Sapphire Sport is breaking free from its parent company after seven years, spinning out as the independent venture firm 359 Capital with $300 million in assets under management. The sports-focused fund, currently halfway through deploying its $181 million second fund, brings its entire 30-company portfolio and investment team into the new structure as it targets Series A and B startups in sports, media, and entertainment.
The venture capital world just witnessed a significant spinout as Sapphire Sport officially breaks away from its $11 billion parent company Sapphire Ventures to become 359 Capital. The move, which managing partner Michael Spirito says was always "on the vision board," marks the coming of age for a fund that's carved out a unique niche in sports and entertainment investing.
"We're all grown up and ready to leave home," Spirito told TechCrunch in announcing the spinout. The newly independent 359 Capital enters the market with $300 million in assets under management and a portfolio that reads like a who's who of sports-tech innovation.
The firm's new identity pays homage to the sub-four-minute mile - that 3:59 barrier once considered humanly impossible until Roger Bannister shattered it in 1954. It's a fitting metaphor for a fund that's spent seven years backing founders attempting their own "impossible" feats, from revolutionizing home fitness with Tonal to transforming newsletter creation with Beehiiv.
What makes 359 Capital particularly compelling isn't just its track record, but its LP roster. The fund has maintained a completely separate group of limited partners from Sapphire Ventures, all deeply embedded in the sports ecosystem. We're talking about major players like City Football Group, adidas, AEG, Madison Square Garden, Sinclair, and dozens of team owners who don't just write checks - they provide unparalleled industry access.
"When we started in 2019, the name Sapphire Sport wasn't just alliterative and sounded cool," Spirito explained. "Sport captured the LP group." That strategic LP composition continues to pay dividends, with these sports industry titans leveraging their relationship with the firm to gain early insights into emerging technologies that could reshape their businesses.
The portfolio transfer includes all 30 companies, spanning from AI-powered search engine Perplexity to sports media platform Betty Labs. The investment team remains intact, with Spirito leading alongside co-founders David Hartwig and Doug Higgins, plus newly promoted partner Rico Mallozzi.
