Despite Having No More Money, Cubs Owners Among Investors in Sports-Betting Startup
During a recent press conference in Mesa, Cubs chairman Tom Ricketts turned his pockets out and claimed that the Cubs can’t pursue more free agents because the team doesn’t have any more money. More specifically, there’s nothing remaining in the baseball operations budget. There are, however, enough discretionary funds to do a little gambling.
According to a Bloomberg report, the Cubs owners are among several investors in Action Network Inc., a subscription-based service offering data and analysis for sports bettors. The company was formed a little over a year ago by the Chernin Group in hopes of leveraging the rapidly growing market of legal sports betting.
While the amount of the investments in Action Network were not divulged, the total of this latest round of funding was a mere $17.5 million. That includes money from Fertitta Capital, the private equity firm operated by former UFC owners Frank and Lorenzo Fertitta, and David Blitzer, co-owner of the Philadelphia 76ers and New Jersey Devils.
I’m not going to pretend to understand all the ins and outs of tech startups and private equity or venture capital, so I’m not going to get myself in the weeds talking about that. For all I know, the money attributed to the Cubs is just the contents of the Ricketts family swear jar. Or maybe they cleaned out Papa Joe’s couch during the last family business summit.
In all seriousness, we know there are different buckets when it comes to the Cubs’ finances, whether it’s the 1060 Project or the construction taking place adjacent to Wrigley Field. The latter endeavors fall under the purview of Hickory Street Capital, a Ricketts-owned business that operates independently from the Cubs. Well, sort of, since there are very obvious symbiotic and financial relationships between the entities.
Maybe the investment came from the HSC bucket of funds that never would have been earmarked for baseball operations. Or perhaps the Ricketts sold off some of their TD Ameritrade shares in favor of a sexier investment with a little more risk. I really have no idea and that’s not what’s most important here.
The real issue is that we’re just a few days removed from Cubs ownership saying there’s no money to spend on players, yet here they are spending money on an industry that promotes betting on sports. So the Cubs can’t invest in actual players, but they’re cool with investing in gambling on players. Makes sense.
While there’s nothing illegal or untoward about the arrangement, it just makes Ricketts’ statements about the budget feel even more disingenuous than they already did. And that’s really saying something, since pretty much no one in either the media or the fanbase took his words at face value.
That’s not entirely Ricketts’ fault — he’s not going to bust open the team’s books and we can’t expect him to — but it’s another PR misstep in a winter that’s been full of them. Whether it’s fair or not, pretty much everything the Cubs do at this point is going to be viewed with side-eye, if not openly ridiculed.
Gee, if only there was some way for them to stem the tide of all the negative news.