All The Angles S1 E1: Focus on the 2024 Playtomic Global Padel Report

Alex Inglot and Hexagon Cup founder Enrique Buenaventura return for the first full-length episode of All The Angles, the business of padel podcast, with an exclusive conversation about the 2024 edition of the Playtomic Global Padel Report.

The two architects of the Report: Playtomic Co-Founder Pablo Carro and Strategy& Partner Elena Martin, join the podcast to discuss the birth of the Report, its importance to the padel industry and the key takeaways, giving a unique extra level of analysis and insight.

This episode is not to be missed as everyone in the padel industry grapples with the Report's data and conclusions!

Transcript

Introduction

Alex Inglot 0:05

Ladies and gentlemen, welcome to the next episode of All The Angles, the business of padel podcast powered by the Hexagon Cup. I'm joined once again by my guest anchor, enrique buenaventura, founder of the Hexagon Cup. And in this episode, I'm delighted to have two of the main architects behind the playtomic global padel report 2024 on this call to discuss the findings. The report was released about a week or two ago to the public and Obviously it's being digested and reviewed rigorously by everyone in the industry since it pretty much is a key reference point. Some call it the Bible of the industry. Um, but as I mentioned, the opportunity to speak to the lead from Playtomic's side, uh, Pablo Carro. And then, Elena Martin, who is the other key architect and lead from Strategy And, which is part of the wider PWC network. So the two of them were on a panel at the Padel World Summit a few months ago to tease some of the findings from the report, but this is the first time we have the opportunity to really dive into the detail, the numbers that were released a week or two ago. Thank you for joining us for this episode, So let's start with a little bit of the background of the report. So this is not the first year It's been going for a couple of years now. Um, And it's an annual day in the diary that everyone Looks forward to to really understand the state of the nation, the state of the sport, how things are evolving, how the growth is panning out, how the markets are developing. But I guess the first question I wanted to ask was the background: how the report came around, why did you both come together and decide that this was a good thing to put together? How did it start really?

Elena Martin 1:52

Um, so Pablo can tell you more about this, but he had the initial idea and he thought that there was no single point where you could find data on the industry. Similar to what you have with soccer with FIFA or with tennis: there was no way nowhere to go, when you wanted to check data on the industry. So he approached us. He approached me through a friend in common. And from our side, the story is quite funny because after, uh, COVID it's being difficult to hire, uh, for professional services I would say, as general, and because they think that we're boring and we wear suits and they want to be, um, in a startup, you know, and so we thought that, uh, going into this, um, venture Would help us position us as a cool segment and that you can do cool things in, consulting too. So that was the beginning of all of this.

Alex Inglot 2:52

And from your side, Pablo,

Pablo Carro 2:53

Yeah, I think two years ago we, we realized there was an excellent opportunity for highlighting the significance of, let's say data driven culture in the industry. I mean, uh, padel was growing, but nobody had a real data, um, about what's, what's going there and at the end of the day, we, I mean, we are a tech company, let's say we got a lot of data, but we are not a consultancy firm for running a proper, uh, research and as Elena said, yeah, I called Elena at that time. And I see we need to put together a professional team and we need to build something Uh, serious, right? Every single industry that is becoming, let's say, professionalized, they need this kind of research because it gives reputation, sector knowledge, for making decisions. I mean, at the end of the day, every single stakeholder, uh, on a daily basis, they make decisions and they need something to back their decisions with real data. And, and yeah, that's, that's the story. And, we publish it every year and we update numbers and we try to headline what's most, uh, relevant. And I think 2024 has been a great exercise as well.

The Industry's Reliance on the Report

Alex Inglot 4:10

And obviously a lot of the information that comes out of the report is kind of carried in headlines. around the world. You see that the headlines from this year were the 51 new clubs every week being built over the last 12 months and 111 new courts being, uh, laid every week in the same period. Those are kind of the, the types of numbers that get thrown around in the media, but do you guys get formal or informal feedback from other stakeholders in the industry saying: we needed your numbers, we used your numbers, it helped us close this deal, it helped us secure this partnership, it helped us secure funding. Do you kind of get that sense that it's really making a difference behind the curtain as much as in front?

Pablo Carro 4:53

Elena, it's a good question by the way.

Elena Martin 4:57

I do get, I didn't get a lot after the report. I did get a lot of messages like the month or the six weeks prior to releasing the report. When are you releasing the 2023 so it's data of 2023), when are you releasing the new report? We're looking forward to that. Uh, I'm thinking about we need to budget next year. We're waiting for the report to come in order to make it more accurate. So I did receive a lot of messages before and asking me: please let me know whenever it's out. And I said, man, you're going to know when it's out.

Enrique Buenaventura 5:32

It's true, that from our side, for example, Hexagon, that obviously we've put in place investors deck and so on: that we use a lot of the data and we are waiting to receive the new report to update those investors deck or those conversations we are having, because it's where everyone is facing and a lot of the, a lot of the reports that you see, a lot of the investors decks that you see in the market, You can

Pablo Carro 5:57

Exactly.

Enrique Buenaventura 5:58

you can see in the disclaimer: based on the Platonic PwC report. So

Pablo Carro 6:04

Every single deck,

Enrique Buenaventura 6:05

a standard. Yeah, absolutely.

Pablo Carro 6:07

Every single deck that we even receive in Playtomic contains part of our report. It's interesting because it has become the reference.

Alex Inglot 6:17

That graph where you have the different countries on the, in terms of their maturity, I've seen that so many times, which leads me to two sub questions. One, do you get recommendations from people about what they want to see in the next report because it would really help them and their business?

Pablo Carro 6:33

Absolutely. We feel the pressure. Alex, we feel the pressure. We, I mean. Not, not prime ministers, but we've, we've received pressures from many countries: Saying: Eh I, you need to include the specific slides about my country in this report. Uh, we can't disclose which country was, but we received a couple of threats about, uh, incorporating their country in the report, in a good way, let's say.

Alex Inglot 6:59

And have you found a way to secure commission from all deals that your report has supported?

Pablo Carro 7:07

yeah, I mean, I was speaking with my friend about a specific conversation with, with a landlord. And the global padel report helped him to close the negotiation with the landlord because the landlord didn't know what is padel about. And with the report, he sent the report, he saw Pricewaterhouse inside, he saw Playtomic as a significant size company. backing it and he started to, um, believe in him. So we, we, we would love to have, um, our markup in every single deal in the industry, but I don't think it's going to be possible.

Elena Martin 7:44

Not the case.

2024 Report Key Takeaways

Alex Inglot 7:47

Okay, well that's one for the future so let's kind of look into the 2024 report in a little bit more detail. Obviously I mentioned the 51 new clubs and the 111 new courts in the last 12 months. As the chief, pen holders, the chief architects of the report, what do you think is really the key takeaways from your point of view? Like what are the key trends that you noticed over this last 12 months and, and maybe how it was different from what you expected or what you forecast in 2023?

Elena Martin 8:15

Pablo and I wanted to highlight these, uh, 51 clubs, uh, every week because, for me, as a, as a consulting professional, I would say the main, uh, takeaway is that growth continues to be very large, like the growth of, the, of the industry in terms of, uh, installation of padel courts is about 17%. Which is massive at the number that we're at this point, because having big growths when when the base is small is easier. So confirming that we're still growing at double digit and that the backlog plus the courts that have already been installed, um, so what has been installed for the first half of 2024, confirming that this is growing at double digit again. For me, it was the. most important, uh, figure, of the report. Having said that um, the growth was a bit, smaller than what it had been for 2022 and 2021 because of the post COVID effect, et cetera. So we wanted to highlight that. Still moving from 20 to 17 with a larger base is very relevant and what it implies on a weekly ratio.

Pablo Carro 9:34

No on top of what Elena said about the growth and the expectations for the future, uh, we've also incorporated a big portion of the customer intelligence that we have. I mean, we've, we've run surveys, uh, focus groups, et cetera. So we, we again, confirm that apart from padel becoming a worldwide sport, the behavior of the players and in this multi club component, and more importantly, the social aspect of the community is being highlighted. Why? Because I mean, the UK, it's a great example. I mean, we we've seen, an incredibly high ratio of open matches, in the UK that we were not expecting. So that, that means that the sport, the essence of the sport, the driving force of the sport, that social component that everyone talks about. It's also confirmed in geographies I mean, the UK is a great example or the US or Germany. So, I mean, this kind of multi club player, playing with people that, um, they don't know each other and these open matches trend is, it's a great highlight for us.

Alex Inglot 10:51

Um, so one thing I wanted to pick up on your point Elena. So I think last year you forecast that the growth would not be as high as it was during the COVID periods. But the number that you ended up with, the 16 to 17, is still lower than you forecast. Is there a reason why there's that delta between what you forecast last year, understanding that COVID was already fading out, and it's still just a touch lower than that when you actually see the numbers.

Elena Martin 11:19

To answer to that: the thing is, we, we were not aware, so we didn't know that we have the COVID effect there, right? I think that we have acknowledged once we've continued, to follow, uh, with manufacturers and talking to them and interviewing them and knowing about their backlog and how they're feeling the industry, et cetera. So they said, that there's, um, installations that have been postponed and we didn't notice. It's not that in the previous report I forecasted that there was a COVID effect and that it would slow down. We didn't anticipate that. We just noticed after it happened. That's the first answer. And the second is that the two big markets that have, uh, not made the expectations are mostly Spain, which is already very saturated. So it's not important. And also Italy didn't meet the expectation, but it's growing fast anyway. So we don't see any signs of that the industry is not healthy there. What I'm saying is that the ones that are the largest are the ones that have had the the highest impact, which it's nothing surprising,

Alex Inglot 12:28

sure.

Elena Martin 12:28

uh, but none of them, um, is for me sending any signs of worriness because Spain is saturated. And in Spain, we were expecting more of a renewal, uh, rate, and we're not seeing that, uh, renewal rate or not as fast. And Italy, uh, was a little bit slower, but, uh, as I said, uh, it's still growing, it's consolidating as, leaving Sweden apart as the second, uh, country in terms of development. All the statistics and the numbers also that Playtomic has. are confirming that it's a very healthy industry there. So, um, it's something that we didn't anticipate and the countries that have not met the expectation are not any worrying geographies.

Alex Inglot 13:15

And do you think that the 16 percent growth rate that we saw in the last 12 months, do you think that's a normalized growth rate? That's what we could probably expect going forward? Or do you think actually that growth rate is going to fluctuate itself?

Focus on the US Market

Elena Martin 13:31

This is, uh, very difficult to answer because there's so many countries that are in a very incipient stage, uh, such as, for example, the U. K., the U. S., even if you see that the curve is tipping, um, up, both the U. K. and the U. S. have a lot of potential, not to mention Germany, where there's some, uh, I'd say license and administrative burden that is, it's not allowing it to grow as fast as we expected. But if any of these countries Just, um, start growing at the rate that we expect, then this figure is going to shift because these are the big countries that have a lot of weight. For example, but Belgium or the Netherlands are courts 200 courts down, doesn't move the needle. But if we see, uh, the U. S. for example, really explode, let's say, let's say Padel made it to a college, uh, sport, I don't know. Then we could see these figures really to change. And because it's not, it's not a stable market yet, because it's been incipient, it's very difficult to forecast now. Now, uh, we always do forecast based on a, let's say, best effort or best guess, scenario. But, with such, uh, immature markets, it's very difficult to say.

Alex Inglot 14:56

And just you touched on the U. S. Actually, the college angle is something that I don't think gets covered in the global padel discussion, but I think it's incredibly important. I know this because my brother was a college tennis player, and it made a huge impact. And once you see that world and you see how important it is to American parents as to how much energy and investment they put into their children and which sport they choose to invest in that country. But you also see how important it is to international players in terms of those who are looking to balance their academic development with their sport development. It is a game changer and I'm going to hopefully do an episode on All The Angles to explore that evolution in a lot more detail. But I 100 percent agree with you that that could, that switch could be seismic for, not just the U. S. market, but for the global numbers.

Pablo Carro 15:48

That would be a game changer, especially in the U. S., Alex, for sure. But we need time for that. We are right now, what is happening in the U. S. is that we are building.

Alex Inglot 15:57

In the report in the U. S. What I found really interesting is you mentioned that the U. S. Has a lot of buzz, but the courts haven't quite reached that same level or that same velocity. But interestingly, right at the front of the report, you notice that 45 percent of the report reading was done in the U. S. for last year. It's fascinating that you've got this incredibly frothy interest and curiosity and, shall we call it case building, for the sport. And it almost feels, and I think this is your conclusion about the U. S. correct me if I'm wrong, is that, that we're almost, if not already, we're at the tipping point where that interest and curiosity and planning is now starting to deliver in terms of courts and clubs.

Pablo Carro 16:39

Definitely, Alex, you're totally right. 2023 and 2022, probably we were generating the buzz in the industry. I mean, just introducing the sport, talking about it. But. I mean, the infrastructure takes time. So what we've seen so far in 2024 is the confirmation that this, this path is becoming, let's say, productive and a real thing. We know that 600 courts are going to be delivered in the U. S. in the next 12 18 months, because we talked to every single manufacturer and we build a quite sophisticated report and we know how to measure it. And we know that these 600 courts will, not the tipping point. I mean, it's a starting point of the sport there.

Enrique Buenaventura 17:30

No, and one, one thing to add on this. So obviously at Hexagon, we are looking for new teams, to add. Most of the requests come from people in the U S. That they want to, to build a team, to do a team in Hexagon, because that will help them in a new project that they are building based on padel clubs. So, so they all say, look, if I do a team, it could help me to promote my padel club, that I'm about to start the project. And I'm, I'm planning to do 1, 2, 3, 4, 5 clubs in the next, uh, five to 10 years. So most of the requests and most of the interest come from, from the US and precisely to promote. A new plan they have on, on, on padel clubs. So definitely they are investigating. They are getting the information to, to start building, to start building.

Elena Martin 18:17

I got contacted, I told you, from the last, so the previous report to this, I have been contacted with several, I'd say, investors. Private investors that want to build courts. And it's exactly as you mentioned. There's a lot of interest. The sentence on that courts are not there yet, it's because we have 500 courts 6, I don't know. But if you take into account, let's say only the regions where padel is developing, really, which is Miami, the New York, California. There's something like 90 million people, and if you take into consideration the population that lives there, the number is very low. Having said that, as you said, there's a lot of interest, uh, Hexagon, uh, the, internet research, uh, the contacts that I get, I get, I guess Pablo also gets some of those. So I think there's a lot of interest, but we need to see this number grow, because 600 for 90 million is still quite low density.

Key Global Growth Factors: Tech & Professionalisation

Alex Inglot 19:17

Sure. I just wanted to move on to there's a page in your report where you talk about five or six of the factors that you believe are driving the growth of the industry as you look at it in 2024, but you prioritize tech and professionalization as the two that you think are really ahead of the others. Can you explain a little bit more why you think that those two are so important and especially because in the professionalization the next page you talk about the b2b conferences being really important to the growth of the industry and the business around the...

Pablo Carro 19:53

Correct.

Alex Inglot 19:53

game. So i'd love to know a little bit about why you felt tech and Professionalization as you define it are kind of the biggest growth factors

Pablo Carro 20:03

Well, I can explain tech for obvious reasons, but let's say that every single industry needs to be supported and let's say manage, uh, through a proper, tech platform, every single industry. Um, if we talk about a new industry like padel: every single club owner, club manager, they think about the tech piece just after the construction, permissions, et cetera, because they know it's going to be their brain. But not only that, it's also because it's going to be the, uh, marketing tool. Um, so that's on the club side. But more importantly, on the user side, what happens is that if we really want to engage new generations, we really need to deliver a social app, something that will drive adoption, something that will make the people play more and something that boost the, the practice of the sport. And, and this is the role that we play at Playtomic is facilitating and, and promoting the social joy of racquet sports. And this is our job and we are, one of the companies, tech companies that we are doing that in the market, right? But it's very important because the club needs efficiency and because the, the player needs a great user experience and especially new generations.

Enrique Buenaventura 21:34

I see. and I was discussing this with a friend the other day. Um, so precisely Playtomic, it's one of the reasons of the upside of padel versus, tennis, for example, uh, in the late latest years. So tennis, I've been a tennis player and, and tennis players have been used for many, many years to arrange their games by people they know and so on. So padel. It's been growing, especially, and I would say outside Spain, it's been growing together with Playtomic, together with the technology and the, and the fans and the communities around it. It's, it's everything around that, that technological, community, no? So a lot of the people say, no, no, all my games are arranged by Playtomic. So all my games are arranged by technology. So this, this is amazing. And that's from my opinion, one of the reasons why, padel is growing so fast, eh, and, in such a big community, because it has that social aspect and a social aspect around the technology. So, so I think for me, it's, it's been key. And, and obviously the more it evolves, the more quickly the sport will evolve. Yeah.

Alex Inglot 22:45

And what about the professionalization piece?

Elena Martin 22:48

Yeah, I think I can get that. Um, so I think I mentioned this at the Hexagon event the other day in London. Um, the thing is, the sport now has developed, mainly, funded by, I'd say, well connected, wealthy individuals. And there hasn't been a lot of. There's been some, there hasn't been a lot of institutional money, meaning funds, private equities, et cetera, into the industry. So why, why I think professionalization is key: because in order to get it to the next level, We need these figures and these, um, multiples and these, we need the figures to prove that this is a, successful, uh, profitable, uh, segment or market to invest in and that this is consistent, along time. So that's why I say that professionalization at this point in time is very important. And these people that are investing at this point, they need, uh, to secure that the courts will be there at the point in time they expect that, uh, they meet the quality they want, that the price they, they was committed. So this, uh, institutional money doesn't want uncertainty. They don't want to be changing their pitch plan or their plans or their, their GANTS or their, uh, calendar all the time. So that's why I said so. And regarding technology, and adding to what Pablo and Enrique said: I'm recommending all the investors that are get in touch with me to ask me, what are the figures there? How much the court costs? Now we have three, four pages on the economics of building a court in the report for the first time. Because I get asked those questions a lot, very often. And I always tell them it's fine. So you need to get the capacity, you need to secure the land and install the court. But at some point, you need to secure the use, right? Um, the average use and this can't be done just by placing the court there. So you need to have people come and want to play in your court and that it's easy for them to reserve and to know when they want to make a reservation and to know when the court is going to be available. That's one point. And the second point is: if you are a large investor, as I mentioned before, professionalization, et cetera, institutional investors, if you want to scale the business, you need some technology and be able to move people from one club to another of your own, although Playtomic has a lot of users that really are open club users. But from an investor standpoint, you can also, um, use the technology or the platform to move demand from one club to another and to optimise your utilization.

Multi-club Player Phenomenon

Alex Inglot 25:44

And I think that actually takes me to one of my final points on the report or its key conclusions Maybe i'm crazy to be surprised and you know, please tell me otherwise, but the idea that effectively 71% of players Play at more than four clubs You had 90% who play more than one and then you had 71% who play at more than four that for me is Bananas, like I don't play at that many clubs. Is the reason for that because people play when they're on holiday because that's the only time I really play at other clubs is when I go on holiday? And and there is where I use Playtomic because my club doesn't use Playtomic but when I go abroad, I need Playtomic to kind of access courts in spain or access courts in Portugal. But uh, I was a little bit surprised that people play at so many clubs

Pablo Carro 26:34

It could be surprising, especially if we think about through the tennis mindset, I mean, because, uh, in tennis, you tend to play in just one club, in your club, your country club, your members club etc. So that, that's the first bias, let's say. Secondly, depends on the market. Obviously, um, Enrique in London has few options. Let's say three, four, five options he can play. Uh, Elena in Barcelona: she has 20, 25, 30, 50 plus. Myself in Madrid, I have a hundred plus. So it depends on the supply obviously. But whenever the, the market is developed, the crucial thing is that the nature of the sport, I mean, it has a multi club component. Why? Because, I mean, you really want to play. And you, you really want to enjoy and have fun while you do sports, while you meet new people. So, I mean, it doesn't matter or it matter less the club you're playing at. Obviously, obviously, if you have a hundred options like myself, I finally play in five, six, seven places, not in the hundred clubs, because I do like the clubs that I like or because the location is better for me. But at the end of the day, the essence of the sport and the nature of the sport and the driving force of the sport is not the facility itself. You need to enjoy the offline experience let's say absolutely. But, it goes beyond that, right? I mean, it goes beyond my club. So this is the reason why the report was showing that, yeah, the people is, is, is playing in, in, in multi clubs.

Elena Martin 28:12

I think for you, it's so surprising because what, uh, Paolo and I have discussed this a couple of times. In general, when padel starts, what happens is that it's usually starting, except for Sweden, for example, it starts, uh, developing in let's say tennis clubs. So you belong to a club, then they build a court, and then you start trying it. It's not that by random you go online and try to find a court. I mean, it happens, but it's not, it's not the most common. So that's how it starts. So that's why for you is so surprising, but at some point the facilities start being built outside of existing clubs, uh, which don't have, let's say members. And then, when the sport develops a little bit, uh, further, some, courts start to be built outside of these, uh, existing membership based, uh, clubs. And that's where what, uh, Pablo explained starts to happen. That people, I don't know, when I go to Madrid and I have, uh, work colleagues and they say, Okay, let's go play somewhere. But none of them is a member of a club where we all can go, or at least, it's not like the way it works. We just go online, check a club that we like, where the facilities are nice, that they're not, let's say, crappy courts, facilities that we like, that it's not so far that it's close because Madrid's a big city too, so, and we say, okay, let's play there. And then we just play. Four of us go there, just pay, and this is how it works once, the country starts to be well developed.

Enrique Buenaventura 29:56

Exactly. I think it's a, it's a matter of offer and demand. Here in London, as Pablo was saying, if I want to play tomorrow, I will check the three clubs that are close to my house. Probably they will be full. Uh, the next club, it's an hour away. In Madrid, you have less than 10 minutes, you have, I don't know how many, but 20 options, no? So you will check one, two, three, four. If they are busy, you will check the others. You will find one at the end. So that's why at the end of the year, you will, you will end up playing in, in more than 20 different clubs because there's a lot of options around. Here, obviously in London, and that's why you, you are surprised, uh, you will have the two or three, four options. From there you will need to start moving around, um, yeah, big distances.

Club Experience Remains Critical Though

Alex Inglot 30:42

Is that a problem for clubs though? Because then you find that there's lesser loyalty to a particular set of courts or a club because people are literally shopping for availability first, before brand and club.

Pablo Carro 30:57

If the experience for the players is crap, I tell you, no matter the demand is super high, the people will play once and they will leave and they will talk bad things about that specific location, so they'll never get back to that club again. So it matters. I mean, it really matters. But what I tell you is that the essence of sport is social component promotes a multi club behavior. Rather than a single club membership, closed community. This is what I was trying to explain. And depends obviously on the country because and the level of development of, of the clubs in each country.

Elena Martin 31:43

If the facilities are good, there's still loyalty. When I told you this example of my colleagues, we like, so there's a place we like; we try to go there. If there's no, uh, court available, we prioritize playing over the place, obviously. I mean, up to, up to a point. Uh, it's not that we're going to drive long distance to a place that we find is not nice only for the sake of playing, but so in the first, uh, priorities we want to play. Second, it's we want this place. If that place is not available, then it's when, uh, we look for options. So it's, it's a balance I would say. If the experience is good, you know, it still creates a stickiness.

Roadblocks: Regulations & Real Estate Prices

Alex Inglot 32:29

And you cover a bit about what are the main roadblocks to the growth of padel and you specifically focus on the regulatory aspect and in markets, and you focus on Germany as a case study. And then real estate prices as another potential stumbling block Do you feel like there is an opportunity for those to be overcome? Or or do you feel like those are going to be pretty stable in especially in the markets where they currently exist?

Elena Martin 32:57

Regulation, I think it's going to change. The thing is, in countries like, I mentioned Germany, but the U. S. is very similar. So the thing is, because there's no specific regulation for building, for getting an economic, an activity license for padel. You assimilate it to, let's say, the closest or the most similar that you get in the country. So, in Germany, it happens to be complicated. You need time and you need to hire someone to do this. And so it's hindering the growth because for an investor, it takes longer time. It takes more money. So the return needs to be better. What I think will happen is that at some point, there will be some specific regulation. So they, they will adapt it to, uh, the needs. It's like you start doing something, you get the closest there is existing. But the regulation, I think they will adapt. It's the same in the U. S. If you build a court, I mean, it depends on the state, but in general, if you build a court in an existing, let's say, tennis club, for example, it's easier. But otherwise, it may take you one year to get the license and for that year, you'll be paying the rent or you'll have to buy if it's the case instead. So it's not that the regulation is stopping it. It's just that it's making more difficult and it becomes more expensive. And this gets us to the second point. I think real estate prices. is, uh, the issue because the other one, will evolve. And, if you, take it to the simplest, which, uh, we showed in the report, this is a real estate business. You rent a land, you put something there that could be, could be a store. It could be a restaurant. And now it's a padel court that you rent out. And that's it. Uh, for people to play. So if real estate prices are expensive, um, your fee for paying will be expensive too. In the London gathering, they were saying that, uh, playing in London or in the UK is still very expensive. Um, yes, but the real estate there is very expensive too. So, if someone wants to invest there, they're going to rent a land, which will be expensive, they'll invest in it, placing a court, and they want to get a return. So, this is something that, um, is probably, more difficult to solve, I would say.

Pablo Carro 35:22

yeah, absolutely. And besides that, I mean, the more that padel develops in a city, the easier it is to build a new club. Why? Because if, if you are the technical guy of a city hall, I mean, the first time you, you see padel, I mean, it's like, well, what is this? I mean, this is, this, I mean, what is this? Is this tennis? Is this squash? No, it's a different thing with fences, with, you know, I mean, it's a cage, uh, with glasses. Uh, this is dangerous. I mean, what about the wind? What about, the exits, whatever. I mean, everything is a mess. Everything is, is, is strange. Everything is unknown. Well, the club number 10, I mean, this same technical guy that is giving the approval to the project I mean, he knows perfectly what is he talking about. He probably played at the clubs he has already approved. You know what I mean? So it is a different story, but it takes time, as Elena said. And, and real estate and infrastructure projects are always complicated and, and and padel if you think about it. It's a, I mean, it is a sophisticated thing, um, from a construction perspective. I mean, it's not, it's not pickleball, right? It's it's, I mean, it involves complicated items, stuff, uh, not only the basement, but also the glasses, as I said, the turf, the fences, the wind in combination with, with the rain. I mean, it's, it's, it's not easy. We, we, we are so familiar with it, but it is not.

Enrique Buenaventura 36:54

You can see it in London, in London, outdoors, okay. You're getting a lot of licenses, but indoors is very complicated. And obviously London weather, it's not the same as in Spain. So you need the indoor clubs to play more, to develop the players, uh, and to get a better level of, of players, no? Until these indoor clubs or these licenses for indoor clubs are given away easier, it will take more time to develop padel in countries like the UK, no? So it's not just Germany, but it's, it's also the UK with indoor clubs, no? So until these regulations speed up the process because it's long processes, it will delay the development of the sport in the country. As Elena was saying, having more expensive locations will mean that it will be more expensive to rent a court. That means that it becomes very niche. If it becomes very niche, it will be very difficult to get good professional players in that country, no? So it not only affects the business, but it affects also the level of competition of that country.

The Future of the Report

Alex Inglot 37:56

I've got two big questions left that hopefully we can squeeze in the time available. One is about the future of the report and one is about the future of the industry. Let's start with the future of the report. Like going forward, you keep innovating in terms of adding extra details, case studies, focuses. What do you feel like are the next areas of insight that the industry really needs from a Playtomic report or from a similar report? I mean, for example, again, I don't know if Playtomic can source this kind of information, but questions about: what triggered people to pick up the sport of padel in the first place is really useful. How many hours people play per player a week is really useful. Time spent at the club when they're not playing is really useful. Money spent per player on court and off court is really useful. I think most importantly the demographics of the market: so, you know women, ABC1, ethnicity, disability? And also, I guess the final thing i'd love to know is the connection between players to the pro circuit how do they engage with the pro circuit? Do they engage with the pro circuit? How can that be improved? Like those are areas that I would love to see in the Playtomic report 2025, but do you guys have a sense of what's on the road map of what you want to roll out in terms of insights?

Pablo Carro 39:19

Alex, to be totally honest, we've already shared a huge amount of information, um, with the padel community, I mean, part of this information has cost us a lot in terms of resources because running a survey, running a focus group in three, four countries, I think, uh, with hundreds of people is not, it's not cheap, but we, we feel that it's a responsibility as, let's say, the tech leader or the leader on this field to share with the community and to help to accelerate the growth of the sport overall for us. Um, and we will obviously incorporate more stuff. Um, we always have to improve the level of information that we provide. And we've already started that discussion with, with both teams trying to figure out what next. And, and it's not already decided. We've just released the 2024 version. Um, and we're still surfing the wave that has generated, right, in terms of information, et cetera. But for sure, we will be adding more, more insightful things in the next years for sure.

Elena Martin 40:22

I usually don't anticipate where I want to include in the next report. Usually Pablo and I meet at the beginning of the year. And I say, look, I've had tons of people, let's say, writing me on LinkedIn or, uh, through friends or friends of friends or acquaintances. And I usually try to, um, show what I've been asked the most. So if a lot of people are, uh, calling me to say, how much it costs to build a court? what's the return on investment? What are the economics? How to run a club? Et cetera. Then I try to, uh, at least give a hint of, uh, of the knowledge we have, on what I get asked the most.

The Future of the Industry

Alex Inglot 41:05

And what about the future of the industry? Obviously your your job is Primarily to look at what's happened in the last 12 months and track that. You are backward looking and data driven. But just for a second, let's be, forward gazing and crystal ball gazing. Like, where do you think the industry is going? Here are some things that are on my mind, for example: multi racket sport venues increasing, especially in America, you know, pickleball or squash or badminton. Is that the future? Or are we still going to see padel- specific centers being increasingly the focus? Are we going to see workspace or shared workspace integration? Residential development integration? And also community built and managed rollout, for example, in the UK and in the U S where you don't have a lot of community-driven, accessible courts. That is a key piece that I think is really missing to really help the sport grow, especially in a demographic that currently is being ignored. But yeah, that's just my, my thoughts. I'd love to know you guys, what do you think is really the future? What do you think is going to be in 2025 and in 2030?

Enrique Buenaventura 42:17

My turn.

Pablo Carro 42:19

I mean, you've been in the padel industry, um, since almost the beginning. I mean, this guy has been playing padel since 95.

Enrique Buenaventura 42:27

Something like that. Absolutely. Or even before that, before that, I would say, So I think obviously the, the example is Spain. So you have Spain as, as the, as the example and what I'm seeing is that a lot of countries are following the same pattern. Some countries will have it more difficult because of the weather, because of the regulations but some others will follow exactly the same pattern. And quicker. Quicker, because now we have a professional, um, tours that obviously with the media, helps to develop the sports quicker. It could become an Olympic game at some point, and that obviously will help even more for brands to invest, for governments to invest. So that just we just accelerate what has happened in Spain. Um, so I think that should be the that should be the trend. In Spain, as you were saying, you have padel in development communities. You have padel everywhere. No, so there's a lot of buildings that before they had a swimming pool and a tennis court, and now they have, uh, they have the padel courts, one or two. They are starting to put the padel courts in schools. Uh, so this is, what has been happening over the last 30 years in Spain. I think we will see exactly the same in a lot of countries. We start seeing that already in the Middle East. So in the Middle East, in Dubai, they are putting padel courts in some of the schools, no? So it will be a matter of how quick some countries get to where Spain is today? And how slow others do, no? But I think that's more or less the future that I see in five, 10 years time: instead of being two, three, four countries, the ones that have Padel as one of the main social sports have 20 countries, 30 countries, no? And obviously with that, it will develop the professional, the media product, uh, and then we will have the 360, no? Not just the social aspect, but also the media product, no? As of today, it's still very, very low, but growing, growing fast as we have seen with, Premier and obviously with Hexagon in the first event.

Alex Inglot 44:36

Pablo, Elena, you're not getting away. What are your predictions?

Pablo Carro 44:40

No, I mean, I just want to say that this inclusivity that we need to, Push even more. apart from what what Enrique said, I think you were right, uh, expressing this, let's say, concern about the limited demographics that have access today to padel because of the prices and because of the, let's say, the cost, overall cost of the activity. So I think we have to become even more inclusive as a sport, uh, trying to engage Different type of social, uh, layers and that's part of our job, uh, or the whole industry. So I like that. And I would support any initiative that, that, um, drives that. And as a business, as Enrique said, if, if the UK, Germany and the U S and France, also, they replicate the same levels of growth that Spain, Italy, and Sweden have, shown I think we have, I mean, a big job in front of us, a huge job in front of us as a business, right, for, for all of us. So, so the future is, is, is amazing.

Alex Inglot 45:49

And Elena, from your side, closing thoughts?

Elena Martin 45:51

I'm going to be very, uh, pragmatic and let's say from today, and in one year time, what I expect. Uh, I don't expect, um, sorry to say that, but I don't expect, let's say, the prices to go down yet, or the expansion to be, like, dramatically, changed from now. Probably we can, let's say, double the number of courts, but still, The density and the availability of the courts, I don't think will be dramatically different in one year time. Although we're going in that direction, but you asked me for the next 12 months. What I do see is more, as I mentioned before, professional institutional money. Professional initiatives like the one Enrique and colleagues have led similar things, be it in terms of tournaments, in terms of funds being professionally invested. And I'd say more systematically invested and asking for return and with more of, not an opportunistic, but rather a planned, uh, development plan. That's what I, I, I foresee. I foresee more, yeah, professionalized, institutionalized, initiatives, in the industry and the growth of the sector continuing on the path that it is today, but this path in one year time won't be like a game changer, right? So that's what I expect in 12 months time.

Alex Inglot 47:21

Well, ladies and gentlemen, we've run out of time. Um, thank you both Pablo and Elena for joining us for this exclusive conversation. It was incredibly useful. I obviously urge anyone who's interested in the padel industry and its growth as a sector, as a business, to grab the Playtomic global padel report 2024. As we've already discussed, it's used heavily in the industry and outside the industry to justify investments and strategies. It's definitely worth a look, a read, it covers a lot of aspects of the growth of the industry worldwide. But for now, thank you very much for joining me and Enrique on

Pablo Carro 47:56

Thank you for inviting us, Alex.

Alex Inglot 47:57

appreciate you joining us

Pablo Carro 47:59

Thank you.

Alex Inglot 47:59

uh, we will reconvene on the next episode of All The Angles. Thank you very much.