The Atlanta Braves are entering the Wall Street big leagues. The Major League Baseball team is officially going public with a Nasdaq IPO. CEO Derek Schiller discussed what it means for the team to go public. Schiller explains that "as a public company, we have a certain amount of responsibilities," such as regulatory filings they will now have to file. Schiller highlights the unique opportunity for fans to invest in the team and shares insights on the Braves' diversified revenue streams, including real estate holdings.
Video Transcript
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BRIAN SOZZI: Welcome back to Yahoo Finance Live, I'm Brian Sozzi live from the NASDAQ right now with a very special guest, Atlanta Braves CEO, Derek Schiller. Derek, good to see you here. Not often you get to think about investing in a sports team, especially a sports team with the background of your franchise. Why was now the right time to take this public?
DEREK SCHILLER: Well, first off, I'll say we love being in New York. We tend to have a lot of success in New York.
BRIAN SOZZI: Just not Flushing Queens, right? OK, you have a point. Go ahead. Go ahead.
DEREK SCHILLER: So why not come on over here and see what kind of success we could have with you? I mean, we're very proud to now convert what was a tracking stock into a full asset-backed equity and officially trade on NASDAQ. It's given all of us a great deal of pride. We obviously celebrated that this morning, and we're off to the races. And we're excited to tell the story of who we are and what makes the Atlanta Braves so great.
BRIAN SOZZI: Tell us that story because I think a lot of folks on the Yahoo Finance platform have never been able to invest in a sports team. Are you going to report quarterly earnings? I imagine you are. Are you going to hold earnings calls? And you as a CEO, how are you going to lead?
DEREK SCHILLER: Well first of all, as a public company, we have a certain amount of responsibilities disclosures and things like that. So we've hired a lot more lawyers and accountants--
BRIAN SOZZI: Sounds about right.
DEREK SCHILLER: --as a part of this whole deal. But we will be issuing the 10-Qs, the 10-Ks. We came out with-- if you saw it, if anybody followed it, our initial issuance of the S-4 had about 650 pages. All the different things you could learn about the Atlanta Braves as well as some of our inner windings that we had with some of the other liberty companies. So that was partly unwinded, which allowed us to break free from that. And that gives us the opportunity to stand on our own and again be listed here and traded here independent from all of that.
For us, the way we operate our business, we'd like to think that we're going to be able to do that largely the same each and every day. And for us, that's very successful. We've had a great deal of success in a lot of different ways. Fans might recognize the success on the field for sure.
BRIAN SOZZI: How is that going to be like, fans can invest in your business? How do you deal with fans potentially coming to your annual meeting and giving you some guff? How are you going to handle that?
DEREK SCHILLER: Well, look, I'd say--
BRIAN SOZZI: It's like, their wildest dreams.
DEREK SCHILLER: I think I looked at this stock, what it was trading at, a single stock here today. And for about the price of a stock, you can buy a Braves ticket. So maybe now the next thing is you buy a Braves ticket and you buy your Braves stock at the same time. And you come in you watch the game and you realize, hey, I partly own this team.
BRIAN SOZZI: Now, that definitely makes a lot of sense, Derek. But last check, I saw the Atlanta Braves valued at about $2 and 1/2 billion. To me from the outside looking in, that seems very low, especially when the highest most valued franchise, at least according to Forbes is the Yankees at $7.1 billion. Why do you think that is the valuation? And look at what other sports teams have been selling for, especially in private markets.
DEREK SCHILLER: Well for other sectors, other industries, this is going to sound crazy. But in professional sports, specifically North American professional sports in particular, the valuations are done on a multiples of revenue. And so if you use that and you look at the past number of teams that have traded, it's a calculation on the multiples of revenue. And they range anywhere from the three, four, five, all the way up to I think the most recent Major League Baseball transaction was North of six, 6 and 1/2. So you sort of can apply that concept towards our total revenues and get a very loose rough estimate as to what's going on.
Now, that doesn't tell the whole story in our case as you wouldn't think it would, because we also have done some things as part of our project in Atlanta, including investing in and building real estate. So we're up to greater than 2 billion square-- 2 million square feet of mixed use development that's sitting on our campus. We're also looking at other opportunities in and around our campus. And so there are some things that are going on there that are really interesting and probably don't quite get wrapped up into even the valuation that people are looking at right now.
BRIAN SOZZI: Is that your growth plan? Because I look at other CEOs that we talk to here at Yahoo Finance, and they can open up a new store, develop a new hot dog, hire more employees and come up with artificial intelligence. How do you grow? It's not like you're creating another Atlanta Braves franchise.
DEREK SCHILLER: Yeah. Look, the overwhelming amount of revenue and growth that can occur on our franchise is going to sit on inside of the Atlanta Braves. But we should not in any way diminish what the value and the growth opportunities are for The Battery Atlanta, our real estate opportunities. And we're honing in on that. Mike Plant and his group really working hard every day trying to figure out what those opportunities are and seeing whether or not we can put them together.
As an example, right now if you were to go down to Atlanta right behind our home plate, just across the street, we're building a new building for Truist Securities. That's another couple 100,000 square foot building. There'll be an active trading floor that sits on that building, have about 1,000 very well paid employees that are in that building. So not only do we get the building and all of that represents the value of that, but all those people spill out, come into The Battery, eat in the restaurants, shop, do all the things that try to create even further value.
So all of these things are really working together. And we see that there's still more opportunity for growth.
BRIAN SOZZI: Right now, your team is in first place. And just absolutely on fire having a bang up year, already, I'm sure, getting visions of getting to the World Series. But what if you weren't in first place? Now that you're a public company, do investors anticipate them, pressuring you to cut payroll, make drastic changes?
DEREK SCHILLER: Yeah, the way we've looked at this, and we've had some time to think about this concept, this discussion and question is, should we in any way, shape, or form reflect off of what the value of the stock price is? Trades up one day, trades down one day. Dramatic or not, is it going to impact the way in which we operate our business? And the simple answer is absolutely not. We can't go on doing things that way. And you know what? There's a lot of other things that drive values in these companies as you know far better than me.
And so we're going to stay away from that. We're going to continue to operate our business the best way we know how. We've got a terrific team of people that are doing that exceptionally well. As you mentioned, team on the field playing really well. This year, we've got eight all-stars, a new franchise record. We've got a great team playing together, having a lot of fun. Who knows what might happen? But obviously, we think that we've got a team that can ultimately win the World Series.
BRIAN SOZZI: I think this next question is important to your story as investors think about investing in a franchise like yours. $208 million payroll, eighth-highest in Major League Baseball. The Mets, awful season right here in New York City. Over $300 million payroll. Why are you able to find success and a team like that just can't get it done?
DEREK SCHILLER: Well, it's difficult to comment on the other teams, but I'll tell you that for a number of years, and maybe this year is yet another case example, by spending the most amount of money on your player payroll, it's not an automatic foregone conclusion that that is going to generate a better team. There's so much that goes into how a team gets assembled. We were talking off air about the role of chemistry and trying to reduce drama and how everybody kind of comes together, that cohesive nature.
One of the things that Alex Anthopoulos, our general manager, person who selects our team, one of the things he does exceptionally well is really understands the makeup of a person and how they're going to come into our clubhouse and what impact that that is going to have. In effect, a psychological review of all of this. And he's really aware of those things. And even just trades that we're doing right now, I mean, these are things we say, OK, is this going to help us? Is it going to hurt us? What's it going to do to the dynamic? What's it going to do to the drama or lack thereof that's in this clubhouse?
BRIAN SOZZI: Derek, real quick before I let you go, is that a world Series ring? I've never seen anything like that before in my life. I've been doing this for 20 years, I've never seen that before.
DEREK SCHILLER: I know a lot of people up here in New York don't have these.
BRIAN SOZZI: I definitely don't have one. I saw what you did there.
DEREK SCHILLER: So I thought I might bring these out. We wear them out in special occasions. It's something really fun.
BRIAN SOZZI: I'm afraid I'm afraid to touch it. This thing is-- wow, that's heavy. You just get it out of my hands.
DEREK SCHILLER: We won that in the 21 World Series. The players, the team came together, gave their thoughts on what to do with it. It actually opens up.
BRIAN SOZZI: That's wild.
DEREK SCHILLER: And you could see a miniature version of Truist Park inside of there and all kinds of other little things. So it's a special representation of winning the World Series back in 2021. And I hope that I'll have many more of these on other fingers.
BRIAN SOZZI: Quite confident to say that the team in Flushing Queens will not be winning one this year. Atlanta Braves CEO, Derek Schiller, good to see you. Congrats on the IPO, very, very cool to see. Appreciate.
DEREK SCHILLER: Thank you very much.
