Funding Expos With No Debt or Government Funding

In a parallel universe, I could’ve been a finance guy (finance grad, investor, taught at McGill etc) so given my exploratory efforts to bring back an MLB franchise to Montreal (article in English | en Français), I posted an article explaining the rationale. The consumer fan survey (English version | version Française) received over 3,000 (2100 in English, 900 en Français) responses in 24 hours. The sentiment was overwhelmingly positive, but as a few inquired about the use of government funding and/or use of debt, as a finance geek, I couldn’t resist but think of how it could be done with either. As there are trillions of dollars sitting on the sidelines, and hundreds of High Net Worth Individuals (HNWI) who would love to own a rare asset like a sports franchise, I couldn’t help.

Disclaimer:
This is not a solicitation for investment. The following is for instructional and illustrative purposes and be prepared for future discussions as the exploration evolves.

In the two models below, Option 1 presumes
– a Canadian/Quebec-based broadcaster sees the value in soaring media rights, ad sales & sponsorships etc. and joins as an investor to secure said rights.
– As MLB caps institutional investors (private equity funds) to 15% per, or 30% in total, two PEs collaborate.
– WatchMojo brings on a third investor to fund our participation, relying on our existing enterprise value (WatchMojo may be worth more or less than in the model below, as I wanted to use a round number for simplicity) while giving our existing investors to cash out in the event such a strategy does not align with their institutional profile (of course, they are more than welcome to continue on our journey). I then outline the ownership of the new WatchMojo investor in the recapitalization table beneath.

Not being presumptuous, and presuming that neither BCE (owners of Bell Media) or Quebecor sees the value, in the new era of streaming, WatchMojo itself would become the rights holder, in which case we would raise a much larger fundraise and bolster our Treasury (again, with the option for our existing investors to cash out via Secondary). Here, WatchMojo becomes the largest shareholder, and alongside our expansion in scripted programming (MojoTV, WatchMojo Studios), we would add sports rights to the portfolio which would allow me to go parabolic in the decade to come, when YouTube’s dominance goes into turbo mode.

As I am unaware of MLB’s parameters, you could also certainly invite other corporations to join the round, reducing WatchMojo’s stake.

There are, of course, many other models and options, including the use of debt, as well as government involvement as the initiative actually consists of three sub projects.