How Sam Kennedy’s Bold Moves Shape the Red Sox, Plus Alex on the MLB All-Star Game

0:00Our hometown is not a test tube. 90 miles northeast of Nashville, a battle for the future of America plays out in one small town. Developers with right-wing ties have purchased hundreds of acres of land. We need cities on a shining hill. This is Our Town, a podcast about what happens when a small town becomes the site of a social experiment and fights back. Guess you didn't move in on a bunch of dumb hillbillies now, did you? Listen to Our Town on the iHeartRadio app, Apple Podcasts, or wherever you get your podcasts.

0:46Welcome back to The Deal. I'm your host, Jason Kelly, alongside my partner, Alex Rodriguez. guys. All right, Alex, a lot of baseball talk today. Coming up on the show, we're going to have Sam Kennedy, the CEO of Fenway Sports Group, talking about the Red Sox. You're in Atlanta, my hometown, where you've just completed covering the All-Star game. I'm actually, in a strange way, in your OG baseball town, Seattle, where you started your career. It's wild to think back to those days. I'm sorry to have missed you in Atlanta, but I had to be out here for Bloomberg Green, and we'll talk about that in a second.

1:20But how was it? Like, what was the vibe there at the battery? I wish the Braves were better, but it sounds like they at least put on a good party. A great party. And you're right. I think that's the point. I wish the Braves had one of their magical seasons that they usually have to be able to celebrate the first half. What I found here is what Atlanta, Georgia is an incredible place. I really love it. The people are wonderful huge sports fans that complex another John Malone production because Atlanta Braves are a public company under John Malone's umbrella just like F1 they've done an incredible job I mean I have the great room in the seventh floor overlooking right center field it was the best hotel room I've ever stayed in and then there's great restaurants great vibe and then we did the pregame show for Fox pre and post out in the pavilion where you have what is called the battery.

2:10And it felt like it was Alabama, LSU. The people were going crazy. But most importantly, the people, the league, everyone was very hospitable here. Yeah, it is amazing what they've done. And I think we've talked about this on the show before. You know, I've been a Braves fan forever. I grew up there. My parents are both from Atlanta, you know, you know them. And, you know, there was a lot of consternation when the Braves left downtown. They were going out to Cobb County. No one really knew how it was going to go. So what I love about this for you is it's like two of the things you love the most, baseball and real estate, like colliding in the most perfect way.

2:49So I have to imagine knowing how you think that like you've got baseball on one side of your brain, but then the rest of the time you're like, oh, wow. They put that retail there and they did the residential in this place and the hospitality here and the hotel and all that. So it must have been a feast for the senses for you. Jason, I have two pages of notes, maybe three, but I mean full notes on all the things that I found that they'd write and unique that I hadn't seen before. The one other shot I want to give out, Jason, is I thought MLB did a fantastic job in honoring one of my heroes, the great Hank Aaron.

3:25And they did a great ceremony. The legacy of the Atlanta Braves is awesome and is cemented by someone like Hank Aaron who endured so much for people like myself and others. and not only was he a great player, but he was just a great example for everyone who loves baseball. I have to say, I love the recreation of, you know, the record-setting home run. I thought that was just incredible. And listen, I think as any sort of sports fan, there are certain moments, you know, if you had to name sort of the five most important moments that you could like rewatch and rewatch and rewatch, Hank Aaron hitting that home run is one of them.

4:08It's like miracle on ice. It's these things that are absolutely indelible in the culture. And to your point, sort of remind us how much sports can really influence the broader conversation, the broader world. Yeah, I am very jealous that you were there. I was here in Seattle, actually interviewing another owner in the sports world, Samantha Holloway. Obviously, the owner of the Kraken, daughter of the late David Bonderman, who I knew through my private equity days. What she has done in Seattle with the Kraken and Climate Pledge Arena. I don't know if you've ever been to Climate Pledge. It is incredible.

4:45This town has changed a lot since you started your career here, lo those many years ago. But it's a great sports town. And they're hungry, and they're hungry. They love all their sports. I remember they used to love the Sonics. I remember sometimes sitting with Paul Allen, one of the co-founders of Microsoft, with Bill Gates. He would sit right behind the court, right there, right behind the hoop. And they sold out, I think, like 15 years in a row. So they missed their basketball. They loved their football. They're incredible baseball fans. And what people forget, Jason, is you don't own that market.

5:15You own, like, the whole Northwest is yours, including Vancouver and parts of Canada. We had tons of fans that would come from Canada all the time, especially in the summertime. but you're right. It's a vibrant city. They love their sports. And because they're so far in the Northwest, I think there's a little chip on their shoulder, maybe a big chip that makes them some of the best fans in the world. Yeah, no, they are serious fans for sure. And Sam was quick to point out that, you know, basketball is still very much here in the form of Seattle Storm, the WNBA franchise. You know, they play their games, all their home games there at Climate Pledge Arena, which is a really cool venue.

5:50And Sue Bird has been a guest on this show. We know the power of the W here. In fact, interestingly enough, someone told me while I was here that Seattle was the first, and this just happened recently with the PWHL, the Professional Women's Hockey League, announcing they were going to have a team here. It's the first city to have all three major women's professional sports franchises. So hockey, basketball, and soccer. And a lot going on here. As you know, like, again, you are a young person here. It's a young person's town. It's a tech driven town. There's a lot of innovation. You know, people love to get outdoors, especially this time of year.

6:31I'm such a rube sometimes. It's like, I sort of forgot where it was in latitude. It's light until like 1030 at night. this time of year. It's crazy. It must have been wild to play baseball here during those times. It was so wild. You know what else was wild, Jason, is I always think, like, I started my first year as an 18-year-old. I was in 1994. And if I just took every dollar I ever made in Seattle and invested in Seattle-based companies, you know, Boeing, just Boeing, Starbucks, Microsoft, Amazon, my goodness. I mean, they're on fire and they have been over the last 20 years. Yeah, it's been really cool.

7:10You know, I've been spending time with colleagues out here. We obviously have a Bloomberg Bureau here in Seattle with some unbelievable reporters and editors and just the storytelling that they're able to do for all the reasons you're talking about, you know, these big companies that are here. But the sports are really off the chain. So excited to get to know them a little bit more. In fact, next week, the NHL is having their annual business meetings here in part because of what Sam Holloway and the Kraken have done. All right. So back to baseball coming up on the show. Sam Kennedy, you know, a guy you've known for a while.

7:45I've gotten to know him a little bit. I love the Yankees Red Sox talk that we had with him. You know, your admiration for Fenway Sports Group as an ownership conglomerate and a lot of sports conglomerate in so many ways really comes through. So excited for everyone to hear that. Coming up on the show, Sam Kennedy.

8:13Our hometown is not a test tube. 90 miles northeast of Nashville, a battle for the future of America plays out in one small town. Developers with right-wing ties have purchased hundreds of acres of land. We need cities on a shining hill. This is Our Town, a podcast about what happens when a small town becomes the site of a social experiment and fights back. Guess you didn't move in on a bunch of dumb hillbillies now, did you? Listen to Our Town on the iHeartRadio app, Apple Podcasts, or wherever you get your podcasts.

8:53Welcome back to The Deal. I'm Jason Kelly alongside Alex Rodriguez. And today, our very special guest, Sam Kennedy, the president and CEO of the Boston Red Sox. Yep, the president and CEO of the Boston Red Sox on a podcast co-hosted with one of the greatest Yankees of all time. So I'm going to start right there, Sam. How in the world are you guys such good friends? Alex, do you want to start? Sure, I'll give it a try. Well, I did my part. I wore pinstripes, Jason. I thought Sam would be wearing red. But, I mean, he's beat us enough over the years, so he didn't want to rub it in. Sam is just one of the most respected people in sports.

9:27And every conversation is a top CEO, not only in sports, but what they're building. Fenway is truly phenomenal. And he's become a North Star and a role model for a lot of organizations, including ours with Mark Laurie and I, what we're trying to do with the Timberwolves and the Lynx. But my rule was always like, I'm a little bit of an old schooler. And I never wanted to be close with anybody in the Red Sox, unless there were grandfathered in like Big Papi and Pedro and Manny. These guys were Dominican. So I'm like, all right, that's different. But I kept hearing about Sam, Sam, Sam. What a great guy.

9:57What a great guy. And you don't want to like any Red Sox, but I couldn't help it. Once I met Sam, I quickly, quickly liked him. And then when I started doing Sunday Night Baseball, he was so kind. was invite me into his box and I would say hello to John Henry and Tom Warner. And, you know, the rest is history. Now we have a great common friend in Ed Hurley, who works for Wachtell, who's a great attorney and a great mentor of both of ours. And yeah, that's our little Sam Abrott story. Well, it is true. We've got a great relationship and it goes back a long way for me. I actually started my career as an intern for the New York Yankees in the early 1990s.

10:34I had a lot of friendships in the front office there. Brian Cashman and I started just about the same time. And so obviously on the field, we've been battling for decades, but off the field, there's a great respect and relationship. And what I've always enjoyed talking business with Alex and so impressed, most impressed. I don't even know if he knows this, but when he started to explain how the multifamily apartment business worked to me about 15, 20 years ago, the first time we met, I was like, wow, this guy is doing so much off the field. And then after his playing days, we got to know each other through business and have always enjoyed the sports business and the sports investing space, which is changing so rapidly.

11:13And it's just such an exciting time for our business, as you guys know. Yeah. So let's talk about that. I mean, you know, take us back to O2 because that's when you joined the Red Sox. You come from the Padres, obviously a storied franchise, but yet things are going great at that point for the Red Sox. There's a long drought that you guys are facing at that point. What did you see as the business opportunity in taking that job? Well, the most important thing was winning, winning baseball games. And, you know, we came in in 2002, our first press conference. I'll never forget John Henry, Tom Werner, Larry Lucchino, the late, great Larry Lucchino.

11:53You know, he liked to mix it up with everybody in the media and other clubs. But we announced that we were going to win the World Series. And in fact, we were going to win multiple World Series. And starting to change the mindset early days about what we could accomplish on the field was really important. Honoring traditions in Boston, trying to preserve, protect, restore Fenway Park was really important. And the third thing was being very active in the community. And those are just words, as you know, stewards of franchises and clubs come in and they say a lot of things, but hopefully we've honored those words with our actions.

12:31But the first order of business, Jason, was to win baseball games, to get a World Series championship. At that time, it had been 84 years. We finally got over the hump in 2004, and that really did propel us. It gave John and Tom and myself, in terms of the business of sports, the confidence to say, wow, if we can do this, get the right people in the right place with Theo Epstein as our GM and Tito Francona as our manager, perhaps these skills could be replicable in other environments. And so it was John who came to me in 2005 and said, listen, we've done a great job. What else can we do? And that actually led us to NASCAR.

13:12So that was our first investment into Roush Fenway Racing in about 2006 time period. And then we've just sort of built from there with that entrepreneurial spirit. Yeah, I was just going to talk about your talent because, you know, 2002, the firepower you guys had. I mean, if you think about John Henry, Tom Warner, Larry Lucchino, yourself, Theo Epstein, and then you go on the field and you have Schilling and Pedro and Manny and Big Papi. What was the secret sauce that worked so well? Because you go almost 100 years without winning and then you last 20 years, you've won four titles. It's a mindset.

13:45I think there's a very, very healthy mindset around being paranoid that we're not good enough and being paranoid that we're not pushing hard enough to make sure that the right people are in the right positions. We've made every mistake in the book that every sports team, front office and ownership group has made with the Red Sox, with Roush Fenway, with Liverpool. We're now in the PGA Tour. We're the Pittsburgh Penguins. We've made lots of mistakes because, you know, this just in the sports business and sporting success on the field, on pitch, on the ice is really, really hard. It's such a competitive landscape.

14:24But we have a real healthy paranoia that, you know, someone's going to take this away from us. We're not uncovering every rock to find the best and brightest people, the most talented general managers, team presidents, people in every position across the organization. it's such a cliche but at Fenway Sports Group it starts and ends with the people there is a really fun collaborative environment where John Henry and Tom Werner and Mike Gordon set the tone of like there's really no bad ideas like you want to throw out an idea to buy Liverpool Football Club when it's headed to bankruptcy in 2010 that idea came from someone in our corporate sponsorship group.

15:08They read about it in the Sports Business Journal. They loved Liverpool Football Club. They sent us a note saying, save our club. And that's how the conversation started. So there's this culture that no matter where you sit within the organization, you can bring a transformational idea to Fenway Sports Group. So being a part of that is really, really special and something that I cherish being a part of this Fenway family. All right. I want to get to Liverpool in a second. But before we get to that, I just want to do one more beat on the Red Sox, because this has been a very interesting season, to say the least.

15:41You know, you've been out and about talking quite a bit about one very specific deal that you guys did with the Giants. You know, talk to us about making big decisions in the current environment and having the history of, you know, making bold decisions and then essentially having to answer for them? Well, I'll never forget when Theo Epstein was named general manager, we were, the two of us grew up here in Boston together. Ironically, we worked for the Padres together. We came back here. When his dad gave him advice back in 2002, when he took over as general manager, it was just two words, be bold.

16:21And those two words have, I think, stuck with us, stuck with John, with Tom, with everybody in the organization. And so bold decision-making doesn't mean you're reckless, but bold decision-making means sometimes you need to do things that are not going to be perceived as popular. I can tell you lots of things that we've done from a business perspective that have not been popular, lots of things from a baseball perspective. The decision to trade Rafael Devers in the month of June on the day that we swept the New York Yankees to get back into this thing. You know, it was timing that we could not control, but a decision rooted in what we felt was best for the organization in the near term and in the long term, because we couldn't find alignment just to be direct.

17:14We've had an amazing relationship with Rafi. He a lot of mistakes that we made along the way, but ultimately we made the decision to move on. And that was really, really hard. I can tell you my 22 year old son was not happy with me. My 84 year old father was not happy with me, with, with John, with Brez, with Tom, with everybody in the decision-making apparatus. But you've got to be willing to make these hard decisions. They are unpopular at times. And we recognize that, but it was a decision that we felt was in our best interest. I'm really proud of the group because we've had to come together and you take that bat out of the middle of the lineup.

17:56Nobody knows who's better than Alex. It's hard to see how that one individual move is going to make you better in the moment. But this was a deal that was bigger than that. Now we've got a few players back in return. It does give us some flexibility here as we go into the deadline. But that was a really hard one, a really hard one. And it's an obligation of those of us in leadership that you got to make really hard calls. And I tell you, they're painful when you walk into Dunkin' Donuts in the morning and people know your name and they're not happy with you. You hear about it. Alex knows that one a lot better than I do.

18:30Sam, I want to take Theo Epstein's dad, there's two words, be bold, and talk a little bit about Fenway. Because I think what you guys have done in Fenway, going back to 02, it's been extraordinary. And I know Larry Lucchino and a lot of your team members over there had a lot to do with it. But from a playing perspective, from watching, you can make an argument that this is the greatest American sports venue to watch a ballgame in. Where it sits in the neighborhood, those are the best seats in the house. How do you keep the integrity of such a great monument, but yet make it more modern and even a more fun place to be?

19:06Well, having grown up here, we knew what Fenway meant. Really, you have two institutions. You have the institution of the Boston Red Sox, and you have the institution of Fenway Park. When we came in in 2002, we needed to study the structure to make sure that it could, with proper investment, withstand another 30, 40, 50 years. We got comfortable with that in about late 2004. And then we started to invest year in and year out. To date, we've put nearly$400 million, all private money, into Fenway Park to preserve it, protect it, enhance it. But you said it, Alex, where it sits in the city, it's walkable, it's accessible via public transportation, it's even accessible relatively easily by car.

19:56So when you have a jewel in American sports, you don't tear it down. You try and preserve it and protect it. It is a place night in and night out, whether we're having baseball games or concerts or English football matches or big time bowl games where people want to come and they want to gather. We've now, over the last decade, started to expand its footprint. We built a 5 ,500-person music venue off of the back. We are now permitted for 2.2 million feet of retail, residential, hotel right here in the neighborhood. We move forward with the music venue, but we've been slowed down by post-COVID construction prices and interest rates.

20:40Hopefully, the tide will turn there. But we really are starting to map out what the future neighborhood looks like. And we're blessed to have Fenway Park as our home. It's really, really special. And as we think about our investments in sports, that's sort of really critical. Part and parcel to everything you do is looking at where the team plays or where they may play as you think about moving forward with a sports franchise acquisition. Really, really important. Let's talk about Fenway as a sports group and the decision to expand it. And, you know, you mentioned John Henry saying, all right, what do we do next?

21:16How do we do more? Let's talk about Liverpool, because that is not an obvious deal to do. you know, we live in a time now where, you know, Brian Reynolds and Rob McElhenney are buying Wrexham and it's this huge success. But there were a lot of people who looked at English football and European football back in the day, back when you were looking at it and said, hard pass, like there's no way we're going to do this. You were intimately involved in that. What do you recall from sort of those key decisions to get that deal done? Well, our purpose at Fenway Sports Group is to elevate brands and clubs and institutions that really matter.

21:57Liverpool Football Club matters to its global supporter base as much as any club. And so we thought our experience in Boston with really a public trust, not a sports franchise or even a club, it's a public trust. And what do I mean by that? We have an obligation to doing everything in our power to win games at Fenway Park and to win matches at Anfield. After we got that famous save my club email, we started to study Liverpool. We started to study the English Premier League and things just started to click and really made sense. And I'll never forget one of the first meetings we had with the investment bankers for the deal.

22:42And they were describing what needed to be done at Anfield because Anfield needed a lot of investment and improvement. And they actually raised the idea of a new stadium. And I pulled the guy aside and I said, listen, don't ever bring that up ever again. And we've just spent a decade preserving and protecting the Mona Lisa of baseball parks in Fenway. If we're going to go into Liverpool, the hallowed grounds of Anfield, we're going to want to preserve and protect it. So we made that very clear. And then it was literally like a light bulb went off with John Henry as he started to get into it. And I remember him saying, well, if we're going to do this, like we're going to have to be prepared to beat Manchester United.

23:26Like those are the Yankees. Like those are the Yankee. We have to get over the hump and beat the best of the best. And so for John, it's always been about winning. Little known fact, you know, Alex knows this. He's he started his career. He was an LP with the Yankees. He was an LP with George Steinbrenner in the New York Yankees in the early 1990s. 90s. And so while they have very different personalities from what I remember about Mr. Steinbrenner, the fierce competitor and the desire to win is always there. And thankfully, with unbelievable leadership from Mike Gordon, who's the owner who's here, who spends the most time on it, Billy Hogan, our CEO, Michael Edwards and the group over there on the football side, we've been really, really good on the pitch.

24:16We won the league title this year. And it's just been a privilege to be associated with Liverpool, but that's what we saw. We saw this club that needed investment and it needed really professional management to come in and help it achieve what it had achieved decades prior and sort of restoring the club back to greatness.

24:41Our hometown is not a test tube. 90 miles northeast of Nashville, a battle for the future of America plays out in one small town. Developers with right-wing ties have purchased hundreds of acres of land. We need cities on a shining hill. This is Our Town, a podcast about what happens when a small town becomes the site of a social experiment and fights back. I guess you didn't move in on a bunch of dumb hillbillies now, did you? Listen to Our Town on the iHeartRadio app, Apple Podcasts, or wherever you get your podcasts.

25:21Sam, I really admire John Henry and Tom Warner, and I think they're both brilliant, but they're both very different. You as the CEO kind of describe the cadence. How often do you talk to them? How are they different? What are their collective superpowers? And how do they kind of check each other? Because it is a bit of a gold standard the way the three of you kind of work together. Well, I have a fancy title as CEO of Fenway Sports Group and CEO of the Boston Red Sox. But really, the CEO of the enterprise is this collective superpower, as you say, John Henry, Tom Werner. I would add Mike Gordon to that list.