This year’s Performance Racing Industry (PRI) show was dominated by High Limit Racing. Brad Sweet and Kyle Larson’s new national series won the Internet.
That is how things are done now. Push the information out, get the fans to react, and watch the likes, comments, and debate ramp up to a fever pitch.
The driver announcements for the 2024 version of High Limit came at a fast pace and got fans talking. There were forgone conclusions and some surprises that shook the Sprint Car racing Richter Scale.
But for the last two weeks, there has been some confusion for fans. Talk of a charter system led to more questions than answers and after Adam Stern released clarification in the Sports Business Journal Saturday, speculation turned to angst. In an interview with SprintCarUnlimited.com, Brad Sweet cleared up some of the concerns and explained the future direction of High Limit Racing.
“That’s the plan as of now,” Sweet said regarding the system. “When we talked to car owners initially about High Limit, the interest and excitement about the prospect of owning a charter, having a rev share, and transparency was really high. So, it’s something we wanted to implement.
“We just couldn’t figure out the exact way to implement it from Day 1. So, to do it the right way, we figured teams would have to commit to us and run for us a few years to, basically, earn the charters. Then, we would implement it based off performance-type stuff and loyalty.”
This initiative is more like a franchise designation used by the NFL or other professional sports. The goal is to have 10 charters, or franchises, given out to teams before the start of the 2026 season when the system is projected to kick into high gear.
The top five teams in points from the 2024 season will earn a charter. In 2025, the five highest finishing teams in the national point standings, who didn’t earn a charter Year 1, will also be a franchise team in 2026.
Here is where some fans were confused. Teams with a charter, or franchise, will share in 50 percent of the revenue developed by streaming. This will be in place of tow money and point money, but the amount, or percentage a team gets, is based, or weighted, on where they finish in the point standings.
As for the teams who enter 2026 without a franchise tag, they are eligible for tow and point money. There is also a chance they can earn, or buy, a charter moving forward.
“Teams not having a charter will be able to run for tow and point money,” Sweet said. “If it’s somebody who has been loyal, and High Limit feels they deserve a charter or they are someone who wants to buy into the charter, then between Mark [Floreani-Founder and CEO of FloSports], Kyle, and myself, and probably the other charter members, we would be able to make that decision.
“We don’t want to dilute the other 10 charters, so we’re going to be mindful of that. So if there is a car owner who has been invested in the sport for a very long time and they really like what we are doing in three or four years and want to bring their team over and buy a charter, we will certainly take a long, hard look at that.”
Questions swirled on social media and in private messages about what a streaming revenue share looks like. Think of it more as a division of Rights Fees.
In the NFL, teams share $125.5 billion in rights fees from the television package. That’s $3.92 billion for each team. High Limit isn’t likely to get that big, but the same notion applies.
According to Sweet, the franchise teams will share in any money that is deemed to be streaming or linear television. That includes anyone, including Flo, who pays for the streaming rights to show High Limit Racing events.
“Essentially, this is ground level,” Sweet said. “We’re hoping as we grow viewership, our rights fees will go up, and that’s when the charter values will start to rise.
“The teams will see that because there is no real way to hide them. We’re going to be transparent with our owners, and it will be pretty simple to see what we’re getting paid for those rights fees.”
There are benefits to a system like this. Teams will receive their franchise revenue on a monthly basis instead of waiting until the end of the season. And while the franchise, or charter, percentage share is based on performance, even if a team has a bad season, they are still earning equity in the company.
The only stipulation is loyalty. A team will only lose its franchise, or charter, if they stop attending races. But, a franchise team wanting to go to another series or run a pick-and-choose schedule can sell their charter, which is similar to an NFL or NBA owner selling his or her team.
“I think the owners like it,” Sweet said. “I think Mark’s [Floreani] quote was spot on. For this to kind of be beyond just a passion where some of these owners are just spending money for fun, we’re trying to look at it as a business opportunity. Owners like the transparency. They don’t want to feel like the series is getting rich, and they are spending millions of dollars a year to have a racecar out on the road.
“You see a lot of turnover with car owners. No matter how rich you are, it gets old after a while spending that type of money year after year and not building equity and not having any transparency while not getting a return on your investment.
“So, I think they love the idea. They have to believe in a long-term vision of where we can take the sport. In the short term, I don’t think charters are going to see huge gains, but it’s something they can sell. You may see someone get a charter after two or three years, all of these other owners want it, and maybe they sell it and still run for some limited tow money and point money and go run a true-outlaw schedule.”
Sweet admits that he, along with the rest of High Limit team, doesn’t have all of the answers. Special circumstances, twists, and turns are bound to come up.
Still, it hasn’t stopped 10 teams from signing on the dotted line for 2024. And according to Sweet, there are more to come in the next few weeks.
“I mean, I don’t know that we have every answer,” Sweet said. “I think that’s the key point I want to make. The NASCAR charter agreements are 100 pages long. We have an idea of what we want to accomplish, but it’s going to take time to get every detail out to the public.
“I’m sure we are going to get some things wrong and have to make some adjustments, but I think you’re seeing how much the car owners are believing in what we’re trying to do with how they’re signing up.”