RedBird Capital and Weatherford Capital are launching a college sports-specific investment fund, one that could lend as much as $2 billion to athletic departments across the country.

Led by RedBird founder Gerry Cardinale, Collegiate Athletic Solutions (CAS) is hoping to cash in on a college sports industry in upheaval, with athletes on the verge of more robust compensation and schools seeking new funding sources to stay competitive. The structure of CAS, according to multiple people familiar with its plan, is to lend upfront money and operational expertise to athletic departments in exchange for a share of additional revenue generated under their partnership.

Weatherford Capital, headquartered in Tampa, Fla., is run by brothers Will, Sam and Drew Weatherford, the latter of whom played football at Florida State and is a member of the school’s board of trustees. FSU has been negotiating for more than a year with another investment firm, private equity giant Sixth Street, on a potential capital infusion for the Seminoles. Representatives for both FSU and Weatherford said the school was aware of his work with CAS and that he would recuse himself from board decisions that might create conflict.

CAS, meanwhile, is raising money and is already in talks with a number of other universities, said the people, who were granted anonymity because the details are private. The new venture plans to initially partner with five to 10 athletic departments, offering $50 million to $200 million to each.

Representatives for RedBird Capital and Weatherford Capital declined to comment.

CAS is one of a number of institutional funds looking to finance and profit off the increased commercialization of college sports. Legal, financial and legislative upheaval has combined to create “one of the most potentially transformative opportunities I’ve witnessed in my 30-year career in sports,” Cardinale wrote in an introductory email to Texas Tech athletic director Kirby Hocutt late last year.

“We have done a tremendous amount of work to position ourselves as a thoughtful impact partner for you and your team as you evaluate the changing landscape,” he said later in the email, which Sportico obtained via an open records request. “Drawing on both (a) our collective experience of building cutting edge sports businesses (e.g., On Location, OneTeam Partners, and Legends Hospitality) to generate more revenue for your department and (b) our expertise in partnering/operating teams and leagues (e.g., AC Milan, Boston Red Sox, New York Yankees, XFL, etc.), we should be a fairly unique partner to programs like yours.”

Both Weatherford and Cardinale have been at least vaguely telegraphing the premise behind their new venture for months. Last August, Weatherford posted a column on LinkedIn titled, “Amateur Collegiate Sports is Dead…Act Accordingly,” in which he argued that instead of “rest(ing) on the laurels of the traditions” of what college sports once was, the industry’s stakeholders should “celebrate” the “multibillion-dollar national treasure” it has become and “commercialize the asset” for their benefit.

In early January, Cardinale told the The New York Times that Michigan’s football team might be worth $1.5 billion and implied that the Wolverines were an undervalued asset. The week prior, on Jan. 2, a Delaware LLC called Collegiate Athletic Solutions Platform was formed, according to the state’s Division of Corporations database. The CAS website is currently password protected with a landing page that says “coming soon.”

The company has one employee publicly listed on LinkedIn—Newman Delany, the son of former Big Ten commissioner Jim Delany, who is identified as a senior vice president. Jim Delany is currently an advisor to the Big Ten as well as a partner at The Montag Group. The Delany family has also been a significant donor to the University of North Carolina, both Jim and Newman’s alma mater.

In a March email sent to Texas Tech’s Hocutt, Newman Delany requested a number of different pieces of financial information for CAS to develop a “tangible TTU-specific analysis as the foundation for a constructive discussion.”

That data included three years of itemized profit-and-loss statements from the athletic department; three to five years of itemized profit-and-loss projections; details on any future revenue pledged to existing projects or liabilities; a detailed breakdown of debt obligations; and a finance schedule for upcoming capital expenditures, including ROI estimates for those projects.

In response, Hocutt sent an email to deputy athletic director Jonathan Botros, the Red Raiders’ CFO and COO, asking if he had “concern in sharing this type of general information.” A Texas Tech spokesperson did not respond to an inquiry about the current status of these talks.

CAS’ approach is different from traditional private equity, or even private credit. The group does not plan to take an equity position in any athletic department’s commercial venture, nor does it intend to secure fixed payments in return for the upfront capital. Instead, a source said, the deals will be structured with returns tied to new revenue generation.

RedBird’s sports portfolio includes Italian soccer team AC Milan, Fenway Sports Group, YES Network, the Alpine F1 Team and the UFL. The firm has $10 billion under management, and recently closed its fourth fund with more than $3.28 billion, according to The Wall Street Journal.

Founded in 2015, Weatherford Capital has raised more than $1 billion since its inception. The group’s portfolio is mostly technology and financial companies, though it invested in IMG Academy in 2023 when the company was sold by Endeavor for $1.25 billion.

(This story has been updated in the third paragraph to include comment from Florida State.)

Player profile

• Class:Freshman
• Position:F
• Hometown:Appleton, Wis.
• High School:La Lumiere (Indiana)
• Height:6-9
• Instagram:gus.bus.19
• Twitter:gusbus2023

BIO: Four-star big man Gus Yalden, a native of Appleton, Wisconsin, returns home to play for his home state Badgers. The 6-foot-9 forward ranked as the 17th best center in the country for his class, according to 247 Sports. Yalden attended IMG Academy (Bradenton, Fla.) and the Asheville School (Asheville, N.C.) during his sophomore and junior years before landing at La Lumiere (La Porte, Ind.) for his senior year. Yalden helped La Lumiere finish 18-10 in the National Interscholastic Basketball Conference (NIBC), which is considered to be one of the toughest conferences in the nation. Prior to his senior season, Yalden had a strong summer in the Nike EYBL, which included a 35-point, 17-rebound performance at the prestigious Nike Peach Jam in July.

HS Mixtape

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Stats

Did not play his freshman year.

The BE coaches in the October time frame come out with their Pre-Season poll. Perhaps we should wait till then or since their is more expertise here maybe we could give it a go now. I'm not sure there will be any more impactful team changes between now and the start of the season that will make much of a difference. Anyone want to give it a go?

1. Creighton
2. UConn
3. St Johns
4. Marquette
5. Providence
6. SHU
7. Xavier
8. Villanova
9. Butler
10. G-Town
11. DePaul

Numerous stay-or-go decisions could be impacted by the largest NIL deal on record, while players staying in the 2024 NBA Draft may be a teensy bit jealous​

By Isaac Trotter

​

Former Duke basketball coach Mike Krzyzewski shared his thoughts on NIL, the transfer portal and more with CBS Sports​

By Isabel Gonzalez

As the landscape of NIL continues to evolve, there are currently a lot more questions than answers regarding the long-term model. Mike Krzyzewski spent 42 years coaching men's basketball at Duke before retiring at the conclusion of the 2021-22 season, when NIL was just getting started.

The Hall of Famer is still involved with the Blue Devils as an ambassador to the university and he recently shared his thoughts on the current state and the uncertain future of college athletics and basketball with CBS Sports.

"I don't think there is a clear path of where it's heading, because so much of it is tied up in lawsuits with the NCAA," Krzyzewski, speaking ahead of an event for the V Foundation, told CBS Sports. "Different conference realignment, lawsuits, you do not have a parent organization that really is leading college sports right now.

"All these things, hopefully some of them will be settled this summer, the legal issues. Once the legal issues are settled, hopefully a new structure for doing things is formed. Then you can get some semblance of order. Right now there really isn't any order.

In April, the NCAA officially said schools can facilitate NIL deals with third parties — but not pay players directly. Nothing is currently black or white, and congress has had discussions on whether players should be considered employees of their respective universities.

There is also the House v. NCAA lawsuit and other antitrust cases with the main argument being how NCAA limits compensation and whether or not there is an unlawful restraint of trade.

NIL is a complex situation with multiple pieces involved and no set standard on how to do anything, despite several deals reaching six-figures and some having an even higher valuation. The lack of uniformity across the country and current legal wrangling make the landscape feel chaotic, but Krzyzewski is hopeful that in the end everything will work out for the best.

"NIL is a really good concept that has gone further than anybody from the NCAA could have imagined," he said. "There is no transparency and there are no guard rails, but overall it's a good idea."

Another hot topic of conversation in college athletics is the transfer portal as NIL opportunities became something else to consider for players who are looking for a new school. NCAA transfer rules typically dictated that a player who transfers has to sit out a year, however, that will no longer be the case. Also in April, the NCAA announced student-athletes will be allowed unlimited transfers with immediate eligibility.

"It's a good idea, but you have almost 3,000 Division I and Division II male players who have gone into the transfer portal," Krzyzewski said. "That's well over a quarter of all the young men who play in Division I and Division II. Is that good? Bad?

"It is what it is, along with NIL. It's tough to make predictions. If I knew who was leading and in charge, I think I would be more apt to make some level of prediction, but you or I cannot say who is in charge because there is nobody in charge, which is kind of scary."

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A ton of information to unpack here.

What shooting by Indiana in this game. Record shooting.

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By Ryan Glasspiegel

Pete Thamel, ESPN

As the NCAA continues to make steps toward the expected settlement of the landmark House v. NCAA lawsuit and other related anti-trust cases, there is pushback on how the NCAA plans to pay the expected $2.7 billion in back damages over the next decade, sources told ESPN.

The NCAA sent out a four-page memo to all 32 Division I conferences this week detailing how the organization plans to cut back on distribution to leagues in six annual payout categories to pay the proposed $2.7 billion in damages.

The memo detailed how the NCAA could split up an expected $1.6 billion that would come from reductions in NCAA distribution, sources told ESPN. The remaining $1.1 billion is expected to come from NCAA reserves, catastrophic insurance, new revenue and budget cuts, sources said.

Of that $1.6 billion, nearly 60% is expected to come from leagues outside the Power 5 conferences that are named in the House lawsuit, sources said. (The NCAA is named, and all of the schools are members.) The other 40% will come from the power conferences.

For example, the cost annually for the Big East is projected at between $5.4 million and $6.6 million over the next decade, according to a source familiar with the memo. The West Coast Conference, another successful basketball-centric league, is expected to annually pay between $3.5 million and $4.3 million. The lowest level of annual payouts expected to be withheld for smaller leagues is just under $2 million, which is estimated to be more than 20% of what those leagues get from the NCAA annually.

This has set off a flurry of upset commissioners and officials in those smaller-revenue leagues, including a series of meetings of the Collegiate Commissioners Association and the CCA22, which are the 22 leagues that don't have FBS football.

Of the $1.6 billion, the NCAA will be withholding distributions from six funds across its 32 Division I leagues, ESPN has learned. Those include the basketball performance fund (via the NCAA tournament), grants-in-aid, the academic enhancement fund, sports sponsorships, conference grants and the academic performance fund.

Three categories of NCAA payments are not expected to be impacted: the equal conference fund, the student-athlete opportunity fund and the special assistance fund.

The NCAA does not plan to take money away from its Division II and Division III distributions, sources said. Sources cautioned to ESPN, however, that the numbers are fluid and could change.

There has been a flurry of meetings of the CCA and the CCA22 in recent days, and the tenor of those meetings has been trying to find whether additional models can be proposed that lessen the financial burden. According to a memo obtained by ESPN, the CCA22 plans to send a letter to the Power 5 and NCAA requesting additional payment models.

According to a source, one smaller non-power football league was told in the NCAA memo that it would be expected to pay more than $2.5 million per year to help cover the costs of the settlement. A source in that CCA22 league said that amount is approximately 25% of the annual NCAA revenue for the schools in the league.

"We're not named in the lawsuit," said a source in a smaller league. "We don't have a voice in any of this. We're just being told what our taxation is."

Added another source in a CCA22 league: "This is incredibly unfair and has a dramatic impact. I'm losing about 10% of my operating budget. Do I cut two staff members in order for money to go to Zion Williamson? Ninety percent of the money in the suit projects to go to Power 5 football and men's basketball players. The 40% payment for the power conference isn't proportionate."

There's a counter to those numbers, as nearly 300 schools would be paying for 60% of the settlement, whereas 68 power conference schools from the four major football leagues in 2024 would pay for nearly 40%.

According to a source, the average overall revenue of non-Power 5 schools was $27 million in fiscal year 2022. A $330,000-per-school reduction in distribution, according to a source, would come out to 1.2% in the school's average revenue. (That $27 million is different than the pure NCAA payouts referenced above.)

"The payment of the back damages is only half of the picture," an industry source told ESPN. "The proposed revenue-sharing arrangement -- nearly $20 million per campus for more than 60 campuses -- would cost more than $1 billion annually and provide all of Division I protections from future similar lawsuits."

There is expected to be continued pushback from the CCA22 in the coming days, sources said. That will come amid the backdrop of votes by the NCAA and power conferences on the settlement, widely expected to pass, that are coming next week.

Gary Cohen mentioned.....

Login to view embedded media The NCAA sent out a four-page memo to all 32 Division I conferences this week detailing how the organization plans to cut back on distribution to leagues in six annual payout categories in order to pay the proposed $2.7 billion in damages.

The memo detailed how the NCAA could split up an expected $1.6 billion that would come from reductions in NCAA distribution, sources told ESPN. The remaining $1.1 billion is expected to come from NCAA reserves, catastrophic insurance, new revenue and budget cuts, sources said.

Of that $1.6 billion, nearly 60 percent is expected to come from leagues outside the Power 5 leagues that are named in the House lawsuit, according to sources. (The NCAA is named, and all of the schools are members.) The other 40 percent will come from the power conferences.

For example, the cost annually for the Big East Conference is projected at between $5.4 million and $6.6 over the next decade.

The NCAA's only source of revenue is from the men's basketball tournament. The back NIL is mostly due to football players based on the number of scholarships per team. So, once again, men's basketball is footing the bill for problems created largely by football. And the big east is paying for conferences that have worked to destroy us at every opportunity. How about dividing this obligation up by prorating it versus annual media distribution rights?

I've long had a "worst CEO of all time" list.‌

I actually keep it on a piece of paper in the kitchen drawer. I haven't made any additions in some time, as there's a high bar to get on the list, and I am 99.99% of the time a happy person — who wants to spend their time labelling people the worst?‌

There is no set formula to landing on my list. But if there is any tie that binds the 10 people who are on it, it's consistently being inconsistent in delivering financial numbers, brutal underperformance versus competitors, and just incompetence in the role.‌

Some don't strike me as nice people, either. I like nice.‌

No. 1 on my list — will never change for as long as I am on this planet — is former Sears CEO Eddie Lampert. A trip down memory lane for you. One of the worst to do the job in history — ran Sears into the ground from his posh mansion. Most investors never even knew what he looked like!

I'm not going to tell you the other nine names.‌

But I'm going to reluctantly add an 11th name to the list.‌

Under Armour's (UAA) founder and boomerang CEO Kevin Plank.‌

I say reluctantly because I have a lot of respect for Plank as a founder. To go from selling T-shirts out of your trunk to building a global retail brand is commendable.‌

Hell, while I got to interview President Joe Biden this week — which has basically taken me 21 years of hustle — I haven't built a company from scratch.‌

But what's going on at Under Armour is a full-on disaster, and Plank has to bear the brunt of it all.‌

Although he only recently returned as CEO — after booting his hand-picked successor a year into the job — he's been on the board since day one. He's been a constant presence at Under Armour, meddling where meddling wasn't needed. Putting the company in news cycles it shouldn't be in.‌

All in all, just not getting it done as a leader, from execution to innovation to company culture.‌

And this week it once again blew up in his face in the form of a shocking earnings release and outlook.‌

Fourth fiscal quarter sales tanked 5% from the prior year. Sales in North America plunged 10%. International sales were down 7%. Wholesale sales (aka sales to department stores and other partners) fell 7%. E-commerce dropped 8%. Apparel sales down 1%. Footwear sales down 11%. Accessories sales down 7%.‌

A little bit of perspective:

• Walmart US e-commerce sales rose 22% in the most recent quarter. Sure, Under Armour doesn't sell ground beef and bikes, but e-commerce continues to be a major growth driver for most retailers. Provided your name isn't Under Armour.
  ‌
• Lululemon's sales in the most recent quarter rose 16%. Sales in its Americas division advanced 9%.
  ‌

"With several CEOs and heads of product marketing in North America over the past half a decade, ongoing turnover of critical leadership has been central to our inability to stay agile and decisive," Plank told analysts on his first earnings call since returning as CEO.

Reminder: Plank has been the constant in the past half-decade during this internal turmoil. The buck has always stopped with him, who is still the controlling shareholder.‌

The company guided to a low-double-digit-percentage sales drop in its new fiscal year, including a startling 15% to 17% decline in North America.

Plank says he is resetting the business.‌

That includes slashing 25% of the company's stock keeping units (SKU), cutting more costs (the other constant in recent years), and rededicating himself to innovation. Under Armour is promising brighter days 18 months from now.‌

But Wall Street is rightly skeptical.‌

"Several of the initial inputs to the turnaround strategy add some comfort (new $500 million buyback, 25% SKU reduction, new cost cut initiatives). However, many elements of the plan seem dependent on UAA achieving a degree of success in product innovation we haven’t seen in years," wrote Evercore ISI analyst Michael Binetti in a client note.‌

And this brings me back to Plank.‌

Under Armour's share price has plunged 87% since its 2015 record. This is a $6.71 stock now! The company's market cap stands at a paltry $2.90 billion, versus $42.3 billion for Lululemon and $138 billion for Nike.‌

Deckers Outdoor — once only known for Uggs boots — has seen its market cap swell to $22.7 billion on the back of feverish demand for Hoka running shoes.‌

Once a consistent 20% plus annual revenue grower, Under Armour's sales are outright declining — with the decline poised to accelerate over the next 12 months.‌

A few odds and ends to this analysis:‌

• The company is in such sorry shape you have to wonder how much longer key brand sponsors such as Steph Curry, The Rock, and Jordan Spieth stick around.
  ‌
• The company totally missed the super-shoe movement.
  ‌
• The company totally let Hoka and On run all over a sneaker business that has never truly gained traction — because of a lack of design and technical factors.
  ‌
• Adidas is becoming popular again and could have a big autumn while Under Armour sags.
  ‌
• Quality has fallen way off. Go touch a pair of Lululemon leggings, then a pair of Under Armour leggings.
  ‌
• The company isn't even in the conversation in terms of offerings for the coming summer Olympics.
  ‌
• Malls are filling up with new Under Armour competitors such as TYR.
  ‌

I want to remove Plank from my list. He has earned his place, however.‌

The next 18 months are likely to be some of the most trying in his career. At some point, he has to consider his legacy, which could mean stabilizing the business by year-end and selling it to private equity.