This is Buying Sandlot — the only newsletter that focuses solely on the business of youth sports.
Today, we launched our latest podcast with John Stewart, Fastbreak AI’s co-founder and CEO.
Fastbreak recently announced a $40M Series A round, which is, best as we can tell, second only to Hudl’s $72.5M Series A in 2015 in youth sports.
I know I say all of these interviews are good, but this one particularly so. After listening, you will get a clear sense of what investors see in Fastbreak— all delivered in a rather blunt fashion.
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I’m aware that only a small percentage of our 12,371 subscribers will watch or listen in-full.
So we bring to you, the reader, 5 things I learned from my conversation with John Stewart.
What and Who
What: Fastbreak AI is an AI-driven sports operations company that streamlines league and tournament scheduling, travel logistics, ticketing and sponsorship activation, bringing pro-level efficiency to both elite leagues and grassroots events.
Who: John Stewart built the business on a foundation of logistics and SaaS. He previously built and sold his route optimization company, MapAnything, to SalesForce for $250 million. He is now applying that playbook to transform sports scheduling and operations across pro and youth markets.
Here’s what I learned from him about Fastbreak’s business, their plans for world domination, and the youth sports landscape overall. His quotes are in blue
1) Pro Sports Are The Proving Ground, But Youth Sports Is Where The Money Is Made
Quotes are lighted edited for clarity
Having professional sports leagues is fantastic. We have north of 50 of them as our customers. These are the largest professional sports leagues in the world, by far. You know, but it’s a relatively small market. By the time you get to the hundredth largest sports league, it's not a significant amount of revenue. So it's hard to build and scale a business if you're just working on professional sports.
Yeah, we were going to do this. So this wasn't a pivot. I could show you the investment decks from way back in 2023 when we first raised capital and it was on the roadmap. We were always going to enhance the direction of the company with attacking the youth sports marketplace.
This could be a stand-in for the overall sentiment around youth sports right now— there is only so much opportunity at the pro level, but the TAM of youth is MASSIVE with a long-tail of customers.
Like a bizarro Drake, Fastbreak started at the top, now they here.
2) Youth Sports Scheduling Has an Insane Number of Variables
If we take a look at tournament scheduling, there's some very common ones that are cross-sport, right? So the most common one you see at youth tournaments is shared coaches.
Two different age groups can't play at the same time because they share the same coaches— the 14 year coach and the 16 year coach.
More importantly, a lot of times these tournaments take place over multiple facilities. So you actually have to consider the facility gap and travel time between those facilities to be able to make that work.
And then again, you have some teams, Hey, I'm flying in from California. I'm not going to get there until one in the morning. Please don't give us the 6 a.m. game, or I have to catch a flight back. Please don't give me a game after 4 p.m. on Sunday.
And then a lot of times it's pool play into bracket play, so you have to be really careful about strength of ranking. So one of the things that we are eventually going to do is build a ranking system, which I know a lot of people have tried, but we're data scientists we're working on… you know, I'm okay to say this, but we're literally working on the international system for Taekwondo right now. We're going to apply some of that down at the youth level.
But [it’s about] making sure the matchups are proper because it's not any fun for a superstar team to get a team that's not competitive. It's not fun for either team. It's not fun for the kids getting blown out. It's not fun for the kids that are dominating because if they're going to these tournaments, they want competitive play. So these are all a bunch of factors that we have to consider.
Now compare that to the decision the league made for my son’s coach pitch team, which I coached, to schedule every game at 8 AM on Sunday. Though I’m not sure you need advanced AI to tell you that suburban dads are likely to be irritable and lightly hungover at the hour.
Anyway, John calls these “constraints”. The pro leagues have many of them, but somehow, there may be more at the youth level, with inconsistent inputs. Only AI can handle something like that— and Fastbreak considers this tech a true differentiator when they approach operators with other products and services that may have more competitors. Though their opening salvo is usually offering up rev share on a sponsor activation before any hard-sale on the software platform.
Ergo…
3) Sponsorship As Subsidy
These tournaments aren't as lucrative as some might think they are. They're very expensive to operate.
And so if you want to keep the price of participation low for the athletes, these operators have to subsidize their income in other places. And so if I'm showing up to that operator and we're bringing them sponsorship dollars, and we're delivering that through our platforms, either with our electronic ticketing platform, onsite engagement, our hotel offering, from whatever the case may be, they can keep the prices cheap while still maintaining a margin that lets them operate.
Remember, they're doing this for a living. This is how they feed their family. We provide another basically revenue source for them. And so win, win, win.
This is akin to how the media world functions. You have hard paywalls for some content, but you can democratize access to information through sponsorships.
Youth sports, in all likelihood, has veered too far toward the premium aspect, while pricing out underserved communities. And that’s largely because the for-profit side has relied mostly on participation revenue and little else. But as the business professionalizes, and operators can tap into other revenue streams - like sponsorships, concessions, and other enhancements - you can reduce the cost of participation.
My ideal situation, if the opportunity presented it, I would love to help an operator basically have his entire department funded by brands. And I don't care if we logoed everything up from the t-shirts, the court to the… to every last thing that there was there, but the kids all got to play for free. That would be amazing. Right. I don't think anybody would care.
Because I do feel like there's becoming this socioeconomic divide on who can afford to participate in these things and who can't.
Now, to be fair, Fastbreak is not the only one targeting brand activations at tournaments. Far from it. Examples like BASE Sports Group come to mind. Still a great goal.
4) Some Pointed Thoughts About Private Equity
The flaw in the model is the PE is coming in with money and they're buying up all the technology companies and partners or programs, and they're slapping it together and they say that makes a company. That's not a solution. Slapping 35 products together does not make a platform.
That doesn't make a solution because you've done that. In fact, that creates a huge amount of technical debt that you now have to consolidate. So those PE companies can't get ahead of the cost curve because now they have instead of a company with one product and a need, now they've got 10 products with 10 dev staffs, with 10 sets of legacy data issues, with 10 sets of go-to-market motions. So it doesn't scale that way because of the fragmentation and the needs.
Look, we're built from scratch and we designed this outcome from day one.
If you're PE and you're just trying to buy the parts… you own all the individual parts as opposed to having a platform or solution. So I don't think, and maybe I'm wrong, but as far as I can tell, I think we're the only true platform player out there. And we certainly built every piece of it ourselves.
From a technology standpoint, I agree with the general sentiment.
Though I think 1) there are exceptions, and 2) the larger PE opportunity in the space is less about technology and more about consolidating operators to leverage shared services and cost efficiencies.
So two things can be true.
5) How Privacy Laws Could Get In The Way of Some Business Models
There's the rights around what can you do with that image, right? Have those athletes signed the waivers? Do you know that, right? If the brand is now paying for it, are they signing up for the liability around whether or not that operator or that streamer has collected the proper release waivers for putting a minor on the internet and a video?
So like I, I don't know how they're going to solve that problem. It's one that makes my head hurt. And I think I'm pretty good at sort of managing the chaos and parts. So it'll be interesting to see how that one shakes out. My opinion on that particular part of youth sports and space is I will stay away from it.
The question was about monetizing live streams with ads, and rev share potential with leagues, clubs, teams and players.
I don’t have a hard take here as I’m not well-versed enough in this area. But interesting questions, and perhaps an area for a broader deep dive around rights, monetization, and - into the weeds we go - privacy laws.
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Good game.