🏎️ Billionaire Toto Wolff Just Got a Lot Richer

Man, the response to Episode 1 of The Saudi Series has been humbling. The emails, the messages, the DM’s. It’s been insane.

Thank you to everyone who has watched, thank you to everyone who has shared.

More importantly, thank you to everyone who has become a member.

As a reminder, Membership goes Live on January 1, every video I make will extra content. All the Saudi Series episodes will be available to TLP Members.

And you can get access to all of this for a discounted rate HERE.

Episode 2 is out on Saturday where we discuss just how much money the PIF have sunk into LIV Golf 😩

Now, today we discuss two separate deals, that are closer principally than you think…

Toto Wolff has sold 15% of his holding company to George Kurtz, the CEO of CrowdStrike, for $300m. Structurally nothing changes at Mercedes. The ownership structure looks like this:

• 33%: Toto’s Company, Motorsport Investment Limited

• 33%: Ineos, owned by Sir Jim Ratcliffe

• 33%: Mercedes Benz

The difference is who sits behind Toto. Kurtz becomes a minority investor now. Crowdstrike have been a long time sponsor of Mercedes Benz F1 so he brings a fair amount of recent F1 experience to the cap table.

The implied valuation is staggering. The deal effectively values Mercedes F1 Team at £4.6bn ($6.0bn). In September, Forbes put them at a £3.5bn valuation. In theory, the value of Mercedes Benz F1 has jumped by more than 30% in under six months. That does not happen in traditional industries. But it happens in F1 because the economics of the sport have completely flipped on its head.

The cost cap turned teams into disciplined businesses. The digital assault through Netflix and YouTube created a new wave of global fans. Even the F1 movie, which critics were… lukewarm on, has become the highest grossing sports film of all time and pushed the sport deeper into culture. All of this sits on top of Liberty Media’s stewardship which has been one of the greatest acquisitions in recent sports history.

Toto is one of the biggest beneficiaries.

He is a gangster. And I write that respectfully. He is a world class operator who has made smart, long term bets.

Throughout all of this however, spare a thought for the Williams F1 Team.

They sold in 2020 for $200m because the losses were simply unsustainable. Today, they are valued at $2bn.

The Williams family simply could not hold on long enough and had to sell at the time. Timing is everything unfortauntely.

And Toto has never mistimed anything.

Now, this week we also learnt that Paramount+ have acquired the UK rights to the UEFA Champions League from 2027 onwards. TNT Sports previously held the package for £913m (which was a drop on the previous deal), but the new deal is expected to land north of £1.0bn.

For UK fans, unless there is a change in the broadcast split of Premier League rights before 2027, to watch every major domestic and European match you will need subscriptions to:

• Sky

• Amazon Prime

• TNT Sports

• Paramount+

Every broadcaster is hunting for must-have sports rights, and fans are being forced to stitch together four subscriptions just to stay with it.

Paramount’s move is not isolated. They recently agreed a $1.1bn per year deal for the UFC. Now they have pushed beyond £1.0bn for European football in the UK.

Streaming platforms need subscribers. Elite sports rights still deliver them. It is that simple.

TNT Sports, though, are suddenly exposed. Without the Champions League they are left with:

• One Premier League match per week

• A handful of European rights such as Serie A

That is not enough to justify a £25.99 monthly fee. Either prices fall, or their football strategy collapses. It wouldn’t surprise me if they pulled out of bidding for therights to the Premier League when they’re up for renewal next. The Champions League was their anchor. Now its gone.

There is a reason I am writing this week about these two pretty significant events however.

I always like to follow the money and ascertain who the winners are.

And as always, the real winners in all of this are the people and organisations that actually own the assets. Individuals like Toto Wolff. Leagues like UEFA. Promotions like the UFC. Anyone sitting on premium sports rights is benefitting from this market where broadcasters are desperate for subscribers and will pay whatever it takes to secure the content that brings them in.

As long as media companies need growth, sports team valuations will keep climbing, rights cycles will keep inflating and deals will keep breaking records. Teams cash in. Leagues cash in. Operators cash in. And even fans cash in to some extent because the product gets bigger and more ambitious every year.

I genuinely thought this cycle would slow at some point. There is a massive narrative in conventional investing at the moment that we are in the middle of an AI bubble. I have been thinking that we are in a sports bubble for many years and I always think that things will soon deflate.

But there is no sign of that happening. The money keeps rising. The valuations keep rising.

So with that being said, congratulations to Toto and congratulations to Paramount Skydance.

And congrats to us who get more UFC Fight Nights. More F1 races and more Premier League games to watch every week.

Long may this bubble continue.

See you next week.