College Sports (Football)
GrayGhost77
- Centennial, CO
>>Private Capital, Private Equity… potato pahtahto. Call it what you want, but it’s essentially a corporate payday loan.<<
This is still false. The B1G had funding coming from a public pension fund. Different than PE. When people hear PE, and this far beyond this forum, people seem to check their brain at the door and tune everything else out. This public pension fund does not have a staff of hatchet men that piece meal out an organization. They would have access to advisors, organizations, money men (or women) to consult with but they don't tear apart a company and sell pieces to the highest bidder and/or drastically slash expenses. They would not control how the DIA operates.
Go look at the SURS organization, somewhat similar. They invest the funds for the pension recipients. They don't answer to the traditional shareholder or those that have put big dollars in a PE firm and demand a return.
The UC Pension System would have 1 of 10 seats on the BTE. That's it. That's their influence. Nothing at the University level beyond BTE.
This is still false. The B1G had funding coming from a public pension fund. Different than PE. When people hear PE, and this far beyond this forum, people seem to check their brain at the door and tune everything else out. This public pension fund does not have a staff of hatchet men that piece meal out an organization. They would have access to advisors, organizations, money men (or women) to consult with but they don't tear apart a company and sell pieces to the highest bidder and/or drastically slash expenses. They would not control how the DIA operates.
Go look at the SURS organization, somewhat similar. They invest the funds for the pension recipients. They don't answer to the traditional shareholder or those that have put big dollars in a PE firm and demand a return.
The UC Pension System would have 1 of 10 seats on the BTE. That's it. That's their influence. Nothing at the University level beyond BTE.
ChiefGritty
- Chicago, IL
I think the most important thing I've learned in my professional life as I have been within different organizations, mostly in the academic and non-profit sector, and grown in my career to get a closer view of how the sausage is made, is that the "water down your product and betray your stakeholders in little nibbles every quarter or fiscal year to generate growth" mentality is not the vicious personal evil of a Gordon Gekko class, nor is it the structural imperative of a private equity business or a for-profit firm.
Within ANY corridors of power and institutional control, whether that be Goldman Sachs or Halliburton or Greenpeace or your local school district, the more-more-more, growth at all costs, burn down everything to make the line go up in the annual report and worry about the consequences later is the assumed, unexamined, uncontested nature of success and leadership. It's all anyone knows, it's what they're taught and socialized into, it's the water they swim in.
The ethic of institutional stewardship, that organizations have a purpose and exist as part of an ecosystem outside themselves, flat out does not exist in 2026.
All of which is to say, the B1G and the DIA don't need to be bought by private equity. When the time comes they are going to act like they are anyway.
my bottom line comment regarding outside financing is “ why is it necessary ?”
the B1G has a huge inflow of cash every year from Fox, CBS , NBC etc . what exactly do they need a “partner” in the form of a pension fund to provide more money for ? money that needs to be paid back later at a cost .
the B1G has a huge inflow of cash every year from Fox, CBS , NBC etc . what exactly do they need a “partner” in the form of a pension fund to provide more money for ? money that needs to be paid back later at a cost .
sbillini
- st petersburg, fl
Technically speaking, the proposed Big Ten and UC pension plan deal is, by definition, private equity. it's an equity stake (as opposed to debt or some of stakeholder structure) in a non-publicly traded for-profit entity (or, in this case, a new for-profit entity to be created) where the expected return has unlimited upside and downside as to what those profits end up being (as opposed to, say, a debt deal where the return is typically capped). Whereas the B12 deal is very much not private equity at all but more of a formal financing vehicle that involves no equity stake at all.
With that said, yes, the UC investment office is not a traditional private equity shop. They don't "operate" businesses like a Warburg Pincus or Blackstone would. It's a minority stake with relatively limited direct control. Nonetheless, does that negate the change in incentive structure vs. the current system? I would argue absolutely not. Ignoring the change in incentive structure would be like saying Microsoft, GM, NVIDIA, General Mills etc etc. don't have ultimately profit-driven motives because they're not private equity owned. All of their shareholders are minority shareholder with limited direct control, yet you can bet your bottom dollar that profit maximization has to be among the very top of their goals. Plus, once you start down this structure, the slope potentially gets slippery as the NIL/facilities arms race continues and schools need to dip their hands in the cookie jar again and again to fund all of it.
Finally, regarding the bolded part above, I'm not sure who you think the "traditional shareholder" and "those that put big dollars in a PE firm and demand a return" are, but it's very much the UC pension plans, SURS, etc. of the world. This case is just cutting out the middle man.
I just think it’s a real misuse of the word. Yes, BTE would be private but there is no direct financial tie in back to the Universities (college, not athletic department). They would hold a 10% stake in BTE, that's it. I just happen to believe that this collective group would bring more valuable than 10%. More valuable than having a Warren Hood heading your deals (synergy with conference wide agreements). Nothing against Hood (former DIA employee) but having a professional group focused just on media rights, corporate sponsorships, advertising, etc. would add value. There’s no damage to the University and at worse you don’t get 10% return on what you pay UCRP. It’s not PE in any traditional sense. There's no shredding of a company, etc...
It's already there IMO, one way or another.
The goals of UCRP or SURS is to earn a return that will pay the retirement benefits they promise.
The goal of traditional PE is to acquire and restructure private companies so they can extract as much profit as possible for their investors.
Huge difference between the two – from 6-7% annual return which is reasonable to a 15-20% return which usually takes some unreasonableness. You're dealing with an entirely different shareholder.
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I agree
Better than 10% than doing it in house or just the B1G. Pen in the grant of rights for at least 10 more years = stability.
sbillini
- st petersburg, fl
regarding the first bolded section - then why not just create BTE, structure it as a separate entity that's wholly owned by the big ten and leave it at that? why bring in UC Investments at all? as you said, they're effectively going to be a passive investor anyway.
regarding the second point, the biggest customer for traditional PE is that UC investments of the world. i agree that UC investments won't be an operator of BTE in the traditional PE sense (which accounts for the difference in expected return that you allude to), they're going to expect a return above their cost of capital. That changes the function of BTE to be a for-profit entity, which is entirely at odds with the stated mission of the Big Ten and its member institutions.
Let’s zoom out and look at the big picture, considering changes to NCAA football over the last decade. Is more money the solution? Or is it the problem? Are we pouring gas on a fire?
In the absence of a structure with salary and spending caps, the NCAA isn’t just becoming more like the NFL. It’s metastasizing toward a doom loop of unlimited spending generating an increasingly unfair playing field and never-ending shakedowns of the fan base for more money just to keep up. Instead of fair fights on a level field we’re moving toward a model of doomed vs groomed teams.
At some point will the doomed teams whither away? Will fans continue to pay and tune in once it becomes apparent the outcomes are preordained by money? At some point it’s more of a funding competition than an athletic competition. The NFL doesn’t have to worry about that threat. The NCAA should.
Can someone please tell me why Illinois needs still more money, whether from revenue, donations, or big loans? How would it be spent? Why would it give me more satisfaction than other entertainment or charitable options? I’m just not feeling it. The sport is getting ugly as the money rushes in unchecked. Maybe I’m alone, an outlier among fans for feeling this way.
In the absence of a structure with salary and spending caps, the NCAA isn’t just becoming more like the NFL. It’s metastasizing toward a doom loop of unlimited spending generating an increasingly unfair playing field and never-ending shakedowns of the fan base for more money just to keep up. Instead of fair fights on a level field we’re moving toward a model of doomed vs groomed teams.
At some point will the doomed teams whither away? Will fans continue to pay and tune in once it becomes apparent the outcomes are preordained by money? At some point it’s more of a funding competition than an athletic competition. The NFL doesn’t have to worry about that threat. The NCAA should.
Can someone please tell me why Illinois needs still more money, whether from revenue, donations, or big loans? How would it be spent? Why would it give me more satisfaction than other entertainment or charitable options? I’m just not feeling it. The sport is getting ugly as the money rushes in unchecked. Maybe I’m alone, an outlier among fans for feeling this way.
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I think they should just create the BTE. Why they don't? I'll just assume trying to get the 18 different entities to agree on how to structure it isn't going to happen.
Collectively public pension funds are the largest, I don't think individually any pension fund is the largest. As far as the stated mission, I'll assume again, the reason why BTE was proposed and separated from the public side of the equation is for that reason.
Just an unrelated comment from my above comments (I've said it before), despite the changes, college football is as popular as ever.
OrangeBlue98
Iowa is not in a great spot right now (LvilleILL1)
- Des Moines, IA
The insatiable demand for more resembles the behavior of an addict. Seriously.Because it’s never enough.
Years ago I had an employee with a gambling addiction. He always needed more. Eventually it cost him his home, then his marriage. Tell me again please, why is more money needed? To play at the same table as other addicts who’ve scrounged up more money? Sounds like my employee and his fellow addicts. But the house always wins. In this case the media is the house. Do the addicts a favor. Don’t give them more money.
Battle89
- Cary-Grove, the better Trojan team
Agree but this is really striking while the iron is hot, at least from the Big Ten POV.
We have been (at best, varying by any given season) second fiddle to the SEC in football and second fiddle to the ACC / B12 bluebloods for decades. The Big Ten now has an environment where above-the-table payments are not only encouraged, but mandated. And they have the media money to push around every other conference and to re-assert themselves at the top of the mountain.
Recent results have been immediate and thorough. National champ in hoops and three consecutive champs in football. While morally I don't like the money grab ethos of today, I get it from the standpoint that the Big Ten needs to keep the train moving. (I was going to say keep the line moving, but that seemed too on point with the addict analogy!)
Left the last cone alive to send a message to the rest of em.
and 69 others
“Timeout South Carolina”
Yep. Left one and said, “Tell your friends about me.”
Keiser Sose