Formula 1 was acquired by Liberty Media f or $4.4 billion in 2016, and it's now one of the fastest-growing sports globally.
They are up billions of dollars on the investment already, and it's one of the best case studies in business.
F1 was previously run by Bernie Ecclestone & the sport was MASSIVE — 600 million people watched F1 globally in 2008.
But there was just one problem..
By 2016, that number had dropped 40%.
The sport lost over 200 million fans in 8 years. Several reasons caused F1 viewership to drop, but one of the biggest was that Bernie Ecclestone didn't care about young people.
For example, check out this quote from him in 2014.
It's so bad that you literally couldn't make it up even if you tried.
This is where Liberty Media comes in. They saw a global sport with millions of existing fans that was under-monetized and had the opportunity to expand geographically
So they acquired Formula 1 for $4.4 billion in 2016.But to turn the business around and make it profitable, Liberty Media knew they needed the US.
Why?
Because it's the most lucrative sports market globally. For example, F1's global fanbase is ~2-3x larger than the NFL, but the NFL brings in ~8x more revenue annually. Liberty Media has also altered the rules to allow more overtaking.
They turned race weekends into mini-festivals with concerts and events, and they even let ESPN broadcast races in the US for free. But nothing has had a bigger impact than their partnership with Netflix.
Liberty Media knew the way to grow in the US was through content, so they partnered with Netflix to launch F1: Drive To Survive.
Many people thought it was Udumb — Mercedes & Ferrari refused to participate at first.
But the docuseries is a home run, especially in the US. F1 viewership in the US has doubled with Netflix.
Avg. US Race Viewership
2017: ~500,000
2022: ~1 Million
Nielsen says that F1 should surpass 1 BILLION fans this year, with 77% of new fans under the age of 35.
That doesn't happen without Netflix.
And if you need another example, just look at the 2021 US Grand Prix in Austin, Texas.
US GP Attendance
2018: 264k
2021: 400k (+51%)
That made it the most-attended F1 weekend in history, and it was the first-ever F1 race for 70% of the 400k fans. This success in the United States has enabled Formula 1 to double down on its growth plan.
They will race in Miami for (at least) the next 10 years and recently added a 3rd US race on the Las Vegas Strip starting in 2023.
The US now has more races than any other country.