Sports Tech M&A Seen as Strong Despite Trade War Worries

Mergers and acquisitions activity in sports tech has started the year strong after a record 2024, showing only tentative signs of caution around President Donald Trump’s tariffs and the resulting trade war, U.S. investment bank Drake Star said in a new market analysis released Thursday.

“While the broader M&A market was still recovering from a muted 2023, the sports tech sector demonstrated notable resilience and momentum—a trend that has continued into early 2025,” Mohit Pareek, a principal at Drake Star, wrote in an email. “2024 marked a historic year for Sports Tech M&A, with over $86 billion in total announced deal value across more than 1,100 M&A, private placement and public market transactions.”

By comparison, 2023 had $26.7 billion in M&A deals in sports tech over about one-third fewer deals.

Drake Star, which specializes in technology deals, said that 2024 was the best year for M&A in sports tech ever, with 486 deals led by highly publicized mergers including the Silver Lake-led take private transaction of Endeavor that closed a month ago, Skydance’s pending $8.4 billion purchase of Paramount and KKR’s Varsity Brands buy for $4.75 billion, according to the report. About two-thirds of deal value occurred in North America with the most active sector being the wearables space, followed by esports, fantasy and betting. Wearables accounted for 37% of M&A deals, according to Drake Star’s analysis.

The momentum has carried through into the early months of 2025, the bank said, citing Urban Sports Club’s acquisition by Wellhub and the Disney-Fubu pending merger of sports streaming assets. “While the ongoing market headwinds in tariff and trade war situation has certainly made buyers a little more cautious, sports as an asset class has remained largely unfazed and we expect strategic consolidation and technology advancement through M&A to continue,” Drake Star said in the analysis.

Less robust has been venture capital, private equity and debt financing activity, which Drake Star refers to collectively as the financing market. The first quarter of 2024 marked the low point for sports tech financing in recent years, with mid- and late-stage deals showing a rebound late last year. Though there are 17 private placement deals worth $50 million or more in 2024, total deal count was down more than 8%—and down 22% by dollar value—from 2023, “showing the lackluster broader financing market,” noted Drake Star.

Still, this year offers some encouragement, with immersive experience tech company Infinite Reality closing on a $3 billion investment from Sterling Select, an arm of former New York Mets owners Fred Wilpon and Saul Katz’ Sterling Equities, and streaming service DAZN raising $1 billion from Saudi Arabia’s sovereign wealth funds. The bank sees AI and predictive analytics, fan engagement, ticketing and venue technology to be active segments this year. Activity will be bolstered if interest rates come down and the trade wars calm down, likely bringing several sports tech companies to consider an IPO later this year.

A third arm of the sports tech financing market, investment funds, also showed the continued ability to fundraise in 2024, with sports-focused funds raising more than $6 billion in new capital, led by Arctos Partners and Shamrock Capital, which raised $4.3 billion and $1.6 billion in new funds, respectively. In 2023 sports funds raised $7 billion.

“With private equity firms being increasingly active and doubling down with new funds focused on sports and media…relaxation of ownership rules on the leagues level and public market showing signs of recovery, we expect financial buyers to be particularly more active,” the Drake Star report said.

(This story has been corrected in the fifth paragraph to remove reference to a $2.4 billion acquisition by Wellhub. That price was Wellhub’s valuation at the time of the deal.)