Prep sports site gains
Jul 20, 2006

Sacramento Bee

MaxPreps lines up $7 million in venture capital to expand.

High school sports isn't a staple of the financial pages, but it's become a big-dollar deal to MaxPreps Inc.
The 3-year-old Cameron Park company, which uses the Internet to compile sports statistics, photos and videos from high school teams in 10 states, announced Wednesday it has received $7 million in funding from three major venture capital firms.

The funding, one of the largest VC deals in the Sacramento area this year, will allow MaxPreps to expand its coverage of prep football teams to all 50 states this fall.

"Our goal this year is to get one-third of all (varsity) football teams in the nation this year," said Andy Beal, MaxPreps founder and chief executive.

While football and basketball are the site's main focus, he said that MaxPreps hopes to have information on every high school varsity team in the United States by 2008, regardless of sport.

MaxPreps specializes in gathering scores, statistics, rosters, scouting reports and other information about high school sports teams through a network of coaches, who post their team's results after every game.

The information is posted on the company's Web site (www.maxpreps.com) and distributed to newspapers and other media outlets, either free or for a fee depending on the content. In addition, MaxPreps has content sharing agreements with USA Today and ESPN.com.

The company also issues team rankings and posts videos of top prep performers. Since its launch in 2003, MaxPreps has grown to an average of about 30 million page views a month, used by 1 million separate users -- primarily high school athletes -- during last fall's football season. Beal said the primary audience is high school athletes, but it also draws coaches, parents and others.

While MaxPreps doesn't disclose its financial details, its primary revenue comes from advertising deals with Nike, Adidas and the U.S. Army National Guard.

It also sells sports action photos taken by local photographers, with MaxPreps and the photographer sharing the revenue.

"High school sports is now where college sports was 25 years ago," said Beal, adding that the growth of cable TV turned college athletics into a major business. He said he expects the Internet to have the same effect on high school sports.

Interest in high school sports is huge, he said, with about 70 million people attending prep football games annually in the United States.

Casey Taylor, head football coach at Del Oro High School in Loomis, said he uses MaxPreps daily during the season to stay abreast of his sport.

"It's a great way to check league standings and get updates on who is playing whom," he said.

Terry Battenberg, boys' basketball coach at Union Mine High School near Placerville, finds MaxPreps to be an invaluable scouting tool.

"If you want to find out about a team, you can get their roster and their scorers and how big their team is," he said. "Before, you'd be calling people and hoping they could give you that information. … It's the best thing to come along in my coaching career."

Scott Lenet, whose West Sacramento-based DFJ Frontier venture capital firm was an early investor in MaxPreps and also took part in the latest round of funding, said the company has positioned itself as the nation's leading source of high school sports information.

"They are going to be the ESPN of high school (sports)," Lenet predicted.

Two other Web sites -- Rivals.com and Scout.com -- also cover high school sports, but primarily from a college recruiting perspective.

Joining DFJ in the $7 million deal was New York-based Dolphin Equity Partners, which specializes in emerging media companies, and BEV Capital, which focuses on consumer-based companies from its Stamford, Conn., headquarters. Dolphin and BEV officials couldn't be reached for comment.