Oakland B's Pioneer League Baseball Launches Crowdfunding Campaign

Paul Freedman, a 45-year-old serial entrepreneur who has founded and sold five educational technology companies, decided last June that he wanted a new kind of company: a baseball team.

When the MLB A's announced last year that they planned to leave Oakland, California, for Las Vegas, Freedman was disheartened. Born in nearby Palo Alto, Freedman moved to Oakland when he was 15 after spending much of his upbringing in Chicago. Arriving as a freshman during high school, Freedman had some initial trouble making friends, so he turned to A's games (particularly the $2 Wednesday games at the Oakland Coliseum) as a regular activity to socialize with his classmates.

“It helped me feel welcome,” Freedman said in an interview with CNBC. “Right field at the Coliseum made me feel part of a community again.”

Freedman has lived in Oakland for the past 30 years, and in that time, he’s witnessed one professional sports team after another leave the city. The NBA’s Golden State Warriors left what was then Oakland’s Oracle Arena in 2019. The NFL’s Raiders moved from Oakland to Las Vegas in 2020. And after this season, MLB’s Oakland A’s will pack up and move to Sacramento before finally settling in Las Vegas in 2028.

Discouraged by his hometown, Freedman sent a text last June to Bryan Carmel, a friend from those high school A's games, with a provocative preamble: “I have a crazy idea.”

Freedman set about thinking of ways to keep baseball in Oakland. That gave birth to the Oakland Ballers, or B’s, the Pioneer League team that debuted earlier this year, co-founded by Freedman and Carmel. The team, just off the ground with seed funding, faces an uphill battle to achieve a successful business model in Oakland, a city with enormous crime challenges and all but abandoned by professional sports.

The Pioneer League, an MLB-affiliated league whose teams are not affiliated with professional teams like those in Minor League Baseball, immediately appealed to Freedman’s technological sensibilities because it is a testing ground for baseball’s evolution. Oakland has also earned a reputation for forward-thinking in baseball, first in the 1960s and 1970s under owner Charlie Finley and later in the “Moneyball” era of the 2000s, which ushered in an era of analytics that has been adopted in nearly every sport.

Instead of extra innings, games tied after nine innings in the Pioneer League end with a five-pitch home run derby. The league allows players to challenge balls and strikes in real time using a computerized system. The B's also boast the league's first female player, pitcher Kelsie Whitmore.

Now, Freedman has another innovation in mind: a new investment model.

Freedman has invested $1 million in the Oakland B's and loaned the team another $5 million. Freedman and Carmel have also raised $3 million in outside funding from about 60 individual investors.

Freedman and Carmel are on the cusp of setting a new valuation for their investment with the debut of a crowdfunding round for up to $1.235 billion, the legal limit allowed by Securities and Exchange Commission regulations for an entity with financials that have been reviewed by a CPA but not formally audited.

The new round of funding will give fans a direct stake in the team. While there is not yet a market for team stock to be traded and function as a real investment, Freedman and Carmel hope that could one day become a reality. That sets the concept apart from the Green Bay Packers' common stock, which is publicly owned and deliberately designed as a nonprofit.

“We're testing the waters,” Freedman said. “There could be a dividend. There could be a secondary market. The shares will have voting rights.”

A liquid secondary market would allow for monetization of team stock beyond major transactions such as the sale of the team.

DealMaker, the platform the Bs are using to crowdfund, has received expressions of interest from more than 3,500 people who say they would like to invest in the team, with pledges totaling a combined nearly $8 million.

Of the hundreds of campaigns DealMaker has facilitated that begin with early expressions of interest, this is the largest number of potential investors the platform has ever seen, said Jon Stidd, DealMaker's chief marketing officer.

“It's a testament to the B's fans and what they're doing for the community at large,” Stidd said in an interview.

The fundraising campaign is expected to officially begin in the coming days. Potential investors will be able to purchase shares on a first-come, first-serve basis, “like they're buying Oakland B's cleats,” Stidd said.

The initial interest has inspired inquiries from other local baseball and football teams looking to raise money on DealMaker, Stidd said.

“There's been a rising tide. The Oakland Ballers are getting the message across,” he said.

Freedman plans to use the money raised collectively for general baseball operations, with a focus on marketing. In their first year, the B's have sold about $1 million worth of merchandise, according to the team, and have secured 47 sponsors, including San Francisco's BART transit system and AAA Insurance.

Working with Oakland city officials, the team used $1.6 million of the team's initial funding to renovate Raimondi Field in West Oakland, a historic baseball stadium site where Before racial integration, the all-black Oakland A-26 Boilermakers played. The field was abandoned and had fallen into such disrepair that it had become unusable even for Little League games, Freedman said.

Freedman said that in working out how to keep baseball in Oakland, he ruled out simply purchasing and relocating a minor league team, fearing that bringing one to Oakland would solidify the city's reputation as a second-tier place unfit to support top-tier sports teams.

But he'll have to make sure the B's blossom into a feel-good story, rather than a sad reminder of what Oakland once had.

“We don't feel like we're replacing the Oakland Athletics,” Freedman said. “We mourn the loss of the A's as much as anyone else.”

One of Freedman's main challenges is convincing locals that Raimondi Park is a fun and safe place to visit. Last month, the San Francisco Chronicle reported that agent Lonnie Murray, who is married to former A's star and Oakland native Dave Stewart, recently expressed to Freedman the players' concerns about substandard housing in an area where players' cars were vandalized or stolen. The B's responded by moving the team to a hotel in a safer area.

It wasn’t long ago that Raimondi Park bordered a homeless encampment in West Oakland. Revitalizing the area is important to both Freedman and Oakland, but it’s also a potential obstacle to fan recruitment. Raimondi Park seats about 4,100. So far, most home games have drawn about 2,000 fans, a bit below the Pioneer League’s attendance average.

Even among locals, there is a misperception of how dangerous the area is, Freedman said. He compared the neighborhood to Chicago’s Wrigleyville, where the Chicago Cubs play. Freedman said he is developing partnerships and relationships with local businesses to promote the team and hopefully expand entertainment and dining experiences outside the ballpark.

“We definitely face challenges,” Freedman said. “Oakland hasn't gotten a lot of good press lately in terms of crime. What changes perception is people having safe experiences. That's what we're offering.”

Alerting locals to the team's existence will be especially important next season, when the A's are gone. Green Day singer Billie Joe Armstrong recently gave the team free publicity by spray-painting the B's logo over the Oakland A's logo at Toronto's Rogers Centre.

Winning will help, too. The B's have had an impressive first season. The Pioneer League season consists of 96 games, split into two halves, and ends Sept. 8. The top two teams from the first half of the season and the second half make the playoffs, which begin Sept. 10. The B's currently have a 42-30 overall record and 15-9 in the second half, putting them in playoff contention.

“It's valuable to have baseball in a city,” Freedman said. “Oakland deserves to have baseball if it wants to have it.”