Per ESPN. You want the nail in the money coffin for the NCAA and college sports, this is it. At this point they become actually extractive money making machines instead of just gross self-dealing ones. It would also introduce actually legal responsibilities to maximize moneymaking presumably, as opposed to the self-imposed "Get every dollar" that we've been dealing with forever.
Not a fan.
Link: https://www.espn.com/college-sports/story/_/id/46452188/sources-big-ten-...
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Private equity usually ends up in everything involved being stripped for parts so the investor can pocket all the proceeds and dump the carcass for pennies on the dollar.
This would be a short term gain for the Big Ten but it would quickly kill off everyone that isn't one of their top performers. It wouldn't be long til the investor pressures the league to sever ties with everyone like Indiana, Northwestern, Purdue, Maryland, etc.
Fuck that shit. Keep Saudi money out of college sports
You'll get Ohio State-Michigan Part 2 Electric Boogaloo The Squeakquel Spring Game Scrimmage in London in April for TV money and you'll like it
FTFY.
This was one of my long-term fears with Pay for Play.
The public was only going to front the money for so long.
I thought the non-P2 would be the first to go this route in an attempt to make up the TV contract disparity.
The fact that the P2 is going this direction is a clear indication that everyone is going to have to.
Private Equity Ruins Everything.
Get ready for fees that you couldn't even imagine if you tried on everything related to Athletics.
P.E. Firms will take every single thing you like about an entity and make you hate them. See Southwest Airlines.
And JoAnn and Borders and and and
"Private Equity Ruins Everything."
100%. I have been living this live action Dilbert strip first-hand for 2.5 years.
Have a sheet printed out listing the months from the start of this year through June, 2027 when my daughter should graduate high school*. Color in each month as I get closer to being able to leave.
* Several years ago - before PE got their tentacles on us - I had come up with the targets for retirement or semi-retirement. They were (1) we achieve X-many dollars of total household net worth (I'm not going to give the value) or (2) when our daughter graduates high school, whichever comes first. Looks like we will make the dollar value first. Maybe even this year. But my wife already took early retirement when her company offered a buyout last year and she will freak out if neither of us are working, so I think I'm stuck until 2027.
I'll only agree with the above. Name a single thing that Private Equity money has improved, other than the wallets of the financiers.
I worked for a company that was bought be a private equity firm, they were buying companies to package them up to sell to a larger company, during that time we got investment capital to build our products at a larger scale and we got profit sharing which was great. It was probably the best few years I worked when you balance everything from a job. But we were a lean company already and engineer ran and focused so we got money to engineer more, and more pay on top of that. As al the companies under them grew they became more profitable during a sale, a d then they sold and that company was fine, but then they got a bad leader and were a mess and they sold off pieces.
So while it is 100% easier to buy and slash so the books look good, a few exist to prop up smaller companies and build portfolio that iz attractive because of the people and technologies they possess. That is much more work and doesn't work for every industry.
this however end with Purdue and Northwestern losing funds to be door mats.
Well, in almost every case it's true. When I worked for DuPont and they decided to get rid of their chemical division, the Carlyle Group swooped in and bought (took over). I can actually say they ran us well and overall things remained almost seamlessly. Now, with that said, they only owned the new company for a short time (2-3 years roughly) so maybe they didn't have time to destroy it.
I feel like there's at least two teams in the BIG Teeorteen who would be dumb enough to flip their stadium and surrounding property for cash now and then pay to lease it back for a thousand years. Something catastrophically dumb is going to happen and result in runzas being $45 and having pay-toilets installed in Happy Valley before this is all over.
No one has been able to make a cogent case for what PE gets "out" of a football team, much less a conference, that can actually generate revenue aside from someone getting absolutely railed in the biblical-but-not-the-good-way sense.
Hell USF just did a shit deal with PE to finance their new stadium buildout that resulted in terms that were worse than those commercially available and costing more over a crippling time horizon to boot. These outfits are payday lending with better suits.
This is about the third time this has been pitched to the Big 10 and no deals were reached the first two go rounds. Guess we will see what happens.
If you thought concessions stands were bad before. I bring you the Samsung hot dog stand with Delta airline Pretzels.
Budwieser presented by godaddy
So a 'Tiny Tim' sized or even microscopically small hot pretzel?
Lol but let it happen to the Big 10 and they can all die, (except the big ones who will be fine anyway). If ACC holds firm and plays the long game we can come out winners here.
Sadly true. Then again, we might have the Spurtle ACC going forward based on some of their decisions.
Paint the picture for me where the ACC plays the long game and comes out winners.
I might have blinders on but I just can't see it.
I could see them stumbling bass ackwards into it by pure dumb luck. It wouldn't be intentional but I could see it happening
Matt Brown - the go to person for all of this stuff - had a great take on this...
First, he notes that everyone is doing something like this:
The he asks the question: what is the money actually for:
At 2 billion just pay all the good coaches to not coach in the SEC and get the conference take a huge hit.
Absolutely nothing will come of this, but at least some people are trying to reign it in
Is this at the Federal level?
Federal
An interesting twist (for lack of a better term) here: the Private Equity wanting a stake in the B10? It's the California pension investment fund...
quizzical dog face
Interesting article.
I like the part where Congress considers yanking their tax exempt status if they do this. So I suppose they'll have to set aside some bribe money.
So instead of the money going to the pensioners in California who earned it, they're proposing to funnel that money to Big Ten schools to prop up their athletic departments?
Yeah, that seems about right
That does sound like a California move.
The idea behind it is that they are promised some sort of return on their investment, like a stake or portion of the broadcast monies. What it means for the schools is that they get a chunk of upfront money, and they get less income for some years afterwards. Maybe a good investment for the schools trying to weather the change in CFB right now, but /shrug?
Look all the funds moved to credit swaps just in time for the housing bubble to burst now they need to move to CFB in time for that bubble to burst.
You could just say "can someone explain pensions to me?" lol
While USC and Michigan have held out and now university board members are now pissed they haven't been able to read the deal I've been thinking about this more and it's truly insane.
This is 2 years of TV deals for 5% of the conference. A bank could probably get them a better deal if they need cash now. So there has to be more going on (read bribes) because it is being shoved through before schools can read the contract. Sounds like some one wants to screw up like the ACC and have contacts no one can review.
The bigger issue is that 2 years of money is nothing to these universities. Think about VT, Burgess hall is 90 years old, Davison is a bit older, this is one of the last places you can still plan long term. Michigan has buildings from the 1800s. These universities expect to be there in 100 years. The time value of money is insane to think about at universities. Selling 5% is worth way more than $2b for 20 years.
Interesting enough Michigan, Penn State, and Ohio State would get unequal larger distributions than the rest of the conference. No wonder they want to push forward.
Michigan is saying no
Michigan might be saying no, but the document still gives them a larger share than the others.
PE is almost always a bad deal, but given the time scale involved, trying to push this kind of thing through should be viewed through the lens of malfeasance or gross incompetence. Anyone with any kind of power at a university who is trying to rush this through without review should be viewed as a bad actor.
The only good result of this could be the eventual fail of the B1G.
I mean its an overwhelming chance that all those employees trying to shove it through have that Chad Swofford arrangement where they have a nice cushy job at the private business waiting for them after they ram through the objectively terrible deal for their current employer.