Technological innovation is transforming the world of sports, but are sports startups receiving the support they need? And, more importantly, are these startups prepared to understand and adapt to change? In this interview, Xavier Trallero, Managing Director at Barcelona Sports Hub, analyzes the main challenges entrepreneurs face in the sports industry and how they can overcome them.
Xavier, a lawyer with extensive experience as a startup founder and an expert in strategy and innovation, explores in this interview the challenges of the SportsTech sector and its impact on sports startups. He highlights the lack of funding in the early stages as a key obstacle to their growth and examines how traditional companies and sports startups can better adapt to technology. Additionally, he emphasizes the importance of public-private collaboration and specialized training as fundamental pillars for success in a constantly evolving industry.
An essential journey through the present and future of sports entrepreneurship.
This is a great question, especially in the field of sports startups. What we have seen is that artificial intelligence, virtual reality, and Big Data are playing an increasingly relevant role. Not just because of technological advancements themselves but because the combination of technology and sports is transforming the industry—especially for sports startups leading this innovation.
We live in an increasingly connected world, where data collection and analysis play a key role in decision-making. That’s why sports startups and other solutions based on machine learning and predictive tools are gaining significant momentum. This type of innovation not only impacts professional teams and athletes but also reaches fans and amateur sports, enabling greater performance insights and strategy optimization.
At Barcelona Sports Hub, where we primarily work with sports and technology startups, we see that the most viable ideas are those that can be easily implemented and generate revenue from the start. In other words, business models that do not rely exclusively on third parties for revenue but are self-sustaining.
In this regard, sports startups developing SaaS (Software as a Service) models are experiencing significant growth. Companies, sports clubs, and other organizations can access these solutions through subscriptions without requiring large initial investments. We also see strong traction in sports startups creating consumer applications, leveraging data analytics to enhance sports performance or user experience. From an economic perspective, these two areas are showing the greatest stability and growth potential.
Traditionally, sports have been one of the slowest sectors to adopt new technologies, as the practice of sports itself has not changed much over the decades. However, the digital boom brought by the internet, smartphones, and now wearables has profoundly impacted how we interact with sports. In this context, sports startups are playing a key role in developing innovative solutions that are transforming the industry.
In the past, sports technology was mainly applied in professional environments. Today, it is present at all levels, from elite athletes to amateurs seeking to improve their performance. Sports startups specializing in data analytics, artificial intelligence, and connected devices are accelerating this transition. Over the next five to ten years, we believe that implementing technological tools for monitoring, data analysis, and decision-making will become the industry standard. Technology is no longer just a complement; it is now a fundamental part of the sports ecosystem.
The legal aspect is crucial and, in many cases, can determine a project’s viability. Many sports startups are unaware that their legal strength is what allows them to protect themselves from being copied. This is particularly evident in trademarks and patents, where a solid legal strategy can make the difference between success and failure, especially in defending algorithms and utility models.
Having good legal advice from the outset is essential. Aspects such as shareholder agreements, corporate structure, data protection, and even liability towards third parties must be clearly defined from the beginning. In the sports sector, especially among sports startups, there is still much room for improvement in this regard. Companies often focus on product development without considering legal protection, which can lead to significant problems in the future.
When GDPR came into effect in 2019, there was a lot of concern in the industry, especially about the financial penalties for non-compliance. We saw cases like Meta or Amazon receiving multimillion-dollar fines, but for a startup or an SME, such a fine could mean the end of the business. Solutions like lawwwing have emerged to automatically update all legal texts on a website, turning this need into an opportunity.
The biggest challenge in regulation is finding a balance between user protection and the viability of business models that rely on data collection. In sports, this is particularly relevant with the rise of wearables and devices that monitor personal information, such as cardiovascular data or physical performance. This data is highly valuable, but if not managed correctly, it can pose significant privacy risks.
For sports startups, which heavily depend on data collection and analysis to offer their products and services, this balance is even more critical. I believe we will see regulatory changes in the coming years to adapt to these new realities. Regulations must evolve alongside technology to avoid becoming a barrier to innovation, especially for sports startups driving advancements in this field.
One key point is the NDA (Non-Disclosure Agreement). Although in practice they are not always fully respected, they remain a fundamental tool for protecting sensitive information in the early negotiation stages.
Another crucial aspect is drafting solid commercial contracts. Many sports startups make the mistake of using generic templates found online without considering that each agreement has specific details that must be properly reflected. Good legal advice from the outset is essential because a poorly negotiated contract can jeopardize the startup’s future.
One of the biggest challenges in negotiating with clubs, leagues, or federations is the power imbalance. Many sports startups need to secure agreements with major entities to scale their business, which sometimes leads them to accept unfavorable conditions. It is important not to concede on clauses that could impact long-term viability, such as termination terms or exclusivity agreements.
Blockchain regulation is outdated. This is no longer a future technology but a present reality being implemented across multiple sectors. One of blockchain’s greatest advantages is its ability to operate without intermediaries, streamlining processes and reducing costs.
However, many current regulations do not account for its applicability in specific business models. For example, we could tokenize real estate and sell it through NFTs, eliminating notary and bureaucratic costs, but the law does not yet allow it. In the sports industry, we see the same issue with the tokenization of experiences and digital rights. Some solutions, like blovize, have emerged to tokenize sports awards and recognitions.
I believe we will see regulatory evolution in the coming years to support the growth of these models in a secure and regulated environment. For now, however, we remain in a phase of legal uncertainty that hinders large-scale expansion.
When a sports startup decides to expand internationally, several key legal aspects must be considered.
First, talent hiring. If hiring employees in other countries, it is essential to understand local labor regulations, work permits, and associated costs. This is especially important for non-European talent if operating in Europe.
Second, market regulation varies significantly by region. Business models that work in one country may face regulatory barriers in another.
And, of course, broadcasting rights present an even more complex challenge. The commercialization of sports content is highly regulated and often dominated by major players, making market entry difficult for new actors.
In short, internationalization opens many opportunities but also brings significant legal challenges.
If you’re looking for advanced specialization in the field of sports law, the courses offered by Sports Law Hub provide a comprehensive and in-depth analysis of regulations, procedures, and the study of complex cases. They will equip you with valuable strategies and a broader perspective to excel in this field.
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