The ROAR Podcast: Craig Sloan, Playfly Sports

Adam (01:01.07)
Hello. Hey, how are you? Welcome to the Roar Podcast. I'm your host, Adam Grossman. With me today is Craig Sloan. Craig, welcome to the podcast.

Craig (01:09.794)
Thanks for having me. One of these times I'm going to say, I really, I don't want to be here type of thing. I'm just waiting for somebody to actually say.

Adam (01:16.647)
Well, that's a start,

Craig (01:19.596)
Yeah, I'm here, but I'm coerced or something. But no, it's great to be here. Good to see you, Adam.

Adam (01:25.026)
Well, if you did that, that would be a let me know when you do do that, because I want to see it and hear it when you do. I think you're right. Somebody should say because a lot of the times people not on these podcasts, they don't want to be here. before we, guess, go down that path, wanted to, you know, again, officially welcome you and start the podcast the way we typically like to start a podcast, which is tell us a little bit more about your background and how you got your to your position as CEO of Playfly.

Craig (01:49.718)
Yeah, I'm happy to do so, hopefully with sort of be able to do it relatively quickly. I've been in the business for a while. So I spent my entirety of my career in the sports business. And the vast majority of that time has been inside one major media company, Fox Sports. I got into the business working for a minor league hockey team. I know probably a lot of folks that are in your classes and or your audience are go through minor league sports. It was an outstanding.

breeding area for a lot of folks, myself included, for getting me into a space where you just wear so many different hats when you're part of a small organization. I just happened to be part of one that was very successful in a very short period of time in Denver, Colorado. I was on an IHL hockey team, our president and going on to do wonderful things at big, broad sports properties, and a host of our other executives did. I was very young in my career, but got a chance to really cut my teeth on a lot of interesting things.

That was great. And I love the property and sponsorship side. I actually thought I would stay on that for the entirety of my career. I just had such a great experience for a couple of years to kick off my career. And I almost did. I just almost stayed on the team side. But I got some advice from a mentor. And I think those mentors in people's lives listen to them because they have the ugliness that you don't have earlier in your career. And they said, get some media experience because you can always go back to the property side. And once I did, really

gravitated towards that for a lot of different reasons, but I found it very compelling and spent the majority of my career, as I mentioned there, I was on the local side of a regional sports network, which at the time were these burgeoning businesses that no one had ever really heard of, but very important to the sports ecosystem. And then I moved over to the national side and moved to Los Angeles. So I was in Denver, LA, and then just found that my career kept progressing. They were giving me bigger assignments, broader assignments, and I was able to continue to.

to learn, develop, actually become something that I wanted to become in the sports ecosystem all through that one environment. And eventually got the heavy push by our former CEO at Fox, not just Fox Sports, but to get to New York. I was running an ad sales business, cross-sponsorship, naming rights, and really mostly media. And the majority, obviously, of the decision makers on the media side were sitting in New York, and I was in Los Angeles. So I got the heavy push. Having grown up in cold weather markets,

Craig (04:13.762)
Having lived in Chicago as well, Adam, it's not a hard sell for me to go to LA. I got very used to my little beachy lifestyle and all that stuff. But I've been in New York area for about the past 16 years and have also enjoyed it. And it was the right move for me personally and for our business as well. So it was hard to deny that our CEO is right. just was a difficult personal decision and all that stuff, but I've really enjoyed being here.

as well. So it's afforded me a lot of interesting things too. I eventually, just to sort of wrap up again, property side, minor league, big media career. And then I got this opportunity. We got acquired by a startup agency now known as Playfly Sports. And I've been here five of the five and a half years that Playfly has been around. And I'm totally enamored by the agency space. And so as much as I was almost hesitant,

Originally, as we were getting into the opportunity, I've become hook, line and sinker in on the space. Don't think I'll ever probably leave it. The amount of creativity, the amount of different things I've got my hands in that are just media, yes, but also a host of other services and capabilities and the amount of people that we touch, I really have broadened out the amount of connectivity I have throughout the ecosystem.

Adam (05:35.18)
I think it's hard to find somebody who's been at the two of the most important intersections in sports and how they've completely changed or overall media and college sports. So we're going to talk about those and more detail about it.

Yeah, let's talk about the start media. You obviously, like you said, you have a long career in media and the evolution of media. So, you know, it's a very broad question, but what has been the evolution in media, particularly local media, right? That has really changed substantially since you and your if not the expert, one of the leading experts in the world about sports media and local media. So from your perspective, what's changed?

Craig (06:09.07)
Well, think first and foremost, I was sort of alluding to this before. The first evolution was actually having dedicated local sports networks because that was the case, right? So the teams all used to air on a little local broadcast station, sometimes literally locally originated. So it might have been a small signal and then quickly moved over to a model where it was a pay TV ecosystem that became an important part of the.

Adam (06:19.32)
Great.

Craig (06:34.164)
revenue model for any rights holder, a local major league baseball team, NBA team, or NHL team in particular, of where it suddenly became an entire new category for them on revenues that in many cases exceeded other parts, sponsorship certainly. And in many cases, even ticketing was something that they were looking at as another part of the ecosystem of how big and how broad can my media rights get to compete with ticketing, which had always been the number one.

revenue driver for any property. And it was new, it was different. They weren't truly local, it was regional. And so you're on one side have this beautiful model, which was distribution. And you have all these people paying cable systems to have the rights to have your content. And then you have this advertising side, which was totally different, which was local TV stations, very much local, only in a DMA, and national single feed networks.

And that's the way that the ecosystem through the agencies and brands moved for a number of years. And now you've got this regional network. So people didn't know really what to do with us. I could hit seven states in some cases because the team had the rights to put their signal out to seven states. That didn't really fit a national network. It didn't fit a local budget either. So we had to really educate the marketplace on the special nature of what the product was, the fan engagement, all the things that were.

were so special and it was early days of people talking about data and we'll get into that more. So it was still an emotional sale. I guess watching that progression, so we went through about 20 years of where the RSN was the only place to be able to watch your local home team. To now there's a lot of disruption and change because that system or that ecosystem got disrupted by essentially high rights fees to the properties, high subscriber fees to the.

the MVPDs, the cable networks and satellites. And ultimately at the end of the day, a model that has been challenged. So some are still operating and in some cases successfully, others have either left the business or getting out of the business. And so that's all happening in real time. So that's one part of the ecosystem. What's happened in the meantime though, during all that time is entertainment programming, ad-supported entertainment programming used to be a massive engine for brands to advertise in and...

Craig (08:53.464)
drove a lot of the ecosystem. And that has just had a precipitous decline for over 20 years to a level of where it's much smaller than the audience that these local teams now provide. So as before, you'd have your Thursday night premiere prime time television dominating and sports would be like on Sundays with NFL and maybe a couple of other things. And those were the biggest audiences. Well, day in and day out, number one program for six months out of the year in most major markets is your local baseball team.

And that's over any entertainment prime time on cable or on broadcast. And the only thing that rivals it are some of these big signature events like college and NFL football. So it's just been a seismic change. I guess, now you add in major media companies that weren't media companies a little while back like Amazon and Google YouTube. And the money is moving in a lot of new directions. So it's been freed up by that decline of entertainment content.

but it's been freed up and moved around to new places where you don't have to look that far back of where the world looked like the same for a long period of time. And all of a just this, again, seismic change in how people invest and where people are spending their time and their energy.

Adam (10:05.102)
I think it's really interesting. You mentioned the non-traditional sports provider, whether it's the Amazons or YouTubes or Netflixes of the world. And obviously we want to get into PlayFly, not everybody maybe who's listening to this knows exactly what PlayFly is, but should. But we would definitely, definitely we'll get into that. But just again, as somebody who has experience, we'll call even more traditional media sales to now where there's all these different platforms and players.

What do you think has been the biggest change and even just the change in the way you mentioned data already? What's the big changes in ways that you've done business as this continues to evolve?

Craig (10:41.198)
It's hard to rival what's happening in real time, Adam, right now.

Adam (10:44.94)
Well, that's why we're glad you're on the content. Yeah.

Craig (10:47.446)
Yeah, right. So I could go back in time and there were some really seismic moments and how we waded through recessions or work stoppages with leagues and all these things that have happened. Even changing rights between media owners and all that stuff. That being said, fans, viewers, consumers are adopting direct to consumer at a much higher rate than I think we ever would have anticipated. So the first advent for us that changed us to your point from a very traditional model

of taking out linear product and linear product only was when the leagues allowed the teams to have local distribution of their streaming rights. And so they went out and created these products, oftentimes as a pairing, authenticated pairing with your cable subscription. you're a Comcast subscriber and you can get it on TV, but also now your TV Everywhere product. So I'm on the go, I wanna watch my team on my commuter, I'm outside my home.

I can now can watch the game on any device. And that was a really big change. We saw a lot of adoption, lot of minutes spent actually lead to the industry on time spent per engagement. So that just tells you how engaged people are when you're watching your team in Chicago, like Cubs fans, they're not coming in and just stumbling into it. They're there very purposefully and they stay for the majority of the game, which just is not the common thing for a streaming environment. So that's been a seismic change, but now you add in direct.

consumer where I maybe don't need my wholesale or I don't need my Comcast or Direct TV anymore to have this content. And so many people are adopting it. It's just growing at a rate that we would never have anticipated. At some point in the not too distant future, I think over half of the people will be watching through direct to consumer that engage with Cubs content in Chicago or Yankee content in New York or Dodger content in LA and so on.

Adam (12:41.282)
Yeah, I definitely want to get back to the core element. Obviously, like you said, you're dealing with this with PlayFly on a day to day basis. But one of questions that I get a lot, and I'm sure you get way more than I get, is do people really, like, do the buyers understand this? How much do the buyers understand? How much are they driving the conversation? What kind of data points are they looking for? How is the conversation, from understanding from the buyer's perspective, what they're seeing, and what they're getting, and what they're expecting now?

How much of that has changed or how much have you seen that change in terms of even just our questions to you?

Craig (13:12.556)
Yeah, actually, probably before I get into that, I should back out to your point. You've written your office. So play five sports.

Adam (13:17.987)
Yeah, we can talk. What is PlayFly?

Craig (13:20.35)
Let me start there and I'll tell you how we talk to the market. So PlayFly Sports, again, is a sports agency by definition, but a media marketing and technology oriented sports agency. And so we work with all the rights holders in a number of different ways. We have a robust college business. I know we'll get to, and that's where we buy out the multimedia rights from big universities. But that media division that we've been talking about is formerly known as Home Team Sports. We're really migrating because the PlayFly brand has been growing.

towards a Play-Fi media brand overall, but Home Team Sports is an accurate description of what we do. We literally bring out all the advertising supply for baseball, basketball, and hockey teams across the US. So every one of those teams is in our portfolio. And the beauty of it is it's allowing for brands that previously might have wanted to get into those games because of the high engagement, the large audience sizes, all the great benefits, but would have been either cost prohibitive and or time prohibitive. It just would have been a very exhaustive process. And we've made a...

essentially again created a turnkey solution for them to come in and have a discussion. So now the franchisees for Taco Bell that used to invest locally now invest their national advertising dollars that would normally have gone into the national single feed ESPNs, turners of the world, and they're buying us and getting the benefit to their core consumer audience, benefit to the franchisees, and ultimately benefit to the brand. So it's really a highly functioning marketing media model.

So that's what we do. So to answer your question about what the buyers and how much they need to be educated, 100 % we need to be on the education train, especially with this amount of change and how the consumption coming in. So our audiences on linear TV are growing, which is a rarity in today's world. Most people are seeing, again, a significant decline on audience size. And I think that's only just, again, showing that the amount of care that people have about these teams in the markets is significant.

but it's not cannibalizing. The other thing that I think is important is most of the major media companies will say, don't look over here. My linear audience is waning, but I'm rolling it over here on my new platform. So concentrate over here. We actually have growth over here and this seismic growth happening on the direct consumer. At some point that'll slow, but right now if the consumption is significant. And so you do need to answer your question, educate the buying community, the investment community at the agencies about it. But we also have an entire client direct team.

Craig (15:43.288)
because everyone understands what NBC is, everyone understands what Fox Sports is or ESPN. They might not know to your point our model and how they could get involved in it. And so we do a very much a client brand-sided education as well. So they just understand it's more on apples to apples comparison. when they're thinking about, I could invest in NBA and I could do that across now NBC and Peacock, I could do that across ESPN, I can do that across Amazon.

But I also have this home team model where the majority of the audience is watching on a nightly basis. And there are a lot of people who just only watch their team, right? So ultimately at the end of the day, it's a great advantage to say, I know that I have a hundred percent of basketball fans watching my content because a Knicks fan in New York is gonna watch their team. They might not watch every game, but they're gonna watch their team. And so that matters, I think, to brands.

Adam (16:32.526)
Yeah, one of the questions that I also or you I get and I'm sure you get and then it's also in the media is like I can't I don't know where to find all the games or like I don't know where they all are. But also, you know, I think there's at times there can be pushback. I don't even want to say pushback or at least, you know, a lack of knowledge from players or leagues or like, you know, even people in the media. You know, what what do you I guess from your perspective, how far along is the education process on the evolution of media and how much again, even from their perspective, are they?

asking you questions or asking your team questions and trying to learn for themselves how to navigate this new environment.

Craig (17:07.917)
Yeah, I think, you know, we're in an awkward period, right? We've seen the splintering rights significantly. And the idea of the old bundled model has gone by the wayside. But I think whether it's the great re-bundling is really going to happen or not, technology will start to advance to a level where we're going to start to figure out ways that it's going to make it easier for people to go back to what we would have called channel surfing and flip between even services a little bit easier than what we have today, which is truly bulky.

and takes time, it's frustrating. And to your point, I might have difficulty finding. So that part will start to settle in. These are long-term rights. the NBA has made a commitment for a long term to be with these current partners. So people start to get used to that. And look, I don't blame the NBA for taking a new partner, especially with somebody with the size and heft of what Amazon has. They're an incredible company, incredible media company now. And they have broad distribution. And ultimately, distribution equals audience.

you're going to want to be on the most widely distributed platforms. So I get why it's happening, but we are in a challenging period. I do love my model for that though, right? So if you look at an 82 game schedule in NBA or NHL, the vast majority of those games are happening on this one singular outlet in the local market. So it's here in New York, it's MSG, it's SNY, it's Yes Network on those teams. For my team, I can know that if the game is on, it's very likely it's going to be on one of those outlets. And so...

From that perspective, it's good. I think when you get to those national games, it used to be, right, that we have one national game a week, potentially even just eventually a couple. And now you have, in a seven day week, you might have 11 games of the week. And so it does start to question, like, is that adding audience? Is it just splintering audience? And that's something that we'll find out as we keep going in these new models.

Adam (18:59.682)
Yeah, and obviously there's most coming up is obviously the MLB and the negotiations that happen with the MLB. know Playfly sits in the, you know, somewhat sits in the middle of what's going to happen there in terms of the negotiation between the players and the players union and the league. And I think you said at a very interesting intersection there, which I'm happy for you to comment on, but I also do want to, you you mentioned college sports and I definitely want to delve into that, you know, talking about another area of growth or change.

You mentioned multimedia rights, particularly for people who aren't familiar with the model there. Because this is actually, think, even though local media sales takes up a large chunk, if not the plurality of the revenue at Playfly, Playfly is well known or potentially most well known for multimedia. So just talk about how Playfly got into the space, what you guys are looking for. And then we can talk about, obviously, the evolution and everything going on from that perspective as well that you guys are dealing with every day.

Craig (19:54.606)
Yeah, actually, let me wrap up on that baseball part that you said. So for baseball, it's an incredible sport that's on an incredible high right now. And didn't just look like baseball classic or a good World Series. It's been on a nice run for a few years here where they've shortened up the games. The pace of play is actually compelling. Younger audiences are adopted. We can see it across a number of different data sets that we have.

Adam (19:57.518)
Look

Adam (20:19.438)
Just before you go there, what are those data sets? That's a quite that's that is obviously a very common conception. It's like baseball is only for older audiences. I've seen it. a younger audience keeps coming in. What are you guys seeing there?

Craig (20:31.246)
Yeah, so look, I think ultimately there's a few. So one is just through our social handles and we can see again what's happening. Where is the engagement and what's happening? The second one, a massive one, is the linear audience. So we're just looking at just Nielsen data, which is going to be more compelling on 18 to 34 than it's been. There is an audience. I'm not going to tell you baseball doesn't have a broad audience. does. But it was skewing older. And now it's clearly this

pace of play and change, think it gets a lot of the attribution as to why these younger audience are growing. And then certainly last but not least is we have like, you know, much more personalized data about the people who are engaging through streaming just because of digital platform and we can see more about them. ultimately at the end of the day, it's a lot of good signs. So something's got to give on this collective bargaining agreement. And there's going to be some heavyweights, you know, knocking heads here on this between the league and the players association. Ultimately, it will get solved. Like the one thing we know at baseball will be bad.

Should there or could there be disruption? That's to be, you know, determined. We'll sort of see how this all ends up playing out. But I think everyone's sort of ready for what could be a protracted negotiation on getting some of these things changed. But I also think there's going be innovation that's going to come. So I'm excited about that part, right? So do they look at the season differently? Do they schedule a season differently? Do they create new platforms inside of it? We've been having some discussions with the leagues on what they're looking to do. All of it sounds really exciting. So.

Adam (21:54.286)
Yeah, before I even hold on that for a second is what are the things that you'd be I'm not saying they would happen. Well, one of the types of things you'd be excited or interested to see.

Craig (22:02.774)
Well, couple of things, one of which is I can't disclose everything, like some of the things have been even written about most recently. I think the idea of what the world baseball classic has become is pretty clear. It's also an awkward time to have it, though, because you players that are not midseason shape or midseason performance levels. And so do you make it even more compelling by taking a longer break at the All-Star game and thinking about celebrating the sport of baseball on an international level?

and have something that's really compelling, gives the players the necessary breaks on the folks that most of the players that aren't going to be playing it, and then have something that sets up essentially a first half race and a second half race. I think that's compelling. I think that there's something to that. I think if you look at some of the other things, does the season start and end at the same time? Do they, again, I know that they're seriously considering the historical nature of all the stats have been generated off 162 game schedule.

How do you comp off of that for since baseball is always known for comparing records? But there's going to be innovation I can a hundred percent tell you that there's going to be innovation and how the game is presented and Again, if you look at two of the most recent changes one that's just being implemented this year pitch clock came first ABX now with the you know automated balls and strike system All of those things are to make this a more compelling game get the game right make it entertaining make it fast-paced all that stuff and

All those things are happening. And by the way, all the same time that the athletes have never been more athletic, right? These baseball players, skill-wise, athletic-wise, know, they're throwing 100 plus miles an hour on a regular basis. have guys hitting the ball out at 110 miles an hour on a regular basis. It's just a compelling, compelling narrative.

Adam (23:43.576)
So I was gonna say, just you saying hitting the ball out at 110 miles an hour, just using that kind of exit velocity vernacular in this type of conversation, it's just showing the evolution of the game and how much more data is also playing a role as well.

Craig (23:55.154)
and available to us as fans and all that. So anyways, long story short, the baseball scenario is big. It's super compelling on what's happening. I trust that they're gonna figure it out and that we'll be on the other side with innovation. So I don't look at this as something that's as dentremental. It's gonna be a good soap opera for the next six to 12 months, but we're gonna see how this all plays out. A really important part of our ecosystem though. You know baseball just again, yes, none of that content.

And the size of the audiences times each other means that we're generating a heck of a lot of engagement and a lot of revenue for the teams through that process.

Adam (24:32.076)
Yeah, and we can't have in several other people have had a whole podcast about local media rights and regional media rights and baseball. But I think there's no you may offer a very silky segue into college sports in terms of the pace of innovation change and how people are consuming content. So I want to make sure we really delve into that. So again, from starting off, what what is play by doing in this space? What are multimedia rights? And then we'll dive into exactly what it is play by doing in this space as well.

Craig (25:02.094)
So I think first and foremost, our position's a little different than some of our competitors in this space. We look at ourselves as a college business. Multimedia rights is one portion of that. We're in ticketing, we're in content builds, we're in the data and information world, naming rights, and a host of other service premium hospitality, premium building. So multimedia rights is a big portion of it, though I'm not gonna lie, right? It's got a big.

big part of the ecosystem and it's a very important revenue stream. We talked about the revenue streams for pro teams. Now you look in college and again, media rights coming in through national for the most part, especially the power four, right? Multi-media rights coming in through companies like ours, Weirfield, JMI are the players in the space. And it comes in through ticketing and it comes in through activation with donor programs and some other things that will happen. But when you think about how

important the multimedia rights is there's a lot of variable in this, right? That's one of the parts of business. They only have a certain number of tickets they can sell at any given. So it's a finite amount of inventory. Their media rights are set for the number of years to come. So that's a finite number that's going to get, it's a big number, but it's a finite number. It's static. And then our portion of the business on the sponsorship side is not infinite, but it's seemingly infinite in the sense that you can innovate.

You can create new platforms, can create new assets, you can create new categories, you can really come up with ways to accelerate growth at a time when these major universities and athletic departments need more revenue. We've got some of these universities operating in a deficit already. You have many of them that have to conjure up overnight revenue share capabilities all the way up to 20 plus million dollars overnight, and that's escalating each and every year.

What's a sustainable way to drive big, what we call chunky growth opportunities to be able to accelerate your revenue picture so that you can keep up with your needs. And so we become a very important part of that ecosystem. And my teams are embedded at these universities for people that aren't in this space and don't maybe understand it. We are filled as the largest by number of schools and they're a big company. do a very nice job. We are the next largest and the one that's growing fastest. And we're taking

Craig (27:24.18)
and we're also just creating new opportunities inside of the college business ecosystem. I think there's plenty of opportunity for us to be able to find pathways for growth at a time when, again, innovation and thought leadership is needed. And we're seeing that the universities are probably more with us in alignment for that sort of thought process. So when we're coming to them and saying, here's what we think,

could be actually accelerating revenues here against your student athlete platforms, the NIL platform, whether it's against your revenue share model and needs, whether it's against your just general budgeting needs, we think that we can bring a lot of accelerated revenue.

Adam (28:05.678)
Yeah, well, how do you do that? Right? I those are the three main areas that schools are committed for. So how do you how do do that?

Craig (28:11.096)
Well, I think first and foremost is we've got a bigger, broader business that understands brand behavior. And we study again, it's a data led narrative, Adam, that you and I have talked about off this podcast, but that idea that data informs all of our decision-making. So why shouldn't it inform our partners decision-making? And so we use that to guide how and where we go and where we're spending our time, energy and resourcing. And so colleges are following suit and we're...

creating new pathways. we either are just looking at the undermined monetization that's happened historically in this space. So we got into the business of college not that long ago in comparison to others. And if you look at the disparity between what a pro team is generating in sponsored revenue and a college, and I agree with more fanivity, larger audiences many times, and a longer cycle for a brand activation from not just a part of a season like a pro team has or part of a year.

we're essentially a year-round activation component. There's a lot of opportunity for us to accelerate, to get caught up to where we believe our entitlement right is of where the spending should be in that space. And so we have compelling schools in our portfolio. We've got some really good narratives, but at a time when college admittedly to your points before, it's going through this tremendous evolution. Now again, partly driven by revenue, partly driven by the natural curiosity of like, okay, what would have more professionalized

sports athletic department look like. And so we've been creating new monetization tools regarding their data sets. We've been creating new ways for them to think about creating larger fan bases. So one of the things I think that's under discussed is when you create more fans, you increase the value of your asset. That's a pretty logical statement, but I don't think it was really thought of at a pro or college level. And so we're doing a lot of things to think about how can we create more

two-way relationships with their fan base and find ways to get growth? Because most of the fans, you you live in Chicago, your school is in Chicago, you're probably back on a regular basis, but there are a lot of people, Northwestern alums, that are living across the globe, let alone the US, still consider themselves a wildcat, but might not have the opportunity or the wherewithal to be able to come and go to games on a regular basis. So how do you still find ways to keep them engaged and be part of your...

Craig (30:29.472)
economic ecosystem, your fan ecosystem.

Adam (30:32.11)
Well, again, how do you do that? How do you guys think about that?

Craig (30:34.99)
Yes, secret sauce is behind me. can't pull that one out. just in all seriousness, there's opportunity for that just through just basic things. Again, thinking about where are your fans engaging, how are they engaging, and then are you able to collect the data off of those engagements or are you finding yourself in a one-way relationship? You're just pushing things on them and you don't really know, did they open it, do they care, do they emote, do they do anything with that engagement?

Adam (31:05.55)
And, you know, I want to hold it a little bit on the data and technology side, but I do want to dive into NIL, right? know, Playfly has made substantial investments into NIL, has products, has offerings, has advisory work. You know, that's clearly the topic. There's, you know, there's two main topics that, well, I guess three between media rights, NIL and private equities entrance into college. NIL obviously dominates probably the most public conversation. So one, how are schools approaching you about NIL?

and how are you helping them and supporting them deal with NIL, particularly in the context of revenue sharing?

Craig (31:39.094)
Yeah, well, you alluded to something in there that I think is important, right? Any of the people that are getting in and having discussions with our universities and athletic departments are coming at it from a perspective of how it's going to help them in the companies coming in. Yeah. And they don't have the expertise. You actually have to be in this ecosystem to, I think, understand the do's and don'ts, the ways to actually grow in a sustainable way.

There's no easy shortcut, right? You've got to put the time and effort in to create and actually. Yep.

Adam (32:12.588)
What do you think they're like, you know, people say that what are like the actual like tangibilities? What do you think like private equity or institutional capital or ultra high net worth individuals or anybody who's looking to say like, I want to make an investment into sports. What do you think they're missing? Or college sports, I mean, specifically, what do think they're missing right now?

Craig (32:29.9)
I don't think that they have the ability other than to bring capital. And many of these universities have access to friendly capital. And so the idea that they're going to fall into a relationship where they might be driven to make coaching decisions, athletic director decisions, facility decisions based off of how profitable it is, I don't think is going to be a fit in the long run. That's my...

personal take, not maybe even the views of Playfly. But I think in general, we look at it as you need to have access to capital, yes, because all these things are going to somehow need investment. The second thing that you're going to need though is who can actually come in and take that, let's say it's a physical asset, right? You're creating a new club area. You're going to create a new environment for fans to engage. You're going to create a new scoreboard that has digital and taking out of the analog world and creating much more imagery.

but then who's gonna monetize that for you? How do you actually then turn around and take the capex that was spent and give the return back to the university at the rate that they're gonna need it to keep up with, again, their growing demands. And so I think that there's a, me today, a pretty clear delineation between people who understand the space, understand operational efficiencies, new monetization, new ways to create fan engagement, and those that are just bringing capital to the table. So I think, you know.

That's my take today. And look, if I'm at university, I'm taking every phone call because you need to do your fiduciary responsibilities to understand like, okay, I've got a challenge, who can help me with that challenge? So I get why there's a lot of interesting discussions being had.

Adam (34:11.691)
And then from an NIL perspective, obviously private capital, private is impacting NIL revs here. So just coming back to that point, what are schools looking to play flight as all from the NIL perspective?

Craig (34:23.277)
Well, I think a few things, right? One is that there is a governing body with the CSC, if you will, of somebody who's actually regulating an area that was unregulated and needed to be. we're just at sort of, I think, the early stages of what this is going to look like in the long run. But I think, ultimately, at the end of the day, I think it's a good process, right? So again, if I'm an athletic director, I want the significant revenue coming in because I want to keep my coaches happy and I want to keep the athletes happy so they stay at my university for as long as they

They can, but I also have to make sure that I'm running a follow of now the processes that have been put in place to ensure that there's in kind value being given back. So you can't just literally pay somebody and have nothing in return anymore. That is part of the revenue share model. And then once you get above the cap, if you all are above the revenue share model, then it's got to be these more sustainable, innovative ways that you can bring new ideas about capturing content with student athletes telling a video.

journal about their experience on campus, creating fanfests and ways for them to do autograph signings or other activations, some endorsements within the local markets. And that's where Playfly fits in perfectly, right? We have been in market selling these assets on a physical asset or a promotional asset at the university along with the IP. And we didn't have the IP of the student athlete. Now, if I'm a brand and every data set again that we're building or starting to look at is showing that it's gonna be a more effective campaign.

of activating the IP of the university, should you have that right, along with that of a student athlete. It's just gonna create more engagement, it makes sense. You've got the linebackers and the school logo into your creative and it's gonna be performing better than one that doesn't. So those things are happening in real time. So I've dedicated in many of our schools what we call Playfly NAL Max, which is our ability to come in separate from our multimedia rights team. They're selling the sponsorship assets in an impaired way. Often we're putting the two together.

but a dedicated team, which I think is necessary to be on campus and going out and selling the value of the student-athlete to brands and looking for new activation opportunities.

Adam (36:28.91)
How easy or not even how easy, what are the challenges and opportunities of working directly with athletes and athlete activations and college athletes, know, who maybe haven't been as familiar, you know, the school has, you know, long time practice, activating sponsorship, activating these opportunities. What are the challenges and opportunities of working with students on this front?

Craig (36:48.098)
Well, we come at it from a very empathetic standpoint, inclusive of Christy Hedgepath, who is our president of our college division, former student athlete herself back in the day, won a national champion, knowing the demands that are on these student athletes for their time. And whether that's training time, whether that's actually practicing participation time in the game, or whether it's just their studies, which is what they're there to do as well. So we are trying to work with them on a regular basis.

to create things that are achievable for them and not putting them in a predicament of where it's pulling away from their experience as a student athlete. so that's, again, still early stage. We're talking about, again, we've only been in this environment for a couple of years. We've only really been in this most recent environment this season for the first time through with revenue share models. But surprisingly, if we're talking about 18 to 22-year-olds typically, we're not having the challenges you would think. I was not probably mature enough.

I mean, myself, and in some cases, exchanging significant amounts of money and understanding the value of that money and then having them to to bring their in-kind value back to a brand. if said auto brand is going to invest a half a million dollars into that student athlete or that position at the school, to have them have to get something in return is clear. I'm surprised how smooth it's actually been. Partly go through the CSE, which is the governing process of this.

And then partly through actually just doing the activating. So we'll see, like it's continuing to be early stage and it's also, you know, we're doing more and more of the deals. We'll see how much the volume of these types of deals starts to come into the equation as well. If I'm a student athlete, I want the money, but I might only want to do limited engagements because I want to concentrate on what's might be going to be my professional career if I'm not going to go pro or my professional athletic career if I'm going to be leaving the school at some point.

Adam (38:38.27)
That's interesting what you said about the CSC. There's been obviously narratives that the CSC at times has both help, has helped and gone relatively quickly. Other times it's had some more challenges. So from a PlayFly perspective, holistically or on the whole, it seems like it's going pretty well.

Craig (38:53.802)
Yeah, we have to support that there needed to be something there's more rigor that frankly is probably going to be needed, not just at the CSC level, but just what is that long term sustainable model? We knew this donor fatigue was going to happen and donor fatigue was going to be real. It wasn't going to be imagined at some point. How many times can you go back to tap the same well off individual or set of individuals to have them fund every single need that you have when they're already being hit up for athletic foundations in general?

the schools and colleges within a university, as well as any other philanthropic needs or areas that the university wants them to invest in. And then you've got this whole new development and like, do you make that something that doesn't feel like a drain? It feels like it's the right thing to do. So I totally understand, right? At the end of the day, student athletes, just like an Olympian, might have a very limited window to monetize

their name, image, and likeness. why wouldn't that be a natural thing for it happen? So we just want to figure out the ways that, again, it won't, we don't kill the golden goose. Like it's here, it's now, hate to see it go away because I want those student athletes to be able to achieve their revenues and have something that's probably a good professional training ground as well to think about having to work with brands and do things that are going to have to make them accountable before they ever got out of college. It's a great learning experience as well.

Adam (40:18.954)
And we want to, as we're getting towards the end of the episode, I definitely want to dive into the data, the technology. You you obviously said how.

And that's, like, as you mentioned, that's the way we got originally connected and in contact was around data and technology. So I know we've only really dove into the college part and the media part of your business. Obviously, there are other parts of your business that we can talk about that are directly impacted by data and technology. But when you say everything at Playfly is led by or informed by or led by data, what does that really mean? How does that be tangible to you and how does it impact all of your different revenue lines?

Craig (40:53.55)
It's in so many different ways, Adam, trying to figure out the best ways to do it. I'll give you a couple of examples. One is, again, we believe in marketplace data that's going to help us for long-term trends.

So it's one thing to look at something in a very short pocket or window. It's another thing to say, this is actually happening and it's going to be happening for quite some time. So let's look at mixed use developments like you and I have talked about in the past, right? There is not one area that would tell you that that is not something that's going to be a significant part of the sports ecosystem for the coming, let's call it five to 10 years at minimum. And so it's worth our time and investment to think about, you know, how are we thinking about it? How are we resourced to be able to participate in it?

What would our partner needs be to be able to have us be an expert and somebody that actually can be a leader to help them, right? All those things.

Adam (41:42.422)
I have to stop you there again. We should get answers to those questions. This PlayFly sits at this potentially intersection and obviously this podcast sits at that intersection as well. So how do you think about all those things?

Craig (41:54.574)
Well, I think you have to understand fan engagement. like what is superfluous to their fan journey and not going to be sustainable and what is core to it. This is not going to be surprising to anybody in this audience, but it is something that's still new. The thought about people coming to the ballpark or the arena early was categorized as tailgating. And that was the only definition. Right. Otherwise, you went and spent your time pregame.

somewhere else in the city, somewhere else in the town, somewhere else. And then tailgating became this thing, especially for football, as we all know. But that means a lot of commerce and a lot of sort of campy experiences happening away from the venue. So how can you program the game weekend in college space, the game day in the pro space in more meaningful way? And what are you doing to be able to understand that journey? Like if you build it, will they come type of thing?

We are querying fans on a regular basis to understand again their willingness to participate. If it was there, would you come earlier? Would you try to avoid or stagger the traffic or some of the things that have been known in sports for being some of the less desirable components of the game day experience? And how can you actually make this more interesting? How can we get them closer to the venue or in the venue at an earlier stage?

Adam (43:12.526)
That's interesting. You mentioned getting them, you know, in and around the games from search perspective. What we're thinking about is live workshop play 365 day a year experience. It's not just on game days. It's on non game days. One of the things that particularly around college is there's been a, at least from no pun intended surge in, you know, particularly residential with people either wanting to live part-time or full-time in and around colleges, particularly around games, also obviously professional. So from your perspective, are you guys, are you seeing that? Are you seeing more of an itch? Even from like a

not just on game days, but on non-game days, and that live workshop play perspective.

Craig (43:47.662)
Yeah, I think it's harder to prove and we're still in that journey right now on colleges where the town swells to 70,000 people during the school year, but it goes back down to 30,000 when they're not in school. How sustainable is that year-round participation? How sustainable for a business to invest in something like that? Can you make enough on the game days or around those game days to make it worth it as compared to these major cities where most are?

And it looks like a no-brainer, but I will tell you, and I'm sure that you and I could probably spend an entire day talking just about the battery, which a lot of people have been talking about, which looks brilliant now. But think about the chance that took. They were actually in a city center, a ballpark in the city center. They didn't choose to knock down and build again there. They built out outside of the city and made it a destination, but actually programmed it, like what we talking about, with the vendors and with how they do it.

with office, retail, all of the things you were mentioning before and have created a community experience where they seemingly almost can't build it. They're at full occupancy on their office space. And out of the 10 million people that went through the battery last year, only 3 million plus went to the ballpark. So those are the stories that we all hear and think about and go, my god, that's just mind boggling.

Adam (45:10.838)
Yeah, so we had Adam Zimmerman from the CMO of the Braves who helped. So he just recently talked about that. So I encourage people to talk about it. But I will take you up on that at some point. And we will spend a day talking about that. But I think the larger point you just said about data, think there was data-driven decision making that said, we had fans, locals, residents, tourists who would come. And I think one of the things that we look at at Surge is it's that holistic.

you really do need the retail, the office, the commercial to make that all work at the same time, like building it at the same time, which I think has been some there are other examples of that that's happened, but most famously and most recently, the battery is a really good example of that. And that's, you know, again, from your perspective, what you guys are seeing since you, you you mentioned before about having expertise, not just bringing in, you know, capital expertise, but bringing in real operational strategic thought leadership expertise.

Are schools coming to you for that from a mixed use perspective or professional teams coming to you and say, we need help from a mixed use development, real estate perspective and what's the data that you're seeing that can help form our decision making?

Craig (46:15.534)
Yeah, they are. And there's a secondary component of it, Adam, which is also maybe not that full-fledged. going from 0 to 100. Yeah. Also, I have two experiences at my venue. I've got 100,000-seat stadium. 90-plus thousand are enjoying them in normal seats, exterior seats. And 10 % of them are enjoying them in some sort of a suite environment. And there's nothing in between.

And is what we know, right, is what we've seen on pro teams sort of guiding the way people are creating 10, 12, 15 different experiences and levels of engagement that's going to serve each part of your fan constituency and be able to monetize that in new ways. And so it doesn't mean that everything's got to be totally premium, but people want to feel a part of something. So if a new NFL stadium is going up like it is in Tennessee, they are coming in with a layered approach on that experience and everyone's going to choose their own path.

colleges still have an opportunity to do that. The challenge is they're probably not gonna build the $2 billion plus new stadium. They're more likely gonna have to fit it retro into the existing stadium as they make improvements. And so we've got that going on today at Beaver Stadium for our Penn State property. That is a wholly different experience on the backend of that. Pat Kraft and that athletic department had a vision, the school backed it. They went down a path of looking at new and realized that Beaver Stadium could be renovated with significant expense.

but creating an entirely different fan experience. so that is, we're in year two, we've got another year to go, but on the back end of that, the drawings, everything that we have seen have been phenomenal as far as how that's gonna enhance the game day experience.

Adam (47:55.414)
What role did PlayFly play in? Obviously you're a substantial partner to the athletic department. What role was PlayFly in those conversations?

Craig (48:03.89)
I mean, at that point, we came in at where the decision had already been made. So it was a little bit late for us on what we were going to do. What we've been doing is trying to guide them to say, OK, if we're going to commercialize this new space or these set of new spaces, what are the best ways to do it? What are going to drive the premiums? We've got empirical evidence to show, again, the value set of this type of activating of this area versus this type of activating of this area. And then are you willing to do that and put the capex expense in, but then get the greater

return on it. So it's been definitely on the commercial side of something like that as compared to some other schools, which are just sort of on the front end of that process.

Adam (48:40.82)
And we're going to, unfortunately, we're running towards the end of time. lot of meat on the bone, hopefully, will have you back on the podcast for a future episode. But our last question is one that we're going to ask all of our guests. Historically, we've asked around career paths. But I think one of the things that has come up for me and come up in conversations is artificial intelligence, AI, and the impact.

that it's having on our industry. And I think we're going to focus more on that going forward as our final question. So from your perspective, and this is a broad question, but artificial intelligence from a Playfly perspective, what are you looking at? What are you thinking about? And how is it impacting your short, medium, and long-term thinking?

Craig (49:20.592)
Another big broad question.

Craig (49:25.568)
Yeah, these are good. look, I would say I'm not putting up a mission accomplished sign anytime soon. Yeah, in this process. That being said, we've been leaning in. And so I could just tell you about a few of the things that we've done already. Again, heavily commercialized group, we go out and we're known as the revenue maximizer. So we go out and truly through, again, better use of data, better use of narratives in the marketplace.

go procure money, I think at a better rate than other people can. So I love what our team is doing. Today, we're now creating these co-agent at a much richer way than what we had originally thought that we could. So not only reactivating a unified CRM, we've made so many acquisitions and brought so many different companies together in this process. And now we're unifying in one CRM, but then we're bolting on this co-agent philosophy of, again, just trying to be that much more efficient, that much smarter.

that much more creative, all the things that you know you can get through this. And then hopefully again, seed ways to bolt on. So you're asking me a question that I love, which is everyone's looking for margin expansion in their business. Who wouldn't be, right? So if we can keep growing revenues without always having to add the old formula was grow revenues to a certain level and then you add more people, grow more people. Can we keep growing rather than think about reduction in force? Can we think about slowing the size of the growth of the employee base?

by being able to put more in for less. And so that's one part of it, but we got our hands in a number of different things. So we do dynamic pricing for companies on their ticketing through an AI led process with a number of ingestion points. Another area is automated content. And so it went through a wave and then obviously it was sort of a negative wave when Google and others sort of downplayed the availability of that because they were trying to protect the consumer.

But I think there's a more elegant way to create opportunities for properties to be able to put things on their websites or whatever that don't always have to have a human beat reporter behind it to be able to at least give a recap of what just occurred and all that stuff. So we've got our hands in things like that that we think might be important in this equation as well. As far as what the future goes, we've got some things on a roadmap, but I would say again, like many.

Craig (51:47.052)
We're not finished on that front and you don't want to over invest in a space that you don't really know about. So there's more discovery to be done. But I do think that the fans will continue to win. I guess that would be our take. We leaned into NIL because we wanted the student athletes to win, but fans are getting more content. They're getting more access to the athletes. getting every game is on. Every game is on in multiple devices.

Your game day experiences are getting better. I mean, if you think about everything is sort of predicated off of what is the fan wanting and people, smart people are creating new assets to make that experience a better process, a better experience.

Adam (52:25.87)
Well, think this is a great way to end, Craig. Thank you for your time. Thank you for the insights. Really good conversation. I'm going to hold you to at least having our conversation on mixed use, but hopefully we'll have you back on the podcast soon.

Craig (52:34.702)
Adam, always great to see you. Thank you.