NASHVILLE, Tenn.>> In Orchard Park, N.Y., this past January, just as tight end Travis Kelce caught a touchdown pass to help the Kansas City Chiefs take the lead in a playoff game against the Buffalo Bills, the real action for many fans watching at home was high above the field. There, in a crowded luxury box, Kelce’s brother, the burly Philadelphia Eagles offensive lineman Jason Kelce, was dancing shirtless and chugging a beer, as Travis’ girlfriend, Taylor Swift, looked on in a combination of amusement and astonishment.

That scene spread quickly online — it was even featured on the Hot Topics segment of “The View” — and Jason Kelce has since become something of a social media star. Building on the success of the podcast the brothers host and the Campbell’s Soup commercials they have starred in with their mother, he has appeared in ads for hot sauce, charcoal and other products.

But since retiring from the NFL in March, what happens for Jason Kelce off-mic and off-camera has become increasingly important. He is one of more than 200 professional athletes who have invested $50,000 to $500,000 in consumer brands like Bazooka, Cholula and Top Golf through a private equity firm called Patricof Co. Since 2019, Kelce has personally invested in 20 companies, including some of the ones he represents in ads.

That’s why in May, Kelce, 36, woke before dawn at his home in Philadelphia and flew to Nashville, Tenn., to film a commercial where he played a mock quality control manager for a moonshine brand that Kelce invests in. Wearing an Ole Smoky distillery T-shirt with the sleeves cut off, he tossed jars of moonshine to employees whom he pretended to train. A crew from Shadow Lion, the film company owned in part by retired quarterback Tom Brady, followed Kelce to a table, where he barked instructions at employees labeling bottles. “Pick up the pace,” he said before leading them in a chant: “Mash, ferment, condense, distill!”

A market opportunity

Private equity firms, which usually require investors to pony up $1 million or more, and professional athletes, who have not always been the best stewards of their wealth, may not seem to be the most natural of partners. While some superstar athletes like Brady, Shaquille O’Neal and Serena Williams are wealthy enough to get access to private equity deals, many professional athletes park most of their money in traditional investments like stocks and bonds. Some also make riskier bets on startups, restaurants and family businesses that can quickly turn sour.

Mark Patricof learned this during his two seasons as a co-host of “MVP,” or “Most Valuable Partner,” a streaming series with Rob Gronkowski, the former New England Patriots and Tampa Bay Buccaneers tight end. A “Shark Tank” for sports, the show featured entrepreneurs pitching their products to a panel of athletes, hoping they would become brand ambassadors. Patricof would chat with the panelists and discovered that they were steered away from private equity by advisers who, he believed, didn’t fully understand its benefits.

“These guys had money and should be putting some percent of their net worth into private equity, so why were they so overexposed to these crazy deals,” Patricof recalled in an interview at his office in Manhattan. “What I got back was, ‘My wealth adviser doesn’t really want me to do any private deals.’ I figured out pretty quickly that in sports, you have the agent, the wealth manager and the best friend. You don’t have business managers.”

Patricof, a former media executive and investment banker and the son of pioneering venture capitalist and private equity investor Alan Patricof, decided there was a market opportunity there. His new firm sought out athletes who wanted to put 10% to 30% of their wealth into private equity deals. Wealth advisers and sports agencies have done this before, but often on a case-by-case basis. Patricof Co appears to be the first private equity firm dedicated entirely to this line of business.

“We’re a strategic investor, not a financial investor,” Patricof said.

Since 2018, Patricof Co has teamed up on deals with KKR, Bain and other large firms to buy into consumer brands that dovetail with the athletes’ interests and that they believe have the potential to go public or be acquired in just a few years. The 250 athletes on the firm’s roster include football stars Joe Burrow and J.J. Watt, and NBA standouts CJ McCollum and Blake Griffin. (From 40 to 100 of those athletes have taken part in each deal put together by Patricof Co; some have invested in just a handful.)

For private equity firms, some of which have had a reputation for milking profits from troubled companies they have acquired before selling them or taking them public (and were once popularly known as corporate raiders), the athletes represent relatable celebrities who can also provide marketing muscle.

Like most investments, private equity is not immune to market forces, and in the past two years, high interest rates and a slow initial public offering market have hurt firms trying to invest in and exit from companies. Consumer brands — an area that Patricof Co has focused on — have been hit so hard that Carlyle, one of the biggest players in private equity, decided in October to stop investing in U.S. consumer and retail companies.

Still, Patricof said the involvement of pro athletes distinguished his investments. He recruited Matt Siegel from Roc Nation, the sports agency, to connect with athletes. Daniel Magliocco, who specializes in mergers and acquisitions, was hired to make the deals. Amy Curtis-McIntyre, after marketing jobs at JetBlue, Airbnb and Old Navy, joined to find ways the athletes could promote the companies Patricof Co invested in, including pitching Kelce as part of Ole Smoky’s ad campaign.

Siegel helped recruit some of the first athletes to join, including Travis Kelce, retired basketball players Carmelo Anthony and Dwyane Wade, and retired New York Yankee C.C. Sabathia. The athletes receive emails describing each offering, and Siegel, Magliocco and others follow up by phone or Zoom to explain the details. Players are reminded that their money will be held for about five years and that returns are never guaranteed. They are invited to share the offer sheets with their financial advisers, who sometimes join the calls.

“I glance over everything and then I run it by my financial people and get the green light or the red light,” said Adam Ottavino, a pitcher now playing for the New York Mets who learned about Patricof Co from his teammates when he was on the Yankees. “Nobody’s pushing you either way, but there’s a lot of resources at your fingertips, so it seemed like a no-brainer.”

The 25 deals that Patricof Co has closed so far include stakes in Goldin, an online auction site for trading cards and collectibles; Kodiak, a healthy pancake company; and Sweetwater, an e-commerce marketplace for musical instruments. The firm has exited partly or fully from five of its deals. Terms are confidential, but generally, Patricof Co invests from $10 million to $25 million. Patricof puts his own money into every deal, too, as do his partners Siegel and Magliocco.

One of the firm’s first stakes was in Cholula, the hot sauce company. Wade promoted the company by hosting a cooking show on Instagram Live with celebrity chef Aarón Sánchez. This was during the height of the COVID pandemic, when millions of Americans were stuck at home and cooking more. The show was a hit, thanks to Wade’s popularity (he has 20.1 million followers on Instagram), and it also bolstered the profile of Cholula, which was later bought by food giant McCormick, for $800 million. Word quickly spread in the sports world that Wade, Travis Kelce, Dak Prescott and other stars had tripled their investments in 18 months.

“The Cholula deal put Patricof on the map,” Siegel said. “At the beginning, we worked with agents and wealth managers. Now, it’s the locker rooms and word of mouth.”

Patricof Co athletes have marketed an array of deals. In 2021, Patricof invested in Real Truck, which makes accessories for pickups and jeeps, and George Kittle, the San Francisco 49ers tight end who played college football at Iowa, invested and promoted the company. When Patricof bought a stake in the clothing company Bombas, Venus Williams, another investor, was part of a social media campaign.

“Athletes are, if not the most important, one of the most important modern-day classes of people,” said Matt Leeds, who worked with Patricof Co on the Cholula deal when he worked at L Catterton, a private equity firm. “You have a society where people’s attention is so fragmented, yet Sundays are one of the few times where you have 75, 100, 125 million Americans all thinking about the same thing. Sports matter more than they used to.”

No “crazy high- octane bets”

Patricof Co’s list of athletes has expanded to include college stars who received payments for their names, images and likenesses, and younger pro athletes like Corbin Carroll, the Arizona Diamondbacks center fielder. He contacted Patricof Co while in the minor leagues because as a high draft pick, he wanted to explore how to invest his $3.7 million signing bonus.

“I want to be as educated as I can,” said Carroll, 23, who visited the Patricof office in May but has yet to invest in any deals. “You’ve got this amount of money that you sign for and you view as a nest egg. After transitioning to the big leagues and pretty quickly signing an extension, it was a little bit more of my understanding that this is the world that I’m going to be in.”

Magliocco said the athletes were told that fluctuations in interest rates, the IPO market and other factors could delay a sale or public offering of stock. But, he said, Patricof Co looks for stable, growing businesses, not high-flying crypto or AI companies. Its portfolio companies have a median revenue of $200 million, and 17 of the 22 consumer-based companies were profitable when purchased, he said. On average, the portfolio companies have grown at least 20% since being purchased.

Some Patricof athletes speak directly to company management. Seattle Seahawks wide receiver DK Metcalf was given the nickname “Candyman” for a reason: He gobbles three or four bags of candy a day. When he learned that Patricof Co had bought a stake in Bazooka, Metcalf not only joined about 60 other athletes on the firm’s roster in investing in the company, he also created a presentation that he delivered to Bazooka executives in New York.

“I didn’t want to show up empty-handed,” Metcalf said. “It’s already an established brand and very well known across the world, but I was just trying to throw in my two cents, or put my spin on things to try to show my value to the company besides just investing in it.”

His presentation included ideas for publicizing the company — including his own potential role — and how to improve products and create new ones. During a 90-minute meeting, Metcalf evaluated some Bazooka products. The company is now reviewing all his suggestions.

Some financial advisers are recommending Patricof Co to their clients because the athletes can invest relatively small amounts in deals, which are vetted by larger private equity firms.

“I want our clients to have a diversified portfolio of private equity companies,” said Geoff Marsh, financial adviser at Octagon Financial Services Wealth, a wealth management firm that works with more than 300 athletes, including several who invest in Patricof Co. “Some will be singles and some will be triples. Not everyone is LeBron James and can throw $250,000 at every deal.”

For now, companies like Ole Smoky say Patricof Co’s investment has been beneficial. “For me as a business owner, it’s a level of authenticity,” said Joe Baker, Ole Smoky’s founder. “It’s not paying somebody to say they like your brand, it’s partnering with somebody who’s investing in the brand because they believe in it in the first place.”