in at a LinkedIn account. We're looking at a trajectory, right, and when you look at Paul's trajectory, it screams champion. Right from the time you're in college to where you are today, it's been like this. No, it hasn't been straight up, I'm sure for both of us we've had this, but we're not afraid of the work. We surround ourselves with the right people and we're never going to give up until we win the title. And I think that's what they recognize. And the other part is we're talking about sports. We're not talking about gas and oil or something that's really like not as sexy. Everybody will take the meeting a because your Paul b because you're doing something big and bold, and see you and Mike have a real thing here.
Why not? Why not?
I'd add to it one more thing that Alex had me think of, which is in the startup community, they'll say, what's your unfair advantage? Our unfair advantage is that I had a relationship with the players. I can't run a league and play in a league against myself, And the unfair advantage was, okay, you could have hypothetically a few other folks come in and pitch starting a pro lacrossely, but they don't have the players. It's all for nothing, right, So in any line of work, what's your unfunded advantage table stakes?
You have to be a subject matter expert.
But that relationship with the players is a critical one. I mean, it's interesting because you've now sat on both sides of the table of like being an athlete being an owner. You know, you were essentially doing both at the same time. Well, Alex said it, and it's not. I think it's actually really really underrated in the entertainment world, which is what we're in as a pro athlete, or you know, if you're in cinema and you're an actor or even a writer, is being humble and having a level of self awareness and being kind to your peers. That actually doesn't exist everywhere. But the people that I try to surround myself with have that. They also have the freedom to check me when I get over my skis. I notice Alex has that.
And you know, now an owner of the Timberwolves, you probably have a really natural and authentic way about going and talking to the players on the team. And that's different than traditional sports owners. You know, where there is a pretty clear and distinct wall between ownership and players, and that's why a lot of times unions started.
Let me add this, I think what Paul and I can do very well is we can be the bridge between institutional capital and the athletes because we now know how they both think. Yeah, and that is really I want to underscore that because, especially as an owner of the Timbles and the Lynks, I see how valuable it is to have empathy for the players to understand how difficult it is today. It's never been harder to be an athlete in today's world. At twenty twenty four. Thank god social media wasn't around. I got myself in enough trouble. God, you know, with social media it was in the heyday when I played, it would have been that much more challenging. So having empathy for the today's player, I think is crucial.
And sometimes empathy is just sitting with emotions and not jurisdicting, which is you know, as executives, is what you feel like is now.
One question when you think, I love what you're thinking, But when you're describing what you did, which is beautiful, and this what makes you kind of Paul one of one is Adam Silver is the same way. He's just a tremendous commissioner. Any commissioners or leaders out there domestically ori internationally that you look and study to see how you can apply to your league.
Adam is a friend, is a mentor. I try to get with him a couple times a year. He is absolutely that. Whether it's Adam, whether it's Jimmy Pittarro, whether it's Don Garber. The best executives I've noticed in sports and sports media, they have velocity, you know, but it's not just returning your email or your text fast. It's doing it thoughtfully. And I think that to your point, when you're a senior executive, your job is to keep the wheel going. You know, talent really matters. You can't forget what business you're in. You know, we run the PLL. We have to think about and spend a lot of time with our players. Is that revenue driving You could like throw dotted lines to such, sure, but it's the essence of what you do. So I think being able to understand that is of utmost importance.
One of the things that strikes me is that both of you are quite evolved, and I also know have done a lot of work on yourselves. You talk pretty openly about being in therapy. You've talked about that a lot as well. How has that changed you? And I'm going to turn it on this guy too, but how has that changed you as a leader?
It's a great question. I asked Alex about this in the past because my concern about originally about sports psychology and therapy is that it would make me soft. And now I think about the soft masculine and how that's the most powerful version of ourselves where we can be empathetic and then also turn up the dial on our competitiveness.
And it's not a light switch.
So I had to learn that because I wanted to be the A Rod of lacrosse. I wanted to be the MJ of Lacrosse. I wanted to be you know what Tom Brady was, And I see these fierce competitors, fierce and you know on the cover of the book that runs in at direct odds with understanding or having perspective around losing being okay or part of the process, and we will heal, we will actually grow. So it was a challenge for me to get into it and then once and I want to give a shout out to my sports psychologists, formerly doctor John Elliott. Once I got into sports psychology and understood that actually know it's a superpower and you're not going to lose that and kind of that metaphorical dial versus switch, and that you're going to become a better leader, which is what helps teams win, it was just all in for me from there.
So I was doing therapy like twice.
A week every week for seven years, and it became like practice, and like practice going back to what we do in sport. When we love in sports, you can feel yourself improve and learn about psychology, and that psychology on the business side has been a big unlock for me. What I've learned the difference therapeutically between being an athlete and a business person is this, in sports, you can win with sheer willpower and effort and strength, and it's designated to do such.
Yeah, like we're going to square.
Off, one of us is going to win, in one of is going to lose. So Mike comes into play. In business, that's the absolute wrong idea. You don't want to go into a partnership where you won the deal and the other person feels really bad because guess what, that partnership ain't going to renew, right, and you want to be in the renewal business. And I know that we've discussed that before, so I'd be curious what any you think of it.
No, I always say the ninety percent.
Rule, right, if you know, in order to get a deal, both sides, I feel have to hurt a little bit and win a little bit.
Right.
It can be like all one side, or that'll be the last deal. But let me bring you inside because I agreed with everything you said about the stigma around therapy or on sports.
And we've come a long ways.
I mean we're now twenty twenty four, but bring you back about call it twenty years back into our club. I was when George Steinberner was still running the team. So George Steinberner says, I want to introduce Chad. He is a very very good sports psychologist. His office will be right next to mine. Come see him anytime. Okay, two years we had zero people walking that run.
Wow.
So then he reintroduced him and he said, hey, I want to introduce Chad. He did is a reintroduce. Reintroduced Chad. He's a performance coach. Twenty three out of twenty five of us went in there. But Chad is such a great guy became still a very close personal friend and an integral part of a two thousand and nine championship team. But talk about how you label something and the way to go around it goes from psychologists to performance coach. Yeah, athletes, we bought into performance coach, and.
That's just also underscores culture, which is set at the top and mister Steinbrenner's focus on and his belief and how that could help the team.
How do you apply all these lessons that you have learned to what feels like a critical moment? Maybe there are a lot of critical moments, but this one feels like a critical moment in the business of lacrosse. Like you're looking ahead to twenty eight in the Olympic. You've merged, as you said, the PLL and the MLL, you've absorbed the league that you essentially usurped.
What needs to happen now?
Things are trending the right direction, But what are those key decisions you have to make? Are the key things that need to happen next?
Yeah, well, a few highlights.
So when we launched our league, we were wholly owned, still our single entity. We changed to a touring model, which is part of what got to send the door with these investors unique. And so we looked at the UFCF one tennis golf and said, okay, if you can bring all of your teams and descend upon a major market city and a professional venue one time a season, then you're going to flip the supply and demand curve because lacrosse fans aren't as big as basketball, football, or soccer fans in America. So we have a different model. I'll come back to that. If you looked at what we did from a media standpoint, we were able to grow year of a year double digits. Since we've launched and own and operated social and digital and now with our media deal with ESPN, we hare to raise great capital, support our players and new business initiatives like we just talked about for us as we look into now getting lacrosse back into the Olympics in twenty twenty eight. If those are the goalposts, how does this league transform into a top six team sports league in North America And what that transformation may look like. Is no longer tour And if you think about what we had talked about we worked with Major League Baseball and still does with team sports leagues. It's community and so we are working pretty actively on dual scenarios, continuing to build out the Holy owned model that's tour based with our teams in home markets and going to those home markets, expanding our schedule, which is in our business called tonnage, which means you get more hours on television, which helps your media right steal to then path two, which is selling our teams. We have eight of them, and if you have great owners in markets like Minnesota, like down in Utah, like we have in New England, the crafts are investors and you find the right ownership group with the package of owning a venue with other sports properties that they can cross promote against effectively their lead INDs. As I had talked about the value of networks. That's a real path and it doesn't stop at eight. If we choose that shift maybe to a trade association model or with Don Garbage in MLS which you maintain a single entity. And he had Soccer United marketing and owners came in. They owned the right to their team and up and their pro out of position of forty one percent of some which owned US and Mexican soccer rights. Our version of call it some marketing is women's lacrosse ownership. We own the largest media company called TLN Youth Lacrosse Investing. We have these other properties that are really valuable and big in addition to just owning a team. So that's how that model could flex. And then you go from eight to ten to twelve to fourteen to sixteen, and you're really leaning into community in real estate, where if I think about what makes sports high multiple businesses, enterprise businesses, it's attention right through your partnerships and everything else I talked about. It's revenue, so it's your corporate relationships, it's tickets, it's merchandise, it's youth community and then real estate.
So Paul, when you think about that model, and you're going kind of two different paths at the same time, which I think is super smart to give you options as an entrepreneur in five years, what do you think is the north star and if you can have a year way, what is the perfect comp that in the league is doing that where they're hunting right now?
So for touring, our players will be full time and living in markets, practicing every single day averaging six figures in wages. We will be playing instead of fourteen weekends of the year upwards of twenty four. If it's individually owned, then we'll have our players in those markets. Their salaries are passed through to team owners. They have their venues that they're part of. The tonnage moves from fourteen to twenty four weekends, which is looking like probably forty eight upwards of eighty games, and that's a really good business for us. From a breath of properties. We're entering a new rights negotiation. Our four year deal with ESPN goes through twenty twenty five. I think the media environment is really exciting. People look at what would often be considered the best business model over the last sixty years in America, the cable bundle, as an indictment on media companies. They're just losing that frothy business model which used to have one hundred and ten million. But they're in the business of content ownership, content licensing, and distribute.
I have one on that. So, Paul, when you think about it, I just want to get it. I'm thinking of you like if I'm an investor, right, so I'm literally pitching you like you're looking for my capital even though you're not in five to seven years. Is it fair to say that you're either something like the NBA model, Yeah, or something like the UFC model.
Yes? Is that fair? Yeah? And I think both both paths are really valuable. I agree.
You know, the UFC sold to Endeavor as they staged up for about four billion, and then Bob and will Iger just bought Angel City at a two hundred and fifty million dollar post. So I think it would probably be NWSL or UFC. And I believe our enterprise value as a league will be in the multi billions over the next five years.
Where is it today? Approximately under one billion. I can't give you more than that. That's fair number.
But look sports sports leagues and teams on average trade for eight to ten times revenue, right, And the reason why is all that we had just discussed. Warren Buffett calls them monopolies because of scarcity. That's that and what the technologists would say. Our LTV is thirty plus years. You know, you get someone into a game, you get them to be a Yankees fan, it lasts a lifetime. That's way different than even the streaming business. LTV For those who are lifetime value.
There you go.
So you figure out how much getting Alex to be a fan of the PLL is worth to us from a revenue standpoint, and then you do what's called a customer acquisition cost analysis, so you build your CAC. How much then would it cost me from a marketing and investing into getting Alex? And is that a profitable difference? Right?
Right?
So if we're running a software business, which kind of talking about would be intimidating to walk into a room because it's not our cup of tea like sports was, then I would be pitching our next round of financing around how how low our CAC is and how big our LTV is, and then you just pour it on customer acquisition. We're in that stage right now where we have a good idea around where we need to spend on awareness and casual sports fans. There's two hundred and sixty million in the US. When we launched the PLL, we had fifteen million lacross fans in the US. Now we have forty six million, scorting to an MRI Simmons report. That's in just five years of operating. So we'll do this, this this all the way through LA twenty eight. Which one more stat When I started playing, there were eighteen countries. Now there are ninety two.
Wow, all right, we're going to do our rapid fire now. A lot of pressure, a lot of pressure. Keep it tight. Okay, all right? What's one word to describe your deal making style? Compassionate?
What's more important to you? Instant gut or data gut?
Who's your dream deal making partner? Mark Cuban? Good one? What's the best deal you've ever made? The next one. What's the best piece of advice you've received on deal making your business?
I think actually from Alex and making sure that everyone feels a little pain and they also see the big picture of why they're letting go of something for something much bigger.
What's the worst piece of advice? And don't say Jason, please win the deal, Win the deal, Win the deal.
What's your hype song before you go into a big meeting or negotiation?
I fall back to nineties rock honestly, Like I listened to Rage against the Machine before workouts. Still, but before a meeting, like I didn't listen to Rage walking into this?
Okay? I try, yeah, I try.
You know what I'll say that try to listen to something that has to do with the meeting in advance. Huh, I countlessly, whether it's interviews or pitches. I've picked up something in the last minute walking into the door that was seminal to closing it interesting.
Take lacrosse out. There's only one sport you can watch for the rest of your life.
Which one is it? I'd call it football, but the English Premier League.
Okay, what team do you want to see win a championship more than any The Boston Cannons my first team, first team and revived now for the New York Blo.
A fun fact about yourself that your colleagues will be surprised to hear about.
I'm a failed musician. Ooh, that's a good one.
I've always wanted to play. I've tried to play the piano. Well, you used to get lessons when I was younger. I've tried to pick up the guitar as an adult, watch YouTube videos. Just haven't been able to get the and even drums, like as an athlete. I'm embarrassed to say, because you think we're really well coordinated, I just can't figure out the multi movements of music. So you guys can bet that it won't be musician in there.
At some point. Paul Rabel failed musicians next time on the Deal. This has been really fun. Thank you, thank you good. I started sweating on the rapid Fire.
Yeah yeah, listen, pressure and its psychology.
Man, I learned that too, by the way, is that you know your body. You feel nerves in big moments. And I remember John Elliott tell me it's a good thing. He's like, if you're not feeling it, he was like, whoa.
I thought.
He was like, no, no, don't say nervousness. That means you're not prepared. Nerves are bodies as athletes were walking on the field.
He heats up.
That's our muscle fibers and twitching beginnings so that when a defender is coming at me to take my head off, I can react and dodge by him.
Yeah.
And that's just the feeling that you're feeling, right, And that was a change of framing, which if I didn't give that answer on one of those rapid Fire questions, I'm sure it's like frame differently and always optimistically.
M beautiful here the man. Thank you so much, Thanks you guys.
The Deal is a production from Bloomberg Podcasts and Bloomberg Originals. The Deal is hosted by Alex Rodriguez and Jason Kelly. Our producers are Anamazarakus, Stacy Wong, Lizzie Phillip, and Victory Veyees. Original music and engineering by Blake Maples. Our managing editor is David E. Ravella. Our executive producers are 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. Rubob Shakir is our creative director. Art direction is from Jacqueline Kessler. Casting by Julia Manns. Our associate producer is Natasha Abbilard. Camera operation by Ryan Cavatero, Jesse Ridner and Suma Hussein. Our gaffer is Alex Brown, and our grip is Max Garstak. Our production assistant is Gabriella Demataes. Katia Vanoy is our video editor. Listen to the Deal on Apple Podcasts, Spotify, or wherever you get your podcasts. You can also tune into the Video Companion on Bloomberg Originals and on Bloomberg TV. Thanks for listening.
