Room for expansion

Fenway Sports group allows Red Sox owners to play the field

By JON CHESTO
The Patriot Ledger

BOSTON - Like most smart investors, John Henry and his business partners who own the Red Sox know the key to financial success is diversification.

After an investment team led by Henry created New England Sports Ventures in 2002 to buy the Red Sox, Henry and his partners realized they shouldn't focus solely on baseball, as lucrative as it can be in this town.

So, in 2004, they created Fenway Sports Group as a wholly owned subsidiary of New England Sports Ventures to branch into other sports opportunities beyond the Red Sox. Mike Dee and Sam Kennedy, two executives who worked together at the San Diego Padres and joined the Sox in 2002 after the sale, came up with the idea for the new group. Dee became president of FSG.

The group, which moved out of its digs at Fenway Park across the street to an office at 82 Brookline Avenue in the spring, now employs 15 people, as well as several executives, including Dee and Kennedy, that FSG shares with the Red Sox, FSG executive vice president Jay Monahan said.

Since its inception three years ago, FSG has been active in a number of baseball-related pursuits, ranging from helping set up Dunkin' Donuts commercials that featured Johnny Damon (when he still played for the Sox) to selling advertising for Major League Baseball's online media arm.

But the division has also branched into a wide variety of other athletic ventures, culminating in this week's AVP Bob's Stores Boston Open beach volleyball tournament at Marina Bay. One big incentive for the diversity: New England Sports Ventures' revenues from non-baseball ventures is shielded from Major League Baseball's revenue-sharing requirements.

FSG offers sports consulting and marketing services. For example, Boston College hired FSG in 2004 to help BC make the switch from the Big East conference to the Atlantic Coast Conference. The five-year marketing contract with the college would have expired in 2009, but BC recently extended it until 2019. "That was a pivotal move in terms of Fenway Sports Group's growth," Monahan said of the original BC deal.

FSG rolled its first busines holding, Fanfoto, in 2005, Monahan said. The venture, as most Sox fans already know, involves sending photographers through Fenway or another sports stadium to snap photos of sports fans and then sell customized versions of those photos through a Web site after the game. FSG has managed Fanfoto operations in Boston and Chicago, and helped several other baseball teams as they established similar ventures.

FSG started a travel business, Red Sox Destinations, in 2006, offering high-end trips with Red Sox themes.

FSG in February bought a 50 percent equity stake in a NASCAR racing team, which is now known as Fenway Roush Racing, for reportedly more than $60 million.

FSG also specializes in event management, and will handle logistics for this week's volleyball tournament in Quincy. The tournament is being run as a joint venture between Fenway Sports Group and AVP Inc., the company that runs the professional volleyball league.

Monahan said he expects more than 16,000 people will descend on Marina Bay this weekend for the volleyball tournament.

Monahan said FSG first learned of the opportunity to run the volleyball tournament through its work with Major League Baseball's online operation, which has the rights to avp.com.

Monahan said the organizers settled on Marina Bay, partly because of its telegenic waterfront setting overlooking Boston's skyline and its access to the WaterWorks nightclub, which is adjacent to where the tournament will be held.

Although it's still to soon to know whether the AVP series will return to Quincy next year, Monahan hopes that the tourney will become an annual event in Marina Bay.

"For us, we figured that this could be an event the the community really got behind because there was a void of a major-network-broadcast, national sporting event on the South Shore," Monahan said.

Monahan said Fenway Sports Group could consider expanding its relationship with AVP, depending on the success of the Quincy event.

"Strategically, we'll look at other markets outside of New England," Monahan said. "But we're primarily interested in managing this event and creating a great experience and buzz, and then we're going to determine how we grow with it or if we're going to just stick with it here."