SBJ College: Big Ten isn’t backing down on private equity

On Monday, I zipped down the street to the Sports Entertainment Venues & Tomorrow conference at South Carolina’s College of Hospitality, Retail and Sports Management to moderate a panel with ESPN’s Debbie Antonelli.

Antonelli was honored as the winner of the SEVT Pioneer Award for “groundbreaking achievement in the sport and entertainment industry.” The conversation was wide-ranging, touching on her time as a broadcaster, how she got into the business and what she envisions for the future of women’s basketball.

Huge thank you to Danny Morrison and the crew over at South Carolina for having me out and congratulations on a great event!

The Big Ten isn’t backing down from its private equity play without a fight.

Yahoo Sports’ Ross Dellenger reported Sunday that the conference has functionally given USC and Michigan an ultimatum to get on board with its proposed $2.4 billion cash infusion from UC Investments or risk it moving on without them (The Big Ten has denied a vote is coming over the next two weeks, but these things have a habit of coming together quickly).

Since news of the Big Ten’s forays into PE money became public, the question I’ve posed to a number of folks around the industry is almost exactly this: Can a deal go through if some schools don’t sign on?

The answers have been mixed, but the Big Ten is seemingly testing that theory.

USC’s and Michigan’s consternation over the PE deal largely centers on two things: 1) How much involvement should university board of regents have in this discussion; and 2) Do they want to tie themselves to the conference via the grant of rights through 2046?

The board of regents question is valid, especially considering the power vacuums in Ann Arbor and L.A. Neither school has a permanent president in place, while both schools’ boards hold considerable sway over their respective institutional dealings. That shouldn’t be discounted.

But as important as anything in this fight to get Commissioner Tony Petitti’s PE deal across the line is the grant of rights. Any sane investor is going to want to know what they’re investing in and an extension of the grant of rights from 2036 through 2046 is the Big Ten’s way of ensuring what it’s selling.

How that plays out without the blessing or the signatures of two of its biggest brands isn’t altogether clear.

USC and Michigan represent two of, at worst, the five most visible brands in the conference. It’s hard to imagine an investor ponying up the same kind of cash for an asset that doesn’t include two of its most valuable pieces.

There’s also a question of longer-term plays. If the Giants didn’t like the media rights deal they’re getting from the NFL, they can’t shop themselves to the Premier League. But in college football, where self interest and revenue drives all these days, schools are reluctant to bind themselves within a system that seems primed for mass changes.

If USC and Michigan don’t get on board, is any of this worth it?

There’s already a schism between Michigan and the Big Ten office over the conference’s handling of the Wolverines’ sign-stealing scandal. USC now finds itself at odds with Petitti, who has spent considerable personal capital on getting this deal to the finish line, and his staff.

The Big Ten’s mercurial commissioner has promised plenty of -- forgive the pun -- big ideas in his two-plus years on the job. He has plenty of support from rank-and-file conference members, along with notable power broker Ohio State.

But for a league that already stands head and shoulders above the rest in revenue, has won the last two college football national titles and may make a run at a third straight, is this all really worth a growing fracture between the conference, its commissioner and two significant members?

Sure seems like we’re going to find out.

In a college sports ecosystem driven by nothing but dollars, UCLA sure feels like it’s betting big at the roulette wheel.

Bruin Report Online reported Sunday that those within the UCLA athletic department see it as a foregone conclusion the school will move its home football games from the Rose Bowl to SoFi Stadium, the home of the Rams and Chargers.

The impetus for the move, local reporting suggests, is better access to premium seating and potential financial gains to be made from them compared to the historic, but aging, Rose Bowl.

But for a football program already struggling to sell seats, moving to an NFL stadium for the sake of high-end tickets feels at the least short-sighted.

UCLA occupies a wonky place in the highest rungs of college athletics. The move to the Big Ten was a way to cash a bigger check for an athletic department whose finances have been upside-down for the better part of a decade.

The football program hasn’t helped the cause, as the Bruins haven’t eclipsed nine wins since 2014. There’s also the recent firing of coach DeShaun Foster, who was ill-equipped to run the program in the wake of Chip Kelly’s 11th hour move in 2024 to become Ohio State’s offensive coordinator. None of that includes AD Martin Jarmond staving off calls for his job amid questions about his hiring of Foster.

Whether the criticism of Jarmond is fair isn’t really the point. Chasing dollars in a stadium that lacks any tangible tie to a fanbase already indifferent toward the product feels like a problem.

That doesn’t include the legal ramifications for UCLA backing out of a Rose Bowl lease slated to run through 2044. (The city of Pasadena and Rose Bowl Operating Company filed an emergency motion Monday seeking a temporary restraining order and preliminary injunction to stop UCLA from moving.)

UCLA recorded $16.4 million in ticket sales during the 2024 fiscal year, per the Knight Newhouse College Athletics Database. That ranked 13 of the 16 public schools in the league, notably behind Illinois ($19.8 million), Minnesota ($22.7 million) and Purdue ($22.9 million) and only narrowly ahead of Big Ten bottom-dwellers Rutgers ($14.7 million) and Maryland ($14.8 million).

Moving to SoFi Stadium isn’t going to change those facts dramatically. A winning football team is generally the only real solution.

Anyways, good luck to the next UCLA football coach. Hopefully people show up.

NIL deals might make ample headlines for star-studded signees and quarterback pitchmen, but one company is helping use it as a military recruiting tool.

Blackhorse Management, a Winston-Salem based strategic consulting company, has been working with the Montana National Guard to promote enlistment opportunities through NIL deals with athletes at Montana and Montana State.

“In our efforts with the government, we’ve focused on name, image and likeness and we think we have a pretty unique positioning with how we’re using it,” said Ray Bednar, founding partner of Blackhorse Management and a former executive at Bank of America. “It’s not totally unique, but it’s very unique the way we’re applying it to the military.”

“We use athletes at universities within the state who have much smaller followings than someone like Paige Bueckers [who previously signed an NIL deal with GoArmy],” added Matt Bednar, Ray’s son, a partner at Blackhorse Management and a West Point grad. “But what you see is they have way higher engagement rates with their followings.”

The idea is fairly simple. Blackhorse Management taps into micro-influencers -- athletes with high visibility within their communities -- to help drum up interest in serving in the state national guard.

The program has seen four athletes from each of Montana and Montana State promote the Montana National Guard through monthly social media posts and a day-in-the-life experience that was captured in photos and videos, among other varying pieces to the partnership.

The deals are paying each athlete between $3,000-6,000, Matt Bednar said -- bets that are already paying off.

Montana Army National Guard has seen an uptick in engagement rate of 1.5% -- middle of the pack compared to other states -- to 10.6%, the top mark for any state in the country. It’s also seen a 15x increase in reach beyond its organic base.

“With Gen Z, the way that they consume media has shifted. So continuing to pump dollars into commercials is giving you diminishing returns, whereas taking this method which pops up when they’re scrolling through their social media feed is just a better way to get the message in front of their apps.”

What comes next from Blackhorse Management is TBD. Meetings with the National Guard Bureau are ongoing in hopes of expanding the fledgling program. The hope would be to engage athletes across the country in similar programming.

“We’re trying to take it into other states … where they’re having recruiting challenges or shortfalls, or even they’re just getting a poor recruiting pool in terms of nobody can pass the physical requirements,” Matt Bednar said. “This is trying to increase the quality of candidates.”

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• Missouri added a pair of on-court sponsors for the men’s and women’s basketball season: Central Bank and Mpix, a digital photo printing company.
• The College Sports Commission released its newest round of data around NIL deal-making, noting that more than 12,000 deals worth $87.5 million have been cleared since launch on June 11 and Nov. 1, while just 394 deals worth $10 million have not been cleared in that same span.
• This week’s Journal cover story from SBJ’s David Broughton explores North Carolina’s research triangle and the college sports aspects of one of the country’s great sports business markets.