NBL owner Larry on the benefits of private investment in sport

Australian sport’s relationship with private investment has been one of triumph and disaster. NBL owner Larry Kestelman tells SHANNON GILL how to make it happen.

Larry Kestelman is a challenger to the orthodoxy about private investment in Australian sport.

“I don’t think profit is a dirty word in sports,” says the NBL owner.

Kestelman will share the stage with Rajasthan Royals IPL owner Manoj Badale at this week’s SportNXT conference in Melbourne, where local sports administrators will hear from global peers about emerging issues and trends.

He will share his view that the often stigmatized notion of private investment in Australian teams and leagues should be reconsidered.

If anyone should know, it’s Kestelman.

Many were skeptical when he bought an entire league that appeared to be on its knees. Eight years later, after wrapping up a season that saw crowds and interest reach new heights, Kestelman believes this is a blueprint for success.

“We as a league are now profitable and growing,” he tells CODE Sports. “That can work.”

Kestelman is the biggest privately owned success story in Australian sport in recent memory. The supposedly larger sports also seek his advice.


Australia has a difficult relationship with private property in sport.

The NRL has had some major successes alongside some perennial favorites. The AFL swore off, cold turkey after being burned by the Skase and Edelsten tycoon experiences in the 1980s. The history of ownership in the A-League is littered with weird and wonderful moments, some of which have left administrators with a huge mess to clean up.

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Many have resisted completely. Last year, during its financial crisis, Super Netball finally turned down private equity offers, while Cricket Australia has flirted with Indian private investment in the BBL for more than a decade without ever taking the plunge.

Kestelman believes private ownership should be encouraged in order to develop all sports in Australia. Still, he believes there are some basic rules to follow to avoid repeating past mistakes.

The first rule: beware of the fan with a large bank balance. Kestelman believes the only motive should be to make a club profitable and not emotional reasons or, worse, vanity.

“Fans buying racquets is always dangerous,” he says. “Nirvana are top notch business people entering the sports business.

“What you don’t want are hobbyists who are potentially very good business people but leave their heads outside the door when they’re playing sports.

“They put three percent of their mental capacity into it and treat it as a hobby.

“That is the greatest danger. So it’s about putting the right amount of rigor around it from a licensing perspective so people don’t do it as a hobby,” he adds, referring to the AFL disasters of years past.

Kestelsman emphasizes that “money is not always money”; Private ownership must be a long-term commitment to be successful. He is skeptical of private equity firms looking for returns in sport.

“When I bought into the NBL, I didn’t have a three-year or five-year window that I needed to get a specific return or outcome.

“With private equity, there’s usually a three to five year agreement that you have to make a return. You think much more short-term and purely financially when these things have to be built over several years.”

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Avoiding these traps is what Kestelman calls “smart money.” As a league owner considering expansion clubs that will most likely be privately owned, smart money is more appealing than the amount of money someone could have.

“Smart money in sport in terms of private ownership is a winning combination. People who think of it as a hobby aren’t for it, and private equity coming in with short-term goals is a dangerous thing.”


For Kestelman, the great benefit of private ownership in sport is the ability to be more decisive; to avoid competing interests slowing down or diverting a strategic plan.

“I’ve been in this sport for almost 20 years – from investor to sponsor, to co-owning a club, to owning the league – almost 20 years now,” he says.

“One thing I’ve seen with the different iterations is the inability to make decisions. When you have a lot of people in the room where you have to vote, you have a lot of opinions and disagreements. The inability to make decisions quickly and concisely kills many sports and business activities.”

He says the NBL’s resurgence would not have happened without that freedom.

“We don’t always win popularity awards with team owners, but history has shown how far the business has come in the time we’ve been involved.”

Ultimately, Kestelman believes private money is good for sport and sport can be lucrative for business.

“Sport is a very good business to invest in,” he is convinced.

“We all know that live sports broadcasts cannot be reproduced. In the Netflix era of watching on-demand, one of the few things people can still attract is sports. As a commodity, it is super valuable.

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“I would advise anyone thinking about investing not to be a short-term investor. Anyone looking for a quick return to sport should think twice.”

Shannon Gil

Shannon Gilcontent producer

Shannon Gill is a Melbourne-based sportswriter specializing in AFL, cricket and basketball. He has previously worked in some of Australia’s largest sports organisations, has been a freelance writer and co-host of the cult sports history podcast The Greatest Season That Was for the past decade. Pixies and TISM fan.

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