Self-Made Billionaire Insights from Marc Lasry

Good evening, ladies and gentlemen, and welcome to the Visionaries Experience. I'm your host, Jay Norris. I'm the CEO, co-founder of Guest Software Platform. I have to do that because I know you guys didn't know who I was. You saw the guy on the billboard outside and it was like, 'Mark Lasry, but who is that guy?' I'm Jay Norris and I own a software company. We're a retail sales intelligence platform. We track consumer swipes and taps and share them with third parties, primarily property owners, but this year we're moving into lending. So we're underwriting merchant sales and reporting them to lenders so that they can provide flexible lease lending arrangements with their merchants. All right, so that's Guest Software. When I'm not running that ship, I'm the co-chairman of the Technology and Innovation Council for the Manhattan Chamber of Commerce. Anybody from the chamber in here? There we go. Thanks, guys. And then also I'm a proud board member and co-founder of this organization called Startup Westport. Any Startup Westport heads in here? Yo, there we go. All right, great. So let me start also by giving a big shout out to Lisa, the Core Club, Jenny, my dear friend Jerry and Rasmine. We kind of connected the dots here and made this all happen. So we got to give them a big shout out. All right, so let me tell you something about the Visionaries Experience, guys. Why we created this. This series was created to inspire visionaries of all ages to chase their dreams. And tonight, I couldn't be more excited to introduce someone who embodies that spirit, Mark Lasry. Okay, so most of everyone in this room knows more maybe than I do about Mark, but let me just briefly go over a couple things here. Mark is a CEO, co-founder of Avenue Capital Group, one of the leading investment firms in the world. He's also known for his time as a co-owner of the Milwaukee Bucks, where he helped them gain a championship in 2021. Who knows how long it took them to get that championship? I do. And I was wondering, let me tell audience, anybody? 50 years. Oh, there we go. Okay. 50 years, guys. I found that out. Fun fact. He's also a philanthropist, board member, and someone who spent his career taking bold risk and building big visions. That's why we have him here. Please join me in welcoming Mark Lasry. And I just want to make sure my wife heard that. Do you approve? Okay, Mark. So I was doing research and I was like, wow, this guy is very, very interesting. Let's take it back to early days. I read you were seven years old when you got here. Yes. So tell me something about those early days. I want to hear a little bit about the early days, but really some of the things that you took with you during that journey that helped you propel your life.

That's excellent. But tell me, because I was wondering, that resilience that you had to pick up then, how did it affect you with certain high stakes moments? Did anything in hindsight when high stakes moments kicked in, did those maternal paternal instincts that they shared with you kick in immediately where you were patient and resilient?

So pause for a second. Your mom almost made an offer to the school. No, she made an offer and they accepted. That's what I mean. What a great story. I didn't read that anywhere, so thank you for that. That's really... She was crazy. I loved it. That's awesome, man. Okay, so now we're going to dive into something that I know everyone in the room knows, Mark, about sports. Here we go. So when was it, on Avenue Capital, I don't know where in that journey, did you decide that I want to own a sports franchise?

It's a pretty unique experience. And so, you know, it was fun, but was it afterwards? What was the catalyst to the sale? Like when you had it, how long did you have it afterwards?

Sounds like it makes sense. Made sense at the time, right? It's great. Made sense at the time. If I had held on, it'd be worth more. So today would have sold it for more. So probably doesn't make sense. So, Mark, I've been hearing about you dabbling in emerging sports. I read about sailing, bull riding. Yeah, bull riding. But tell us, because enlighten the audience here. Was it the audience because you started looking at the actual audience and the viewerships? So all right, so here, everybody here in this room who's a sports fan, raise your hand. All right, so pretty much everybody. All right, let's see what you know about sports. How many Americans live in this country? 380. Yeah, 350. Right. Okay. Of the ones we know. All right, a little joke. All right, so here's a question. Average hockey game on TV, how many people do you think watch an average hockey game? 100,000. Oh, 100,000. Okay. Million. A million. Average. Yes. 50,000. 50,000. How many you think? Average hockey game. 500. Okay. Baseball. How many people watch an average baseball game? Depends on the team. No, just average baseball game on TV. Two million. Two million. A million. A million. All right. Basketball, average basketball game on TNT. How many people you think watch? Someone has to know this. Come on, guys. Two million. More or less? Only 500,000. 500,000. Yeah. Less. All right, so average basketball game, a million and a half. All right, so now let's add everything up. A million and a half, a million, 500, 3 million. It's less than 1% of the US population is watching a major sporting event during the week. Okay. Hockey, $600 million media deal. Baseball, $2 billion. Basketball, $7 billion. All right. Sailing. How many people do you think watch sailing? Two. Two. They're in this room. Is that it? No. Right. You think two? No one more. 100,000. Okay. All right. Four years ago, Larry Ellison starts a league. It's called SailGP. Guarantees CBS that he'll have 100,000 viewers. And in return for that, he gets paid $40 million a year. All right. They just had a race a little while ago. How many people watched it? Two million viewers. Wow. Okay. So more than watch baseball and hockey combined. More than watch basketball. Their media deal comes up in three or four years. I don't know what it's going to be, but it's going to be more than $40 million. That's why we invested in it. Said two. Pardon? I said two. You said two. Just didn't add the last part. Exactly. This is writing. How many people do you think watch bull riding? It's called the Professional Bull Riders league, PBR. How many people do you think watch that on TV? 100,000. I hear 100. Any higher? 500. Higher. Yeah, it's a million. What? More than... Yeah, it's called television. On television. You can watch it. Everybody's taking notes. Are we taking notes here? The thing that's funny about sports is the perception is totally different than what reality is. The great thing is I already know the answers. Why? Because the minute you have an event, you know what the ratings are. So if I know the ratings, then I know the answer and I know you got people watching. So therefore, let's do an emerging league. That's what you're trying to do in sports, right? You're trying to figure out leagues that are going to do well. But you only make money in sports three ways: ticket sales, sponsorship, media. That's it. There's no other way you can make money. So if I know my ticket sales are going up and I know my sponsorship is going up, if I know my media is going to go up, then I'm going to do it. So who here plays pickleball, right? It's great. You love it. Fun. I bought a pickleball franchise with James Blake five years ago. We paid $50,000 for it. We sold it for close to $5 million. So about a hundred times in three years. It's a low return, but it's fine. It's 100 times. You know the problem with pickleball? Nobody wants to watch it on TV. Love playing it. You may go watch it, but you're not watching on TV. So therefore, your media deal isn't there. It's got to be all three of them. American football, how many people watch that on TV? 25 million. The biggest sport in the United States. 95 of the hundred highest rated TV shows last year were football games. Wow. 95. It's the more of the facts you know, the more you look at it and go, 'Wow.' Okay. So sports today, why did we do a sports fund? Because you're literally in the first inning. There's so much capital coming because it is the one thing that AI can't reproduce. It's the one thing people want to watch live. It's the only thing that's live. Nobody records. Who here watched the Super Bowl? Right. Anybody recorded, 'I'm gonna watch it in six months?' No. Right. Did you do that? No. Nobody records. What's your favorite show on Netflix or on Amazon Prime? Gosh, so many. I don't know where to begin. I love Ozarks. That was good. All right. Now you'll binge watch. Oh, yes. Nobody binge watches sports. Yeah. No. Nobody says, 'I'm recording all 162 Major League Baseball games and I'm gonna go watch that.' Right. That's why the media deals keep going up.

I see. So does this also venture into international like in football, soccer? Because I heard about women's soccer.

Tremendous, not just huge. I thank you for that. The insight there was pretty good. Now, I have to ask this one because I didn't read anything about this. What are your thoughts and how are you positioning yourself for AI?

All right, great. So no big AI investments.

Okay. All right, great. I had to ask, guys. Sorry. So at this stage, outside of sports, any other investments or alternatives or emerging markets that you're thinking about?

Wow. We have to talk after this. Mark, revenue-based funding. We're doing it now. So we'll talk about that. Okay. All right. So what else would you say would be the next for the next generation? Do you have any advice for the up-and-coming fund managers or private equity groups that you would tell them? Maybe not as much as you would say to your son, but just the up-and-coming thing.

Great advice, guys. Great advice. All right, so here's one of my last ones. This I don't know if anybody asked you this one, but it's all said and done. How would you like to be remembered?

That's awesome. No, that was... I mean, guys, we're going to do the Q&A now. Questions.

Hey Mark, thanks for the time. Pleasure. As the consumption of sports moves from TVs to mobile devices, how does that change the investment landscape?

That's a great question. Hi, Mark. Hi, Jay. Hey, great conversation. Thank you all so much. A couple quick questions. So you're bullish on women's sports and the opportunities that exist there. I have a youth sports tech startup. As you probably know in your space, youth sports in America, according to the Aspen Institute and TeamSnap study of 2022, parents in America spent $40 billion on youth sports, which is a huge white space. Lots of different entities. The gentleman right here, what's your name? I'm sorry. Neil. That you just asked how mobile devices and social media will impact how people view sports. In this space of youth sports, KKR is one of the companies that is invested in the viewing of youth sports. They have done youth sports investing with Blitzer and Harris. They've invested in the multiplexes. What I want to know is how are you looking at opportunities, if at all, in the youth sports space that's highly fragmented, and how can we defragment that, and do you see any opportunity there?

Okay, great. I'll help you catch up. And you know, Chris, I was thinking about that because I had another question. You know what told me to ask you this was a friend that we have in common, Gus Johnson. He said, 'What's he doing in NIL? Is he doing an NIL platform?' And he told me, 'Yeah.' So we're trying to buy college teams or invest in college teams. Okay. Right. So that's actually the play. The problem, where'd you go to school? Howard University. Okay, DC. So it's a D1 school. So the problem with Howard, let me tell you all the issues since I've never been there. You're coming to homecoming with me this year. So here's the problem for Howard, for Michigan, for any division one school. It's for athletes. Athletes now are getting paid money to go. So Howard University's biggest question is where to allocate resources. You're going to have the chemistry department saying, 'I need more money.' And then you've got a different department. So sports, which was a big thing, is saying, 'Hey, now we need even more money, otherwise nobody's going to come.' So if you're a university, you're stuck in this quandary: do I pay money to help the reputation of the school and by helping that, more people apply, or do I end up taking very scarce dollars and putting it in the biology department, chemistry department, English department? If you're a school like Howard, that's really hard. If you're a school like Michigan, that's easier, but it's also hard because Michigan has got to go spend 20 to 30 million a year to get the players. Here's the part that nobody knows. There are only two programs in a university that ever make you money: basketball and football. The men's soccer team doesn't make you money. The women's soccer team doesn't make you money. The men's volleyball team doesn't. You've got 30 teams. Yet, if you're a university and you say, 'We're going to cut everything and just have the teams that are profitable,' which is what you would do if you were a business, you can't do that as a university. So they've got all this pressure and they need capital. I think firms like ours are going to help by doing that and owning a piece of these teams. Whether that's tomorrow or a year from now, you're going to see private equity coming into that space. Because schools don't have a choice.

Okay, you heard it here first, guys. That's awesome. Questions in the back.

Sure. I had a question. So I'm not big on sports and not really knowledgeable in sports, but from what it sounds like, you bought the Bucks as what would be more of a distressed investment because they weren't doing well and they won their first championship with you. How much of that was plug and play, kind of a private equity approach to having better managers or in that case better players or hiring a better coach? How much of that was maybe restructuring the strategies that they had? And I know you do mostly distressed lending a large part. How did that experience really help you with something like sports on that side? And then the second question is, how much of your investing in sports now is mostly on that same distressed focused approach versus someone that's kind of more on the uprise and it's more obvious?

Mark, since you were just talking about something and it just dawned on me, the TGL. Yes. Can you share with the audience what that is?

Mark, send us that whole draft. We'll just send it out as a newsletter. Watch this. Right. Talk to the little people, right? Just help them.

Hi, I wanted to go back to the European UK women's football soccer, 5 to 10 million. What am I getting for that? When you talk about the LA example where a team's going for 250 and we have all of the work that goes into it, I'm not cutting a check for that and saying, 'Let's ride the wave.' How should someone think about what else has to go in to create that value from an investment perspective and sort of frame it for that purchase price? You're receiving X, Y, and Z, but then the work begins and the money has to go in.

Is there any Ryan Reynolds effect from a Wrexham or something like that? Seriously. No, it is. It helps awareness. And is that something you build into what you're doing?

Thank you very much.

Hello, I'm David. I studied public companies in part because as a kid I thought I was good at following sports teams and how their leaders changed over time. You notably took a win-now approach that some thought might have been risky and shortsighted. Correct. And that was in contrast to the supposedly patient approach that the 76ers took. What were the trade-offs that you were considering as you chose that approach, and has it impacted your business thinking at all?

Thank you very much.

Well, thank you very much. Go ahead. Thank you for being with us tonight. First of all, if you don't mind me appreciating your chair, great choice of socks and the seekers for this event. Absolutely. Amazing. About half of the questions I had to ask. I was raising my hand for a while now. But just to focus on a couple of things I still remember. First of all, just to mention, I heard you saying Marrakech, your hometown. Just to pronounce it correctly the way I know it from my childhood. Marrakech. That's okay. Yes. Thank you. So just two things I have in mind. My daughter, same age as yours. One of the things I notice, I take her to sports and stuff like that. My father's brother, my uncle, being a captain of a subcontinent cricket team. All my childhood I sat in a pavilion, not in the way you described mediocrity or watching from different angles. I've been in that, sitting with the players, talking to them before they bat. I was looking at what bat you're using, whether you're using willow dipped in oil for 72 hours before you start batting. I think the two things I need your feedback on. I'm very well versed in sports, and we've been discussing so far the financial part of it, which was a turnoff for me based on my experience. I think that comes as a bonus. Money is always a bonus in cricket. Forget about cricket, any sport. I think it's always the focus on the game and the passion and the niche market. I saw you mentioned two things. One thing which is common in this case, I always believed hockey. I don't know, we didn't get any question on that. Undervalued all over the world so far. The most money-making asset going forward in the next 20, 30 years. IPL and all that, cricket is still into it, they discovered it. But this is like they say, there's always room at the top. Somebody has to look at the room. Not everyone has the ability to look at that. So if you always see that room at the top and undiscovered niche markets like hockey, but football yes and all that, is that something you are looking at going forward in the next decade or a couple of decades? Because that's, and again, money to my extent, I'm a businessman. I never looked at money as focus. It's always a bonus. It's always your passion that earns that bonus piece of advice.

I know there's time for one or two more questions. Yeah, thanks for that. My question is a bit more personal. There are not that many brother-sister duos in the world. You went into business with your sister. I'm wondering what the impetus for that was. If I may be so bold, I'm wondering if you're still close. And I'm wondering what became of your other sister and how that informed the raising of your kids, not just as your kids, but as siblings to each other. And then second question, I'm wondering what you're currently reading and what your favorite book is.

41 years. Wow, guys. All right, let's wrap it up. Let's give Mark Lasry a nice round of applause, guys. Excellent, Mark. Thank you. Excellent.