Youth Sports Was 2025’s Breakout M&A Theme. Here’s What’s Next

Today’s guest columnist is Chris Russo, CEO of Fifth Generation Sports.

In the world of sports mergers and acquisitions, 2025 was the year of youth sports. What had long been a fragmented, passion-driven corner of the sports economy became one of the most active segments for investors and strategic acquirers.

Numerous acquisitions closed across software, events, media and facility operations. Many private equity firms, some of which had never made sports-related investments, “discovered” youth sports as a scalable, high growth opportunity.

The result was a surge of deal volume, valuations and heightened competition for quality assets. But the youth sports boom was not a one-year anomaly. It’s become one of the hottest M&A categories, driven by structural factors that continue to reshape the industry:

1. Scale of the market

Youth sports is now a $40+ billion economic engine, including registration fees, equipment and uniforms, travel and lodging, and lessons and instruction, among other expenditures charted by the Aspen Institute. These products and services are targeted to approximately 27 million kids aged 6-17 who play organized sports in the U.S. The sheer size of this total addressable market (TAM) makes it an attractive sector for acquirers.

2. Extreme fragmentation across verticals

Youth sports remains extraordinarily fragmented with thousands of independent clubs, hundreds of regional tournament operators, dozens of niche software or video-analysis providers, and event companies with highly localized or sports specific reach. But beyond simple fragmentation, many of these operators are historically “mom and pop” run without standardized operations or scalable infrastructure. For private equity, this represents a double opportunity, for roll-up synergies (shared services, procurement, marketing, cross-selling, branding) and professionalization upside (opportunity to enhance margins and performance once modern systems and management discipline are introduced). Buyers recognize that even modest consolidation may create meaningful value when replicated across dozens or hundreds of locations or events.

3. Parent spending and the emergence of NIL

Youth sports spending has long been resilient as families prioritize team fees, tournament travel, private coaching and club participation over many other expenses. But in recent years, the rise of NIL has raised the stakes and accelerated this trend, helping to drive a 46% increase in average family spending on each child’s primary sport since 2019, according to the Aspen Institute. The ability for college athletes to earn name, image and likeness (NIL) income has fundamentally changed the psychology of many parents. While only a small percentage of athletes will ever play in college, a much larger percentage of families believe they might, or at minimum, believe their child has a shot at scholarship or NIL-related opportunities. This belief system—whether realistic or aspirational—has driven even greater investment in club teams and travel tournaments, showcases, personal training, recruiting platforms and video analysis.

4. Development of new products and services

The past five years have seen an explosion in new monetizable products and services that have expanded the youth-sports wallet. COVID accelerated video streaming, enabling live event subscription, remote instruction and enhanced digital recruiting. Technology and AI are now transforming performance and training, including AI-driven highlights, player tracking, advanced analytics and data aggregation, and biometric tools.  These tech and software innovations have also created new recurring-revenue business models that may scale more efficiently than clubs or facilities. Some investors see this as a structural tailwind that will last for years.

5. Entrance of respected investors and buyers

Perhaps the most important accelerant in 2025 was the entry of highly credible investors—PE firms, family offices, pro-team owners and sports-focused funds—who validated the category.  This process had actually begun a few years earlier in 2022 when KKR invested in PlayOn.  Then in 2024 and 2025, Josh Harris and David Blitzer—owners of the Philadelphia 76ers, New Jersey Devils and other pro sports properties—publicly and aggressively entered youth sports through the creation of Unrivaled Sports. 

The Harris Blitzer initiative was featured in a widely circulated New York Times article published in July, a watershed moment for the industry. The piece validated youth sports as a legitimate, investable asset class, signaled that major sports owners were now committed to the sector, and inspired a wave of new entrants (family offices, PE and institutional capital). 

As the youth sports investment wave matures, investors and operators will be focused on three defining questions:

1. Are there enough scaled assets?

The biggest constraint in youth sports has always been a lack of scaled properties to sustain deal momentum. Many clubs, events and platforms are sub-$5M EBITDA businesses, and a question remains as to whether there are enough $5M+ EBITDA assets to keep institutional buyers active.

2. Will robust valuations continue?

2025 saw elevated multiples for top-tier assets, driven in part by competition from first-time PE entrants. The sustainability of valuations in 2026 may hinge on supply/demand imbalances for quality companies, platform performance and integration success of recently completed deals, and overall economic factors (e.g. interest rate trends and the cost of debt).

3. Which sectors will attract the most investment and buyer interest?

Several youth sports verticals appear best positioned for 2026 activity, including facilities, events, video streaming and software products, especially for performance and training. However, there is also the possibility that other categories (e.g., e-commerce or traditional categories such as equipment and apparel) could emerge as high growth opportunities over the next 12 months.

This much is clear. The youth sports boom of 2025 was not a temporary spike—it was the formal institutionalization of an asset class long overlooked. Structural drivers remain intact, respected investors are now committed, and an emerging ecosystem of scaled operators is taking shape. The next year will test whether the sector can keep pace, but many indicators suggest youth sports could remain one of the most dynamic and investable categories within the sports economy for years to come.
 
Chris Russo is CEO of Fifth Generation Sports, a boutique advisory firm focused on middle market sports transactions. He advised SportsRecruits and Big Teams on the deals listed above. Previously, Russo served as a managing director at Houlihan Lokey, and before his tenure in investment banking, he managed the NFL’s digital media group. Russo holds a B.A. from Northwestern University and an MBA from the Harvard Business School.