Being Outside Cricket

Today marks the second phase of the process to sell The Hundred’s teams. As news has trickled out of the recent days and weeks, I have started to ask myself the question: If I was a billionaire investor and was offered the opportunity to buy one of the eight Hundred teams, how much would I be willing to pay?

We have been given a unique view into what investors have seen behind the scenes, thanks to an extraordinary leak of confidential ECB projections by IPL founder Lalit Modi. It includes the ECB’s estimates for both revenue and costs up to the year 2032, as well as (perhaps more importantly for us) the actual figures from 2024.

2024

The leaked ECB projections over the course of the next eight years become so positive that even their media partner the BBC has labelled them “overly optimistic”. However, the 2024 figures are presumably fairly accurate and so these are the first things I would look at.

Team	Central Revenue Distribution (£m)	Total Revenue (£m)	Total Costs (£m)	Total Profit (£m)
Birmingham Phoenix	4.5	5.9	5.0	0.9
London Spirit	4.5	6.8	5.8	1.0
Manchester Originals	4.5	6.0	5.0	1.0
Northern Superchargers	4.5	5.8	4.5	1.3
Oval Invincibles	4.5	7.7	5.5	2.2
Southern Brave	4.5	6.1	5.6	0.5
Trent Rockets	4.5	6.2	4.7	1.5
Welsh Fire	4.5	5.4	4.9	0.5

There are two things which leap out at me here, regarding the two London teams. Oval Invincibles appears to have twice as much profit as almost all of the others, whilst London Spirit is only the fourth most profitable franchise due to having the highest level of costs.

So, in the hypothetical scenario in which I have enough money to buy these teams, how much would I pay for these teams if I expected to make a profit based purely on these figures? That would depend on how confident I was about the long-term viability of The Hundred. It’s like the difference between renting out a house or investing in cryptocurrency. People are happy to accept lower rates of return on houses because they can be fairly confident that the asset will still be around in twenty or thirty years time. The same is not true of cryptocurrency and NFTs, so investors want to make as much money as they can as quickly as possible.

For the sake of argument, I will use 8% and 15% gross profits (ie before taxes and other costs) as the two benchmarks. At 8%, I would expect to have earned my stake back within thirteen years. At 15%, that falls to seven years.

Team	Total 2024 Profit (£m)	15% Valuation (£m)	8% Valuation (£m)
Birmingham Phoenix	0.9	6.0	11.3
London Spirit	1.0	6.7	12.5
Manchester Originals	1.0	6.7	12.5
Northern Superchargers	1.3	8.7	16.3
Oval Invincibles	2.2	14.7	27.5
Southern Brave	1.0	6.7	12.5
Trent Rockets	1.5	10.0	18.8
Welsh Fire	0.5	3.3	6.3

Bear in mind that these valuations are for 100% of the teams, and not just the 49% minority stakes which the ECB is currently attempting to sell. The ECB reportedly believe that the teams are collectively worth around £1bn, including the 51% stakes being gifted to the hosts, but the sum of 8% values here is just £117.5m.

2025

Of course, the 2024 season has already been and gone. If I were to buy a team, the first opportunity I would get to actually do anything would be in 2025. This is important because most of the contracts agreed from the beginning of The Hundred expired in 2024; The Sky and BBC TV deals, the KP Snacks sponsorship, the hosting agreements, and the County Partnership Agreement which governs how much professional cricketers are paid in England to name a few. The ECB slides leaked by Lalit Modi gives hints to how some of these are going to change.

The entry regarding domestic TV revenue is interesting. It shows an increase from £37.8m in 2024 to £54.3m between 2025 and 2028. This is in spite of a decline of 35-55% in terms of viewers on Sky from the first season in 2021 to 2024, which most people would expect to cause a drop in any TV deal’s value.

There are two possible rationales for how both can be true. One is that Sky and the ECB signed the contract covering these years in 2022, before the second edition of The Hundred, under the assumption that audiences would increase year-on-year. They have in fact fallen in each successive season, but the perceived value to Sky in 2022 might have been higher than it would be now. The other possible reason is simply that Sky pays for everything in a single block payment, and it is the ECB which arbitrarily assigns values to each individual asset. I have written before about how they appear to intentionally and systematically undervalue women’s cricket in these calculations, for example. The ECB are trying to sell The Hundred teams to investors, and so they stand to make more money from this if the TV value of the competition is higher.

Despite the growth in central revenue thanks to the domestic TV rights, the ECB’s projections show decreased profits for each team by over 40% in 2025 due to increased costs. Hosting fees more than double for each team, whilst team wages increase by over 80%. Both of these costs appear to be written in stone and non-negotiable (presumably already agreed with the host grounds and players’ union), which means that any new owner cannot avoid taking this hit.

Team	2024 Profit (£m)	2025 Profit (£m)
Birmingham Phoenix	0.9	0.4
London Spirit	1.0	0.6
Manchester Originals	1.0	0.4
Northern Superchargers	1.3	0.7
Oval Invincibles	2.2	1.7
Southern Brave	1.0	0.4
Trent Rockets	1.5	0.8
Welsh Fire	0.5	0.4
Total	9.4	5.4

These figures look terrible, but if I was an investor then the one thing which would leap out at me is that teams in The Hundred are currently making a loss in terms of live attendance. The total projected ticket revenue for the group stages in 2025 is £10.9m, but the total costs (excluding hosting fees, because teams need a TV-capable cricket ground even with no fans) are £14.3m. That is the sum of Ticketing (a small and unavoidable cost), Event Delivery (fireworks, live music, and other non-cricket entertainment) and Marketing. If you cut the last two by 90%, which would align both budgets with typical costs in the T20 Blast, then that frees up roughly £12m across the eight teams.

If each team did this, resulting in higher profits than the ECB’s 2024 figures, then the projected team values almost double as a result.

Team	Total Profit (£m)	15% Valuation (£m)	8% Valuation (£m)
Birmingham Phoenix	1.9	12.9	24.1
London Spirit	2.4	16.0	30.0
Manchester Originals	1.9	12.9	24.1
Northern Superchargers	1.9	12.5	23.4
Oval Invincibles	3.3	22.1	41.5
Southern Brave	1.9	12.9	24.1
Trent Rockets	2.2	14.3	26.9
Welsh Fire	1.8	12.3	23.0

From a total team value of £117.5m based on the 2024 figures and an 8% annual return, this increases to £217.1m if owners cut costs for the 2025 season. It is still a long way short of the ECB’s stated £1bn valuation for the eight team franchises, but at least demonstrates a potential upward trajectory.

On a related note, a few teams might see an opportunity to increase ticket prices in order to make even more money. This isn’t viable for everyone (Welsh Fire had half the ticket revenue of any other team in 2024, for example), but Oval Invincibles could arguably gain a few hundred thousand pounds every year.

A Volatile Future

As with almost any prediction, the ECB’s projections become less and less reliable the further into the future they go. The general consensus, not just from people with obvious motives to talk down the value of the competition like Modi, is that ECB’s long-term expectations in terms of overseas TV and sponsorship revenues appear virtually unattainable. Given the lack of Indian men’s cricketers and the unfavourable time difference between the UK and India, there is a natural cap on how much widespread interest The Hundred can attract in the Indian public. There will be some, and is already, but a large portion of that will be based around gambling rather than any actual affinity for the competition. This can be seen in some county Youtube feeds, where the comments are often overrun by Indian bettors

The financial foundation of The Hundred is the domestic TV revenue from Sky and a Freeview partner (I say “a Freeview partner” because the BBC has yet to indicate whether they will be broadcasting any English cricket on television next year). The ECB predict this will be worth £85.0m in 2029, which equates to 64% of the ECB’s income which is distributed to the teams even with a projected 1050% increase in overseas TV revenue and 390% increase in sponsorship revenue from 2024 which many people consider unrealistic.

Is £85m a year an attainable sum? Possibly. UK sports broadcasting deals are amongst the most valuable in the world, which is one reason why American sports leagues like the NFL court UK broadcasters with games in London and contemplate hosting teams here. It isn’t a wholly ludicrous amount, if The Hundred can gather some momentum in the next few years.

Aside from increasing the number of viewers, there are a few other factors which could boost the value of any UK TV deal. Competition is a big one. The TV rights for English cricket from 2020-2024 experienced a big increase thanks to a bidding war between Sky Sports and BT Sport. In 2022, when the next contract was signed, BT Sport was about to be taken over and not interested and so Sky were able to get the rights with no increase at all. If the ECB were able to have TNT Sport or streamers such as Amazon become serious contenders then it would almost certainly increase how much money they would expect to get.

There is also the most obvious path to securing more TV money: Play more matches. If The Hundred lasted 6 weeks then it would clearly be worth more to a broadcaster. It would be unpalatable to the counties and probably make the existence of an English international window untenable, but if the ECB was desperate to finance The Hundred then it would be an option.

All of this assumes that Sky will want to bid for The Hundred in 2029 at all. The number of viewers has fallen in every successive season of The Hundred. If this continues then at some point it will fall below the threshold of profitability for Sky. It is an expensive competition to produce daily coverage for, relative to the T20 Blast for example, and a lot more expensive per game than the Blast (or other T20 leagues) in terms of the rights.

One question which might ring alarm bells for potential investors is whether the ECB’s projections include all of The Hundred’s costs. A review of the ECB’s accounts by Fanos Hira in 2023 suggested that there was an additional £14.5m per year of expenses which the ECB didn’t include in their internal project budgets. This might include the use of the ECB’s offices, central ECB staff spending time working on the competition, the promotional materials attached to the All Stars and Dynamos programmes, amongst many other things. If The Hundred is spun off as an autonomous entity, one in which the majority of counties no longer have a financial stake in its success, then there is little reason to suppose this extra support will continue.

With this level of uncertainty about The Hundred’s main source of revenue and the dubious nature of the ECB’s other projections, the level of risk goes up for potential investors and therefore the value of the teams goes down. In order to counteract this, I suspect that the ECB will have to give specific guarantees to buyers about both the central financial payments and maintaining the broader ecosystem of support around the competition.

Put simply: If I was buying a team, I would insist on a contract where the ECB guaranteed to pay me £5.3m per year from 2029 to 2032 (as the ECB’s projections state), regardless of whether The Hundred’s TV deals and sponsorships were sufficient to cover this amount or not. If that has to be subsidised from the ECB’s Test revenue, so be it. In fact, I’d probably push for a contract lasting at least a decade and possibly more.

Don’t Forget The Women

Most articles about the sale of The Hundred teams, and the sale itself, seems to completely forget about the women’s competition. This is a mistake, for a number of reasons.

The Hundred has a claim to be the premier domestic women’s cricket competition in the world. It has the greatest attendance of any women’s cricket competition, including ICC World Cups. It has a very high standard of play, which only stands to increase next year as every single player will be a full-time professional. Only the WPL, with its vast TV audience, overshadows it in terms of financial performance.

The gap in UK TV viewership between the men’s and women’s Hundred has fallen by roughly 60% between 2021 and 2024, suggesting that the women’s competition is gaining in terms of popularity (or at least declining less quickly). In fact, if this pattern continues then the women’s Hundred could overtake the men’s as the most valuable aspect of the TV package within the next decade. I am not joking.

So, despite the fact that a lot of people consider women’s cricket to have zero commercial value and the proceeds of selling eight women’s teams won’t send an extra penny towards women’s cricket in England and Wales, a speculative investor might well look at the women’s competition and see an opportunity to get in on the ground floor before its true value is realised.

It’s Not Just About Money

The whole of this post has assumed that the reasons for someone buying a team in The Hundred are purely financial. There are a few other considerations which may push the value up for some investors.

If someone already owns a number of T20 team franchises, then an English team offers a chance to scout and hire English players for their overseas teams. It also promotes their team’s brand in what is a lucrative sports market, even if this particular competition isn’t the most successful.

It has been suggested that some overseas investors are attracted by the idea of owning a bit of English cricket. The after-effects of being part of the British Empire, followed by the dominance of England and Australia within global cricket until the 21st Century, means that a number of Indian billionaires see this as an opportunity to ‘stick it to the man’. To impress on the ECB that it is India and Indians who hold reins of power now.

There is also the possibility of buying political influence. Anyone who buys a team becomes, at the very least, a business partner with the ECB. If you consider how obsequious the ECB is towards Sky, then it certainly appears to be the case that the ECB will bend over backwards to support the interests of companies they work with. If you’re a billionaire who can afford to lose the money, why not spend £50m on a sports team which coincidentally increases your chances of getting measures you support through ICC meetings?

But even with all of the intangible benefits, the potential of the women’s teams and the cost-cutting I’ve listed above, I cannot fathom why anyone would think the total value of the teams could be worth more than £400m or so. Even that figure feels highly generous. If the ECB and counties are expecting a billion pound payday, I expect they will be disappointed.

Richard Gould has said that he won’t sell the teams for less than he thinks they’re worth, but the pressure from nearly-bankrupt counties like Yorkshire for extra cash will be too much to withstand for long. The Hundred’s teams will be sold, soon, for whatever amount the investors offer. If cricket wasn’t something I loved watching, I’d be eating some popcorn whilst watching the slow motion car crash of what used to be the most popular sport in the country self-destructing through its own hubris and incompetence.

As it is, at this point I’m just hoping English cricket survives a little longer than I do.

Thanks for reading this cheery blog post. If you have any comments on it, or anything else, please leave them below.