- Dramatic potential in Multibillion dollar eSports, Youth Sports media, and Sports Complex markets
- Recent M&A move introduces $20M annual revenue potential in $76B US market
- Financing underway to fund unique family sports complex model with national and international expansion potential
- Small <1M Share Float could drive dramatic squeeze expectations as news cycle develops
It’s hard to find new major growth markets to disrupt, but Sports Venues of Florida Inc (OTCMKTS:BTHR) appears to have its finger
on the button. Shares of the stock are quietly running higher, advancing 400% in
the past month on gradually broadening volume and liquidity (and doing so during
a broad market crash, no less) on the strength of a relatively simple argument,
which has just crystallized with more force this morning.
The bird’s-eye view is this: the youth sports market is a whole lot bigger than you or I probably realized. It’s massive. In fact, it’s projected to grow to $76.5 billion by 2026 according to extensive recent research and analysis from Wintergreen Research published in December. According to the report, “Worldwide $24.9 billion youth sports markets are poised to achieve significant growth as travel teams become more popular and families learn to enjoy time together during a weekend sporting event.”
BTHR is effectively specializing in this market. And, after hours of looking, we really couldn’t find any other publicly traded company with the same target on a pure-play basis. Hence, this is definitely worth close examination.
The Model
How do you “disrupt the $77B Youth Sports Market”? That’s the key as far as evaluating this opportunity. How indeed.
BTHR is stringing together a multi-phase model. The first is through its recently closed acquisition: LYSN. Live Youth Sports Network (“LYSN”) is gearing up to dominate the live-streaming of youth sports events around the country. LYSN will be installing HD cameras in youth athletic venues, enabling the live streaming and archiving of all events for pay per view access by parents, grandparents, military personnel, alumni, scouts and anyone else who cannot physically make it to the game.
BTHR purchased 100% of LYSN, Inc. in a transaction valued at $5.5 million that closed late last year.
John V. Whitman Jr., CEO/President of Sports Venues of Florida, Inc., said, “We could not be more excited. Shane Jones founder of LYSN has established contractual relationships with dozens of school boards across the United States. LYSN’s business is expected to produce revenues that exceed $20,000,000 within the first 14-months. This business is a perfect fit with our business model and will blend seamlessly with a series of planned subsidiary acquisitions and startups that will all support Sports Venues core business.”
As this unique media solution gains traction – which looks extremely promising given the lack of competition and the relationships the company has already put in place – it will help establish traction in a market that can link up with its next moves: into the eSports and large-scale sports complex markets.
There are many reasons to see the company’s moves down the line as plausible in these latter steps – a team that has already had decades of success in the real estate development space, coordinating billions of dollars in financing and working with local authorities on game-changing projects, and talks already underway to form dominant joint ventures in the Nevada eSports market for upcoming tournament events.
But the thesis for why BTHR shares are sorely undervalued right now by the market really hinges on the first step: the establishment of a nationwide consolidated monopoly in live-streaming youth sports, generating a vast recurring revenue stream from pay-per-view and local advertising demand in an underappreciated, underexploited, but large and rapidly growing marketplace.
The Launch
This morning, the LYSN commercial-stage venture launched in an official capacity. The starter-gun is the company’s signed agreement with its first client high school. We see that as representing a pilot case study that will serve as a powerful tool in quickly expanding its scope to surrounding districts.
According to the release, the company and the school have jointly executed an agreement allowing BTHR to live-stream all of the school’s sporting events through the company’s sports portal. The agreement calls for the company to install all equipment and immediately begin streaming all of the school’s sporting events in 2020.
“We are lining up hundreds of schools as potential venues right now,” commented Whitman. “But we are extremely excited to get LYSN actually up and running at our first location with our first active partner school. This represents our first tangible venue and will act as a pilot case study. Once this first example is up and running, we will be able to demonstrate how seamlessly this technology works. Along with strong testimonials from users and viewers, we believe we can trigger a rapid expansion of the network because demand for this product is just bubbling under the surface according to our research.”
The monetization model for this relationship leverages both local advertising and pay per view viewership of individual streamed events. A piece of the local advertising revenues from streamed events will be earmarked for each school to assist in fundraising to support the it and its surrounding community.
The company plans to rapidly expand throughout the eastern US market first, and then extend its network across the entire domestic US market next year.
Conclusion
Sports Venues of Florida Inc. (OTCMKTS:BTHR) has a strong model, including a diversified strategic approach to multiple multibillion dollar markets, and has demonstrated a facility for both organic and M&A-driven growth potential within the past year. Furthermore, the company has indicated that it is seeking to aggressively power its model forward in 2020, and the live launch of its LYSN model is a testament to that commitment.
But shares are likely extremely undervalued at present levels, with both illiquidity and inactivity risks currently factoring into its present price per share.
Based on the massive end-market opportunities the company is pursuing, its core market advantages and assets (including strategic relationships and financing terms), and the current extremely tight float of the stock, the risk for BTHR appears to be skewed dramatically to the upside.
