The Rise and Influence of Challenger Sports

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Welcome to the second edition of The Sports Stack! I’m truly amazed by the support I've received—we’re nearing 100 subscribers! In this edition, I’m going to examine the rise and influence of Challenger Sports in detail.

I’ll cover the following:

• Which challenger sports should we watch out for?

• How are challenger sports breaking traditional models of sports business?

• How do their content strategies differ from traditional sports?

• New technology serves as a great equaliser.

• Blood, Business, and Billions: How the UFC rewrote the challenger's playbook.

👀 Which challenger sports should we watch out for?

Firstly, a Sports Stack definition. What are challenger sports? They range from seven-a-side football leagues to high-speed sailing, and they are flipping the traditional playbook on its head. By mixing cutting-edge technology, innovative game formats, and often taking a digital-first approach, these entities are creating new leagues and sports that capture the attention of fans and investors worldwide, even in a saturated attention market.

Many challenger sports are vying for mainstream attention, but a few are beginning to stand out.

• Sail GP

• PDC Darts

• Professional Fighters League

• Kings League

• Baller League

• Padel

• Grand Slam Track (Coming Soon)

• 3 × 3 Basketball & Unrivalled

💼 How are challenger sports breaking traditional models of sports business?

When analysing these challenger sports, it's important to recognise what makes them different from traditional sports and what could give them the edge as fan behaviours and interests evolve, especially among younger audiences. Having a different business model or changing the rules and format of a traditional sport enables you to think differently and move faster.

Formats & Distribution: 

Kings League has transformed football into a digital-first, interactive spectacle. By broadcasting exclusively on Twitch and YouTube, it bypasses traditional TV rights deals. Peak match streams draw over 100,000 live viewers and engage 80% of its Gen Z-dominated audience.

According to SportsPro, 65% of Kings League revenue comes from major sponsorships, so you may question how this differs from traditional sports entities. On paper, this heavily weighted sponsorship model doesn’t seem that different, but it’s how Kings League integrates these sponsors and combines the incredible reach of their streams that make them stand out. Kings League's most recent World Cup generated over 100 million views across the 10 days of the tournament.

But what makes them different? 

By using Twitch, YouTube, TikTok, and Facebook, they can reach their core demographic and establish a global presence across over 60 countries. They also utilise Twitch's interactive features to generate revenue through microtransactions, allowing fans to actively support the league during streams by purchasing virtual gifts, paid emojis, and other micro-contributions. This builds an engaged community on the platforms where their audiences exist. It’s no longer a typical subscription-based model but an incentivised, pay-anytime model based on engagement and rewards.

Altman Solon’s 2024 Global Sports Survey reveals that 66% of sports fans find it hard to access their favourite live events, many of which require subscriptions. Of those fans facing these challenges, 56% believe they would watch more if these events were available on their primary viewing platforms. Kings League’s recent success supports this and shows that other models, not just subscription-based can work.

Athlete & player equity models:

Equity models are also on the rise, with the launch of Unrivalled, TGL and others. In Unrivalled, all 36 participating players receive equity stakes in the league, creating shared ownership and collective investment in its success. Equity distribution varies among players and is influenced by individual marketability and prominence factors. For instance, standout athletes like Caitlin Clark have been offered significant equity shares alongside substantial salaries exceeding $1 million for the three-month season. (Note - she has not yet committed.)

Unrivalled looks to be the first league to compete with the WNBA financially and with its resources. But it’s not just the WBNA that’s under threat. 👇

We’ve seen this equity model creep into traditional sports entities and leagues as athlete and player power has grown. The PGA Tour recently launched a ground-breaking player equity programme in 2024, enabling its top players to have a stake in its new for-profit PGA Tour Enterprises.

🤳 How do their content strategies differ from traditional sports?

It’s difficult to break the mould of a fan’s longstanding viewing habits and convince them to swap the time they invest in one sport for a new challenger sport. This is where the content execution strategy becomes crucial. With various formats, rules, and business models, challenger models need to leverage content as a key differentiator to break through the saturated sports and entertainment attention market.

Traditional sports leagues have long relied on conventional broadcasting and content distribution methods, often struggling to engage younger audiences. In contrast, emerging leagues like Misfits Boxing and Kings League are pioneering dynamic content strategies to engage modern viewers.

A notable aspect of the recent triumph of the King’s League World Cup, highlighted by Ed Abis, is their distribution of broadcasts across more than 25 official and streaming channels. The ability to leverage existing, engaged streamer audiences to distribute your content is an incredible lever in the race for audience attention. It also adds that ‘stamp of approval’ as audiences will trust their favourite celebrity or streamer’s opinion (the reason why influencer marketing & brand affiliation has boomed in recent years).

While not directly stemming from a challenger sport, the rise of watch-along streams is certainly significant. The recent Overlap experience and Australian Open Bluezone have brought these watch-along activities into the spotlight, integrating them into mainstream sports and related entertainment.

According to Ed, whose company Dizplai powered The Overlap’s watch-along, integrating live data and live chats helped make the production successful. Approximately 700,000 people tuned in to the original production, and another 600,000 watched the highlights of Man United vs Arsenal.

These innovations reflect a shift towards interactive and ‘live-adjacent’ content in the sports & sports entertainment industry. As consumer preferences evolve, traditional sports leagues must embrace digital platforms and innovative content strategies to stay relevant and engaged. The success of challenger leagues highlights the need for established organisations to modernise their audience engagement approaches.

🤖 New technology serves as a great equaliser.

Technology is becoming more accessible and increasingly democratised across all industries, including sports. The true difference between challenger sports and traditional sports may not be the technology itself but how effectively it is used to create value for fans, athletes, and stakeholders. With advances in AI, we can ‘just do things now’, and as technology becomes more accessible, sports entities, including challenger brands, that embrace this new world and compliment it with strategic content creation will break through and make a lasting impact.

OpenAI’s Sam Altman predicts that AI will enable single-person billion-dollar businesses in the future. By adopting this mindset, all sports entities—not just challenger sports—have the opportunity to achieve more with less and more quickly. The mindset should be experiment, experiment, experiment. New technologies have reduced the time to market for previously complex experiences and have created a level playing field for most.

But what makes it different for challenger sports? 

Challenger sports have a significant advantage in adopting new technologies, given that traditional sports organisations often struggle with outdated systems and processes. Creating something entirely new is easier than modifying, managing and rebuilding existing structures and frameworks.

🥊 Blood, Business, and Billions: How the UFC rewrote the challenger's playbook.

MMA, particularly the Ultimate Fighting Championship (UFC) is perhaps the most prominent example of a challenger sport breaking into the mainstream in recent years. The UFC has grown from a niche combat sport in the 90s to a global phenomenon, challenging boxing’s dominance in combat sports.

Despite considerable controversy and regulatory obstacles, the UFC slowly gained legitimacy by implementing stricter regulations, establishing weight classes, and collaborating effectively with state athletic commissions to sanction events. This strategic change, along with a sequence of smart acquisitions (such as Pride FC) and cross-promotional agreements, evolved the UFC’s revenue streams from relying solely on pay-per-view sales to a diverse mix that encompasses television rights, live events, sponsorships, and video games.

By the mid-2000s, the UFC had firmly established itself in pop culture, boosted by hit reality TV shows like The Ultimate Fighter and the emergence of star fighters who captured public attention beyond the sport. In 2016, the landmark $4.025 billion purchase by WME-IMG (Endeavor) highlighted how far the promotion had evolved from its marginal origins. Today, the UFC’s adoption of advanced technology—including streaming services, real-time analytics, and social media—positions MMA as one of the most significant and rapidly growing sports entertainment brands worldwide.

Traditional and longstanding sports entities should not default to a mode of fear when faced with challenger sports but instead use them as motivation to look inward and innovate their own products, helping to always adapt to fans' evolving needs.

As the saying goes, ‘The hunters become the hunted.’ 👇