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Overtime's Evolution Continues with the Introduction of Overtime Boxing
Overtime's Evolution Continues with the Introduction of Overtime Boxing
March 14, 2023
Overtime's Evolution Continues with the Introduction of Overtime Boxing
Overtime, the Gen-Z focused sports media company, recently announced the launch of Overtime Boxing (OTX). OTX will stage fight cards from the OTE Arena in Atlanta come August.
OTX becomes the third owned and operated sports property under the Overtime banner. The company rolled out the Overtime Elite basketball league (OTE) in 2021 and the OT7 football league last year.
Overtime's evolution from digital content publisher to digital content publisher
and
rights owner is indicative of the desire that exists to grow the business.
“It’s given us more diverse [income] streams without an overall reliance on one channel, and it has been accretive to our revenues,” Dan Porter (CEO, Overtime).
It also reflects Porter’s vision for the future, to build a business with a powerful flywheel.
“At the center is a digital content creation [engine]; an expertise, a brand and a platform,” he said. “The digital content side powers the growth of the leagues, not just in terms of [fan development], but contributing revenues towards it as well.”
Overtime got its start in 2016 covering high school basketball and football. Its goal was to “capture that next generation sports audience and become [Gen-Z's] brand or community of choice,” Porter said.
The company, which set out to accomplish that using distributed media and social platforms, continues to take that same approach today.
“The core part of Overtime we’re still running, all our social accounts and covering basketball, football, soccer, gaming and lifestyle,” Porter said.
But Overtime has since introduced owned and operated assets it now utilizes too.
“We’re able to double down [on capturing Gen-Z fans] by offering them not just visual media, but live rights, a league, teams [and] athletes to cheer for,” Porter said.
Overtime chose to go down the owned and operated path for two reasons.
“Number one, it was this sense that no matter how big you get as a media property, you’re always renting other people’s rights or covering other people’s IP,” Porter said.
There was also a desire to better monetize the fandom that had been constructed.
“[We] have this huge community and a lot of what [we were] doing is essentially giving the value of [it away] to other people who own the rights,” Porter said. “As a business, you start to think, what if we just had our own league? Then we could [keep] all the value and it would expand our business model.”
Overtime’s media business still makes up ~40% of company revenues. “We work with over 100 different brands who want to be integrated in or advertising around our core content,” Porter said.
And its e-commerce arm continues to bring in roughly 20% of all revenues.
However, the startup leagues have opened up a trio of new revenue streams: media rights, licensing (think: trading cards) and long-term sponsorships.
“It’s one thing to say [ABC] brand has a campaign in-market and [it] wants to be connected to Overtime content,” Porter said. It’s another for that same brand to do a multi-year sponsorship of one of the sports leagues.
That is because the advertising dollars come from different buckets. “One is a media bucket. The other is a sports sponsorship bucket,” Porter explained.
OTE has a broadcast distribution deal with Amazon Prime Video. OTX has one with DAZN.
“Sponsorships around the league and the [Amazon] media rights deal is probably 40% [of revenues],” Porter said.
Overtime now generates eight figures in annual revenue and the company says it is trending towards nine.
However, it is still not profitable. Costs on the league side have the business in the red.
“We’re also investing, trying to expand teams and launching new properties,” Porter said.
Overtime has raised over $200 million to date.
There are no plans to raise any additional capital in ’23. The macro-economic climate will factor into decisions beyond that.
“It [also] depends at what rate we want to grow and if we want to launch or acquire other properties,” Porter said. “We could have never launched anything besides basketball, focused on profitability and gotten there. But now we have three different opportunities to build $100 million plus businesses.”
For most emerging sports properties, there are no existing fans of the product on day one.
“So, you’re literally not just building a league, but trying to build a brand and awareness from scratch,” Porter said.
That’s not an issue for Overtime though. 80 million people follow the company across platforms.
Porter estimated that 99% of OTE fans are Overtime followers who discovered the league via one of its social channels.
“That’s a huge advantage for us,” he said. “It is cost efficient because we don’t have to rebuild everything we do for every single league.”
The other challenge startup properties face is that people don’t “arbitrarily like sports,” Porter said. “They like sports because they care about who is playing” and rarely know the teams and/or players participating in upstart leagues.
But Overtime’s media business helps to solve for that. “If you do storytelling and engage and respond to the audience, and we respond to millions of messages, you [can] start to make people care,” Porter said.
The approach seems to be working. OTE content received more than one billion views this year, twice as many as last season.
Young fans are tuning in for the live broadcast of games too. “We’re regularly getting hundreds of thousands of people with 20–30-minute average watch times,” Porter said.
A narrative exists that
. But Porter believes it is misguided.
“Part of the reason they don’t watch is access, and part of the reason they don’t watch is it [tends to be] a long, slow product.”
Overtime addresses the former by delivering content on YouTube and across social platforms.
It has taken measures to solve for the latter too, including eliminating the need for a referee to touch the ball after a change of possession before the inbound pass in OTE games. “On average [that change] has added eight more possessions per game, a higher score and it is cutting off almost ten minutes off the broadcast,” Porter said.
Overtime expects to continue adding sponsorship revenue as advertisers become increasingly familiar with its challenger leagues. The hope is the media rights dollars will follow.
The company’s long-term viability may depend on it.
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