JPMorgan Chase on Thursday said it has bought an equity stake in a data analytics company owned by New England Patriots owner Robert Kraft, as the bank looks to sports ownership as an avenue for increased returns for its wealthiest clients. Financial details weren’t given.
The data company, Foxborough-based Kraft Analytics Group, has become an industry leader in using analytics to advise sports owners on how to make more money from their teams. It does so by analyzing data from mobile ticket sales, sports gambling activity, and team-specific marketing efforts to make the fan experience better, according to officials at the organization.
Robert Kraft, chairman of the Kraft Group, said in a statement that this approach makes the organization a “leader” in using analytics to help teams speak to their customers “more directly.”
Jessica Gelman, chief executive of Kraft Analytics Group, said in an interview that JPMorgan’s strategic investment in the organization validates its data-driven approach to sports ownership.
“Better engagement leads to a more passionate fanbase,” Gelman said. “Helping teams, and team owners, harness that [data] to understand their customers — those are all the key elements that make the overall fan experience better and increase the asset value of the team.”
Kraft Analytics Group, or KAGR, advises around 20 clients, including the National Football League, teams in the five major sports leagues, and various college athletics programs. Now, with JPMorgan’s strategic investment, KAGR hopes to expand its operations as it gets access to a larger set of current and prospective team owners, Gelman said.
Gelman — a former basketball player for Harvard University and a professional team outside Tel Aviv — began working for the Kraft family in 2002, handling business development. The success from her data-driven approach in that role led the Kraft Group to formally spin off her division five years ago into a separate entity, she said. (Gelman is also co-founder of the MIT Sloan Sports Analytics Conference.)
JPMorgan’s private wealth division, which advises clients who have over $5 million in investable assets, helps clients decide whether to buy and sell professional sports teams and arenas. The bank has seen growing interest in clients wanting to invest in sports ownership, said Vince La Padula, global head of lending solutions at JPMorgan’s private banking arm.
Mary Callahan Erdoes, chief executive of JPMorgan’s asset and wealth management division, said the bank’s strategic investment in KAGR will be crucial to its growth in sports finance.
“Sports ownership is capital intensive,” she said. “Specialized analytics are essential to the deal-making process.”