Disney dynasty builds new entertainments business through family office

The Disney family is taking advantage of tech-driven insights and Covid-19’s impact on vendors to develop a portfolio of entertainment businesses which hark back to the ruling passions of its founding father, the late Walt Disney. 

Its family office/private equity business, Shamrock Capital, has bought a minority stake in Excel Sports Management which represents 180 sports stars including Tiger Woods, Derek Jeter and Blake Griffin. 

Shamrock makes no secret of its determination to get stuck into media, entertainment and communications ventures. Its portfolio is worth at least $2 billion

The deal comes a month after Shamrock bought a song portfolio written by US pop star Taylor Swift from estranged music manager Scooter Braun and Carlyle Group for $300 million.

Excel’s founders used to work at global sports agency IMG and quickly established a dominant position in US basketball, baseball, football and golf.  It offers brand management, sponsorship and events management. 

It came third in Forbes recent ranking of the most valuable sports agencies, with billings worth $4.1 billion. 

Co-founder Jeff Schwartz has said Excel wants to bolster current lines of business, while seeking other opportunities. It was not seeking funds under duress, he added, although these are certainly hard times for spectator events. 

Excel wants to use media outlets to develop celebrity sporting events such as The Match, which attracted a record 5.8 million cable TV viewers in May. 

Schwartz reckons lines are blurring together: “They have allowed athletes and personalities to become media stars.”

A lack of cash from live concerts, plus thin pickings from streaming services, lies behind music sales by rock stars.

In a recent tweet musician David Crosby said: “I am selling mine  …I can’t work …and streaming stole my record money …I have a family and a mortgage and I have to take care of them so it’s my only option ..I’m sure the others feel the same.” 

Music rights are owned by Shamrock in a separate fund, but it will want to develop the popularity of Taylor Swift’s songs in the same way Excel is out to progress the appeal of its sporting clients. 

The Disneys are past masters at ferreting out stardust. Walt Disney started off by using ground-breaking techniques to develop animated films with his late brother Roy O. Disney. Their company has become a $315 billion listed entertainment gorilla which retains its edge in animation, plus ESPN sports channel, television channels, film studios – and music copyrights. 

Over the years, the Disneys reduced their involvement in the company although Roy Disney’s son Roy E. Disney played a role in the ousting of Michael Eisner as chief executive of listed Disney. In April 2020 his daughter Abigail went public with her view that its executive bonuses were far too generous.

Roy Edward Disney started Shamrock in 1978, but died in 2009. Abigail has served as Shamrock vice-chairman but its private equity business is led by veteran venture capitalist Stephen Royer.

Shamrock makes no secret of its determination to get stuck into media, entertainment and communications ventures. Its portfolio is worth at least $2 billion.

Its Excel deal follows the purchase of sports franchises by a string of US billionaires who see potential in building them up through a range of media, and streaming events into the homes of loyal fans. 

Sports stars enriched by the entertainment industry are building their own investment portfolios. With the help of agents like Excel they can hope to build their fortunes faster still. Family Capital examined the trend earlier this year.

Shamrock backs companies whose product could facilitate sports entertainment. They include Pixellot, whose multi-camera systems can capture the flow of play on the sports field, together with companies involved in wireless communications, online marketing, language dubbing and fantasy sports games.

That said, Shamrock is also prepared to divest. It used to own 80% of the Harlem Globetrotters, for example, but sold the stake in 2013 to the US Herschend family, owners of a string of theme parks. It also has a business partnership with singer Dolly Parton who happens to be mulling the sale of her music rights, right now…