Venturi Racing have announced that US investor group Vroom E have purchased the team, with founder Gildo Pastor and team principal Susie Wolff retaining interests in the company.
On a call with Formula E media yesterday, Wolff said that discussions with the group, led by US investment expert Scott Swid and Spanish fund manager Jose M Aznar Botella (son of former Spanish president Jose M Aznar) began a year ago after the group approached Venturi.
Aznar is the brother-in-law of Formula E founder and former CEO Alejandro Agag but has no prior significant investments in Formula E. The two had begun looking at investing in sports, and specifically motor racing, when Swid’s attention was caught by Liberty Media’s purchase of Formula One.
Swid said: “What I thought was really interesting was when Liberty bought Formula One and I didn’t really know that much about Formula E – even though Jose and I have been friends for around twenty years and I’ve known Alejandro a long time as well and I’m a huge fan of what he created here.
“I was in the investment business and one of my analysts came and gave me one of these 40-page reports from Morgan Stanley on the stock of Formula 1.
“Being a sports fan, I’d been looking for non-institutional investment ideas in the private sector and I thought that what I saw, in my sports fan career, was that when really good management with long-term thinking took over sports leagues – I think David Stern and the NBA or Pete Rozelle in the 60s in the NFL – great things happen to team values.
“So I said ‘forget about the stock, let’s look at Formula 1.’ Jose and I had worked together already, I knew nothing about car racing – this is probably about three years ago – and I called up another friend of mine and they said ‘ok, sounds interesting, you do the work, it’s your idea.'”
However, Swid said that F1’s financial problems seemed intractable, despite new ownership, which had moved them to look at Formula E: “I did the work and it just seemed like there was a lot of problems,” he said.
“Financial problems, in that initial thesis and I kept digging around and then they put in their cost cap and that sort of piqued my interest again and I started looking at it and that’s when I sort of found out that every problem I had with Formula 1, it was almost like it was solved by Formula E.
“As a business case, not necessarily about the car racing – such as competition, in terms of the ability to make money, fair and equitable chances of winning a race. Alejandro set this up and the powers of Formula E set this up to be the anti-Formula One, so I never looked at Formula E but Jose and I were together, looking at this space and then we met Susie and that was it.”
Wolff confirmed that talks had been specifically held with Swid and Aznar, not as a wider idea to take Venturi Grand Prix, the Formula E team, to the open market.
The sale had been solely agreed if investors could be found who matched Pastor’s original vision in moving the team forwards as a proudly Monegasque and innovative racing entity.
Pastor retains Venturi Automobiles, the company that runs Venturi’s experimental and boutique vehicle development – from landspeed record attempts to an arctic exploration vehicle and Wolff said that he is refocussing on efforts on a new space programme.
Asked if the recently announced exits of Audi and BMW from the category made them concerned for their investment, Aznar and Swid said that they anticipated Formula E moving to a partnership model between teams and the championship, with additional ways of making money and revenue-sharing for the teams, as well as bringing in new sponsor opportunities and sales cases.
Formula E currently operates a not-dissimilar model to Formula 1, where teams buy entries to the championship but it retains all its own commercial and broadcast rights.
Other sports, like football leagues – referred to frequently by Swid, who called Formula E a league rather than a series or championship – distribute more of that income down to teams.
Although it has never been announced as a plan for Formula E, former CEO Alejandro Agag told Dieter Rencken in 2019 that, when the sport reached financial maturity, such a model was a possibility.
Speaking then, in Marrakech, Agag told Rencken: “What makes sense is that first we recover our investment, then we make some profit from our investment, and then we start the conversation with the teams on how we’re going to do [any] distribution.”
Yesterday, Swid said: “I think it has been tough for the teams to make money and I think that’s going to change, meaning I don’t think it’s a confrontational issue. No one gave Alejandro a shot at making this league and look how great it is.
“The league has passed all its initial hurdles, it’s not a venture business model anymore, it’s in its intermediate stage and we have all the markers of that and I think it’s just a natural progression that that’ll shift.
“I don’t think it’s controversial and I think Jamie [Reigle, Formula E CEO] and the league know this and that Discovery and Liberty know this and I don’t know what BMW and Audi were thinking but we think it’s the perfect time to invest.”
“The need for a better business case for teams exists – and we’re going to be advocates for that,” added Aznar. “The model is there, the most successful championships and leagues in the world are partnerships between the league and the teams and we expect that it’s going to happen in Formula E, as well.”