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Monthly Archives: August 2013

I was asked to complete a short industry analysis of a field that interests me so I chose celebrity and athlete representation. This is a $6.8 Billion industry and is an integral part of the business side of sports and entertainment. In particular, I am drawn towards athlete representation, which accounts for about 35% of the overall services provided.

I am a passionate former athlete, coach, and fan and have always been fascinated by the inner workings of the glamorous world of professional sports. The top priority is usually contract negotiations and sponsorship deals but there are a number of other services provided to athletes including career counselling, wealth management, and health promotion.

Heavy training loads from a young age coupled with the intense pressure of competition during the formative years can cause varying degrees of emotional and social stunting amongst professional athletes. This creates a need for agents to help guide young professionals through situations that might seem trivial to the average bystander. My experience as an educator, coach, and mentor could prove useful in addressing some of these issues while my ongoing MBA training will help fine tune the wealth management and career counselling aspects of this industry.

IBIS World has identified three key professional factors for industry success, all of which match my interests and strengths. These are negotiating, product promotion, and the ability to vary the services provided based on individual needs.

This industry has a unique makeup and segmentation. IMG (formerly the International management Group) is the only firm with more than 5% of total market share, sitting at a mere 5.2%. Concentration is very low and so is the barrier to entry. This does not mean it is easy money, however – in 2012 there were 35,886 registered establishments that represented athletes, entertainers, or authors in the United States, suggesting an extremely competitive environment.

IMG and their main competitors are private companies, so some specific financial data can be hard to come by. However, a lot of information about the industry is known publicly. For instance, the volume of small operations with low overhead costs has created a need for firms to be nimble; this crowded marketplace causes agencies to regularly cut commissions, thereby creating lower industry wide profit margins.

The industry is considered to be in the mature stage of its life cycle, characterized primarily by widespread market acceptance and low levels of technological acceptance. There is still promise of gains to be made, however. This industry, like many, is driven in large part by the health of the overall economy. Better financial times mean more per capita disposable income for consumers (the primary drivers of ticket and merchandise sales) and higher advertising budgets (endorsement deals).

Industry revenues plummeted after the financial crisis in 2008 and showed only modest average annual growth (0.7% year over year) between 2007 and 2012. Projected annual growth through 2017, however, is estimated at 2.3% bringing annual revenues up to $7.6 Billion dollars.

Because of the number of small operations in this industry, M&A activity is pretty normal. It is not uncommon for a small firm representing a notable athlete or celebrity to get gobbled up by a larger establishment seeking easy market share.

Source:

Jose, Eben. IBISWorld Industry Report 71141 – Celebrity and Sports Agents in the U.S. October 2012.

 

It was my good friend’s father who used to say it: Write your own script; don’t star in someone else’s movie! I thought it had a nice ring, but more importantly, a great moral. As I got older, I learned to cherish the message even more – be a leader, not a follower.

My style evolved over the years though, and unfortunately, the Hollywood analogy no longer worked for me. Nonetheless, I wanted to keep the leadership metaphor alive so I retooled it a little: Don’t read the map, write your own! Think about it, we all lose our way sometimes, it’s inevitable. Our first instinct is usually to look for directions; to consult some existing framework that might help guide us back on track. But where is the fun in that? Life needs a little adventure from time to time and mine has arrived.

I used to be a high school teacher, athletic director, and lacrosse coach in the greater Montreal area. I was surrounded by culture, wonderful friends and family, and I was involved with sports every day – something I enjoyed immensely. I had a life that saw me wake every morning with a smile on my face because I was content. But contentment, I realized, is not the same thing as passion. That said, I was ready to shake things up.

When my wife got the opportunity to relocate to Vancouver for work, I was thrilled. I supported the move with all my heart, even though a nagging voice in my brain expressed the occasional objection. The move would mean giving up a very secure career and a respectable level of status in the community. We spoke about it at length but ultimately decided to throw caution to the wind. So, in June 2012 we boarded the plane, never to look back.

I expected to face some hurdles but I must admit, I didn’t foresee the black diamond mogul run that I was about to encounter in BC. I did some seasonal work for a movie company, some landscape labour, substitute teaching, and I even did a brief stint as a rig worker in the oil patch for some quick cash – all in a matter of 6 months. Throw in some health problems for good measure and you really had a guy in desperate need of a map, or more accurately, the means to draw one up.

I had long thought about pursuing an MBA but it became clear last December that it was time to take a serious look at what direction I wanted to head professionally. I knew that the MBA was an excellent way to develop skills and tools – particularly those needed to help draw maps in a world whose landscape is constantly evolving. So I began preparing for the GMAT and got involved with a local technology start up to help me cut my teeth in the business world. The rest is history, albeit history in the making.

I have been blessed with the opportunity to attend yet another world class educational institute, the University of British Columbia, and I feel privileged to be surrounded by an endless sea of intelligence, talent, and drive. It has occurred to me that no map exists to guide one from the gym to the boardroom so I take pride in the fact that I get the honour of creating it. I am sure the path will wind from time to time but that’s ok because I am also confident that the Sauder School of Business will ensure my tool belt is well equipped for what lies ahead.

#MakeYourOwnMap

 

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