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Beyond The Sideline: April 3 Edition

Welcome to Beyond The Sideline, the community resource for the next generation of sports business leaders.
The Big Idea
The Five Things The Best Player Agents Do In Negotiations

Agents who succeed in their negotiations have the chance to become stars in their own right. Rich Paul used his negotiating skills to eventually launch Klutch Sports, now an industry leader.
We talked with several sources from big agencies to independent agents. This summarizes their best collective advice for successfully negotiating on behalf of player clients.
Agents come in many forms, from big agencies like Wasserman, to boutique firms like Athletes First, to independent sole proprietors. But the advice that the best of them offer to up-and-coming agents is remarkably consistent. Here’s the best from the best:
Do your homework
This is the first thing mentioned by every agent. You should:
Know the player performance metrics and how your player ranks among his positional peers.
Know the marketplace trends. On the demand side, understand if teams are ascribing more or less value to the position. NFL running backs were considered lower-value positions three years ago, but have rebounded in value as the running game has returned. On the supply side, understand who else will be in the marketplace from both a draft and free agent perspective.
Know the context of particular teams. Your player may have a lower or higher value to teams depending on their current depth or gaps at a given position. Teams will also be in different salary cap situations. Two teams may look at the same player very differently depending on their circumstances.
Understand the difference between market value and replacement value. Your client may be worth more to a team with restricted options. If your client is the sixth-best player in the league, but the only other available player is the tenth-best, it will be harder for that team to find an equivalent substitute.
Agree on your BATNA
BATNA stands for “Best Alternative to a Negotiated Agreement.” Use the homework to set a floor contract value with your client. The BATNA may include factors beyond the standalone contract value. Location, stability, or quality of the team may be non-financial factors that are meaningful to your client. A BATNA not only helps solidify your negotiating position, it also sets expectations that ease any post-negotiation seller’s regret that you may have been able to squeeze out an even better deal. You’ll both feel satisfied if you meet or exceed your agreed BATNA.
Roll like water, not like rocks
A rock stops rolling when it hits an obstacle; water just keeps going around it, over it, or under it. There are lots of creative ways you can extract more value from a contract. Deferred payments, early termination clauses, opt-in clauses, and performance bonuses that tie to either individual or team metrics represent some of the ways to get to a successfully negotiated agreement.
Negotiate differently in public than you do in private
You can play hardball with the General Manager if your position is strong. But outside the negotiating room, your player should never be anything but reasonable, grateful, and hopeful for a deal. Front office execs may not admit it, but they don’t want to be the bad guy in front of their fans. So don’t let them off the hook by giving the public any reason to think your client is to blame for a difficult negotiation. This is especially true for clients still in the prime of their careers. In that case, you have to think about the next negotiation as well. Avoid creating any grounds for a bad reputation that might lessen leverage in the next go-around.
Start early
One of the advantages of the sports industry is that you generally know when a negotiation is coming. Most of the advice provided above applies to work that should be done well before the official negotiation begins. Start the homework at least a year in advance of the contract date. There are different league restrictions on when an agent can begin negotiations with a player’s existing team or potential new team. But informal conversations with the General Manager or Owner of the player’s current team should be ongoing to get a sense of how the team views the player and to keep the relationship warm before showing up on opposite sides of the negotiating table.
Nerding Out - Business
VALUATION MATH: UNDERSTANDING WHAT’S BEHIND IT
This section of Beyond the Sideline was inspired by a subscriber request. Have any questions or news you want covered? Email us at [email protected]

Just months after celebrating an NBA Finals win, the Grousbecks have sold the Boston Celtics for $6.1 billion
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Team valuations are a mix of art and science. As they keep climbing, it’s useful to understand the math, or lack thereof, behind them
Sportico came out with its valuations for MLB teams in March. Their valuation estimates provide one of the most rigorous and consistent comparisons of team value in sports. But all team valuations tend to be less analytical than they first appear. Let’s go through it.
Valuation Approaches
To oversimplify a bit, there are two approaches to business valuation: discounted cash flows and relative valuation.
The discounted cash flow (DCF) method treats businesses like a money machine. You see how much money the machine churns out a year, and estimate how much that machine will continue churning out in the years ahead. Future earnings are discounted by a cost of capital (inflation, interest rates, etc). In non-mathematical terms, a dollar today is worth more than a dollar two years from now, so the discount translates the value of future dollars into today’s dollars. You add up all the cash flows from now until the future, and you get a value for the company based on DCF. Most publicly traded companies are valued this way. It doesn’t matter if a company makes cars or movies; its value is determined solely by the cash it is expected to generate.
Relative valuation, on the other hand, treats businesses more like houses. The value of a house, generally speaking, is determined by what similar houses around it have sold for. You could have two identical houses with very different values based on the proximity to a major city, the type of neighborhood, the quality of schools, the current style trends, and a host of other intangibles. A real estate appraiser determines the value of a house primarily by looking at what other houses in the neighborhood have sold for. The appraisal may go up a bit if the house has an extra bedroom, a bigger yard, or newer construction than the other houses, but the valuation is mostly based on what other people have paid for similar houses nearby.
Team Valuations
If you look at the Sportico estimates, they appear to show the data associated with the DCF approach. They gather lots of information on the various revenue streams, look at stadium and other real estate rights, adjust for league and local revenue sources, and generally seem to take a very mathematical approach. But if you look at the footnotes, they then apply a “team multiplier” to the revenues to get to a valuation, which is basically just a way of saying people just like some houses better. If you compare the top and the bottom teams, it’s clear the teams are not being valued solely on cash flows.
Teams | 2024 Revenue Estimate ($ Million) | Valuation Estimate ($ Billion) |
New York Yankees | $799 | $8.39 |
Miami Marlins | $305 | $1.30 |
Source: Sportico
The Yankees make about 260% more money than the Marlins but they are valued at about 650% more. That would make little sense in a DCF model, but is more understandable with a relative valuation model. In essence, people would just pay a lot more for the prestige of owning the Yankees than they would for the Marlins. It will be interesting to see if the growing ownership interests of private equity and other professional investors will change this as they become more focused on the financial performance of the teams and less on the status of running a storied franchise.
By The Numbers
Numbers That Jumped Off the Page
3- The NFL is putting more presents under the Christmas tree as Netflix and Amazon will stream 3 games on December 25, 2025. The league continues to expand its holiday presence, ensuring football fans have an excuse to escape awkward family conversations on Christmas Day.
1.93 Million- MLB's opening day broadcast on ESPN drew 1.93 million viewers, making it the most-watched season opener since 2018. Baseball's return continues to draw strong viewership, proving America's pastime still has plenty of fans willing to tune in for the first pitch of the season.
$7.7 Billion- The NHL has secured a massive 12-year, $7.7 billion broadcast extension with Rogers Communications for Canadian media rights. NHL Commissioner Gary Bettman noted the deal "reflects the different realities of the Canadian market." Apparently, the reality is that Canadians really, really love hockey!
$100 Billion- A study by Klutch Sports suggests that mixed-use districts surrounding sports venues could attract up to $100 billion in investment. The research highlights the growing trend of creating comprehensive entertainment destinations around stadiums and arenas, transforming game day into an all-day experience.
Pulse Check
Last week, we asked Beyond the Sideline readers, “What is the best season opener in sports?” Here’s what they thought.

Our “Other” votes ended up avoiding the Big 4 leagues entirely and chose College Football Week 1 as their personal favorite. It seems football reigns supreme when it comes to starting off the season with a bang.
Which of these leagues is most likely to still be around in 5 years? |
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