The America’s Cup

You may think that the oldest sport competition is the modern Olympic games, which took place in Athens in 1896 for the first time. Actually, there is an older, and therefore oldest, trophy in international sports: the America’s cup.
The America’s cup is the most prestigious sailing race, involving the highest technology and innovations in the yacht industry, but also massive financial investments.

The latest edition of the regatta, held in Waitemata Harbour New Zealand, finished on March 17th 2021, with the victory of New Zealand’s Emirates, at the expense of Italy’s Luna Rossa Prada Pirelli team.

In this race, the winner really takes it all; whoever wins decides where and when the following edition will be and gives the guidelines for the new boats.
Rules have changed throughout the years, but generally, in the first years of the competition the race was just between two sailing yacht clubs – the New York Yacht Club versus a British Yacht Club or a Canadian Yacht Club. Then in 1970, more clubs were interested in racing for the cup and so a competition to determine which team – the Challenger of Record – would challenge the current holder of the cup – the Defender. From that year the modus operandi has stayed the same. What has kept constantly changing has been the locations, the boats and the time for each match. For example, last year the defender was Emirates Team New Zealand and the challenger was Luna Rossa Prada Pirelli team, they had to race in a maximum of 13 matches, and the first team that reached 7 points – 1 point for each race won – won the cup, or, in last year’s case, defended it, since New Zealand won 7-3.

In 1851, 45 years before the first occurrence of the modern Olympic Games, a syndicate of American businessmen sailed from New York to England for the World’s Fair on board of the schooner “America”; once they had arrived in England, they decided to take part in a local but very prestigious regatta around the Isle of Wight. The American team won the race against the British yachts and claimed the £100 Cup. Queen Victoria herself was watching the race and when it finished she asked who was in second place, to which the reply was “Your Majesty, there is no second”. This iconic sentence has since become the mantra of the competition and has pushed the teams to great innovations and performances. The regatta was born once the Americans went back home and decided that the trophy would be “a perpetual challenge cup for friendly competition between nations.”. They also decided to name the cup after the schooner America, and not the country, as is often thought.

So far, only 4 nations have won the cup: the United States, Australia, New Zealand and Switzerland, making it one of the hardest trophies to win.

The New York Yacht Club regained their cup title for 132 years, until they lost it to the Australian team in 1983 thanks to new winged keels that granted them superior speed. From that moment teams started to elevate the design and technology of the boats.
As a general rule, in each edition, all the yachts racing had to be mostly the same, but with enough space to change some details to improve the boats’ speed.

The racing yacht designed for the 2021 edition was the AC75, a 23m monohull with wing-like foils which allowed the boat to be lifted out of the water as it increased its speed so that the drag would decrease and the speed would increase. The boat’s speed reached 53.31 kn. The two editions before that – 2013 and 2017 – saw other sailing hydrofoils as protagonists, but both were catamarans, meaning that they had two hulls. Before then all the boats were monohull and ranged from schooners at the very start, to J-Class yachts (1914-1937),to 12-metre (1958-1987) and International America’s Cup Class (1992-2007).

However, these kinds of designs and technologies don’t come cheap. In recent years, the price behind these ground-breaking boats lurks between 8 to 10 million dollars, and each team has at least a test boat or a backup just in case. Moreover, the entry fee for each team was 2 million dollars last year. Thus, the overall costs each team deals with, including salaries for the sailors and the support crew, infrastructures and so on, totals to more than $100 million. The most a team has ever spent on the competition is $300 million.

Where does all this money come from?

Each team has an owner (or CEO) and one or more sponsors which are – and have always been – international giants in different sectors who are willing to make multi-million investments. The media interest around this event is huge and therefore companies race to be the sponsor of a team.

Since the beginning of the race in the 19th century, the event’s yacht owners and sponsors have been among the wealthiest people on earth. The first notable name that can be found in the history of America’s cup is Sir Thomas Lipton, the Scottish tea baron who challenged the Americans 5 times between 1899 and 1930. Even though he never won (he became known as the “loveable loser”), he was the first person to introduce sports sponsorship. He realized that a lot of profit could come from the event. From 1983 to 2017, the main sponsor of the cup, besides all those behind the teams, has been Louis Vuitton. The Louis Vuitton Cup is the trophy that has been given to the winning team of the Challenger Series before the match against the Defender. The 2021 edition saw Prada as the main sponsor and so the Louis Vuitton Cup was replaced by the Prada Cup. The Italian fashion brand was also the co-sponsor alongside Pirelli of Luna Rossa, whose owner is the CEO of Prada himself, Patrizio Bertelli. The New Zealand team had quite a few sponsors, including Emirates, Omega and, surprisingly, the State itself, since sailing is their national sport along with rugby.

The cancellation of mass gatherings was one of the first and most severe hits for the sport and entertainment sector. A great number of events were cancelled, postponed or varied – the cancellation of the 2020 Olympic Games in Tokyo is maybe the most unexpected and, at the same time, declarative case – but fortunately there were some exceptions. The America’s cup was one of them. The competition was surely affected by some difficulties. First of all, sponsors couldn’t invest as much as the past years and therefore there were more of them. Moreover, there was the incognita of the development of the virus which caused some matches to be postponed when New Zealand entered the emergency zone. Eventually, the competition was carried out smoothly. In terms of audience, Kiwis were allowed to see the matches from the shore or closer, on boats in the harbour, given the very low number of Covid-19 cases. This made the event a little bit more “normal” for the people from the rest of the world following the races from home who could see the local people cheering, which helped them feel a part of the festivity. Beyond this, having an audience meant having profits from the perspective of sponsors.

The next America’s cup (37th edition) will be in 2024. We can only wait for updates, but we surely look forward to be astonished in a very luxurious way.

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