Investment firm Brand Velocity Group has acquired RCX Sports, which operates league-licensed youth sports properties including NFL Flag, Jr. NBA and NHL Street. The company was previously owned by The Raine Group’s investment arm.
BVG is an independent sponsor, raising capital on a deal-by-deal basis, and the RCX investment is part of the sports investment strategy it launched in 2022. Limited partners in the RCX acquisition include Hamilton Lane’s social impact fund, St. Cloud Capital, Darco Capital and Three Ocean Partners. Athlete investors in the deal include Eli Manning, a partner with BVG, as well as Emmitt Smith, Peyton Manning, Klay Thompson and Larry Fitzgerald.
Financial terms were not available. The transaction is for 100% of RCX’s equity. Raine and Orrick, Herrington & Sutcliffe advised RCX, while BVG was advised by CohnReznick Advisory and Sidley Austin. Sidley’s Chuck Baker is also an advisor to BVG’s sports investment practice.
BVG partner Austin Ramos said RCX is differentiated from other youth sports operators because of its valuable league partnerships -- he pointed to the NFL providing a Super Bowl ad spot for RCX’s NFL Flag program last year -- and its strategy of pursuing mass participation instead of just elite-level play.
“The strongest youth sports businesses are the ones where you have commercial success and community impact go hand in hand,” Ramos said. “RCX is not a business focused on optimizing the revenue per participant. The model is around building access, and that’s a sustainable base. In this case, the financial performance of RCX and accessibility, they’re going to point in the same direction.”
RCX was originally part of a youth sports roll-up strategy at Raine, but it was split off when the rest of that business was sold to Endeavor in 2021. It currently has licensing deals with the NFL, MLS, NBA, MLB, NHL and WNBA. Raine’s Brett Varsov told SBJ last year that the firm was getting weekly calls from potential buyers.
Ramos and BVG’s Drew Sheinman acknowledged it was a competitive auction process, though they wouldn’t comment on financial details. RCX’s management team will remain in place.
RCX CEO Izell Reese said he welcomes stronger guardrails around youth sports investments, as recently proposed in Congress, but shared he spent the last four years getting to know the firm and its partners. He said there’s alignment on the core goal of improving youth sports accessibility, and he spoke highly of BVG’s Share the Gains initiative, which sets aside some of the general partnership’s carried interest for portfolio company employees.
“While we do sit under private equity in youth sports, there’s a right way to do it. That has always been my vision,” Reese said. “We attracted the attention of six pro leagues because of that mission alignment. So to have a firm now that is solely focused on that, ... it truly gives us a platform and an opportunity to accelerate the growth, evolve the vision and look at more sports to bring on board.”
