Race Business: How Williams went from $200 million sale to being worth $2.5 billion

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The Race F1 Podcast 48 min 2 speakers 4 chapters transcribed 2 months ago
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Darren Cox 0:00
We're here at the Williams Experience Centre for the latest The Race Business In Conversation With. And today's conversation is with Matthew Savage, who is the chairman of Doralton Capital, and of the Atlassian Williams Formula One team. We're going to talk everything, including valuations of Formula One teams, the new commercial business, and of course, we'll have to talk about the Netflix effect, but also some interesting insight about their drivers, including Carlos Sainz, and everything beyond that. It certainly has been an interesting journey that Matthew's been on in the last six years, and we're going to talk to him in quite detail in one of his first ever interviews talking about Formula One.
Darren Cox 0:46
Matthew, an amazing location for our conversation here at the Williams Heritage Centre. You bought Williams for around $200 million. Forbes has the valuation now about $2.5 billion. Most investment companies, most private equity probably would have taken some money off the table now. You're on record saying you're not for sale.
Matthew Savage 1:07
Absolutely. That's correct. This has always been a long-term investment for us. We recognised it would be a long road. I've been quite pleasantly surprised by the valuation increase over the last five years. But the truth is we want to be in it to win it. So our goal is to bring the team further up the grid. And so it was always a 10 to 20 to 30 year investment horizon for us. And we're still on that pathway.
Darren Cox 1:34
That's an amazing level of commitment that you've got to this racing team. We're in a very strange situation in Formula One. There's lots of people interested in buying into Formula One, and I'm sure you've had lots of interest. I heard you say that you're getting two phone calls a week of people that are interested to buy the business.
Matthew Savage 1:53
It's something like that, Darren, in one form or another. You know, it's great that people are interested in the sport. I mean, I think it reflects a lot of things. You know, what the sport has done itself, what the Liberty folks have been able to do in growing it. You know, things like Drive to Survive. And then, you know, what the team itself has done over the last five years in terms of pulling itself out of the abyss.
Darren Cox 2:16
We're certainly going to talk about all those subjects. Who are those people that are phoning you? What sort of investors are looking at Formula One right now?
Matthew Savage 2:24
I think it's right across the board from institutional investments and investors to high net worth families. We have the odd conversation with automotive companies along the way. I think sport as a whole is a hot investment area, and people continue to raise money. The financial institutional investors are raising money, and they're looking for ways to invest it.
Darren Cox 2:52
Your background, which we can dig into in a moment, is in the investment space, not in the Formula One space. Why is it that sport suddenly is the place to be? Why is there a lot of money rushing towards sport?
Matthew Savage 3:04
Well, I think it's seen as content. It is content, right? I mean, in one sense, it's a competition, but we're also an entertainment show in more ways than one. And I think it's also seen as a stable asset class that will keep on growing. I think in particular with Formula One, there's a lot of scarcity around it and very few sports, if any, have the same global platform as we do here in Formula One. Maybe football does or soccer to the Americans out there.
Darren Cox 3:34
You certainly know a lot about Formula One now. You've got a lot of knowledge about sport. But when you started here, if I look at the investment thesis of yourself and your business, it wasn't about buying sports franchises, was it? What's the background? What's the history of the investment business? And how did you end up here?

How did Dorilton decide to buy Williams during COVID and what was the deal structure?

Matthew Savage 3:53
That's a great question. We started out really as a normal private equity shop. We also have a venture business. And that's how we met James Matthews. So we were co-investing with him in some venture type things. James, in the middle of, when would it be, 2000, I guess, was when COVID hit. 2020.

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