Luxe Sponsorships Set Sail at America's Cup
For the first time, the America's Cup will be raced on the West Coast. Festivities kick off over the 4th of July with the beginning of the Louis Vuitton Cup. That is a series of races to determine which challenger will sail for the America's Cup in September against the current defender, Larry Ellison's Oracle Team USA. Staging the event itself is estimated to cost as much as $100 million, and sponsors are expected to cover two-thirds of that.
"It's obviously great to be part of such a prestigious, anticipated event here in our hometown where we're headquartered," said Jonathan Craig, Chief Marketing Officer for Charles Schwab. Schwab joins Louis Vuitton, Puma, Lexus, Oracle and Kaiser Permanente as primary sponsors of the event.
(Read More: Billionaires Set Sail at the America's Cup)
"We are the official investment firm for the PGA tour. We also sponsor the San Francisco Giants as well as the U.S. Ski and Snowboard Association," said Craig. "This is the first time we've done sailing."
Coming up with enough sponsors has been a challenge. "It was tough," said America's Cup CEO Stephen Barclay. "We started doing this in 2010, and we were in the midst of a worldwide recession, so getting sponsorships and those sorts of things, getting a television deal, was extremely difficult." Now the Cup has a portfolio of sponsors which Barclay said "is growing" and a television deal with NBC.
Bringing the race inside San Francisco Bay offers the public more viewing opportunities and more ways for the Cup to sell tickets. Barclay predicts more than two million spectators will view at least one of the races.
Individual teams have faced their own challenges in attracting sponsors. "It would be good to see different countries in there," said Oracle's sail designer, Mickey Ickert. "It would be good to see Asian countries being involved, it would be good to see the French—their tradition is very strong."
Most of the contenders that could afford to compete are funded by a single source—a billionaire. Ellison is funding about 80 percent of his team's expenses. Oracle Team USA general manager Grant Simmer would like to shift that burden.
"All the other sponsors have added enough funding to improve the quality of our program," he said inside Oracle's massive hangar near the Bay Bridge. "Our goal is that they want to sign up again for the next Cup and for more money."
Fewer competitors means fewer races. Will Americans lose interest? That, coupled with the death of crew member Andrew "Bart" Simpson during a practice sail in May by the Swedish team, has some wondering if the Cup may not be the success once envisioned.
"It hasn't dimmed our enthusiasm," said Schwab's Jonathan Craig, while expressing sadness over Simpson's death. Craig won't reveal how much Schwab is paying to be an official sponsor, but he said the company has two goals for being here. "One is we want to use it as an opportunity to entertain some of our top clients." The other goal? "We want to leverage a significant brand presence. This is a world class event...you can absolutely feel the excitement."
—By CNBC's Jane Wells. Follow her on Twitter: @janewells.
Disclosure: Comcast owns NBCUniversal, which is the parent company of CNBC and CNBC.com.