Team sports are often cited as building character and values. In the US, they also build better financial returns for the athletes who make it to the college and professional levels.

Getting Paid

If you were an athlete of such tremendous talent that you had your choice of which professional sport to play, your best financial choice would be a team sport. To illustrate, let’s take a look at tennis and basketball. Tennis has more global fans than basketball, with rough estimates ballparking tennis with an astounding 1 billion fans. Yet, as of 2024, there are over 500 players in the NBA, and the 2024-2025 minimum contract is $1,157,153. That same year in tennis? Only 71 players on the ATP circuit earned more than $1 million.

Even that might be an optimistic comparison. Individual athletes have to pay for their own travel, coaching, conditioning, and medical expenses, all while those aspects of an athlete’s life are either paid for or highly subsidized by the teams of soccer, basketball, etc. The ATP and PGA represent the top tier of their respective sports, but players near the bottom of the rankings may lose money playing on their tours. The ATP is trying to address this disparity under a pilot financial program called Baseline that guarantees a minimum annual income for players ranked in the top 250. But it only paid out $1.3 million to a total of 26 players in 2024.

The financial advantage of team sports trickles down to the college level. The lion’s share of NIL payments goes to the athletes who generate the most revenue for the schools, which are men’s football and basketball. The one notable set of athletes for whom teams don’t provide the biggest payouts is women. Of the top 15 highest-paid female athletes in 2024, 14 were from individual sports. This may be attributed to the relative recency of professional women’s team sports leagues, and it will be interesting to see what happens as women’s leagues and their fans further develop.

Creating Jobs

Sports built around teams also offer more opportunities for job creation beyond the sidelines. There are fewer management roles for individual sports. It makes sense for leagues and teams to invest in roles dedicated to things like team operations, venue management, player and business analytics, and marketing. Part of that is because individual sports put more of the operational onus on the players, so there’s less to do than in the leagues. But a simpler reason is that bigger businesses generally spend more to keep those businesses moving. The NFL brought in close to $20 billion in revenue in 2024. That supports a lot more jobs than the estimated $2 billion the PGA Tour brought in.

Calling My Agent

The different financial streams have implications for agents as well. Generally speaking, agencies representing US athletes can make more money from major team sports than from individual sports. This is true because of the higher average contract values, the greater number of players, and the wider media exposure that creates more opportunities for endorsement deals. It also changes where agents can bring the most value. For many team athletes, the largest source of their income is their salary, and agents can negotiate complicated non-standard contract terms to win them higher payouts. Non-negotiable tournament winnings determine the playing income of most individual athletes, so agents' largest source of added value is in negotiating appearance fees, endorsements, sponsorships, and other sources of non-playing income.

Attracting Investors

Teams are also far more investor-friendly. Individual sports are difficult to invest in. Outside investors don’t buy and sell shares in the NFL, they buy and sell teams. Even in college football, close to half of the bowl games are owned by for-profit companies. Investors can’t buy players in golf or tennis, and most tournaments are owned by the PGA Tour or ATP, respectively. There’s no clear investment vehicle for individual sports. While LIV Golf touted their team format as a fan-based innovation, the stronger motivation was to create teams for investors to buy and to generate future franchise fees for LIV. Pickleball is making a similar effort, as both the PPA and MLP eschewed the tennis model and based their leagues on teams. A business model that attracts outside investment helps drive the financial engine of future growth. 

From almost every angle, it really pays to be a team player.