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Slam Dunkonomics: Why Investing in Africa is Net Positive for the NBA (and others...) 🏀
By recognising the growing market, developing talent and infrastructure, and unlocking commercial opportunities, African sports can offer significant potential to both investors and rightsholders.
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With the NBA's establishment of NBA Africa in 2021, the potential for growth and development in African sports is starting to catch on.
The entity which conducts the league’s business in Africa, including the Basketball Africa League (BAL) – a partnership between the NBA and the International Basketball Federation (FIBA), is the NBA’s first collaboration to operate a league outside of North America.
With a population of over 1.3 billion people, the continent is home to a young demographic passionate about sports. And as a result, African sports offer a dynamic and thriving market, brimming with untapped potential for rights holders and investors.
“With this league, the NBA has taken a step further than any international sports league in terms of moving Africa's sports industry forward - offering opportunities for players and coaches, as well as for fans to see their favourite celebrities like never before,” explains Ibrahim Sagna (chairman, Silverbacks Holdings).
By forging alliances with local stakeholders and leveraging their expertise, the NBA has created a platform to nurture talent, develop infrastructure, and promote the commercialisation of African sports.
“Contrary to the NBA's [exhibition] games in the Middle East, Asia and Europe, the NBA's involvement in Africa is a reflection of the league's recognition of the raw talent that exists locally,” said Sagna.
Talent which includes the MVP of the 2023 NBA season, Joel Embiid. The Cameroonian, who has become a 6x NBA all-star, was in fact first spotted at a Basketball Without Borders camp in Johannesburg in 2011.
“To me, the league is invested in Africa because it recognises the sheer talent of our people,” Sagna continued.
“The league is now ensured to get access to the best talent directly and no longer needs to wait for these young Africans to export themselves to other basketball leagues in Europe, Asia or Australia, where their contract cost and agency fees skyrocket.”
This strategic collaboration has benefits for the continent, too.
Not only has it helped to attract significant investment to the region, but it has also paved the way for sustainable growth and long-term success.
Sagna, who’s Silverback Holdings have invested into Cape Town Tigers Basketball Club, the current South African champions and Road to BAL winners, explains that the NBA's involvement in Africa has seen the establishment of basketball academies and grassroots programs aimed at identifying and nurturing young talent.
By providing access to this higher quality coaching, training facilities, and exposure to international competitions, a greater pipeline is emerging for future professional athletes.
Moreover, strategic investments in infrastructure, such as stadiums and sports facilities, enhance the overall sporting ecosystem, enabling African athletes to reach their full potential and compete on a global stage.
The NBA’s partnership has also led to increased media coverage, broadcasting rights, and sponsorship deals in the region, resulting in a rise in revenue streams - and making the sports properties a more attractive investment proposition for the likes of Sagna and Silverback Holdings.
“Our investment thesis around sports assets is centred around media rights and the ability of said sports assets to get in front of as many eyeballs as possible,” asserted Sagna.
“We invested in a BAL team because we believe in the league's attractiveness due to its affiliation to the NBA, as well as its ability to grow its media and commercial proposition with time.”
By recognising the growing market, developing local talent and infrastructure, and unlocking commercial opportunities, there is possibility for other African sports to offer investors and rightsholders a similar chance to make a meaningful long-term impact and reap returns - as the NBA's partnership in Africa exemplifies.
The African Super League, initiated by CAF President Patrice Motsepe, is one such example of the opportunities for both new leagues and players on the continent. The NFL is also looking closely at getting more involved, even hosting a talent identification camp earlier this year in Kenya, following in the footsteps of the NBA.
Given the amount of talent already playing and dominating in both top football leagues in Europe and in the NFL, neither of these moves seem all that surprising. The question appears to be ‘when’ rather than ‘if’ other leagues get involved.
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