BKFC on Precipice of Broadcast Deal, Mainstream Recognition

BKFC on Precipice of Broadcast Deal, Mainstream Recognition

Bare Knuckle Fighting Championship (BKFC) has gone from circus-like sideshow to the precipice of mainstream combat sports in six years. A recent investment from Conor McGregor has the challenger promotion threatening to push all the way through.

“We have a rocket ship. We just needed the fuel,” David Feldman (founder and president, BKFC) said. 

The former UFC champion is expected to provide it. He will be participating in event promotion and fighter introductions.

But BKFC has more going for it than just McGregor. A domestic broadcast rights deal is said to be on the horizon, and its parent company, Triller Corp, recently agreed to a $4 billion tie-up with AGBA Group Holding (NASDAQ: AGBA).

“If the merger completes, and [Triller] becomes a publicly listed company, it’s game over for us–in a good way, Feldman said. “The funding that [would] come with it, and what we’ll be able to do with all the entities involved [in the Triller portfolio], there [will be] no stopping us.”

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BKFC was created in 2018. Its first five years were a struggle. 

“We weren't [just] launching another combat sports promotion, we [were introducing] a whole other combat sport,” Feldman said. “So, we had to gain regulatory, fan, and fighter acceptability.” 

And that doesn’t happen overnight. 

“I don’t think anybody took it seriously for a while,” the Fight Oracle (a combat sports consultant) said.

But the promotion has seemingly turned a corner over the last nine months. 

The pace of state regulatory approvals has picked up enabling the promotion to host more shows in more places and grow the fan base quicker than anticipated. Fubo also made a strategic bet on the company in January that Feldman described as a ‘gamechanger’.

“Just from an institutional investment [and perception] perspective, [it] brought significant value,” he said. The streaming service has also “really expanded our viewership, and [its leadership has made introductions] that have helped a lot.”

BKFC’s success convincing UFC castoffs to fight under the banner has played a role in raising mainstream awareness of the promotion too (see: Mike Perry, Paige VanZant). 

Now “we’re getting right under, or right over, one million viewers [for] every live event,” Feldman said. 

Those cards currently air across multiple platforms in the U.S. (see: BKFC app, Fubo TV, and YouTube). 

While awareness is up, so too are BKFC revenues. The promotion has doubled dollars in the door YoY every single year of its existence. 

“From last year to this year, it’s probably going to 3-3.5x,” Feldman said.

Triller consolidates its financial statements. So, it’s not clear exactly how much BKFC brings in. 

However, security filings indicate Triller posted $50mm in ’23 revenue. BKFC and Triller TV (formerly FITE.tv) are believed to be the two largest revenue generators within the holding co. portfolio.

BKFC currently generates income via several channels.

“We have an app. We have sponsorship partners. We sell a good number of tickets. We do some [shows] on PPV. We create ad revenue. We get international [media] rights. Merchandise,” Feldman said. 

What’s missing is a domestic rights pact. 

“To get over the hump, there has to be a bigger, wider [TV] deal,” Feldman said.

But the fight sport founder indicated that one is on the near-term horizon. 

“We’re going to have a big platform or television deal wrapped up within the next 60 days,” Feldman said. “We’re talking to one linear [network] and two streamers [about terms] now.”

The BKFC founder noted the deals being discussed would more than double BKFC revenues.

While Triller bought ~76% of BKFC for $7mm cash and some equity in ‘22, the promotion has largely operated on an island waiting for the hold co.’s public listing to occur since. 

“That was really the [end] game for this whole [rollup],” Feldman said.

If/when the merger with AGBA closes, the expectation is BKFC will be able to leverage some of the other assets in Triller’s portfolio for growth (see: Triller TV database). 

There is also “a marketing arm, an AI business, and an influencer [network],” that can be used to generate promotion and drive sponsorship dollars, Feldman said.

But most importantly, the public markets would give BKFC access to the growth capital it needs to market the promotion more heavily, to add more marquee fighters, and build out its team.

Capital that might not be available otherwise.

Triller “wanting to be a public company so [badly] has a lot to do with access to the capital markets that stalled as a private company,” the Fight Oracle said.

The business lost more than a billion dollars between ‘21-’23.

We say if/when because Triller has had its share of false starts before. And because the combined valuation for the two companies, which both lose money and collectively generated just over ~$100 million last year (AGBA reported $57mm in ’23 revenue), is $4 billion. 

But the stock has 6x’d since since the announcement.

“It’s [seemingly] a done deal now,” Feldman said.

However, getting to the finish line does not ensure Triller’s (or BKFC’s) survival. 

“As we’ve seen with some of these shitcos during the SPAC era,” the Fight Oracle said.

BKFC might be best off if Triller spun it off. 

“[It’s] something I would like to see happen,” Feldman said.

There’s simply too much baggage with the parent co. for those most bullish on the promotion to get behind it. Investors also don’t know what they’re buying with the Triller hold co. or how to value it.

“The problem with these holding company structures is you don’t get the sum of the parts valuation,” the Fight Oracle said. “And when you’re talking about Triller, with the mess their financials are in, and now merging with this company that doesn’t have a good history, it’s going to be very difficult to trust them.”

It’s not clear if a spin off is feasible. Triller may need the cash-flow BKFC generates to offset losses elsewhere within the portfolio. 

McGregor will announce the specifics of his deal with BKFC when ready. But Feldman was clear that it’s not a token promotional deal.

“He has significant equity. He’s in this thing. He’s all the way in,” the fight sports exec said. “He put his money where his mouth is and wants to perform.”

Look for the promotion to announce a few additional high-profile stakeholders soon.

“I have two or three real needle moving names, on top of McGregor, that are coming in with us as well,” Feldman said.

The star power is expected to lend credibility to the nascent promotion and raise awareness of it worldwide. That is valuable with BKFC’s future growth expected to come from an increasing number of people experiencing the sport.

The promotion intends to host more events in more states and more countries in the years.

“I need fans to see this,” Feldman said.

The UFC was built on a similar philosophy.

Speaking of the UFC, BKFC’s biggest draws to date have been former stars of the MMA promotion. But Feldman understands that picking those guys up at the end of their careers is not a sustainable strategy.

“We can use crossover stars for viewership, and spikes for a one-off event,” he said. But “to spike across the board, we have to create our own stars.”

So, BKFC is developing a prospect series that will serve as a pipeline for new talent. Then, it will invest in the marketing of those fighters.

“The thing that we’ve been lacking, that we’re going to do [in H2 ‘24] into ’25, is tell stories of the fighters and create our own stars,” Feldman said. 

With McGregor on board, a broadcast deal on the horizon, and access to the growth capital needed BKFC appears ready to enter the mainstream sports conversation. 

“We [think we] have everything we need now. We'll know in the next 30 days for sure,” Feldman said. 

And if for some reason the Triller-AGBA merger doesn’t close, the BKFC founder indicated it would only be another 30 or 60 days before the promotion found another source of funding.

“There’s a lot of inquiries on investment all the time right now,” Feldman said.

FWIW, Feldman suggested BKFC is currently valued at $400mm.

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