WAPPINGERS FALLS, N.Y. — The substitute turf at Heritage Monetary Park is new. So is the right-field wall that opens huge sufficient for an 18-wheeler to haul live performance gear onto the sector. The get together deck is sponsored by a brewery that’s 10 miles away, large home windows have been put in across the company occasion area overlooking left subject, and the renovated dwelling clubhouse, the place the Hudson Valley Renegades costume earlier than video games, has two indoor batting cages flanked by state-of-the-art knowledge and motion-capture know-how.
That is Class-A baseball in 2024. Quirky and native, but in addition large enterprise that’s booming. Minor-league attendance is up and approaching pre-pandemic ranges, new ballparks are being constructed, and present franchises are promoting at what are believed to be file costs. These should not the wood bleachers and potholed infields of previous.
On the heart of this transformation is Diamond Baseball Holdings, a three-year-old firm that owns greater than 1 / 4 of all minor league golf equipment. From a ground-up franchise in Spartanburg, S.C., to long-established golf equipment in Louisville, Ky., and Lansing, Mich., to their most up-to-date buy of the Harrisburg Senators in Pennsylvania, Diamond Baseball Holdings (DBH) now owns 32 of 120 associates, and its founders stated they’re nonetheless “aggressively in acquisition mode.”
“We’re agnostic to geography. We’re agnostic to membership affiliation,” govt chairman Pat Battle stated. “In case you’re one of many 120, we have an interest.”
The DBH portfolio has grown at a charge, and to a dimension, that might have been inconceivable 5 years in the past. It’s a byproduct of Main League Baseball’s 2020 takeover of the minor leagues, which yanked affiliated baseball out of greater than 40 communities and shifted minor league management to the MLB workplace. Commissioner Rob Manfred’s “One Baseball” initiative seeks to place each facet of the sport below one umbrella — that of the main league staff homeowners — from Yankee Stadium to the Little League World Collection, and all issues in between.
In the course of that plan is DBH, co-founded by former school sports activities licensing govt Battle and longtime minor league proprietor Peter Freund, and financially backed by non-public fairness funding agency Silver Lake.
“We felt like, man, if now we have Main League Baseball aligned with minor league baseball actually for the primary time ever, this may very well be an unbelievably thrilling time to do it,” CEO Freund stated.
Past its possession function, DBH has a strategic partnership with MLB to assist negotiate nationwide sponsorships and branding alternatives on behalf of all minor league franchises, and it additionally performs a job in shopper product licensing for all 120 groups.
Main League Baseball declined to talk on the file about DBH, and a few minor league homeowners did as effectively, noting that each Freund and Battle are shut with Manfred. The homeowners who did agree to speak about DBH stated it has paid good costs for groups and appears to run them effectively — it’s largely retained native workers and invested in communities. But there are issues about its outsized affect in a quickly evolving business, and whether or not minor league baseball — lengthy thought-about a hyper-local, mom-and-pop enterprise — can thrive inside a large company construction.
“They assume they could be a little extra environment friendly, and possibly they will,” one former proprietor stated. “However, once more, MiLB could be very native. You type of want the individuals you want there to promote and all of the stuff that must be carried out on the bottom. They will’t try this corporately.”
There may be additionally some fear that given DBH’s dimension and attain it might impression MLB’s decision-making sooner or later, particularly as some minor league homeowners concern that additional contraction of groups and even higher MLB management may very well be within the works.
“On the one hand it’s tremendously useful that DBH has a say as a result of MLB can’t are available and push 120 groups round,” stated one longtime minor league proprietor who, like some friends interviewed for this story, was granted anonymity in order that he might converse freely. “Nonetheless, the most important concern that now we have is that as we strategy the subsequent (minor-league contract) in a number of years, DBH has such affect, and the groups themselves are only a small a part of DBH/Silver Lake’s total involvement, that it’s conceivable MLB might damage the minor-league groups to the good thing about different areas.”
From a set overlooking the renovations at Heritage Monetary Park, Freund and Battle insist these issues are unfounded.
“Whether or not you’re a DBH staff or not, we’re all on this collectively. And we do imagine a rising tide lifts all boats. If a non-DBH staff has success, it’s nice for minor league baseball, and we rejoice that,” Battle stated.
Areas and Main League affiliations for minor league groups owned by Diamond Baseball Holdings.
For greater than 20 years, Battle constructed the Collegiate Licensing Firm along with his father, Invoice Battle. CLC acquired the licensing rights to greater than 200 universities, conferences and bowls earlier than, in 2007, being acquired by IMG to type IMG Faculty. Battle served as that firm’s senior company vp and chief govt for 3 years.
Faculty sports activities are large enterprise, however their epicenters should not New York and Chicago. They’re in Ann Arbor, Mich., Boulder, Colo., and Tuscaloosa, Ala.
“I feel MLB sees in us individuals who actually perceive Scranton and Des Moines,” Battle stated. “They’re not the 30 main markets, however they’re actual markets, and crucial communities on this nation.”
Battle briefly held an possession stake within the Augusta GreenJackets and stated he was “studying with curiosity” in 2020 as Main League Baseball took over the minor leagues and launched a considerably completely different Participant Growth League (PDL) construction. Associates signed 10-year PDL contracts. Larger and infrequently costly facility requirements had been put in place. Affiliations shuffled and ranges modified. Brief-season leagues had been eradicated. Three beforehand impartial groups turned associates, and 43 minor groups misplaced affiliation (a lot of them as a result of their services had been deemed inadequate). Minor-league operations moved out of the MiLB workplace in St. Petersburg, Fla., and into MLB’s headquarters in New York.
It was a radical, and hostile, takeover within the eyes of many.
Whereas some homeowners felt a rug pulled out from below them, Battle noticed a platform being raised. Many minor-league groups had way back stopped being mom-and-pop operations. Now with Main League Baseball pushing to additional modernize the enterprise mannequin and doing extra to advertise its prospects — among the many new facility necessities was the flexibility to stream in excessive definition — Battle acknowledged a chance.
When Battle approached the league workplace, MLB not solely supplied reassurance he was studying the tea leaves appropriately, the league linked him with a keen associate who had deep baseball connections.
“They noticed it as a big funding in minor league baseball,” Battle stated. “It’s precisely what they had been seeking to do themselves, and inside per week or two, I acquired a name from the commissioner’s workplace saying it’s worthwhile to meet Peter.”
As a longtime minor-league proprietor of the Memphis Redbirds, Charleston RiverDogs and Williamsport Crosscutters, Freund was an insider. He was buddies with the opposite homeowners, acquainted with the league workplace, and had been working with the commissioner’s workplace to enact the restructuring.
“This was (MLB’s) alternative to actually take this factor and produce it as much as the subsequent stage,” Freund stated.
In October 2021, Diamond Baseball Holdings was born — Battle got here up with the identify, a reference to a diamond within the tough — and in December 2021, backed by their Silver Lake capital, DBH introduced an preliminary acquisition of 10 minor league groups. It added 11 extra between December 2022 and June 2023, and three up to now few weeks.
Peter Freund, left, and Pat Battle began DBH in 2021 and so they now personal 32 minor league baseball groups. (Courtesy DBH)
“In case you had requested me in 2019 if this situation was even attainable, I’d have stated you’re loopy,” stated longtime Iowa Cubs basic supervisor Sam Bernabe, whose franchise was among the many first DBH purchased. “No person would have that type of curiosity in that.”
Beneath the previous construction, numerous minor leagues existed as impartial entities. Every labored with Main League Baseball, and nobody was allowed to personal a number of groups in a single league. MLB’s takeover eradicated that rule — as a result of these leagues started to exist in identify solely — which cleared the trail for DBH and its deep pockets.
MLB’s takeover coincided with the COVID-19 pandemic, which worn out the 2020 minor league season. Even the franchises that survived contraction confronted misplaced income and big uncertainty. Some homeowners noticed DBH as a lifeline.
“They simply got here in and supplied much more than we had been (anticipating) to get, actually,” stated a former proprietor who offered to DBH.
Different homeowners shared DBH’s optimism and refused to promote, believing they too might capitalize on this shiny new future.
“We’re all earning profits,” stated Larry Botel, who has an possession stake in three minor league groups. “We’re all benefiting from what MLB is providing us.”
DBH developed a fame for purchasing groups on the excessive finish of perceived worth. Even when that had not been the case, it could have been troublesome for DBH to swoop in and undercut susceptible homeowners, as each sale must be permitted by the league workplace and cross inspection by an govt board made up of 4 Main League homeowners, 4 minor league homeowners and an impartial ninth get together. DBH doesn’t have a seat on the board.
DBH acknowledged some skepticism round minor league baseball when it started shopping for groups, however Freund and Battle imagine they’ve received over most homeowners.
“There have been quite a lot of groups operating their enterprise prefer it’s 1975,” one present minor league proprietor stated. “My hope is that (DBH’s) experience in gross sales and advertising will elevate all of the groups.”
DBH owns 20 groups on the Triple-A or Double-A stage. It owns all 4 Atlanta Braves associates, three from the Boston Pink Sox, and one or two from roughly two-thirds of all main league golf equipment. Two participant growth executives for MLB golf equipment with associates below the DBH banner described DBH as educated and simple to work with. “Very organized, very skilled, requested all the appropriate questions,” one stated.
Not each minor league franchise offered up to now three years has wound up within the DBH portfolio. The Sacramento River Cats — Triple-A affiliate of the San Francisco Giants and considered one of minor league baseball’s most dear franchises — offered in 2022 to the group that owns the NBA’s Sacramento Kings. The Goldklang Group, which has long-standing connections with Freund, offered two of its franchises to DBH however held onto one other. Chuck Greenberg, who owns three minor league franchises, has stored these.
“There’s quite a lot of constructive power round MiLB proper now that might have been troublesome to foresee just some years in the past,” Greenberg stated.
After taking up a staff, the DBH playbook sometimes includes minimal surface-level adjustments (besides in instances like Hudson Valley, the place Heritage Monetary Park wanted vital renovation to satisfy the brand new facility requirements). When DBH lately bought the Winston-Salem Sprint and Inland Empire 66ers, every information launch said that every one present workers would stay with the groups. That’s been the norm. DBH has by no means changed a basic supervisor upon acquisition. Two of its groups have rebranded — each dropping the identify of its main league affiliate in favor of one thing extra native — and DBH introduced plans to relocate two franchises: the Down East Wooden Geese will play out the 2024 season in Kinston, N.C., after which uproot to Spartanburg, S.C. The Mississippi Braves will transfer in 2025 to Columbus, Ga.
DBH stated group connection is among the first issues it considers when evaluating a possible buy, but it surely’s additionally essential that services have a path to PDL compliance. Kinston’s Grainger Stadium is among the oldest within the nation, and Freund stated DBH felt it could be almost inconceivable to modernize that facility, so the corporate purchased the staff intending to construct a brand new ballpark in downtown Spartanburg.
Tyson Jeffers, the incoming basic supervisor in Spartanburg, transferred from the DBH-owned Hudson Valley franchise and has carried out all the things from organising a submit workplace field to creating connections with group leaders. Jeffers has greater than a decade of minor league expertise, and the distinction with DBH, he stated, is that all the things strikes quicker.
“And quite a lot of that has to do with financials,” he stated.
Based on Freund, DBH has bought 12 new video boards up to now 12 months. They’ve purchased in bulk all the things from stadium lights to grounds crew tractors. When the Memphis Redbirds’ enjoying subject fell into disrepair final season, DBH introduced grounds crew members from its Springfield, Mo., and Des Moines, Iowa, associates to assist repair it.
“You’ll be able to standardize nearly each facet of the enterprise and nonetheless keep that hyper-local (component),” Battle stated.
Standardization and hyper-local ought to battle, however DBH goals to standardize below the hood whereas conserving the surface-level idiosyncrasies that make minor league baseball distinctive. Diamond can slather the identical nacho cheese throughout 30 franchises however nonetheless carve out area for Rendezvous BBQ in Memphis, Tenn., to supply the nachos at AutoZone Park. Similar for Paul Cerda’s churros in San Jose and the Desk Speak Pies in Worcester, Mass.
“It’s infinite what you are able to do from an financial system and a scale standpoint,” Freund stated.
DBH can also be working to finalize a strategic merchandising partnership with Fanatics, which DBH stated will enhance in-house retail service for choose golf equipment by including selection and bettering the flexibility to replenish inventory.
DBH doesn’t personal any of its ballparks. A overwhelming majority of minor league groups play in community-owned stadiums and lease the venues. Many groups pay a flat charge to function the stadium year-round. A minor league season ensures not more than 75 dwelling video games, leaving at the least 290 open dates. “The non-baseball could be our largest alternative to activate these ballparks,” Freund stated.
The expansion and attain of DBH has some individuals in minor league baseball pondering the quantity of energy one possession group ought to maintain on this evolving panorama. DBH got here into existence not solely with non-public fairness cash, however with a “strategic partnership with MLB for business rights.” The league has different individuals engaged on nationwide sponsorships for minor league baseball, however DBH has a contract to try this as effectively (the group signed Oatly because the Official Oat Milk of Minor League Baseball). DBH additionally has a contract to assist develop the licensing program and total shopper merchandise enterprise throughout all 120 groups.
“From a nationwide sponsorship and a nationwide shopper merchandise perspective, we positively put on an MiLB hat,” Battle stated. “After which as we conduct our enterprise on ticketing, merchandising, regionally at our venues, we’re carrying a DBH hat. We don’t see that as conflicted in any method.”
Different minor league homeowners expressed little concern about DBH filling nationwide roles as a result of, they determine, somebody goes to be paid to search out and maximize these alternatives, and DBH appears to be good at it. There’s little sense that nationwide rights are going to be the first driver of economic success, anyway.
“Perhaps there’s an additional 10 to twenty % income that may come out of this extra nationalized, institutional sort of strategy,” Botel stated. “However in the event you ignore the native, you’re gonna lose cash. You’re gonna get creamed.”
DBH stated it largely agrees with that notion. “Neighborhood is admittedly essential for us,” Freund stated.
However what does Main League Baseball take into account essential?
The present PDL contracts expire after the 2030 season. Some minor-league homeowners expressed concern that, in seven years, MLB might additional contract the minor leagues, eradicating the affiliation of one other 30 groups — leaving three ranges per Main League group — and once more elevating the requirements in order that smaller operators can have a tougher time assembly the necessities.
“We’re fearful about getting squeezed out,” one minor league proprietor stated.
DBH stated it doesn’t count on and even need additional contraction — the Williamsport Crosscutters, which Freund owns, had been among the many groups to lose affiliation in 2020. Contraction may also be harder now that minor league gamers are members of the highly effective MLB Gamers Affiliation, which is able to absolutely struggle in opposition to the lack of a whole lot of jobs.
There may be additionally the query of what Silver Lake, the non-public fairness cash behind DBH, hopes to realize from all of this.
“Non-public fairness might be unhealthy for all the things aside from the those who they’re shopping for issues from, and I’ve a bigger concern for baseball elsewhere,” one proprietor stated. “However I feel (Battle) is healthier at what he’s making an attempt to do for minor league baseball than anyone.”
Some in baseball speculated early on that DBH/Silver Lake had been gathering groups to bundle and re-sell as a package deal. A spokesperson for the non-public fairness agency referred to as DBH a “compelling alternative” and stated: “Silver Lake’s investments are commitments to long-term partnerships, and we’re supportive of DBH’s continued work to nurture the evolution of minor league baseball whereas celebrating the distinctive tradition and really feel of every membership.”
Freund and Battle stated they’ve by no means mentioned promoting. “There’s simply an excessive amount of forward to even take into consideration that,” Freund stated.
Any sale of the DBH portfolio must be permitted by Main League Baseball, and few in minor league baseball assume DBH is appearing with out a basic understanding of what MLB would possibly do.
Mentioned one former proprietor who offered his franchise to DBH. “No person else could be doing this in the event that they didn’t have some understanding of what Manfred wished, or on the very least, his blessing.”
— Further reporting by The Athletic’s C. Trent Rosecrans.
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(Illustration: John Bradford / The Athletic. Images: Nic Antaya / Getty; Wealthy Schultz, Zachary Roy, Wealthy Schultz / The Boston Globe)