Local sportstech is now worth as much as the fintech startup sector, with more than 750 companies involved, according to a new analysis from the Australian Sports Technologies Network (ASTN).
Releasing its second annual Sports Innovation Report for 2023, ASTN sets up the value of sports technology $4.25 billion as the industry begins to ramp up for the 2032 Brisbane Olympics. It now represents 11% of the sports industry overall.
ASTN chair Dr. Martin Schlegel said they found out 758 companies in the local sportstech ecosystem, which now employ 13,438 people. That figure means that the sector has grown at an annual rate of 11.8% year in the decade since the pinnacle for sports technology and innovation launched in 2012 with 284 businesses.
“Rapid growth in sports technology is reshaping the sports industry as we know it and unlocking new revenue streams,” said Dr. Schegel.
“The second edition of the ASTN Sports Innovation Report takes a closer look at the emerging industry – to help inform industry leaders and provide new growth opportunities for sports tech startups.”
ASTN CEO Dr. Martin Schlegel
The report identifies 115 companies as market leaders, including brands such as 2XU, SWEAT, VULY and PTP. Those companies generate about 87% of the industry’s total revenue.
“Australia’s sportstech sector has proven that it has now emerged from its nascent phase as it competes with Australia’s booming fintech sector. Australia continues to prove that it is one of the world’s leaders and long-term pioneers in sports technology and innovation,” said Dr. Schlegel
” The sector has beat all expectations in this year’s report as the sector surpasses $4 billion in sales.”
The rise of Australian sports tech matches its exponential global rise. Are estimated worth it US$22.9 billion (A$34.65 billion) in 2022, and expected to grow at 13.8% per annum to US$41.8+ billion (A$63.2 billion) by 2027.
Go for gold
Meanwhile, Dr. Schlegel believes that the The Brisbane 2032 Olympic and Paralympic Games will provide new opportunities for the industry to develop a new wave of technology solutions.
“We are building in one of the world’s most advanced and integrated sports tech ecosystems leading up to several major events on the Australian sporting calendar over the next decade,” he said.
“We can expect new technologies from AI, big data analytics to mobile, non-invasive wearable sensors and smart materials are deployed all over the sportstech market verticals. As a result, new companies will be formed that will provide the opportunity to move forward growth of the industry.”
10 trends
The report identifies 10 major themes that present strategic opportunities for industry, from ESG to active living, fitness and wellness and smart apparel, which have accelerated digital transformation across leagues, teams and federations.
Many of the emerging trends such as aArtificial intelligence, emerging sports and women in sports technology are part of ASTN’s five-year strategy.
Dr. Schlegel said startups, companies, founders, government and the wider sports industry need to recognize and embrace these themes, looking at how they affect current operations, how they need to evolve and adapt, and what opportunities they present.
“To continue the momentum of the industry, Australian sports technology companies need to keep abreast of global trends and capitalize on these opportunities to reap the rewards over the next decade,” he said.
“There is still a huge amount of untapped opportunity in the local sportstech ecosystem. The sports technology sector in Australia is manifesting its position as an ideal incubation and validation market, with our global counterparts recognizing the capabilities and quality of sports technology solutions derived here.”
Main findings
The main findings of the report are:
- Sportstech employment by state: Of the 13,438 people employed in sportstech, ASTN estimates that almost half (47%) of sportstech jobs are based in Victoria, followed by NSW (27%) and QLD (18%).
- Location Sportstech: The majority of sports technology companies are based in Victoria (41%), New South Wales (31%) and Queensland (19%) – with operations concentrated in the three main metropolitan areas, including Melbourne, Sydney and South East Queensland.
- M&A activity has slowed: There has been a decline in mergers and acquisitions (M&A) and capital raising activities in FY23 compared to FY22 – due to a significant narrowing of access to investment capital driven by rising interest rates and inflationary pressures. M&A activity has slowed to about A$500 million in FY23, compared to more than A$1 billion in FY22.
- aSTN companies pave the way: Sportstech companies mentored by ASTN programs now employ 270 people, and thirty of the more than 70 alumni startups from ASTN’s Accelerator program have raised a total of more than A$60 million in capital in recent years.
- Mass Participation & Active Life market dominatesM: ASTN found that the majority of companies (56%) provide their products and solutions to the mass participation and active life market, followed by the corporate sports and entertainment market (46%) and professional and elite sports (14%) .
- ICT remains the largest technology category: Most companies develop their solutions using information and communication technologies (ICT) (66%), followed by advanced materials (23%) to build their products.
- Emerging sports tech trends offer new opportunities: ASTN’s top 10 themes are:
- 1. Artificial Intelligence (AI),
- 2. Active life, fitness and wellness,
- 3. Web 3.0, Metaverse, Gaming and Blockchain,
- 4. Virtual sports of tomorrow
- 5. Smart clothes, gear and wearables
- 6.ESG,
- 7. Sports Digital Ethics, Privacy and Security
- 8. Women in Sports Tech,
- 9. Investments and Venture Capital,
- 10. Global Trade and Business Alignment.
The full Sports Innovation Report 2023 can be downloaded here.
Highlights from the 2023 ASTN Sports Innovation Report
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