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Can Private Equity benefit college sports?
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[QUOTE="HtownOrange, post: 5303234, member: 622"] Yes, I have too much time on my hands, today, which led me to ponder PE and College sports. Just a few questions regarding private equity and college sports. 1) PE firms exist to make a profit from their investments. How are the majority of college sports monetized to produce a profit? Recall that most college sports programs run in the red, how will PE raise new revenue, decrease expenses, or both? 2) How will PE work within the confines of Title IX? 3) If football, and possibly basketball, be separated out for private equity purposes, how do Athletics Departments survive, in light of the fact that most ADs fail to break even, let alone make a profit on their own? (If you prefer, how do schools justify sharing their limited athletics revenue with a profit seeking mouth to feed making money from the only sport(s) breaking even or making a profit?) 4) If, as suggested, the football and hoops teams are merely associated with the schools and players need not be students making the sports minor leagues, how do they generate revenue? The present argument for the pros not having minor league football is that it is too costly and the NBA already has the G-League, which draws nothing and arguably has better players not in the NBA than most schools. 5) What is the impact on the schools of being associated with the PE run sports? This is a perception, operational, and financial question. While non-profits may own for-profit entities as long as tax and legal rules are followed, what is the practical basis for schools not managing their own business affairs in lieu of PE running the show? I probably have more questions, as many others do. I have read several writers and speculators predicting the PE movement is imminent but have seen no substantive movement in this direction. While I am instinctively against blurring lines more than necessary, I am open to listening (or reading) reasoned, thoughtful analysis; armchair financiers need not respond. Also, so e FSU fans (I know, some serious credibility issues with whatever they state) believe PE will come to their rescue, as will the courts and that they will be joining the B1G or SEC later this year (or at least providing notice to the ACC that they are leaving). Nevermind the facts regarding FSU and the lawsuit, I am curious whether PEcan actually save the day. This thread is intended to develop reasoned analysis re: PE investment in college sports. I am sure there will be more questions by me and others, let's not make this personal to this site's participants, though abusing Georgetown, Rutgers, UConn and the stupidity of others (i.e.: FSU's AD) when factual or just plain funny are acceptable. I say this because I will question how to justify PE investment in Rutgers and UConn. Anyway, I hope this thread results in substantive analysis. [/QUOTE]
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