Andrew Thompson, SailGP Managing Director: ‘Welcome to F1 on Water’ (Ep81)

0:00SIRGP is owned by Larry Ellison. He's very clear from day one this needs to be run like a business. This isn't some philanthropic venture. It was to create a commercially sustainable sailing league that had never been done before. Then it was a case of how do we build value in those franchises? There is value to big names investing in sports teams. We wanted to make sure that they were authentic investments. So you're not just like handing to Kilian some equity and do some Instagram posts and thanks very much. They were very interested from day one. Sailing is a huge sport in France. and Killian sees the long-term opportunity.

0:34Really, we're targeting a racing fan. There's the top of the tree in racing fans, which is Formula One, and then there's a group of other kind of racing properties that are probably below that. How are we within that group of properties? And at our Auckland event, we had 20 ,000 paying spectators and 70 % of them had never touched a sailing boat. This is extreme sports and crashes and that kind of thing. That's resonating with the new generation, that's for sure.

1:01Hello and welcome to The Business of Sport, the show that takes you behind the scenes with the industry's leading owners, operators and athletes. So it's a different take we have for you this week. Welcome to Formula One on water. SailGP has become one of the fastest growing sports leagues, bringing sailing to the forefront of modern entertainment. The national teams that race identical F50 catamarans go to some of the world's most enticing coastal locations in a Grand Prix-style format with millions in prize money on the line. The franchises are valued at over$50 million and owners include major private equity and finance as well as consortiums of celebrities including Kylian Mbappe, Ryan Reynolds, Hugh Jackman and Anne Hathaway.

1:41As managing director, Andrew is in charge of the Global Water Show as it continues to develop its product and fanbase. But how do you successfully build and establish a new sporting product that delivers both the entertainment factor while proving financially sustainable? We talk about the competitiveness of the modern attention economy regularly on the show. The race is on, literally, to capture that audience and develop a new type of sailing fan. If you haven't seen what SailGP is all about, I highly recommend you take a look. This is a fascinating insight into one of sport's most exciting new products.

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3:43Welcome to Business of Sport. Yeah, it's great to be here. Thank you for having me. I'll start off with one of the more complex questions you'll be asked, but it's a new area, so let's go for it. What is SailGP? Yeah, so SailGP is Grand Prix racing on water in a nutshell. So it's a circuit that goes around the world. We've now got 13 events in iconic locations. We've got 12 national teams competing. and yeah it's it's winner takes all the end of the season for two million dollars we've got the best athletes in in the sport in in our national teams and our boats are all one design so you know they're kind of competing in a level playing field started in 2019 we're on our fifth season now halfway through our fifth season and yeah it's it's expanded significantly since we started and yeah we've got got some big plans for the future what's the origin story why did it start what was the thought process and the ambition behind this?

4:37It depends how far you want me to go back. Sgt. P's owned by Larry Ellison, who you may know has a rich history in sailing. He's a hugely passionate sailor. He's won the America's Cup with Oracle Team USA on a couple of occasions. Our CEO is Sir Russell Cootes, who is one of the greatest sailors of all time. He's won the America's Cup five times and an Olympic gold medal. So really, the origin came from their vision for the sport of sailing. If you think about the sport of sailing, there's so many different disciplines, so many different classes, and there's never been a kind of elite series that's existed for the long term.

5:16So Larry and Russell were successful in the America's Cup world. We were the rights holders for the America's Cup as Oracle Team USA. And really, the business model then kind of flowed off that. I won't go into it, but there's a number of governance challenges around the America's Cup. But really, it was creating a business model for the sport of sailing that never existed before. Tell us about that. I mean, we love governance challenges here. It's a discussion point to often take your hair out over. But they breed innovation. They breed creativity. Where there's governance issues, there's also generally opportunity to create something that's better affected and kind of creates more opportunity.

5:55So what is it about this structure that what was it about the challenges of the governance within sailing that created a sail gp window yeah well the america's cup is governed by a document that was signed by queen victoria in 1851 i believe called the deed of gift and that's ruled by the new york supreme court and you can see where the issues are yeah yeah it's a good starting place right so uh effectively what it means is you you know you need a yacht club to challenge for the America's Cup and the holder of the America's Cup, they set the rules and they set the type and size of the boat. That's kind of setting the start really.

6:32And then what that means in the modern day is whoever wins the America's Cup, they choose where the event is, they choose what boat it's in. Importantly, they take the commercial rights. So what that means is you can commercialize the cup on one cycle, but then there's always uncertainty about what's going to happen in the future because anybody could win and then anybody could also challenge that winner so you know that means that you can have all these plans for the future you can set up new venues you can try and set up long-term sponsorship deals or broadcast deals and actually when we were the rights holder of the america's cup between 2010 and 2017 you know we had broadcasters saying okay how do we do a long-term deal sponsors come into us how do we sign up for a few cycles you say well actually sorry guys we can't do that so just me saying that you know it seems pretty obvious that there's an there's an opportunity within this sport to deliver something that doesn't have that kind of stop start nature and a huge part of this is creating a sport that is also now tailored to i'd imagine kind of modern sporting ideals and passion points great technology fast uh engaging is something that resonates strongly with SailGP from what I've seen.

7:47Can we start with the boats and the technology? What is it about the boats that makes this such a great event? Yeah, I mean, firstly, this is a racing property and this isn't a traditional sailing property. These aren't old boats. These are technologically very advanced boats. They're foiling boats. There's a hard wing sail. So what that means is that these boats can go three times faster than the wind and they're just hugely efficient machines and quite often i'll have people say where's the motor in these boats you know actually you know it's the wind and you know you kind of oh the wind's not very strong but these boats are foiling at almost 60 miles per hour so we actually produce all of our own boats at our facility in southampton but we're constantly evolving the boats making sure that they're at the cutting edge of innovation we just introduced a new foiling system actually to create more efficiency there and make them more durable, but also enhance the speed.

8:45So yeah, they're at the cutting edge, that's for sure. So for those uneducated in traditional sailing, if we can call it that, what is that main difference technologically from a foil to what you would class then as sailing boat? Yeah, well, I think if you think about a traditional sailing boat, the wind is powering the boat off the wing sail. What that means is the hull is actually in the water most of the time, which creates a lot of drag, which means the boats can't actually go, that they go reasonably fast, but there's only a certain amount that they can go. But with foiling boats, they create lift that lifts the boat out of the water, and then there's no drag on the hull at all.

9:22So they're hugely more efficient in the speeds that they can get to, and they're not powered by the wind in the traditional sense. It's really the kind of riding moment between the foil and the wing sail and how that kind of propels the boat forward. So it's a hugely complex engineering feat, but it just delivers a much more compelling product. And was this a key concept at origination from SailGP? This was a new design of boats or was this a modification of something that was already being raised? Yeah, it is a modification and we're modifying them all the time, but it was a modification from the AC50 that was used in the America's Cup in 2017, which itself was a modification of the boats from the 2013 America's Cup and they're constantly evolving the whole time.

10:04And the America's Cup boats are also evolving, which is cool. And it's fantastic to see that. We believe though that the boats themselves, whilst being fantastic and hugely innovative, we believe that you need to have the same boats to create a race that actually is compelling to watch. Even in our races, they're 15 minutes in duration more or less. And the top team versus the bottom team, they're still kind of four minutes of difference between the two boats so imagine these boats having different kit you'd know the winner before you started and that was certainly what we didn't want to have as as a sports league so this is the thing i find really interesting because it's something that often dominates other sports like formula one where you know you have a similar set of rules but yeah let's say formula one doesn't centralize and make cars as a single body and then distribute them amongst the teams there are always different modifications how do you go about then i guess building and creating these foils centrally how much they cost firstly to build well a boat itself is the whole thing is about five million dollars and each team will have one each team has one boat and then we have you know a set of spares that we take on tour if there's damages or and so forth so there's quite a few i guess close calls on our boats and so we're constantly supplying kit to the tour from our facility in Southampton.

11:27Who picks up the cost of that? Is that distributed to the teams or is this centralized for SailGP? Yeah, we have a central cost system. So I'm sure we'll come on to that, but the teams pay two central costs. One is for shared services, which is kind of logistics and kind of race management, umpires, all those things. And the second one is for the capital assets. So we kind of say at the start of the year, here's what that is going to cost and then as an organization we kind of work within that parameter to deliver the boats over the season and then any innovations on the boats thereafter so what you'd really say is having this structure this model ensures that the winners are really the best sailors we're not looking at the dependence on technology we're not looking at someone's got the better car and therefore is driving better yeah it's absolutely the best sailors it's also the way that you sail the boats as well you have to really push the boats and so you can't hang back and you know so there's that side of it there's also the data side of it our philosophy from day one was that we have open data source for all the teams which means that the lower teams can see the settings that the higher teams have and they can learn from them and then that closes the gap as well but i think it's been really interesting to see that the top teams in sail gp are really diving into the data after every day i'm learning from that the more kind of traditional style of sailing of kind of like going with feeling is is not the way to do it anymore and that's been a really interesting development for us tell us then a little bit about these teams so you mentioned at the beginning that they are national how do you look at that from an ownership perspective and can you take us from the early stages of setting up when you created those first teams to now where you're going with the centralization to privatization model as well?

13:18Yeah, to begin with, we actually set out to have it a fully franchised system. And, you know, we had a group of owners in the room and we were kind of sat around the room thinking we're going to set up this league and, you know, it's going to be really easy and we'll put money in a pot and come by our, we'll all kind of work together and it'll be easy to run. And it turned out pretty quickly that it's just really hard to run things by committee. And we wanted to move quickly. This would have been early 2018. And we'd obviously just come off the back of the America's Cup. And we had a lot of knowledge.

13:53And we had boats already. We were building boats. And certainly Larry Ellison took the view that he doesn't run his businesses like committees. And we're not going to get anywhere. So he took the view that he'll take it on. and then people can buy teams or franchises off us in the future. And it was really a sense of how can we move this business quickly in these first years and make the right decisions for the future of the sport and SailGP rather than having to coalesce a group of owners to agree with it. So did Larry pick up the costs that really had to be covered? Because quite often you sell early franchise slots because you need that injection of capital early.

14:34Correct. Yeah. And we're fortunate enough to have Larry, who's hugely supportive of us as a league. He's very clear from day one, this needs to be run like a business. And this isn't some philanthropic venture. It was to create a commercially sustainable sailing league that had never been done before. So that was the primary objective there. So clearly, we were very lucky to get that support from him and continue to do so. But yeah, then it was a case of how do we build value in those franchises and those teams and also build a commercial framework that investors want to come into. And I think we've seen the growth of the league and that's also been part of the attraction as we've looked at investors coming in along the way.

15:21And that was always their objective. The first five seasons was build a property and then carefully choose owners who can come in and help us deliver what we're trying to do as an organization. I mentioned to you outside, it seems a bit like what the 100 have done, the ECB centralizing the ownership of the franchises. And then when the competition's in the place, should we say, where it's proven its value, but also is now really going to benefit from that independent investment to take it to that next level. They've gone out and tried to find the right partners. What to you does a really good partner look like?

15:52Certainly someone who's passionate about the sport. I think you do have to have that kind of fire inside of you to really move the sport of sailing into a different place. To have a business plan, you want to be here, but also you have a business plan that's going to take your franchise and turn it into something that is hugely valuable because then other owners see that and say, oh, well, that business model is working and we can emulate that in other franchises. So, yeah, I think those two things are kind of the key aspects. Obviously, you want to ensure that they have the right financial backing.

16:29I mean, that goes without saying. I'd imagine that would be the case in any other sport as well. But yeah, definitely business plan and a huge passion for what we're doing. You've had traditional investment from companies that are very active in sport where you've got multiple investments in and around. Do you have many that are coming in fresh, should we say independent from other sporting investments, looking at it because they are particularly sailing incentivized? I think there's a broader trend in sport right now that private equity companies are looking at assets around the ecosystem. And certainly we're getting a lot of interest in that kind of private equity space.

17:07We're certainly very careful in how we look at deals with those type of organizations in that we certainly think we want those companies to have a long-term horizon. this isn't a kind of you know buy a team for a season and then spin it in a season or two we want to make sure that they've got a plan that as i said before helps commercially build sales gp as an organization and that they're going to be around for the long term but yeah we've definitely seen that that interest coming to us from people who have never even you know touched a sailing boat in their life so i want to come in and purchase a franchise yep what does it cost me today the lowest amount is going to be 50 million us five zero what did it start at good question um i think in the early days we were we were actually looking at people just to come in and underwrite the costs of teams so as you referred to earlier you know kind of larry erson gave us a you know a good capital injection to begin with but then for us to grow we needed to add teams and in those initial transactions we were really looking at how could people just help support those teams and then that's developed over time then we kind of i guess got more sophisticated in how we were looking at this we got you know we've got some more i guess sophisticated financial support in how we were looking at this and then you know we went up to 20 million and that was our bar we've seen that just rapidly grow over the over the last three or four seasons and and is that that increasing cost partly driven by the scarcity value and demand that you're seeing for these franchises?

18:41Yeah, definitely. I think it's also the growth of the league itself. In season two and back in 2019, 2020, it's also COVID as well during that period. Coming off the back of COVID, we were still pretty small. And you kind of get into a room and people are like, what the hell is SailGP? What are you even talking about? Whereas I think now we've certainly more established. We've got a long way to go, don't get me wrong. but there is a better understanding of cell gp as a property and so yeah and there's a growth of the league but also we're seeing that the commercial model of these teams is now working and i guess three years ago we were still saying are you going to be a loss making team to begin with and sometimes that doesn't work but whereas now we're seeing that certainly three or four of our teams this season are going to be at least break even investors are looking at that and thinking, okay, well, I'm not going to have to fund a load of losses to begin with.

19:38And along with your point around kind of demand and scarcity, there's only so many teams. I think the other thing with SailGP, which is probably different to other sports properties, is you actually own that national team. So you actually own the national market in a way. Yeah. Obviously, we retain the rights for the event in that national market. But yeah, it gives you, you almost have a grassroots angle to it in that, you know, It's almost not your responsibility, but you'd work with the National Sailing Federation and you almost become the elite level of the sport in that country. So that's something different.

20:13Because that's what I was going to ask. Why have the national element to it when it could just be a completely different brand or name attached to this? What's important about having GB Canada? Yeah, I think initially it gives a fan base in each country. and then secondly it gives a sailing talent pool in each of those nations and i think we've been careful to select nations that a have you know good sailors who can compete at this level and b have a established fan base to begin with rather than us turning up to an event in in auckland and saying you know here's all these teams that have got funky names the locals would just say okay well I'm not sure who to cheer on here and then you know really it gave us that that fan base to begin with and it's something that that is innovative in the world of sport as well it's not often that you get the opportunity to to own a national franchise so it's something that we were really wanting to go with to begin with and we also believe it helps us with marketing in that country too so not only is there a fan base but if you own a team in New Zealand let's just say you're going to be really keen to make sure that the press in New Zealand knows about us, the media knows about us, and you help us with the marketing in that country because then that helps the growth of your franchise too.

21:34So that was also a bit of part of the thought process. One thing around the teams that is interesting alongside the ownership is Team GB is then Emirates. GB. So where does that kind of ownership piece, is that the owner then can look for a title sponsor to come in and work with them on that commercial element and try and drive value on a naming rights deal as well. But it would have to remain as the country, I guess, does it? Yeah, I mean, initially we were kind of thinking, oh, yeah, do we want to have naming rights partners? And, you know, is that the right move for us? We want to build our brand equity and, you know, it needs to be the sale GPT in that country.

22:10But then really I think that the commercial model won out here and it was, you know, we needed that asset in order for the teams to be commercially successful. But then at the same time we wanted to retain some kind of element there. So we've given the teams, I guess, guidance on how the naming framework works. And yeah, with the kind of Emirates GBR just kind of worked for them as a team. You might see that, for example, our New Zealand team is kind of transitioning to become the Blackfoils now. And so we're retaining that national affiliation, but we're becoming a bit less strict in how we police that, I guess.

22:48And Brazil's Mubadala, is that right? That's Mubadala, yeah. So it's Mubadala Brazil. yeah they're a partner with us at the league level and then you know they have a great relationship with the team there and you know they do a lot of business in brazil and when we kind of floated the idea that yeah they jumped at the opportunity tell us about the big news in the french team getting killing mbappe to to come in we've seen the value of big sports people invest in you know franchises outside of their sport this is a really interesting one for sure i i think the way we've looked at that is there is value to I guess big names investing in in sports teams we wanted to make sure that they were authentic investments so we're not just like handing kill you in some equity and do some instagram posts and thanks very much if someone's going to invest in our team they have to be investing in the team and in doing so they care about the team and they care about their money and they they want to see that the value in that team grow so yeah the opportunity TROs via the transaction that we did for that team with the Accor Group.

23:51And Sebastian Bazan, he's the CEO of Accor, is hugely passionate about the sport and they see a lot of value in the sponsorship that they've driven. And it almost became a natural conversation to move that onto ownership in some way. And then, yeah, through that, the conversation with Kilian started and his team who've been great to work with and yeah they were very interested from from day one you know sailing is a huge sport in france particularly offshore sport of sailing in france and killian sees the long-term opportunity and when you're going through this process with someone like him do you have a lot of direct interaction with these individuals is it done through intermediaries how do you go through i guess that process to ensure that you get exactly as you said the right people on board not looking for a different type of outcome yeah well i don't personally have killian's number in my whatsapp groups uh but yeah look we talked through his team for a long period of time obviously they already have the relationship with a core in any case so is that a core because they were sponsoring psg right is that the core hotels and yes yeah and they have a personal deal with killian as well so he almost like came recommended by them in any case and yeah really talking to his team they they have almost like a venture arm that they're looking for what's after football for Killian and you know they were very passionate about again what I just said before about this being a real investment and how can Killian make this investment work for him over time and yeah kind of at the very top level you know Killian has obviously endorsed that and you know he's fully behind the team and you know we're looking at some really cool things with him over the coming weeks or a month, sorry.

25:33So yeah, watch your space in that one. Amazing. You mentioned that and I want to get back into it. I deliberately passed over it, but I was fascinated because you said the word breakeven. Breakeven and profit generally are not words we hear often in this room. Sustainability is normally how few millions can you lose? What is the business of these teams? Because that's what makes them attractive to investors as well now, as you've highlighted. How do the teams make money? First and foremost, it comes down to a number of cost controls i'll come on to how they make money in a second but in our view any league needs to work it needs to have some kind of cost cap otherwise you get yourself into it's certainly to you we've seen that in other sports teams can get themselves into trouble so from day one we were clear that we wanted to have that cost control and in a way as i explained earlier we control all of the costs through the central services and the boats that's kind of a huge barrier to entry in the world of sailing you have to build a boat which costs you 50 100 million and whereas because you have to do all the design work and we've already done the design work so really is a fundamental principle let's make sure we cap those costs and then the team costs are also capped so that was principle number one and then from there it was how can we give each team equitable rights but also how do we split up the league and team rights to make this work for both parties because our view is you need strong teams to have a strong league and you need a strong league to have strong teams and that's almost a symbiotic relationship in many ways.

27:05But the fundamental revenue drive of teams right now is sponsorship. They have a huge amount of branding space on their boat. As a league, we actually retain some branding space for Rolex, for example, as our title partner now. But the teams have branding space all over the rest of the boat. It's a pretty significant floating billboard. Like an F1 car. Yeah, but it's bigger. But it's the same type of model. Yeah, sorry, same time of modeling. Big is great though. Yeah, there's more space to brand on our boats, but probably less eyeballs at the moment, unfortunately. So they get the branding spot on the boat.

27:42And then we do have a broadcast distribution model. Effectively, 50 % goes to the teams of our broadcast rights, albeit forecast rights is not a significant income stream for us at this point of time as you'd expect and then you know there's obviously hospitality there's there's kind of merchandise and and so forth that they can each of the teams can can generate income from and and we do have a model whereby teams can work with sale gp for their event in territory as well again that's not a huge money spinner today but it may be something over time that delivers value to the team what is the cost cap 10 million 10 million us and what's included in that cost cap everything okay so that's what you can pay sailors sailors that's what accommodation travel practice training business support commercial marketing boats logistics everything is within that now we're actually in a discussion with our teams right now i don't think that quite works in a sense of yes we want to we want to control the costs but there's some things we want them to spend money on like social media and marketing and having a cost cap today means oh well we can't do that massive marketing campaign that we wanted to do in new york city so there's a few things that we're kind of looking at now to almost like take out of that cost cap which kind of makes sense for us to kind of further the commerciality of the league if you didn't have the cost cap what's the areas or the area that you fear teams could spend too much on and and i guess lose some of that financial control Where could that money seep away?

29:18Yeah, well, I think fundamentally the challenge in the sport of sailing is the actual design and the build of a boat. So we've almost taken that away by kind of doing that centrally anyway. And you see, you know, these America's Cup teams, their budgets for a cycle are 150 million pounds. A lot of that is spent on design time, build time. So that's where we've seen in the past costs get away from teams and sailing. But then the next thing is it will be athletes and it will be salaries will increase. And we want this to be the place where the best of the best compete in sailing. But there is a situation where I think we've probably got, you know, five, six of the top people in the sport who are going to become attractive to people.

30:05And fair play to them that, you know, they've made themselves attractive for teams. but in doing so we don't want teams to create mega teams and then go out of business by doing so. Yeah, similarly I guess in football models. Players or the talent is the area where a lot of the money can start getting out of control. Yeah, for sure. And I think today we're in an okay space but I guess fundamentally we've set SailGP up to be an elite platform for athletes. And so if you're a kid at a sailing club or wherever you are in the UK or Australia, you can say, okay, that's now, there's this professional level that I can aspire to be at.

30:46Oh, and I'll make a career. We do want athletes to be making a career out of Sal GP and they should, but obviously you kind of need to ensure that you have that control in place for in future when those salaries start to get inflated. I appreciate you can't say specifics, but what a ballpark kind of top salaries look like in this area. We low hundreds of thousands, high millions where does it really sit i think it's somewhere in the middle of that range you just incredibly diplomatic yeah um yeah i mean yeah i think you know if you go to the america's cup then all bets are off there there's some pretty significant money that changes hands for the the best of the best but the other thing we've tried to do with our athletes is also you know give them equity in teams and i know there's been other sports properties that have looked at doing that as well but we think that's been a really strong way to retain that or bring the best athletes in so so for example in season one we had a really strong british team but but ben ainsley wasn't in the team yeah now if you're british you kind of ben ainsley is synonymous with british sailing in in many ways so we actually did a deal where ben received equity in the team if he kind of bought in an investor and it was almost like an incentive for him to get that team going so yeah that's that's kind of been something certainly new in in the world of sailing for sure do you think they understand the value of that they do they do now yeah well now i'm sure they do i think you know ben was one of those early teams that came in and so you know if you're talking about he got some equity and he's it's almost sweat equity in the sense that he's earned that by being part of the team being the ceo of the team being on the boat growing the British team and now he's got you know chunk of equity in a team that's worth over 50 million dollars yeah I think they that they all appreciate that I think you know our top athletes you know Jimmy Spiel is another one he's now the the co-owner of the Italian team and he's the CEO of that team and you know Jimmy's had a fabulous career and he's worked with Larry and Russell for for many years and in a way it's kind of payback for all that hard work and you know now they've got a real business that they can run as well as you know the salary that they can earn just as a sportsman what are the team structures and how does the nationality versus the actual sailors in the boat well yeah nationality is a hot topic amongst our teams we want to retain an element of nationality so we're kind of i guess working out what the best solution is right now but but in terms of the natural the athletes on the boat there's six athletes and three of them have to be from the country that they're affiliated to.

33:20So straight away, we actually dropped that from one down to three last summer. Straight away, a transfer market opened. And so the Canadian team, for example, took Giles Scott, who was with Ben Ainslie and his team, and he's with Ineos in the America's Cup. And Giles now, he's part of the ownership group in Canada. And there was a transfer fee paid between two sailing teams that's never happened before so it's the start of something to come does that transfer fee fall into the bud the cost cap yeah okay so they've basically got to ensure they free up now an additional uh part of that in transfers do you think now the now that that's happened this will become a far more prevalent action yeah i guess so yeah um i mean look commercially it's very attractive to have a successful team you know you get there's kind of two success factors for each of our teams.

34:11One is performance on the water and then performance off the water. And the two live very closely alongside each other. So yeah, there's definitely, there's more prevalence of that. What we've actually seen though, again, this is good for the athletes that all the teams are tying up athletes on long-term contracts. So, you know, up until recently it was like, okay, we'll give you a contract for a year and see how you go. But now, you know, for example, the Italians, you know, I know for example, they've got five-year deals and that's great for those athletes they've got certainty they're not beholden to where the america's cup is going to go they it works for for that athlete and yeah again i i think we've got to make sure that this is controlled what we can't afford to happen is is costs go out of out of control for teams and and that blows up the whole commercial model so you know that's it's something that we're very careful about and we want to make make sure that we keep those cost caps at a reasonable amount.

35:12Turnover then. What's the average turnover of a team? How much can we generate in a season to hit that breakeven mark and match those costs against the expenditure? The high-performing teams in a commercial sense, around eight or nine million US. Okay. Wow. And a lot of that then generated from sponsorship. So they're doing a great job on... Yeah. If you look at our Brazilian team, we've got a CEO called Alan Adler. He's actually an Olympic sailor from a long time ago. He actually competed against Russell in one of the Olympics in the 80s. He's the promoter of the Formula One Grand Prix in Sao Paulo.

35:42So he's already got a pool of influential, commercial and marketing people in Brazil. And so for him, it was almost like a natural extension of those deals that he was doing in any case. And he's been hugely successful in their first season as well. So that's really good for us as a league, that it's kind of really shown that you can come into CLGP and be successful from day one. Is franchises the right term? I keep saying franchises. Do you talk about teams? Yeah, I think we say teams, but you know, interchangeably. People know what it means. Will you continue to add teams? What's the growth plans like based on, I guess, the existing teams you have, but also taking advantage of new opportunity?