KKR's $1.4 billion sports bet started with a decade-old relationship

• In February, KKR bought sports investing experts Arctos Partners for $1.4 billion.
• KKR's co-CEO Scott Nuttall explained how a deal a decade ago led to KKR's acquisition.
• He outlined how KKR and Arctos would build out a business buying stakes in private equity funds.

KKR's $1.4 billion acquisition of Arctos Partners traces back more than a decade to a relationship that began long before Arctos even existed.

"We have known Ian Charles, the founder, for a long time: a decade plus," Nuttall said at Bloomberg's Invest conference on Wednesday as he got into the backstory of the deal announced last month.

In 2016, KKR was looking for a secondaries specialist to help free up capital and worked with Charles, who at the time worked at Landmark Partners, a major secondaries investor later acquired by Ares. The collaboration helped lay the groundwork for KKR's healthcare and tech growth platforms, which now manage more than $17 billion, a person familiar with the matter told Business Insider.

"You know, sometimes you meet somebody and say, wow, they're really capable, and you would love to have him as part of our team," Nuttall said. "It was that kind of a moment. Sadly, he worked somewhere else at the time."

Charles went on to cofound Arctos in 2019, and the firm has fast become one of the biggest players in sports investing. It is the only firm with private equity stakes in all five major men's professional sports leagues in the US, including ownership stakes in the LA Dodgers, the Golden State Warriors, and the Buffalo Bills. They've also invested in international powerhouses such as the Aston Martin F1 team, Liverpool FC, and Paris Saint-Germain.

Sports have become a major investment thesis in private equity, with a record $23.6 billion in sports franchise acquisitions and $6.3 billion in sports services acquisitions in the first three quarters of 2025, according to S&P Global Market Intelligence Data.

KKR has yet to buy any sports franchises, but has made investments in cheerleading apparel company Varsity Brands, and high school streaming platform PlayOn! Sports, and previously invested in FanDuel and the UFC.

Once Charles co-founded Arctos, the relationship developed "organically from there," said Nuttall.

"And so we started looking at what they were doing and bec,ause of our relationship, we just were comparing notes," Nuttall said. "You know, they would call for advice, we'd call them, get their thoughts on the markets, that kind of thing."

So when KKR looked to finally add a stake-buying business, the "one thing we do not have" as a firm, Nuttall said, Arctos made sense. KKR evaluated other firms in this space as they went to market, but Arctos, which buys stakes in other private markets firms, was the right fit.

Their dominance in the "highly attractive" sports field, combined with their "secondaries background" opens up opportunities in not just sports franchises but also "real estate, securitizing media rights," and "GP solutions," he said.

The combination of the right relationship fit and their former expertise made it the right place to "build secondaries together," Nuttall said.