Investors put up $206 million for the Carolina Panthers when the National Football League added the expansion team in 1993. Five years ago, billionaire hedge fund manager David Tepper bought the franchise for almost $2.3 billion. Back in 1984, the Denver Broncos were sold for a then-record $70 million. A group led by Walmart Inc. heir Rob Walton paid more than $4.6 billion for the team last year.

Now as the NFL prepares for Sunday’s Super Bowl in Glendale, Ariz., industry executives are keeping an eye on who might pay billions more for the Washington Commanders, which hired a bank to explore sale options and has been soliciting bids in recent months. Names including Inc.’s Jeff Bezos and Philadelphia 76ers owner Josh Harris have been floated as potential buyers.

NFL team valuations have skyrocketed to record highs in recent years, boosted by red-hot demand for broadcast rights for live sports, and the lofty price tags will soon force the league into making some tough decisions on who’s allowed to own a piece of a franchise. What’s certain is that the new owner of the Commanders won’t be an institutional investor, because they’re barred by league rules — at least for now.

Private equity firms such as Arctos Sports Partners, RedBird Capital Partners and Dyal Capital Partners have been buying stakes in teams in other leagues, from the National Basketball Association to the English Premier League. The NFL hasn’t tapped into private equity yet because it hasn’t needed the capital, but industry insiders say it’s inevitable the league will open up as valuations continue to rise. 

“To have private equity firms be institutional minority owners should not be a controversial thing,” said John Burbank, a minority owner of the Golden State Warriors, which became the first NBA team to sell a stake to a private equity firm in 2021 when Arctos bought 5 percent of the team at a $5.5 billion valuation. “It is going to be essential for liquidity provisions and for the owners and investors in all these teams.”

NFL bylaws require the main owner of a team to command a 30 percent stake and limit the debt that can be used to make an acquisition. But there’s only a tiny universe of the ultra-rich who are both able and willing to write a multi-billion-dollar check to buy a team. And as clubs get pricier, that pool shrinks.

The historically risk-averse NFL has been the final holdout among North America’s top leagues in other matters too. While the NBA, Major League Baseball and the National Hockey League were signing dozens of crypto sponsorship deals worth billions of dollars, football kept its doors largely shut to the industry. It took years for the NFL to do an about-face on sports betting and the league didn’t even allow liquor ads on its broadcasts until 2017. The NFL’s success largely explains its reticence — don’t tinker too much with the moneymaking machine or it might break. 

If valuations keep rising, we may see more teams go public within 20 years, a status now limited to a very few elite clubs such as Manchester United, said Sal Galatioto, president of financial advisory firm Galatioto Sports Partners. The media rights are so lucrative because all teams get equal shares of the media revenue whether they’re at the top of the standings or in last place. That means no one loses — unless they can’t get in the game to begin with.

“It’s the most bulletproof investment in the world,” Galatioto said. “My golden retriever could run an NFL team and make money.”