Monetizing Innovation—The Story of Yes Network and AC Milan 🏟️

What drives you out of bed every day? For Gerry Cardinale, founder and managing partner of Redbird Capital, it’s the thrill of playing shadow entrepreneur and solving problems with capital. His journey from Wall Street to owning one of the world’s most storied football clubs is a testament to innovation and bold decision-making.

Introducing Redbird Capital 📈

Redbird Capital is an investment platform that allows Gerry to invest the way he did successfully during his 20-year career at Goldman Sachs. The core idea: Solving problems with capital. In Gerry’s words, he starts not with the deal but with the problem, seeking legitimacy in every investment. This approach has led Redbird to become a major player in the sports media landscape.

The Game-Changing Deal: Yes Network 📺

In the late 1990s and early 2000s, most investments in media focused on distribution channels like cable systems, outdoor billboards, and TV stations. But the creation of the Yes Network was a radical idea—monetizing intellectual property owned by sports franchises.

When George Steinbrenner, the visionary owner of the New York Yankees, broke away from Cablevision and MSG, he sought a way to capture more value from his team’s games. This led to the formation of the Yes Network, a revolutionary concept at the time.

Dealing with Challenges 💡

The deal to form the Yes Network was handshook on September 10, 2001, the day before the tragic events of 9/11. Despite the uncertainty, Goldman Sachs decided to back the venture with a $335 million check, making it the largest private equity check ever written at the time. This tenacity paid off as the Yes Network rapidly became a major player in sports media, eventually selling to Murdoch for roughly $4 billion in 2013 and then bought back by Redbird in 2019.

The Transformation of AC Milan ⚽

Leaving Goldman Sachs to found Redbird Capital was a tough decision for Gerry, but it allowed him to scratch his entrepreneurial itch. One of Redbird’s most significant investments to date is in AC Milan, one of the most storied clubs in European football.

Hitting the Ground Running 🏃

The journey into European football wasn’t random; it was methodically planned with guidance from Billy Beane, the Moneyball mastermind. Redbird looked at hundreds of clubs before making their first control buy in Toulouse, France. The success there paved the way for their investment in AC Milan.

When Redbird acquired AC Milan from Elliott Management, it marked an important transition. With improvements in team management and strategic changes, AC Milan made it to the semi-finals of the Champions League in just their first year under new ownership.

Other Noteworthy Ventures 🌐

At Redbird, every investment builds off the previous ones, creating an interconnected web of value. Examples include:

• On Location – Built from the success of Legends Hospitality and Yes Network.
• One Team – Originated from On Location.
• Ever Pass – Built on previous NFL deals.

These investments highlight Gerry’s ability to spot synergies and capitalize on them, bringing a comprehensive approach to investment.

The XFL: Spring Football Reimagined 🌸

Gerry’s investment in the XFL further exemplifies his innovative approach. Understanding the demand for quality spring football, the XFL aims to be a significant part of the NFL ecosystem.

With support from the NFL, the XFL is poised to be a development league, offering a pathway for players who didn’t make the NFL initially but have NFL-quality talent. This partnership and mutual benefit illustrate Redbird’s commitment to creating long-term, sustainable value.

Lessons in Entrepreneurship 🔑

For budding entrepreneurs, Gerry offers invaluable advice:

• Understand Your DNA: Determine if you have a natural inclination for investing.
• Passion Over Money: Follow your passion; the money will come as a byproduct.
• Value of Integrity: Build trust and legitimacy in your business practices.

Final Thoughts 💬

The story of Redbird Capital, from the radical Yes Network deal to the reinvigoration of AC Milan, showcases the power of innovative thinking and strategic investment. Whether it’s rethinking traditional media rights or diving into European football, Gerry Cardinale is always ahead of the curve.