Let’s say you want to be a professional ticket broker. You know there is a lot of demand for a specific event, so you start acquiring inventory through season ticket holders, credit card presales, and primary-market bulk purchases. Once supply starts to thin out on the primary market, you list your tickets on secondary market websites at a significant markup. The entire process takes a few months to play out, and as long as demand for the event outweighs supply on the primary market, it’s a pretty easy way to make money with relatively little upfront capital.
You can then repeat this process successfully until you build your own bankroll. As you register more profit, you use that profit to buy more tickets, which gives you additional buying power. It’s a simple business model. You target popular events, buy tickets low, and then sell them high. The more times you do it, the more money you make. And as long as your hit rate exceeds the breakeven point, you can even afford a few bad calls and still end up heading home with a profit.
But what if you wanted to do this on a larger scale without risking millions in upfront capital? That’s where leverage comes into play. Just as an equities trader might use options or margin to increase buying power, professional ticket brokers are now structuring ticket resale packages as legitimate financial transactions.
Here’s how the process works: A ticket broker approaches an asset management firm → the asset management firm puts together a specialized loan agreement, providing the broker with millions in upfront cash in exchange for contractual loan payments → the ticket broker then uses that money to buy more tickets on the primary market, splitting the economics with that asset management firm.
Ticket brokers like this model because it provides them with non-traditional leverage, and the asset management firm likes it because minimum interest rate guarantees and collateral requirements effectively lock in a seven-figure profit.
But this is something everyone should care about because it is 1) becoming more common, and 2) it will likely drive ticket prices higher for every sporting event.
Let me give you an example.
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