Private Equity firm Otro Capital raises $1.2 Billion for first fund

Otro Capital, a private equity firm founded by former RedBird executives, has raised $1.2 billion for its inaugural buyout fund, surpassing its $500 million target. The fund aims to invest in professional and collegiate sports assets across the United States, reflecting growing institutional interest in sports-focused private equity opportunities. Backers include pension funds, endowments, and family offices seeking exposure to sports franchises and related businesses.

Otro Capital’s first fund targets sport Private Equity opportunities

Otro Capital’s first buyout fund achieved significant oversubscription, attracting more than double its initial goal. The California Public Employees’ Retirement System contributed $50 million, illustrating strong confidence from institutional investors. Other participants include major endowments and family offices, signaling broader interest in the sports investment sector.

The fund targets businesses with reliable cash flow, dedicated fan bases, and potential for operational improvement. This includes professional sports teams, college athletic programs, and companies connected to the sports ecosystem. The strategy emphasizes viewing sports properties as operating businesses rather than purely cultural or entertainment assets.

Otro has already made a notable acquisition in college sports, purchasing a stake in Utah Brands & Entertainment. This deal marks the firm as the first private equity investor to enter the U.S. college sports segment, highlighting both innovation and an expansion of traditional sports investment strategies.

Sport Private Equity growth and Otro Capital’s strategic approach

Private equity participation in sports has increased significantly over the past five years. Analysts at JPMorgan estimate that roughly 20% of major U.S. professional sports teams now involve some form of private equity ownership. This trend demonstrates how investors perceive sports franchises as viable, long-term investment opportunities with both revenue and branding potential.

According to Apollo Global Management, the market for sports-related businesses represents a $2.5 trillion opportunity globally. The sector benefits from highly engaged audiences, consistent revenue streams from ticketing, media contracts, and sponsorships, as well as opportunities to enhance operational efficiency through private equity expertise.

Otro Capital’s approach seeks to capitalize on these dynamics by combining traditional buyout strategies with sector-specific knowledge. By targeting underdeveloped or operationally inefficient sports assets, the firm intends to generate both financial returns and strategic improvements across its portfolio.

Otro Capital: first fund and focus on sport Private Equity

Founded by Alec Scheiner and Brent Stehlik, Otro Capital leverages the founders’ prior experience at RedBird Capital Partners, a firm known for sports and media investments. The company has positioned itself as a specialist in sports-focused private equity, aiming to integrate business discipline with the unique characteristics of sports assets.

The firm’s first buyout fund represents its entry into the U.S. market with a clearly defined mandate: invest in properties that can generate consistent cash flow while engaging loyal fan bases. This focus distinguishes Otro from generalist private equity funds and positions it to capture opportunities in both professional leagues and adjacent service businesses.

Otro Capital’s $1.2 billion fund demonstrates rising institutional interest in sports as an investment class. By combining operational expertise with targeted acquisitions, the firm aims to develop sustainable, revenue-generating sports properties. The move highlights the ongoing growth of private equity in professional and collegiate athletics, and positions Otro as a notable player in this evolving market.