David Abrams and Arne Rees have launched Velocity Capital Management, an investment fund focused on the intersection of sports, media and entertainment.
The fund aims to acquire growth-stage companies with strong business fundamentals and an enterprise value of up to $2 billion.
Abrams most recently served as Chief Investment Officer of Harris Blitzer Sports & Entertainment, which owns sports properties including the Philadelphia 76ers and New Jersey Devils. Reese, who previously served as North American CEO of Sportradar, will step down as of today’s announcement and join the data and analytics company’s advisory board.
“The differentiated experience of not only investing in different asset classes in different industries over many cycles, but actually executing, reorienting and creating value in different businesses,” Abrams said in a video call. “We believe we have a great plan to take advantage of what our characteristics are.
Velocity launched with at least $27 million in assets, as reported in its August 31st regulatory filing. In addition to funding from the co-founders, Velocity’s outside investors include Jacobs family-owned concession companies, the Boston Bruins and Boston’s TD Garden. Germany-based family office Bolt Ventures. Signify Wealth is a registered investment advisor who primarily serves his NFL players. Sports marketing and talent agency Remington his Ellis. Leeds United footballer Jack Harrison. and RNW Management, the family office of Mark Rowan, CEO of Apollo Global Management.
Velocity has already made one investment in shares of Camp NYC Inc., an experiential retailer that primarily sells children’s merchandise and offers Disney’s Mickey & Friends in-store experiences and Art Camp paintings and pottery. Done. Abrams said the fund also plans to complete another investment soon.
Two executives believe Velocity’s timing is a coincidence given the tight valuations across the market this year. In particular, Mr. Abrams’ background in distressed assets (he was co-head of his sales and trading group at Credit his Swiss global distress) would be an asset in the current environment.
“What we are seeing today is not just disruption in this area, but also market disruption in terms of revaluation,” said Abrams. “This is a great opportunity for a fund with restructuring and operational expertise to become not just a provider of capital, but an operational partner to businesses that may have to pivot their plans.”
Abrams, in particular, points to sports betting and NFTs as two areas where values seem to be leading the way, and companies will need to rethink their approach. The pair’s background in many aspects of the investment and sports business makes them an active partner in helping companies restructure, Rees added.
“Starting my career as an investor, my interest has always been in investing in sports as an asset class,” Reese said in a video call. “As a rights seller, rights buyer, investor and operator, I have been very lucky to see the many facets of this business. As an investable asset class, I am fascinated by this whole world.”
Attracted by the opportunity to return to investing, Reese is the reason he is leaving Sportrader, which has led its North American operations since late 2020, after his involvement as an investor. Reese is perhaps best known for his work at ESPN, where he held various senior management positions, and for UEFA, where he was head of strategic business development. He was also previously a partner at MSP Sports Capital.
Abrams and Reese got to know each other well when Sportradar acquired Synergy Sports in 2021. Synergy Sports is an integrated business that includes Harris Blitzer’s investment in his Keemotion.
“I’m really happy to be starting this with David,” Reese said. “I think there is a place for growth-minded fund investors. We now have a number of proven venture-funded businesses, and David and I are looking to leverage our experience. We have a real sweet spot in helping them take the next step.”
In today’s announcement, Velocity also detailed members of its executive team. Investment banking veterans Jessica Li and Sarina Crisci are Head of Investor Partnerships and Chief Operating Officer respectively. The investment team includes Dylan Zane, who worked on sports and entertainment deals at Evolution Media Capital, and Nishanthi Jain, who was at investment firm Blue His Points His Capital. Touré Clairborne, who recently served as Head of Consulting and Sponsorships at Intersport, is an operating partner of Velocity’s company-wide initiative.
According to a press release, the fund will invest up to $50 million in controlling or non-controlling companies with a focus on capital preservation and superior risk-adjusted returns.
“Pricing in the public market creates a perfect opportunity for the private market to recalibrate accordingly,” Abrams said in a video call. We are building what we consider to be a differentiated business.”