BlackRock Sep 18, 2026
With David Rubenstein, Co-Founder and Co-Chairman of The Carlyle Group
The Los Angeles Lakers sold for $12.5 billion one year after changing hands for $10 billion, and a few years after being worth about $6 billion. The Boston Celtics went for $6.1 billion having once been bought for around $330 million.
A private equity investor looking at that record would normally be describing a trade. David Rubenstein, who has spent a career underwriting double-digit returns, said he bought his own team for a reason that has nothing to do with the numbers.
"Well, I did it for a reason that's unrelated to investment."
Rubenstein co-founded The Carlyle Group, is an original signer of the Giving Pledge, and in March 2024 led the group that paid $1.7 billion for the Baltimore Orioles, the team he watched as a child. His book on what he learned from other owners is the reason for the conversation, on BlackRock's podcast The Bid.
The full interview is covered here so you can skip it.
Here are the 11 lessons that matter.
Key Takeaways
95 of the 100 most-watched US television shows in a given year are live sports
He bought the Orioles as a civic gesture rather than an investment, and said so first
The Lakers at $12.5B, the Celtics at $6.1B and the Orioles at $1.7B against a 1954 price of $2.2M are his price evidence
Franchise prices are not a bubble yet, on his account, but a plateau is likely because nothing rises forever
Owners he interviewed never brought up what their teams are worth, including one sitting on a gain from $172M to $8-9B
A sports hold is 10 to 30 years, against five to seven in private equity
Baseball teams run on $200M to $300M of annual revenue, modest next to the companies Carlyle owns
Smaller investors can now buy in through partnerships at the $100K to $500K level
Outside sports he names AI first, then quantum computing, fusion, biotech, space and aerospace defense
1. Why He Bought the Orioles
Asked whether he approached a sports team as an entertainment business, a media business or something else, Rubenstein rejected the frame in his first sentence.
He put the motive before the analysis
Well, I did it for a reason that's unrelated to investment.
David Rubenstein
What followed was an account of where his giving had gone and where it had not. He has signed the Giving Pledge and directed most of his philanthropy to universities his family attended and to Washington, D.C., where he has lived for four decades.
Baltimore had not received its share
I really didn't do as much for Baltimore as I thought I should. I grew up there. My parents grew up there. My parents were married there. They raised me there. They're buried there. I'm going to be buried there.
David Rubenstein
He had served on boards at Johns Hopkins without giving what he called staggering sums there. The team purchase was the correction.
2. Not a Private Equity Deal
The host noted that Rubenstein knows how to evaluate an investment, and asked what made this one different. The difference was the return requirement.
He dropped the rate-of-return test
Well, in the private equity world, you're trying to make money, and you're always looking at certain rates of return. Your investors are looking for double-digit rates of return and so forth. In this particular case, I didn't really focus on that quite the same way.
David Rubenstein
He recruited co-investors on the same basis: people involved in Baltimore's revitalization who might also like baseball. He was careful to separate his own motive from the market's.
The rest of the market is not doing it for civic reasons
Now, the world has changed, and it was the case many years ago that people made sports investments because they really love the sports. There's no doubt today that a lot of people are attracted to it because the profitability seems to be pretty high if you get lucky and you get it at the right time.
David Rubenstein
3. Baltimore's Lost Tax Base
Asked to explain the civic argument, Rubenstein laid out the city's position in numbers rather than sentiment.
The city has fallen out of the top 20
When I grew up in Baltimore, it was the ninth biggest city in the United States in the 1950s and 60s. Now, it's not even top 20 in terms of population.
David Rubenstein
Population loss, crime, drug problems and the departure of corporate headquarters have taken the tax base down with them. Then he named a structural feature most listeners would not know.
Baltimore and St. Louis are the only US cities outside a county
I should point out that in the entire United States, there are only two cities in the country that are not in a county. One is Baltimore and one is St. Louis, which means when you move out of Baltimore City or St. Louis, none of the tax revenues that you might give to a surrounding county go back to the city.
David Rubenstein
A city outside a county keeps none of the tax revenue of the suburbs around it, so a resident who moves out takes their contribution with them entirely. That is the mechanism behind his argument that the team is a way to revitalize the downtown area around the stadium.
Camden Yards changed how stadiums get built
And when it opened in the early 90s, it was revolutionary for baseball because it was a downtown stadium arena which hadn't been built that way recent years. Recent years, you build things in the suburbs and this one was designed to look like an old park, Wrigley Field or Fenway Park.
David Rubenstein
Every stadium built from 1991 onward wanted the same model, he said.
4. What the Refurbishment Buys
The host said the park still looks much as it did on a visit 20 or 25 years earlier. Rubenstein corrected the ownership point first: the state of Maryland owns Camden Yards through the Maryland Stadium Authority, and it provided money to refurbish.
The list of what the money went on
And we've done a bigger scoreboard, better sound system, better dugouts and clubhouses, more restaurant-related facilities, better food facilities, and many different things.
David Rubenstein
The test is whether the evening is worth the ticket
So, you want to have a good winning team, which will always bring fans to the stadium, but you want to have the food be good, the amenities be good, the whole experience be something that they think is worth the price that they pay.
David Rubenstein
5. Why Fans Care So Much
Asked what surprised him about the job, Rubenstein compared the public's interest in a baseball team with its interest in everything else he owns.
Nobody asks him about the aerospace company
Well, Carlyle owns lots of companies, and virtually nobody ever comes up to me on the street and says, "Hey, how's your company doing in the chemistry industry? Or how many people are really employed by you in the aerospace industry? Or how's your aerospace company doing?" Nobody cares about that.
David Rubenstein
The disproportion is the point, because the team is a small business by his firm's standards.
A baseball team is a modest revenue business
When you think about it, baseball teams, for example, are relatively modest revenue organizations, 200, 300 million dollars or something like that in revenue annually. And that's modest compared to the kind of companies that Carlyle or other large firms like ours own.
David Rubenstein
His explanation for the gap is borrowed status rather than economics. A fan gets none of the proceeds if the owner does well, so what they are buying is a share of somebody else's success.
What a fan is actually getting
Because people want to feel that they have some attachment to success. People want to be successful. And if their local team is successful, they feel like they're successful.
David Rubenstein
The host said New York had shown the same thing when the Knicks won the NBA championship, and that millions of people across the five boroughs shared the feeling.
6. Owners Care About Winning
Asked what the owners he interviewed for the book had in common, Rubenstein gave a single answer and then two examples.
The priority is not the return
They care more about winning than making money. Winning is everything. Making money, it's nice. You want to make money, you don't want to lose money, but they take much greater pride in the success on the field.
David Rubenstein
He had interviewed James Dolan that weekend and asked what a championship feels like after 50 years of criticism. He also interviewed an owner with six Super Bowls and a very large paper gain, who did not raise it.
The gain nobody mentioned
Also this weekend I interviewed Bob Kraft, who's won six Super Bowls. And he never mentioned how much money the team has become worth as a result of — he paid, I think, $172 million years ago. Now it's worth about eight or nine billion.
David Rubenstein
What owners say instead
It's something that owners know that the teams go up in value, but that's not their main focus. It's winning, winning and being good to the community.
David Rubenstein
7. A 30-Year Hold, Not 5 Years
The host asked whether the time frame for a return had taken adjusting to. Rubenstein said the two businesses are not comparable on that measure.
The exit date is known in advance in one and absent in the other
Sure, it's much different. In a typical private equity investment, in five to seven years you're going to exit, and you know that in advance, and everybody knows that in advance. In baseball or other professional sports, you have people owning these things sometimes for 10, 20, 30 years or more. The Steinbrenners have owned it since 1972, the Yankees.
David Rubenstein
He gave a live example of what that changes. The Orioles had just signed a player placed on waivers by the New York Mets, at real cost, with only 30 games left in the season.
Spending late in a season only makes sense if winning is the objective
and we only have 30 games left in the season, but we thought it was worth it to spend that fair amount of money because we really want to win and get to the World Series and get to the championships and get to the playoffs if possible
David Rubenstein
On how the organization runs, he described two reporting lines: baseball operations under a general manager or head of baseball operations, and a separate business side selling tickets, suites, sponsorships and advertising. Both report to him. He holds the control position alongside a co-owner who is chief executive of Ares and who he expects will eventually take it.
His rule for overriding the people he hired
But, if you're overturning your baseball person or you're overturning your business person all the time, you probably should get somebody else.
David Rubenstein
The counter-example is the owner who did everything himself, and whose economics are still the most striking in the interview.
Steinbrenner put in $250K of his own money
He paid $8.8 million in 1972. He put in 250,000 of his own money. That's all he had to put in. And he syndicated the rest, and the team is now worth about $10 billion.
David Rubenstein
8. Prices Are Not a Bubble Yet
Asked what risks new entrants to the asset class underestimate, Rubenstein declined the bubble word and then listed the prices anyway.
He will not call it a bubble, but the rate surprised him
Well, everything doesn't always go up to the sky forever. Sometimes you have hiccups like we do in the business investing world. And so sports right now I won't say it's a bubble, but clearly prices have going up at rates nobody anticipated.
David Rubenstein
The four sale prices he used as evidence
Most recently we saw the Los Angeles Lakers were sold for 12 and a half billion dollars one year after they sold for 10 billion dollars, and that was just a few years after they were worth about 6 billion dollars. The Boston Celtics just sold for 6.1 billion dollars. They'd previously been purchased for about 330 million dollars. The Orioles came to Baltimore in 1954 for a purchase price of 2.2 million dollars. My partners and I paid 1.7 billion dollars.
David Rubenstein
His forecast is a plateau, not a fall
Nothing goes up forever, and therefore it's likely at some point there'll be a plateauing, but right now people like it
David Rubenstein
Three reasons support the prices in his account: league television contracts, a US population that has almost doubled since his childhood, and a far larger number of franchises to own.
The leagues were a fraction of their current size
For example, when I was growing up in 1960 the number of NBA teams was eight. The number of NHL teams was six. That's it. The entire NHL was six teams. The entire NBA was eight teams. Now they have, I think, 30 or 32 teams.
David Rubenstein
9. 95 of the Top 100 Shows
The host recalled a figure from the book about how many minutes a year Americans spend watching televised sport, put it at something like a trillion, and said he was not certain of the number. Rubenstein did not repeat it, and gave a different one.
Live sport is almost the whole list
It's staggering, and think about this: the 100 most popular TV shows in any given year in the United States, 95 are live sports. 95 of the 100 most popular.
David Rubenstein
That is the demand side of the television contracts he had just credited for franchise values.
10. AI After Moneyball
Asked whether AI had changed how he thinks about investing in sports, given he bought the Orioles in March 2024, Rubenstein separated the two questions.
It has not changed the sports thesis, and it will still arrive
It hasn't changed my thinking about investing in sports, but AI is going to permeate our society and it will permeate sports.
David Rubenstein
His precedent is the analytics wave. A book called Moneyball showed that baseball could be analyzed with data rather than instinct and experience, and every team now runs an analytical staff.
The analytics departments are already using it
Now every team has detailed analytical staffs, and now increasingly these staffs are using AI. So increasingly AI will be used, and some will use it better than others, but AI is going to be important for every part of society and certainly in sports.
David Rubenstein
He was careful about the timing of it.
It has not gone through the sport yet
It's clearly going to change the way some analytics are done, but again AI is not yet permeated baseball completely, and it's going to take a while before it does, but it's obviously here now.
David Rubenstein
11. Where He Looks Next
Asked what defines the next 20 years, Rubenstein started inside sports, with how people who cannot write a billion-dollar check are getting in.
Retail money is arriving through partnerships
They're investing in partnerships that will aggregate a lot of investors that might be at, I don't know, $100,000, $200,000, $500,000 level. They can buy into a sports partnership, that sports partnership will buy a team, and that person can say, "I'm a part owner of that team."
David Rubenstein
Outside sports he ranked the sectors, with one at the top and no close second.
Nothing competes with AI for now
In terms of non-sports related things, nothing is going to rival artificial intelligence for some time.
David Rubenstein
Then three more over five to 10 years
But overall, if I would say the next 5 or 10 years, areas that I think will be very important are things like quantum computing, fusion will no doubt be a big thing in the future as well. And probably things related to biotech, CRISPR, and other kinds of vaccines will no doubt be an important part of the investing world.
David Rubenstein
On quantum he made the point that the technology has been perpetually five years away and is no longer.
The five-year forecast has been running for years
Quantum computing has always been said to be 5 years from now. In other words, every year people say it's another 5 years. But now, I think we are really getting close to having quantum computing.
David Rubenstein
Quantum computers can reach some answers far faster than current machines, which is why he expects the industry to be reshaped, and he noted there are already publicly traded companies in the field. On biotech he spoke from a board seat.
Moderna is his worked example on biotech
I'm on the board of Moderna. Moderna is a company that had a technology that didn't get a lot of raves for a while, but then when it developed the COVID vaccine, people began to realize that this RNA technology can really do something wonderful.
David Rubenstein
He said trials in melanoma have been successful and that a vaccine for pancreatic cancer has been approved by the FDA. Two more areas closed the list.
Space, on the back of the largest US listing
And then I should mention space. The biggest IPO ever in the United States is SpaceX. It has a staggering valuation, but that has made other people say that their space companies should be taken public
David Rubenstein
And the sector investors used to avoid
Another area that's really attractive is one that people shied away from before, but it's called aerospace defense. As we've seen, technology is changing, drone technology is changing the way we fight wars for better or worse, and as a result, more and more people are going to invest in aerospace defense
David Rubenstein
The buyers he expects are governments and companies in countries that do not yet have an aerospace defense industry, which he said is most of them.
Bonus Insights
The first game he remembers is about the food
Sure, my father took me to an Orioles game when I was probably 7 or 8, and I didn't really know what I was doing. I rooted for the team. I remember the food was good. The hot dogs taste great. It's amazing how hot dogs taste better in a baseball stadium than they taste at home.
David Rubenstein
He collected player autographs at eight or nine and has no idea what became of them. People now ask for his, which he signs while pointing out that an owner's signature is worth nothing, and he prints rather than writes because a baseball is curved.
He puts his own peak at nine
Well, when I was a little boy, I was a good little leaguer at the age of seven, and then around eight or nine, I peaked. I was an all-star, but it was a Jewish little league, and so, you know, everybody's not going to be Sandy Koufax.
David Rubenstein
The host closed by noting Rubenstein's interest in American history and the place baseball holds in it. A host also observed that the sectors Rubenstein named are the same ones BlackRock's own investors have discussed on the show, and Rubenstein agreed.
Rubenstein's bottom line is that sports franchises have become an asset class priced on television contracts and a growing number of teams rather than on profits, that the people who own them optimize for winning and for their cities instead of returns, and that an investor who cannot buy a team should be looking at AI first and then quantum computing, fusion, biotech, space and aerospace defense.
Products, Companies & Tools Mentioned
Baltimore Orioles (Bought for $1.7B in March 2024 by his group, having come to Baltimore in 1954 for $2.2M; just signed a waived player with 30 games left)
The Carlyle Group (His firm, and his comparison point: nobody stops him in the street to ask about its chemical or aerospace holdings)
Camden Yards (Owned by the state of Maryland through the Maryland Stadium Authority, which funded the refurbishment; the downtown model every stadium built after 1991 copied)
New York Yankees (Held by the Steinbrenners since 1972, bought for $8.8M with $250K of George Steinbrenner's own money, now worth around $10B)
Los Angeles Lakers and Boston Celtics (His price evidence: $12.5B a year after $10B, and $6.1B against an earlier purchase price of about $330M)
New York Knicks (The host's example of a championship being felt across a whole city)
New York Mets (Placed on waivers the player the Orioles then paid to sign)
Moderna (He sits on the board; the RNA technology was unloved before the COVID vaccine, with melanoma trials and an FDA-approved pancreatic cancer vaccine since)
SpaceX (The largest US IPO ever, on his account, and the reason other space companies now want to list)
Ares (His co-owner in the Orioles group is its chief executive, and is expected to take the control position eventually)
Wrigley Field and Fenway Park (The old parks Camden Yards was designed to resemble)
Books & Resources Mentioned
Inside the Owner's Box – David Rubenstein (His new book, drawn from interviews with other sports owners, and the reason for the conversation)
Moneyball – Michael Lewis (The book he credits with showing that baseball could be analyzed with data rather than instinct)
The Giving Pledge (He was an original signer, and most of what he has given went to family universities and to Washington rather than Baltimore)
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