Background: LIV Golf is the breakaway professional golf league launched in 2022 with backing from Saudi Arabia's Public Investment Fund. The league was built to challenge the PGA Tour and quickly grabbed attention by luring star players with massive prize money... We're talking around up to $250 million to the annual prize pot. The Saudi wealth fund initially invested $400 million to get it up and running - with big names like Phil Mickelson, Dustin Johnson, and Australia’s Cam Smith all signing up.

What happened: Now, LIV Golf's biggest supporter is stepping back. Saudi Arabia's Public Investment Fund is telling players and staff it plans to withdraw funding at the end of this season. Why? Economic pressure tied to fallout from the US-Iran war is prompting it to review major investments across its portfolio.  

What else: So, while LIV Golf is expected to generate around $100 million in revenue this year, it's still heavily dependent on a single major funding source. That means if the Saudi fund pulls out, the league's future could be in serious doubt. It's a strong reminder of the risks that come with relying too heavily on one backer.

What's the key learning?

💡 This is one of the main challenges of having a concentrated funding risk. It's what happens when a company or organisation relies overwhelmingly on a single investor… or client. And when your whole operation runs on one wallet, you don't have a true business…you have a true dependency.

💡 LIV Golf's reliance on Saudi backing echoes WeWork, where SoftBank's support helped drive a $47 billion valuation before collapsing when confidence faded. WeWork's valuation crashed from $47 billion to under $8 billion in weeks and later filed for bankruptcy in 2023.

💡 It's a bit of a cautionary tale for LIV Golf...  they either need to turn a profit fast… or find a new backer willing to foot the bill. Otherwise, their biggest stars might find themselves going back to the PGA begging for their spots back.