Sports Earnings Investment Model

Big League Advance buys percentage stakes in minor league baseball players' future earnings, providing upfront cash in exchange for a share of their potential future contracts. The company uses analytics to identify promising players, validated by a $30M return from Fernando Tatis Jr.'s $340M contract.

Key Points:

• Core Business Model:

  • Offer minor league players upfront cash for % of future earnings
  • Example deals: $100K for 1% or $350K for 8% of future earnings
  • Target market: 1000+ minor league players making minimal salaries

• Investment Strategy:

  • Use analytics to value and select players
  • Expect 80% of deals to lose money
  • Aim for 20% of deals to generate outsized returns
  • Currently operating with little competition in the space

• Risk Management:

  • Portfolio approach spreading bets across many players
  • High-risk, high-reward model similar to startup investing
  • Success depends on accurate player valuation and prediction

• Market Dynamics:

  • Exploits inefficient minor league market where players earn very little
  • MLB and Players Association have mixed feelings but allow the practice
  • Company intentionally keeps low profile

• Expansion Potential:

  • NBA opportunity exists with guaranteed contracts
  • Could offer upfront payments for future contract earnings
  • Some leagues (like NBA) currently block similar arrangements

• Validation:

  • Fernando Tatis Jr. deal returned $30M on investment
  • Even "failed" deals can be profitable (example: $360K investment returned $120K)