Today’s guest column is by Joseph Glatt, co-chair of the global Private Credit Group at Paul, Weiss.

The business of sports has evolved into one of the most sophisticated capital markets in the world. Franchises that once relied on wealthy patrons now operate as global enterprises with complex balance sheets, diversified revenue streams and brand portfolios that span continents. Behind the scenes, a quiet transformation is taking place. Private credit has become the financing engine powering the next phase of the industry’s growth.

For decades, the financial architecture of sports was narrow. Teams depended on a mix of owner equity, bank loans and broadcast advances. That model worked when sports was seasonal, media rights were centralized, and stadiums were used a few dozen times a year.

Today the business is more complicated. Digital engagement has replaced ticket sales as the primary growth driver, broadcast rights are fragmented across platforms, and venues have become year-round entertainment ecosystems. Private credit brings structure, speed and sophistication to a business that is increasingly complex and ever-evolving.

The appeal is obvious. Sports franchises have matured from passion assets into performance assets. Media rights, sponsorships, premium seating, licensing and real estate all provide recurring cash flows—a profile that looks less like entertainment and more like infrastructure. For credit investors searching for yield with tangible downside protection, it’s a natural fit.

What distinguishes the current wave of sports lending is its focus on assets. Lenders are financing discrete pieces of the ecosystem rather than entire teams—broadcast receivables, naming rights, arena redevelopment or ancillary real estate. A stadium backed by long-term contracts and naming agreements can support senior debt that behaves much like project finance. The economics are stable, the security is visible, and the exposure is detached from game outcomes. It’s a structural rather than sentimental approach to sports finance.

This shift has attracted institutional capital on a scale that would have been unthinkable a few years ago. Pension funds, insurers and global asset managers now view sports as a legitimate component of their private credit portfolios. The logic is straightforward. The sector offers infrastructure-like cash flows with entertainment-driven growth. European football clubs have refinanced legacy debt with private credit facilities. North American franchises have used direct lending to fund media rights and working-capital needs. Even emerging leagues and women’s sports organizations are turning to private lenders to build facilities and extend reach. The flow of capital is both a cause and a consequence of the sector’s institutionalization.

The sophistication of these transactions reflects a growing recognition that sports carries unique risks. Revenues can fluctuate with team performance or media cycles, and valuations can move with public sentiment.

The best lenders manage this through structure rather than pricing. Deals often include covenants tied to attendance, sponsorship renewals or season-ticket deposits. Some of them link pricing to revenue performance or secure cross-collateralization between real estate and media income. The emphasis is on aligning capital with the rhythm of the underlying business, not imposing a one-size-fits-all template.

The opportunity extends beyond the professional leagues that dominate headlines. Collegiate athletics, youth sports and ancillary service providers are entering a commercial era of their own.

The legalization of name, image and likeness rights has turned college programs into fully commercial enterprises that now require working capital, facilities financing and sponsorship advances. Private lenders can design structures suited to that environment—secured against receivables, ticket income or local partnerships—where traditional financing models fall short.

Youth and amateur sports tell a similar story. The sector generates tens of billions of dollars in annual spending, yet capital formation remains fragmented. Financing of complexes, tournaments and training facilities have become scalable credit opportunities, driven by durable demand rather than speculation.

Real estate has also become inseparable from the business of sports. Stadiums are now anchors of mixed-use developments that include hotels, retail and housing. Teams are monetizing their brands across hospitality, content and data ventures. That convergence between physical and intangible assets creates a dual source of collateral. A stadium’s concrete and steel can be valued like infrastructure, while its media contracts and licensing revenue resemble corporate cash flows. Private credit thrives in precisely this intersection, where structure can integrate both sides of the balance sheet.

This new market is maturing quickly. The challenge now is discipline. Not every team or league deserves institutional credit. The fundamentals must be right: diversified revenue, credible governance and transparent capital structures. The most capable lenders operate more like strategic partners than passive financiers. They help management teams optimize balance sheets, monetize non-core assets and think creatively about liquidity. The value in these relationships lies in partnership, not just pricing.

Looking ahead, the next decade of sports capital will likely involve consolidation and securitization. Portfolios of sports-backed loans may be packaged into rated vehicles, widening access to institutional investors. Cross-border ownership will further globalize the ecosystem, blending European clubs, American franchises and Middle Eastern sovereign funds into a single capital network. That will require not just financial innovation but also regulatory fluency and geopolitical awareness.

Private credit’s entry into sports is not a passing trend. It marks a structural evolution in how capital supports one of the world’s most powerful industries. Sports is now a platform business, and platform businesses demand flexible, sophisticated financing.

The investors leading this transformation think not in seasons but in cycles. They understand that the scoreboard measures only part of the game. The real competition is for capital efficiency, and those who master it will define the future of sports finance.

Glatt has over 25 years of experience in private practice and in-house at one of the world’s largest alternative asset managers, with a particular focus on complex transactions, strategic product innovation and capital raising for asset management firms and financial institutions.