Selling or Staying, The UFC and Zuffa A Case Study for Sports Business
May 12th, 2016
From The Desk Of Kenny Rice
The UFC is making news this week, which isn't news in the MMA world in most weeks. But this time it isn't about a dispute with a fighter or finalizing a card, it's (could it really be?) the end of a an era possible drawing near.
On Tuesday sports business journalist Darren Rovell set the social media abuzz with his story on ESPN.com that there were "advanced talks" with the UFC parent company Zuffa about selling the organization that has become, in a relatively short period, with a handful of powerhouse potential buyers. It would be a multi-billion dollar deal, the kind that gets notice from Wall Street to Main Street. Serious money for an outfit that was a novelty act not that long ago.
There have been denials of the report, most prominent from the figurehead of the group Dana White. There have also been several sources pop up in the last few hours with just enough information to whet the appetite of the curious that indeed as Bruce Buffer would say "It's Time," to move on from the octagon with such lucrative offers on the presumed table.
Selling or staying, the UFC and Zuffa are a case study for sports business. In my ebook Not Hit Yet
chronicling the watershed year that was 2011 in MMA, there is a chapter devoted to the incredible rise and White addressing, of all people, the scholars at Oxford.
The Fertitta brothers, Lorenzo and Frank rolled the dice with a $2 million purchase of the UFC in January 2001. Later they would say even their attorneys and friends wondered why? What were they getting for their money? That Ultimate Fighting Championship acquired backed then bears no resemblance to the one the mainstream sports world has come to know except for the name, and that name meant very little at the time of that deal. In White, the Zuffa LLC as it became known had the perfect pitchman, an in-your-face look at me, look at us Bostonian with no apology or explanation needed. The rest is history, a huge chapter in the business book of this century.
There are mixed emotions about the report this week from thousands of fans, even some fighters. It's where passion meets finance, which is never advisable in personal dealings but it expected when it comes to sports. The player who just can't leave does because there's more money to be made elsewhere. The franchise promises to get better, bear with the young talent and keep buying season tickets. Some passion runs hotter. The Rams can leave St. Louis for Los Angeles but if there was ever a sacrilege to even think, or hint the Cardinals would move from the shadow of the Arch, there would be a revolt all the way to the governor's office.
If the report comes to fruition the world we know as the UFC may not change that much. It is so entrenched in execution there is little reason to tinker, just keep the fighters coming and rake in the PPV bucks. Whether the Fertittas, low key as they are, would explore another venture in regards to the sport is unlikely. Dana White would likely stay with the UFC, he remains a decade later the most recognized face of the organization. Fighters came and went, belts changed but Dana has always been front and center. The behind the scenes matchmaker extraordinaire Joe Silva and the politically savvy Marc Rattner would be warmly embraced by any new boss as key personnel.
This is speculation for now. What this IS about right now; is how amazing it is that a $2 million dollar gamble 15 years ago has become a success measured in billions of dollars. The greatest knockout in MMA history and one of the best sports business stories ever.
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