CU has rejoined the Big 12 and broken college football - talking out asses continues

[GRM]

In terms of private equity deals, whether it be a certain school or a conference, I would not relish being the "test model" for it working or failing. It is something new--sort of like the Apple streaming option that was offered, but not found optimal, thus a factor in the PAC imploding. Private equity is all in the deals and is an emerging market in CFB, just like in other industries. You can get into something that initially looks promising that you do not like down the road. You can wait and see if the private equity deals get better and the model is more established. The deal is only as good as the private equity partner. The team that I would foresee testing the model is SMU given what they had to give up to join the ACC. Now they have leverage getting into the playoff, so see what transpires.

It would be optimal if CU was flooding with billionaires with open wallets. On the other hand with Prime, I believe CU has done a great NIL job with certain players landing on it's feet relative to other PAC12 teams taking less than a full share. CU has elevated itself in the current climate and I hope we keep that up.

 

[Buffnik]

The thing about the PE idea is that I have to ask "why?". Universities are not for-profit entities. The revenues and resources are already tremendous. It seems like this would be a move motivated by fear of being left behind which would completely change the relationship between a university and its athletic department. Do we really want a future where ADs are professional sports franchises which simply license the university's branding but are only loosely affiliated with the university? Because starting down this path is irrevocable and it will ultimately lead to a completely different mission from what college athletics was intended to be.

 

[Alfred91]

The thing about the PE idea is that I have to ask "why?". Universities are not for-profit entities. The revenues and resources are already tremendous. It seems like this would be a move motivated by fear of being left behind which would completely change the relationship between a university and its athletic department. Do we really want a future where ADs are professional sports franchises which simply license the university's branding but are only loosely affiliated with the university? Because starting down this path is irrevocable and it will ultimately lead to a completely different mission from what college athletics was intended to be.

I just don't like it. PE doesn't like it when they don't maximize profits. The best way for this to work is for the conferences and schools to reinvest profits. That seems to mean working at cross purposes.

 

[LesGrossman]

I genuinely don’t understand the operating model in a PE and AD partnership. Don’t really see the appeal for PE to leap into it either. Seems like a legal and financial nightmare. You can’t even do proper M&A and arb multiples lol

If you want exposure to collegiate athletics, why wouldn’t you move up or down the entertainment and merchandising stack so you can get in on the gravy train with plenty of deals to be done without entering a quasi-govt owned legal nightmare propped up on private donations and athletes who aren’t even employees lol

 

[The Alabaster Yak]

I genuinely don’t understand the operating model in a PE and AD partnership. Don’t really see the appeal for PE to leap into it either. Seems like a legal and financial nightmare. You can’t even do proper M&A and arb multiples lol

If you want exposure to collegiate athletics, why wouldn’t you move up or down the entertainment and merchandising stack so you can get in on the gravy train with plenty of deals to be done without entering a quasi-govt owned legal nightmare propped up on private donations and athletes who aren’t even employees lol

How much money could PE truly expect to make from this kind of relationship. The net “profit” of these ADs isn’t that much and they aren’t going to take 100% of it. How much would they invest and how much ROI would they need to see to make it worth it. Just doesn’t seem like there’s a revenue model built for investors.

 

[LesGrossman]

How much money could PE truly expect to make from this kind of relationship. The net “profit” of these ADs isn’t that much and they aren’t going to take 100% of it. How much would they invest and how much ROI would they need to see to make it worth it. Just doesn’t seem like there’s a revenue model built for investors.

Not just that, but how do even value these things given the quasi public status and, you know, exit for a multiple that isn’t overshadowed by just rolling up HVAC businesses

 

[GRM]

The thing about the PE idea is that I have to ask "why?". Universities are not for-profit entities. The revenues and resources are already tremendous. It seems like this would be a move motivated by fear of being left behind which would completely change the relationship between a university and its athletic department. Do we really want a future where ADs are professional sports franchises which simply license the university's branding but are only loosely affiliated with the university? Because starting down this path is irrevocable and it will ultimately lead to a completely different mission from what college athletics was intended to be.

Totally agree with this. Also, @The Alabaster Yak and @LesGrossman comment. For 95% of the schools it is only college football. This is where the big revenue stream lies. Bring in PE partner, and you really have another big mouth to eventually feed and the brand co-opted. PE usually is good for emerging ideas in new markets and/or technology. CFB is already mostly established, it fluctuates but is what it is.

I wonder what a PE firm or partner brings in? What exactly is their pitch? Naming rights? Advanced marketing strategy? Optimize strategic partnerships? Initial short-term capital for X number of NIL? Financial management? In big time college football the fanbase, alumni, donors, tv exposure/revenue, and licensing fees etc... are already mostly tapped, what else is there to be had? Many universities already have experience with advanced marketing, strategic partnerships and probably already hire some firms for that endeavor anyways.

Texas A&M is a perfect example of where an initial huge initial investment bought the "NIL house down" (pun), but the results did not follow. Jimbo Fisher may not have worked out, but did not become a sh*t-bad college HC overnight either. Maybe overpaid and lost momentum, that is not a crime or something we have not seen before or now--see Lincoln Riley and USC.

 

[The Alabaster Yak]

Not just that, but how do even value these things given the quasi public status and, you know, exit for a multiple that isn’t overshadowed by just rolling up HVAC businesses

It’d have to be at the conference level, not program level

 

[LesGrossman]

It’d have to be at the conference level, not program level

Gotcha, that makes a bit more sense on operating model, commercialization, M&A.

Still seems like way too much squeeze for too little juice in an industry with a rapidly changing regulatory framework. I can’t imagine it seems super appetizing once you get down to brass tacks on due diligence and risk assessment

So many industries and businesses out there offering a fraction of the complexity and risk with a clearer path to big exits

 

[BerkeleyBuff]

He had inside knowledge of Colorado meeting with the Big12 and broke it first.

No he didn't

 

[4BienemyTDs]

Let me change gears here.
I do not want a pure Private Equity Deal, I would rather have an intimate football program partner Co-Franchise Owner relationship, long-term partnership that provides a tremendous cash infusion for the specific purpose of team, staff, and facility upgrades.
I have constantly thrown out Bundesliga and the Green Bay Packers. Neither of those have PE inputs, rather they have people or companies that are involved for the benefit of the organization. The Green Bay Packers are a community corporation that will never leave Green Bay, never leave Lambeau Field, and tries to do what is best for the franchise.
A Bundesliga Club is still owned by the community (CU in our case), but is willing to bring in up to 49% of outside support, either in cash or professional support.
This is what I am talking about. Obviously PE firms would be the most interested, but I agree that the mode of operation and the intent probably would not align.
PPP projects happen at every public institution for Dormitories because the school may not be best suited to fund the buildings, operate and maintain the buildings, etc., so they bring in a development firm that helps make the PPP work by bringing money and expertise, but the School always owns the land, and essentially will own it outright in say 30-50 years. The Cash flow is the fees for living there paid by students, while the football program has its cash inputs that at this point are very fluid if we cannot attain the top league status
Could CU collectively raise $200 Million to $500 Million from Boosters, Supporters, Companies, and possibly even some big fish?
You would own stock or some form of ownership in the Side Organization that is there to help boost the program. I know that we already have people that donate to the programs, but that seems like an endless "give us your money", and trust us that we are up to the modern task of operating a pretty much fully professional sports franchise. Is that what the Academic Institution should do? Or, could a supporting organization help make things more robust and more optimum.
That is where I am at.

 

[GRM]

It’d have to be at the conference level, not program level

Again, it think that it has been tried. Phillips 66 Big 12? Texas and OU were in on this, so you expand on that? At the conference level, even the B1G/SEC, how do you parse out the schools that are huge revenue makers v. the hangers on? Texas did not want an equal share with the B12.

ACC/B12 should not immediately cave to PE. IMO, a better counter move against the SEC/B1G is for the ACC and B12 is to maybe to loosely partner (which the B1G and SEC may already be doing) in scheduling, snag ND (who hates B1G) to a degree (maybe they schedule not join), and rely on geography/time. Let's see how isolated USC, OR, UCLA and UW are after 5 years? CAL and Furd are already reeling to different degrees. IMO, that experiment will implode rather than explode. TV can rule to a degree, but they cannot shun huge parts of the country.

IMO, much of it comes down to geography. College football is definitely King in the SEC, Florida and Texas. Not so much on the West Coast--as they seem to gravitate to other ventures. The B1G has appeal, however it is diluted somewhat. MI, OSU and Penn St. are bell-weathers. OR and UW provided a boost this year, but I feel like MSU, Wisc, IA, Bugs + UCLA/USC were diluted too. They have Rutgers for the NY market . . . wasn't Penn St. enough? That said, the whole country follows college football so some degree, so it cannot be frozen out.

Of all college football programs, like them or hate them, Notre Dame is the biggest brand. They have done this through independance and expanding geography.

 

[GRM]

Let me change gears here.
I do not want a pure Private Equity Deal, I would rather have an intimate football program partner Co-Franchise Owner relationship, long-term partnership that provides a tremendous cash infusion for the specific purpose of team, staff, and facility upgrades.
I have constantly thrown out Bundesliga and the Green Bay Packers. Neither of those have PE inputs, rather they have people or companies that are involved for the benefit of the organization. The Green Bay Packers are a community corporation that will never leave Green Bay, never leave Lambeau Field, and tries to do what is best for the franchise.
A Bundesliga Club is still owned by the community (CU in our case), but is willing to bring in up to 49% of outside support, either in cash or professional support.
This is what I am talking about. Obviously PE firms would be the most interested, but I agree that the mode of operation and the intent probably would not align.
PPP projects happen at every public institution for Dormitories because the school may not be best suited to fund the buildings, operate and maintain the buildings, etc., so they bring in a development firm that helps make the PPP work by bringing money and expertise, but the School always owns the land, and essentially will own it outright in say 30-50 years. The Cash flow is the fees for living there paid by students, while the football program has its cash inputs that at this point are very fluid if we cannot attain the top league status
Could CU collectively raise $200 Million to $500 Million from Boosters, Supporters, Companies, and possibly even some big fish?
You would own stock or some form of ownership in the Side Organization that is there to help boost the program. I know that we already have people that donate to the programs, but that seems like an endless "give us your money", and trust us that we are up to the modern task of operating a pretty much fully professional sports franchise. Is that what the Academic Institution should do? Or, could a supporting organization help make things more robust and more optimum.
That is where I am at.

I think that is the same competition that is going on right now. BAMA and/or GA sent out letters to boosters, supporters and companies to boost. Special partnerships--doesn't every school try to enter into these, although now they are off the books. I don't want Texas by Mobile Oil... Stanford by Microsoft etc... Would that be what PE brings...

 

[4BienemyTDs]

Again, it think that it has been tried. Phillips 66 Big 12? Texas and OU were in on this, so you expand on that? At the conference level, even the B1G/SEC, how do you parse out the schools that are huge revenue makers v. the hangers on? Texas did not want an equal share with the B12.

ACC/B12 should not immediately cave to PE. IMO, a better counter move against the SEC/B1G is for the ACC and B12 is to maybe to loosely partner (which the B1G and SEC may already be doing) in scheduling, snag ND (who hates B1G) to a degree (maybe they schedule not join), and rely on geography/time. Let's see how isolated USC, OR, UCLA and UW are after 5 years? CAL and Furd are already reeling to different degrees. IMO, that experiment will implode rather than explode. TV can rule to a degree, but they cannot shun huge parts of the country.

IMO, much of it comes down to geography. College football is definitely King in the SEC, Florida and Texas. Not so much on the West Coast--as they seem to gravitate to other ventures. The B1G has appeal, however it is diluted somewhat. MI, OSU and Penn St. are bell-weathers. OR and UW provided a boost this year, but I feel like MSU, Wisc, IA, Bugs + UCLA/USC were diluted too. They have Rutgers for the NY market . . . wasn't Penn St. enough? That said, the whole country follows college football so some degree, so it cannot be frozen out.

Of all college football programs, like them or hate them, Notre Dame is the biggest brand. They have done this through independance and expanding geography.

Colorado doing anything that ties us to the Big12 is beyond the dumbest move we could do.
Despite us applauding Yormark and being a good conference partner, our Football Program cannot be tied to this league if the P2 is going to continue to pull away.
Every other sport besides football can be the biggest Big12 fan and supporter, it is the right place for them to be, but not Football
The best move that Colorado could do is to work with the biggest and best remaining brands outside the SEC/B1G and collectively make a true 3rd power organization with the flexibility and strength to join the other two. Work hard with TNT or the Streamers to get equal money, but there are too many duds in the Big12 and ACC to just do it together. Have to get cutthroat to get where you want to go.

A small league as follows would be the best play:

1. Notre Dame (Midwest and National)
2. Florida State (North Florida)
3. Clemson (South Carolina)
4. Miami (South Florida)
5. Georgia Tech (Georgia)
6. North Carolina
7. Colorado
8. Kansas
9. Stanford (California)
10. Arizona State

Play a 9 Game League Schedule and this would be a very strong media property

 

[4BienemyTDs]

I think that is the same competition that is going on right now. BAMA and/or GA sent out letters to boosters, supporters and companies to boost. Special partnerships--doesn't every school try to enter into these, although now they are off the books. I don't want Texas by Mobile Oil... Stanford by Microsoft etc... Would that be what PE brings...

Owning or Partnering in on your local Sports Franchise is more of a passion than a pure financial motivation.
The heart and soul of Colorado Football should always be the most important
How that brand grows and excels is about the People, Product, and Procedures

 

[66BUFF]

Let me change gears here.
I do not want a pure Private Equity Deal, I would rather have an intimate football program partner Co-Franchise Owner relationship, long-term partnership that provides a tremendous cash infusion for the specific purpose of team, staff, and facility upgrades.
I have constantly thrown out Bundesliga and the Green Bay Packers. Neither of those have PE inputs, rather they have people or companies that are involved for the benefit of the organization. The Green Bay Packers are a community corporation that will never leave Green Bay, never leave Lambeau Field, and tries to do what is best for the franchise.
A Bundesliga Club is still owned by the community (CU in our case), but is willing to bring in up to 49% of outside support, either in cash or professional support.
This is what I am talking about. Obviously PE firms would be the most interested, but I agree that the mode of operation and the intent probably would not align.
PPP projects happen at every public institution for Dormitories because the school may not be best suited to fund the buildings, operate and maintain the buildings, etc., so they bring in a development firm that helps make the PPP work by bringing money and expertise, but the School always owns the land, and essentially will own it outright in say 30-50 years. The Cash flow is the fees for living there paid by students, while the football program has its cash inputs that at this point are very fluid if we cannot attain the top league status
Could CU collectively raise $200 Million to $500 Million from Boosters, Supporters, Companies, and possibly even some big fish?
You would own stock or some form of ownership in the Side Organization that is there to help boost the program. I know that we already have people that donate to the programs, but that seems like an endless "give us your money", and trust us that we are up to the modern task of operating a pretty much fully professional sports franchise. Is that what the Academic Institution should do? Or, could a supporting organization help make things more robust and more optimum.
That is where I am at.

 

[4BienemyTDs]

View attachment 80420

Gonna beat it until it is at the glue factory

What is your level of confidence that from today out 5 years, CU Football will be totally relevant and part of the Top Power Leagues or Conferences?

 

[manhattanbuff]

Gonna beat it until it is at the glue factory

What is your level of confidence that from today out 5 years, CU Football will be totally relevant and part of the Top Power Leagues or Conferences?

100%

 

[4BienemyTDs]

100%

I am honestly at about 40%

5430 Alliance just shutting down without transition communiction
Stadium upgrades
Prime Extension
Overall Booster Support
Playing in the Big12

Lots to get right

 

[manhattanbuff]

I am honestly at about 40%

5430 Alliance just shutting down without transition communiction
Stadium upgrades
Prime Extension
Overall Booster Support
Playing in the Big12

Lots to get right

Your prognostication of 40% increases my prediction to 200%.

 

[4BienemyTDs]

Your prognostication of 40% increases my prediction to 200%.

Love your confidence Rick George, keep posting on Allbuffs

 

[Bread]

I am honestly at about 40%

5430 Alliance just shutting down without transition communiction
Stadium upgrades
Prime Extension
Overall Booster Support
Playing in the Big12

Lots to get right

Taking my bias out of this and looking at it logically. The alliance shutting down with minimal comms is RG either not knowing how to effectively communicate the transition or actively choosing not to. The AD is the acquirer in this situation and they are typically in charge of the communication for these things.

Stadium upgrades from the past year and on I would wager are on hold at a majority of universities as they have to find a way to navigate the new “salary cap”

Extension should have been done already, either Prime is pushing for as much as is feasible and RG wasn’t prepared for it or Prime is taking his time with the extension on his desk.

Booster support is at an all time high right now.

Being in the big 12 does not reduce our chances.

 

[4BienemyTDs]

Taking my bias out of this and looking at it logically. The alliance shutting down with minimal comms is RG either not knowing how to effectively communicate the transition or actively choosing not to. The AD is the acquirer in this situation and they are typically in charge of the communication for these things.

Stadium upgrades from the past year and on I would wager are on hold at a majority of universities as they have to find a way to navigate the new “salary cap”

Extension should have been done already, either Prime is pushing for as much as is feasible and RG wasn’t prepared for it or Prime is taking his time with the extension on his desk.

Booster support is at an all time high right now.

Being in the big 12 does not reduce our chances.

The college model of having the chance that if a Coach leaves you have to completely rebuild the staff or underlying support staff, and the chance that the AD is operating parallel to the football program or other programs is frustrating and pretty low end and that has to be turbocharged as soon as possible.

Stadium upgrades obviously could be affected by settlement costs and other things, but if they are necessary or beneficial, then you must work to find a way to make it happen. Maybe a naming rights deal would be nice

Prime's extension better be something special and blockbuster because all signs point to things looking good with recruiting and retention, but man is it hard to wait and with Prime and his managing Shedeur to the NFL, it is nerve wracking

Booster support is the one thing that feels great, but as mentioned, why is Buffs 4 Life or 5430 or whatever not crystal clear

So how does being in the Big12 not matter? $50 Million less per year, and less viewership.

I like everyone's optimism, but we are messing around with a Billion Dollar Baby that we treat like a hobby

 

[4BienemyTDs]

Greg may have dropped a smidgen of a nugget 1 hour and 38 minutes into his show tonight.
This is all about private equity.

One of the monster Streamers is looking for content, but may not just want to provide exposure, but wants to work to redefine sports watching and interactions.

YouTube and Youtube TV (Google)
Netflix
Amazon Prime
Tubi?
Combination of a few along with TNT

ESPN is not on strong footing overall as a business and has promised a whole lot to the SEC and even the Big12 and ACC, what if there is a major pullback or overall bad financial situation with them? I bet you that ESPN would unload the Big12 and ACC if given a chance

 

[manhattanbuff]

Love your confidence Rick George, keep posting on Allbuffs

You don’t want an insult war…

 

[4BienemyTDs]

You don’t want an insult war…

Agreed, Truce

 

[Burrito]

You don’t want an insult war…

Does anyone else get a vote? Asking for me.

 

[ahoelsken]

The college model of having the chance that if a Coach leaves you have to completely rebuild the staff or underlying support staff, and the chance that the AD is operating parallel to the football program or other programs is frustrating and pretty low end and that has to be turbocharged as soon as possible.

Stadium upgrades obviously could be affected by settlement costs and other things, but if they are necessary or beneficial, then you must work to find a way to make it happen. Maybe a naming rights deal would be nice

Prime's extension better be something special and blockbuster because all signs point to things looking good with recruiting and retention, but man is it hard to wait and with Prime and his managing Shedeur to the NFL, it is nerve wracking

Booster support is the one thing that feels great, but as mentioned, why is Buffs 4 Life or 5430 or whatever not crystal clear

So how does being in the Big12 not matter? $50 Million less per year, and less viewership.

I like everyone's optimism, but we are messing around with a Billion Dollar Baby that we treat like a hobby

The lack of communication on NIL is on everyone involved-the AD AND the people behind 5430. I wasn't happy about that, either.

My guess is we'll hear about an extension close to the NC Game.

 

[Buffnik]

The lack of communication on NIL is on everyone involved-the AD AND the people behind 5430. I wasn't happy about that, either.

My guess is we'll hear about an extension close to the NC Game.

It's Coach Prime. So expect the announcement to occur whenever it will generate the most noise at a time that it will give the program a bump in revenue and/or recruiting. It won't be like all the other announcements we've seen. This is show business as much as it's football.

 

[InTheBuff]

Today's show goes into a more detailed reason why Yormark and others are hellbent on PE.
Early in this show the host also went over an article released today about the FUBO Tv & HULU Live merger and how it's all connected.
If you are interested in PE discussions, there's good content here.