VC Kara Nortman made an early bet on women’s sports, and now she’s creating the market

When its season ended earlier this month, Angel Metropolis FC completed eleventh out of 13 groups, a disappointing consequence for the Los Angeles soccer franchise that enterprise capitalist Kara Nortman co-founded in 2020. However the season’s struggles inform solely a part of a a lot greater story that’s reshaping the way in which traders take into consideration girls’s sports activities.

Regardless of its lackluster efficiency on the sphere, Angel Metropolis itself has change into a case examine (together with actually, inside Harvard Enterprise Faculty) on how finest to construct a girls’s sports activities property. The crew’s superstar possession group, together with Natalie Portman and Serena Williams, has helped generate virtually unprecedented buzz. The franchise has additionally been savvy about sponsorships, breaking information earlier than gamers have even kicked a ball.

“We went from zero to $30 million in income. We bought video games. We constructed one thing that individuals did not suppose was attainable,” Nortman mirrored in an interview final month, pointing to Angel Metropolis’s industrial success for the reason that crew’s inception. “That actually led to the formation of Monarch.”

That industrial success, not the trophy, turned the blueprint for Monarch Collective, the $250 million fund Nortman launched in 2023., which has change into the primary funding car targeted solely on girls’s sports activities. Whereas its origin story could also be rooted in a crew that has but to win a playoff recreation, Monarch’s portfolio and affect have expanded far past Angel Metropolis’s coaching facility in Thousand Oaks, California.

The fund now holds stakes in three different Nationwide Girls’s Soccer League golf equipment: the San Diego Wave, Boston Legacy FC (debuting subsequent 12 months) and its latest funding, introduced earlier this month, FC Viktoria Berlin. The deal for 38% of the German membership, makes Monarch the primary international investor to purchase a stake in a German girls’s soccer crew.

It is a numerous assortment that displays Nortman’s perception that ladies’s sports activities have reached a turning level, whatever the fortunes of any single crew. The numbers again up her optimism, too.

“The general males’s sports activities market globally is estimated to be round half a trillion {dollars},” Nortman explains. “The ladies’s sports activities market, once we began Monarch in 2023, was considered about half a billion {dollars}. Now it is nearer to $3 billion.”

Making an attempt that development requires a special playbook than males’s sports activities, Nortman says. It isn’t a easy rinse and repeat. “For instance, what number of males’s crew house owners are pondering of skydiving Sephora bins from the rafters? Or having at (a New York) Liberty (WNBA recreation) a Fenty digital camera to place your (Fenty) lipstick on, or Angel Metropolis having a Hey Kitty collaboration evening the place folks cannot determine the best way to get their palms on the merchandise earlier than it sells out”?

Angel Metropolis’s modern strategy to advertising and marketing and partnerships helped it construct a lot pleasure that final fall, energy couple Bob Iger and Willow Bay acquired a majority stake in it for $250 million, making it probably the most helpful girls’s sports activities franchise on this planet.

For Nortman, who left Upfront Ventures and extra conventional enterprise capital to focus full-time on girls’s sports activities, Angel Metropolis’s industrial achievements have continued to show Monarch’s thesis. Though there’s present stress — actually within the sports activities press, at the least — between the Angel Metropolis’s enterprise success and its efficiency on the sphere, the crew has confirmed indisputably that ladies’s sports activities can generate severe income with the best components in place.

Now, as with every profitable new endeavor, the query is: can the momentum final? Nortman is effectively conscious that ladies’s sports activities have seen moments of promise evaporate earlier than. She usually refers to a placing historic parallel from 1920, when 60,000 folks turned up in Liverpool, England, to observe the Dick, Kerr Girls play soccer, which is a much bigger crowd than most Premier League matches right this moment. The next 12 months, the English Soccer Affiliation banned girls from taking part in and the game primarily disappeared for many years.

“Everyone must get up and change into an explorer of girls’s sports activities after they do,” says Nortman. “However it takes fixed, exhausting work to get it to consistency.”

That onerous work, she argues, requires extra than simply getting the eye waves of big-name stars like Caitlin Clark or Angel Reese. It requires systematic funding in infrastructure, governance and operations – the unglamorous work of constructing sustainable companies.

That is the place Monarch’s strategy differs from typical enterprise capital. As an alternative of constructing passive bets on dozens of startups, Monarch is taking concentrated positions in a handful of groups and leagues, getting deeply concerned in operations. The fund describes its technique as “venture-like markets” with “development fairness or non-public equity-like” danger administration.

“We come along with management house owners and add numerous operational worth,” Nortman explains. The aim is to assist groups obtain backside line or profitability of their core operations, positioning them to profit as greater margin media income grows.

Monarch’s funding curiosity extends past soccer. The fund is concentrated extra broadly on what Nortman calls sports activities with “no market product danger,” that means established codecs with confirmed audiences.

“Is that this a sport folks like to observe on their pc or TV?” she asks. “There are participatory sports activities, like pickleball, however are folks going to sit down at house and create an occasion watching it?”

Certainly, whereas Monarch now has stakes in 4 “soccer” golf equipment, it additionally has pursuits in girls’s basketball, golf and tennis – sports activities with vital media income potential, together with current infrastructure.

The agency’s present restricted companions embody Melinda French Gates, former Netflix executives and different rich people, and curiosity in its mission seems to be rising. For one factor, Monarch’s $250 million debut fund is considerably greater than the $100 million that Nortman and her co-founder — Jasmine Robinson, a former investor with growth-stage agency Causeway targeted on sports activities, media, video games and health — initially deliberate to lift. She says the elevated measurement displays the fast maturation of the market throughout Monarch’s fundraising interval.

“After we began fundraising, 9 out of 10 conversations had been, ‘Yeah, we do not suppose (girls’s) basketball is mostly a factor,’” says Nortman, recalling “numerous skepticism round it.” Then got here Caitlin Clark’s meteoric rise, the WNBA’s report viewership, and all of a sudden basketball was the most popular section in girls’s sports activities.

This rising curiosity validates Nortman’s thesis that investing in girls in sports activities shouldn’t be about discovering the one good crew, however about supporting an ecosystem the place a number of franchises can thrive. Some will win championships. Some will battle competitively however succeed commercially. The bottom line is to have ample capital and operational experience unfold throughout the market to satisfy particular person hurdles.

Already, Angel Metropolis seems to be inspiring different possession teams. “You are beginning to produce other groups — Kansas Metropolis, Bay FC, the Washington DC Spirit — with female-led possession teams coming in and displaying they’ll construct an actual P&L,” notes Nortman. Deliberately or not, Angel Metropolis turned a template.

As girls’s sports activities enter what looks like a sustained interval of development — the Golden State Valkyries simply performed their first WNBA subsequent season, the NWSL is increasing, media rights offers are rising — Nortman stays cautiously optimistic about whether or not this second will probably be any totally different from previous surges of curiosity.

The important thing, she argues, lies within the fundamentals: robust league governance, proprietor engagement, infrastructure funding and constructing true group bonds. Media consideration creates alternatives; operational excellence makes it sustainable.

“Each tip is a chance to create a long-lasting expertise round it,” says Nortman. “You must take a look at all the basics to see the place it is more likely to stand.”