When ProSmart Enterprises Inc. (TSX.V:PROS) announced a strategic growth partnership with Canucks Sports & Entertainment, owner of the National Hockey League’s Vancouver Canucks, it was like an undrafted hockey player coming out of nowhere and running away with the game's first star.
ProSmart provides a globally scalable web-based sports platform, combining best-in-class customizable practice plans, fully animated drills, and personalized skill videos from the pros, supported by a suite of cutting-edge team and league management tools. ProSmart is using this platform to create an integrated global sports community that also functions as a marketplace, where all participants at the grassroots level, including brands and sponsors, can have valuable exchanges.
ProSmart’s global community is not just about the athletes, it is also about their families, supporters, fans and anyone else that touches, or is exposed to, ProSmart’s wide offering of resources. All of these people are valuable “community members” to ProSmart and create a much larger reach than is typically found within other traditional sports software companies.
As one would expect from a Canadian company, hockey was the first sports vertical established. This August, ProSmart launched its football (soccer) vertical with the backing of former Canadian international professional, Craig Forrest. The plan is now to add a new sports vertical every quarter. Baseball and Basketball are on deck as the next to go live, however, some interesting discussions are taking place and may lead to other community sports verticals jumping the queue — stay tuned.
The partnership with Canucks Sports & Entertainment is just the latest in a string of partnerships and agreements with some of the leading sports organizations in the world.
This partnership exemplifies ProSmart's unique approach. The two organizations will work together to build a market-wide Canucks-branded grassroots hockey program, powered by ProSmart. This program will support and grow the Canucks' fan base regionally and globally, while at the same time help ProSmart grow its leading hockey community of over 1,500 registered governing bodies and associations across 100 different countries.
By activating and engaging existing and prospective Canucks fans with the ProSmart platform, both the Canucks and ProSmart will develop a large cohesive and valuable hockey community and marketplace that grows revenues, Canuck’s fans, community members, sponsors and brand opportunities. Content and community sharing mechanisms will be developed that ultimately lead to larger fan and community member engagement, more robust data, community insights and revenue sharing opportunities.
"The Vancouver Canucks are an important validation of what we are doing as a company," says CEO, Alan Schuler. "We’re creating really amazing partnerships — some of the largest, most influential brands are already around the company, and the Canucks are just the latest milestone on this journey."
ProSmart also recently announced a strategic growth partnership with Accelerated Growth Partners (AGP), a Stamford CT-based, business advisor focusing on sports marketing in the sports media, entertainment and lifestyles sectors. AGP’s team has worked with an extensive and impressive list of clients, including Sports Illustrated, USA Today, the PGA Tour, NCAA, Pepsi and Charles Schwab. AGP has already made several key introductions to groups in the U.S. and partnership discussions are well underway.
Other partners include Sportsnet, Scotiabank and the NHL Alumni Association. Outside of professional and recreational teams, leagues and associations, major brands and media companies, ProSmart is also courting various public causes, universities, schools, and academies as well. The sky is the limit as everybody wants a direct connection to the sports community.
The growing number of partnerships and community members is establishing ProSmart as a leading digital media company for sports communities. And as former NHL All-Star defenseman and Board member, Paul Reinhart points out, those partnerships aren't just feel-good, give back to the community agreements — they're business deals. "The partnerships we strike with organizations like the Canucks and AGP are commercial deals ultimately designed to drive revenue growth for both parties." he says
Like many rising sports stars who seem to come out of nowhere, ProSmart has been in development for many years. The company was founded by CEO, Alan Schuler and COO, Ty Summach. Alan is a former professional hockey player and Ty has a successful digital media background from Disney Interactive, particularly with Club Penguin, a massive community platform, which became the #1 Virtual World for Kids, and sold for over $700 million.
The company has a strong, diverse Board of Directors. In addition to Schuler and Reinhart, Alex Rothwell, formerly President and Head of Canadian Equities of Macquarie Capital Markets Canada, brings a wealth of capital markets experience and expertise. Also on the Board is James Mutter, a senior corporate lawyer and seasoned business professional who previously served as President of the Premier’s Technology Council. Board member, Myles McGovern has a successful track record in founding and operating various technology companies, including CEO of Immersive Media Corp. (acquired in 2016 by Digital Domain for $100 million) and CEO/President of Centrinity (formerly TSX: CTI).
The company has added high quality advisors to its team, including sports media, marketing and branding expert Dean Bender, who was most recently SVP Creative at Rogers. Greg Hope adds technology expertise, having co-founded Prologic (which became Fincentric/Open Solutions) and having led an engineering organization within Microsoft that builds components now generating over $20 billion in annual revenue.
Pascale Audette provides operational strategy expertise, particularly around creating and accelerating sustainable growth. Pascale is CEO of Carebook Technologies and has an impressive background, including co-founding Hyper Hippo Productions, and leading the charge in growing Club Penguin to over 150 million unique players.
The operating team continues to be bolstered, with the most recent addition being Greg Bobolo, EVP, Sports Content and Media. Greg has led 3 successful start-ups in the media space, and he and his companies have won major awards including, Ernst & Young Entrepreneur of the Year, the TOP 40 Under 40, and #4 in the PROFIT 500 fastest growing marketing companies list.
ProSmart also launched an Influencer Program where some of the most recognizable and connected athletes and personalities in sports have specifically been brought in to engage with and grow the company’s community member base. These Influencers include Wade Redden, Cory Cross and Bret Hedican in hockey; Craig Forrest, Nick Dasovic and Jimmy Brennan in football (soccer). Every one of these individuals have strong relationships with important brands and organizations internationally. ProSmart will continue to add Influencers going forward, especially those in new sports verticals, and those with significant reach beyond North America.
These Influencers complement ProSmart spokespeople like Hayley Wickenheiser and Wendel Clark.
ProSmart now has an integrated team with extensive expertise and relationships in sports, technology, media, marketing, branding and operations and are well-positioned to execute on the opportunity they’ve created for themselves. This group has been involved with numerous early stage companies in the private and public markets that have become success stories, creating significant value for the shareholders.
The opportunity for ProSmart is staggering.
Over $1 billion has been invested in emerging companies in the high growth but fragmented sports technology space. ProSmart has successfully participated in this trend, raising over $4 million of new capital in 2017 to capitalize the company for future growth.
The global youth and recreational sports industry is made up of over 1 billion active participants from all over the world playing a myriad of sports. Growth in the sector is in part driven by the increasing number of recreational leagues and associations turning to technology to help them increase efficiencies. The market for sports software is forecast to grow from the current $400 million to almost $6 billion by 2022 in the US market alone.
When you factor in all the families, fans and supporters of those billion athletes, not to mention the equipment and other suppliers and brands, the global sports marketplace is worth hundreds of billions of dollars annually.
Reinhart says ProSmart expects to see significant revenue growth starting in 2018. And Schuler adds the company has structured the platform to accommodate a range of revenue streams that range from direct-to-consumer and other advertising campaigns, to payment processing and e-commerce, all built on a foundation of monetizable data.
"The revenue opportunities are tried-and-true across other community platforms, but have not been combined like this in a sports platform" Schuler says. "All the revenue building blocks are in place."
As if this wasn't enough, ProSmart Enterprises Inc. (TSXV:PROS) also has one other huge factor in its favour as it builds that go-to community platform — the power of sport naturally bring people together, keeps them together, and transcends almost all boundaries that typically fragment a community.
"Sport has the power to change the world. It has the power to inspire, it has the power to unite people in a way that little else does,” says Summach.
"We're not a one-game wonder," says Reinhart. "This is a business and tech team built to go deep into what you might call the digital media playoffs. And the pay-off could be huge."