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The sports media publisher Overtime launched its third franchise Tuesday morning, a product called Overtime Boxing (OTX) that centers on a series of four summertime match cards hosted in its exclusive venue, OTE Arena, featuring male and female boxers.
The new vertical marks the latest offering from Overtime, whose unique business model entails creating standalone sports leagues featuring young athletes, then monetizing them with a blend of branded content and socially native advertising, according to chief revenue officer Rich Calacci.
Its merchandising business is also on track to generate revenue in the eight figures by the end of the year.
In addition to OTX, Overtime also offers Overtime Elite (OTE), its basketball league showcasing rising stars, and OT7, its seven-on-seven football league that highlights high school players in offensive skill positions.
The 6-year-old publisher has raised more than $250 million to finance its capital-intensive operation, whose costs extend beyond those of standard media companies due to the infrastructural expense of building sports leagues from scratch. The company is not currently profitable and declined to share revenue figures.
But its ambitious model aims to ride several paradigmatic tailwinds transforming the sports media business, including the professionalization of young athletes through new Name, Image and Likeness (NIL) rules, and a shift in sports consumption toward social media and digital video channels.
The strategy also reflects a growing emphasis across the media ecosystem on original intellectual property, whose popularity operators can gauge, then transform into multiple lines of revenue with low risk and high margins. In recent years, publishers including The Atlantic, Texas Monthly, Time and Bloomberg Media have all invested significantly in repurposing IP into new products.
Appealing to young sports fans
The Overtime franchises cater to younger sports fans, a mission aided by the age of its athletes—OT7 and OTE participants are 16 to 18 years old, while OTX will focus on early career boxers—as well as its socially native structure.
The company, which eschews a traditional web presence in favor of finding audiences on social media, claims to reach 75 million people monthly across all platforms. Posts from its portfolio of accounts include highlights, athlete interviews and viral content.
The decision to launch into the boxing space is supported by data that reflects a shift in how young audiences consume sports, said Brandon Rhodes, who will lead OTX as its general manager.
According to a Future of Sports Fandom study released in 2021, boxing is the fourth-most popular sport amongst young audiences, and its appeal comes as the result of a number of emerging trends.
Compared to older generations, sports fans aged 16 to 24 are more likely to follow individual athletes rather than teams, and they follow a greater number of sports than any other generation, creating a shallower fandom.
As a result, the narrative structure of boxing, in which a stream of bite-sized stories ladders up to a one-off climactic event, caters to the Gen Z sports fan, according to the report.
In addition, boxing has taken on newfound relevance to younger audiences due to the involvement of celebrities like Logan Paul, the YouTube creator turned professional boxer, and Ryan Garcia, a 24-year-old boxer and influencer with 9 million followers on Instagram.
“Sports is worldwide, but Overtime has captured its youth market,” said Michael Heller, chief executive of Talent Resources, an influencer marketing agency that has invested in Overtime. “They make it easy to watch things how kids want to watch things.”
Three advertising products and merchandise
Overtime offers advertisers three distinct products, each of which generates roughly one-third of the overall advertising revenue, according to Calacci.
The company produces branded content through its in-house studio, such as a recent YouTube documentary following the Orlando Magic’s Jalen Suggs.
Through OT Engage, it uses Overtime influencers to create timely social media content, such as this recent promotion by Overtime Megan. And with HIVE, the company takes the preroll or in-feed assets of a brand and distributes them through Overtime feeds.
OT Engage and HIVE have the greatest room for growth, according to Calacci, and most media buys package at least two of the three products.
Overtime has also grown significantly in the connected television space. The company recently signed distribution deals with Amazon Prime and AMC, and it plans to expand from four CTV channels to 12 by the end of 2024.
Turnkey, vertically integrated sports media buys
As a commercial model, Overtime pitches its vertical integration as a selling point for ad-buyers, said Jack Jenkins, vp of league partnerships at Overtime.
Rather than strike separate deals with athletes, leagues, teams and channels, Overtime enables brands to integrate their messaging through every touchpoint with a single transaction.
By highlighting athletes who have yet to enter college, Overtime also taps into an emerging market, which it positions as additive to the overall sports ecosystem, rather than in competition to the incumbent leagues, Rhodes said.
The value of this preprofessional ecosystem is driven, in part, by the athletes’ financial incentive to heighten their own exposure: Under new NIL guidelines, they can monetize their reach through brand deals and use it to improve their odds of matriculating to a professional league.
“If they can get it to work, Overtime effectively becomes the seeding ground for professional sports,” Krishna Subramanian, CEO of influencer marketing firm Captiv8 said.
