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Good morning, Qualifiers!
With the F1 season quickly approaching, news, deals, and rumors will fly around at an incredible clip. This week is no different.
McLaren took the lead in launching their livery before anyone else with a social media twist. By making some cryptic moves and giving the fans something to speculate, there was a palpable buzz.
The new car looks excellent and loses the ugly blue (which is nice, at least in my opinion). While many don’t love the exposed carbon, I think it looks sharp with the contrasting papaya.
There’s another team coming with new sponsors and a new name, that’s AlphaTauri, Red Bull’s little brother, and I’ve got some thoughts.
So, keep reading below to get the scoop.
One thing I ask is that if you find this newsletter interesting, would you share it with someone you think would also enjoy it? Thank you 🙏
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Banks Go Racing
Late last season, we saw American Express announce a major sponsorship with F1 in the Americas — promising its card members exclusive benefits and activations in 2024.
In Vegas, the partnership had its first big event called the "American Express Fan Experience." Card members got a unique view of the race from the Koval Straight, exclusive merchandise, and a virtual race simulator where they could create their own avatars.
F1 Vegas was Amex's first new sports partnership in over ten years. It has already made a mark at basketball, tennis, and golf events, and executives are excited to continue growing the event's success.
“We announced the F1 partnership in October, and we were very pleased with what we were able to offer card members at the first-ever Las Vegas Grand Prix (LVGP),” said Mary Ellen Jelenek, SVP, Global Brand Marketing & Sponsorships at American Express. “All the feedback has been really good and I personally was just blown away. I mean, it was completely electric.”
Banks sponsoring Formula 1 teams aren’t new; they’ve been around as long as the sport has existed, many of them being regional or country-specific:
Saxo Bank
MIG Bank
Swissquote Bank
SMP Bank
Bank Sonoras
Falcon Private Bank
First National City Bank
Santander
Banco Master
Banco do Brasil
Unibanco
Banco Portugues do Brasil
Banco Cruziero do Sul
Banco Comind
With the newfound popularity of Formula 1 and the ongoing marketing blitz, any brand looking for an excellent billboard opportunity and ways to engage their customers would be foolish not to look at the Pinnacle of Motorsport.
Enter Visa and Cash App
Domain registrations spotted by Reddit sleuths have seemingly spilled the beans—we might be looking at Visa Cash App Racing Bulls this season.
The "Racing Bulls" rumors have been fueling the F1 gossip circuit for a while, and given the excitement around sponsorships, I'm not shocked to see names like Visa and Cash App ready to ride with the Red Bull marketing machine.
It’s important to note that Visa was involved with Minardi (AlphaTauri’s predecessor) on the 1998 M198 car, so the history here is ironic, at the very least.
When officially announced, I expect the final name to be Visa Cash App RB.
Since 2021, Cash App has partnered with Red Bull, which has often been lumped in (incorrectly) with other crypto/bitcoin partnerships.
But the Cash App side of this is much more than a flippant deal to ride the Formula 1 coattails. Quite frankly, I believe the Cash App deal with Red Bull has been vastly undersold, and what Cash App brings to the table moving forward shouldn’t be ignored.
Who is Cash App?
While Visa’s brand is globally recognized, Cash App is a relatively new player in the payments space.
Let me first add that Cash App is a legitimate company and service. Founded in 2013 (as Square Cash), it is a mobile payment service available in the United States and the United Kingdom that allows peer-to-peer payments.
In September 2021, it reported 70 million annual transacting users and US$1.8 billion in gross profit. Cash App is consistently ranked the #1 finance app in the Apple App Store and surpassed Venmo in total downloads (33.5 million cumulative), becoming one of the most popular peer-to-peer payment platforms.
Cash App Understands Culture
A fascinating trend has been noted in hip-hop, where nearly 200 artists have mentioned Cash App in their lyrics, a testament to how profoundly it has permeated hip-hop culture. Its integration appears to have originated within the Black community in Atlanta, and this influence has spread, making it rather ubiquitous in the genre.
Part of the Cash App's allure in the rap community might also be traced back to the early adoption and enthusiasm for cryptocurrencies among artists. The fusion of music and finance through this mobile payment service has fostered a unique cultural narrative and sparked an influential trend.
The impact of Cash App reaches beyond music. It has successfully forged strategic agreements with mainstream rappers like Travis Scott, Megan Thee Stallion, and Cardi B. These collaborations further elevate the app's visibility and relevance within the hip-hop community.
Cash App’s influence also extends to social media. Many digital influencers have adopted it as a tool for receiving audience contributions. Since 2017, a popular sweepstake, Super Cash App Friday, has seen Twitter users engaging with posts from the official Cash App account using the #SuperCashAppFriday hashtag, with the chance to win from $10,000 to $50,000. This initiative has seen substantial engagement, highlighting the haven of excitement and interaction it has generated among users.
The Minardi M198 sporting a VISA logo on its nose.
From Red Bull to RB
When Cash App signed on with Red Bull in 2021, and Formula 1 continued to grow in global presence and appeal to new fans, Cash App’s goal was to educate current and future consumers on the best way to manage personal finances and invest in one’s future.
Red Bull has a title sponsor in Oracle, so the only way for a team to stay involved with the Red Bull marketing machine and move from partner to title sponsor is to move on to the opportunity presented in the Scuderia AlphaTauri rebrand.
Red Bull is known for giving fans what they want in everything they’re involved in. Being disruptive is part of their M.O.
In 2022, at the USGP at COTA, I was invited to the Cash App trackside club. It was filled with influencers and celebrities alike (I even passed by Serena Williams at one point near the espresso barista).
Why It Matters
For motorsport purists, this might seem like just another fluffy activation bringing in people who “don’t care about the sport.”
For anyone with a sense of business, Visa and Cash App investing more money into the Formula 1 ecosystem is excellent news.
More money being pumped into a team means more resources available to them for talent, technology, and marketing. If we’re really concerned about leveling the playing field, the financials is where it starts.
What makes F1 sponsorship an attractive position for a brand like Cash App?
Global reach
Formula 1 had 1.54 billion TV viewers last year, making it a great advertising opportunity. But it's not just about that - brands also value the chance to network in person. With races held globally, companies can connect with potential clients or investors and mingle with influential people in their industries.
Executives at German software firm TeamViewer said as much during the company’s 2022 annual report.
Our partnerships with Manchester United Football Club and the Mercedes-AMG Petronas Formula 1 Team, which have been in place since 2021, have led to more visibility worldwide in 2022. At numerous events on the sidelines of football matches and F1 races, our sales colleagues successfully presented our solutions and engaged in sales talks with representatives of customers and partners.
The cost
Sponsoring F1 also seems to be a better value than sponsoring one of the four major American sports.
For example, steel producer Cleveland-Cliffs spends $10m yearly to have its logo patched on the jerseys of the NBA’s Cleveland Cavaliers.
By comparison, MoneyGram disclosed that it spent around $6m to become the title sponsor for the Haas F1 team.
Sponsoring the Cavs is less expensive than the LA Lakers, and backing Haas is absolutely less expensive than a team like Red Bull. Even so, MoneyGram believes there is value in the marketing effort despite the drag on earnings:
“I'm really excited about what it can do, but that's a long-term investment,” said MoneyGram CFO Brian Johnson during a call with investors. “We haven't seen the top-line impact yet, but we really think from a brand perception and long-term value creation perspective, investments like that — in addition to reinvesting in product and IT — are the right decisions to make.”
What are the immediate implications of all of this? That’s to be seen, but at least now you have some context when someone asks why they see Cash App slapped across Daniel Ricciardo’s chest.
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