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It is stuff for another faux segment UH slash little
college football segment, and we're gonna get to know what's
going on up on.
Speaker 2: The hill the uh.
Speaker 1: The University of Utah has executed one of a kind,
first of its guide private equity deal. We'll see if
it passes, see if everything's kosher, et cetera. But it's
pretty monumental. H The first domino of private equity has fallen,
and it's right here in the state of Utah. We're
gonna get to know what's happening up in Salt Lake
City from an insight here momentarily. It's going to be
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Speaker 2: Let's get out to the hotline.
Speaker 1: Welcome in my good friend, Josh FURLONGKSL dot com, University
of Utah insider Josh.
Speaker 2: How you living do it well?
Speaker 3: How are you ben doing?
Speaker 2: Awesome? Man?
Speaker 1: How crazy? Has the last well seventy two hours been
for you.
Speaker 3: Yeah, it's it's been. I mean, this is one of
those things where you know, as a sports reporter you're
not really well versed in like private equity or anything
like that, and so it's like it's a learning curve
and everything that way. But I think, you know, you
pick up things along the way and you try to
make it the most of it. But it's it's crazy.
I mean, I think this is a new evolution of
the NCAA and we're going to see a lot of this, right, Like,
we're going to see a lot of differences this way,
and we're going to be much more well versed in
business side of things instead of just what's happening on
the field or on the court. So it's it's interesting.
Speaker 2: No, no, Lo, what have you learned through this process? Right?
Speaker 1: You're an inquisitive soul. That's why you became a journalist.
You like to ask questions, You like to learn about
all manner of things. Obviously sports things are what you
love the most. But what have you learned this process?
With the private equity deal executed this week?
Speaker 3: Yeah, I mean I think a lot of people hear
private equity and they get scared right, and admittedly, like
what was that last year when brett Ormart kind of
broached the subject of potentially having private equity for the
Big twelve. I mean, I think you hear that and
there's negative connotations about how they're just going to come
in and they're going to gut everything, and you know,
it's not going to work out this this deal. You know,
I've learned that it's a little bit different. And then look,
I'm the last person to understand all the nuances of
what private equity is or anything that way. But at
the same time, I think what they're doing here is
they're trying to more build you know, investments for high
end donors. People that want to be able to promote
the university, want to be able to be heavily invested.
And you know, I think you hear a lot of
a lot of people donors, especially who are kind of
frustrated with the process. Right, you throw in a bunch
of cash, it goes to players, and there's no real
guarantee that it actually goes to them or that they
stay and so there's kind of like some burnout with
with donors in the sense of giving cash. And so
I think it's it's one of those situations now where
you're investing in an actual company and using those funds
to be able to help some of this stuff. So
I think there's there's advantages there, you know, that has
opportunities where you can get more support from the don
owners where they're putting in a lot more.
Speaker 2: You know.
Speaker 3: I think a lot of people also see the five
hundred million dollar figure that's being thrown out of that's
all coming from the private equity firm and in reality,
a lot of this is coming from donors. Uh, they're
putting in their investment. They want to get that piece
of the University of Uta athletics department, that kind of stuff,
and so it's just kind of like a group effort,
so to speak, to kind of make it work. So, look,
there's still risk. Any business venture is going to have risks,
and I think we won't know about that until you know,
five seven years from now. But I think it seems
like they're trying to go about it the right way.
It's just it's hard to know, right anytime you get
an upfront cash, it's hard to know what that's going
to do for an entity that that you know, this
is a new realm.
Speaker 1: For strategically, who gets to decide where the the influx
of cash is going to? Right, Obviously you have nil,
you have operations, you have personnel. Is it going to
be kind of the board that sits over the Utah
brand sports in lls the l Is it going to
be that border trustees which is made up of the donors,
made up of some administrator a d oo s Mark Harlan.
Speaker 2: Do we know what the border of trustees for the
brand is going to look like?
Speaker 3: Yeah, I mean it'll definitely be made up of a
compilation of that. They have, you know, four people that
will be a part of the athletics department, you know,
the actual brands and entertainment company. You'll have four donors
I believe it was, and then I think it's two
or one and one of of some capacity of ultro capital.
And so there's there's going to be a wide makeup
of it. But at the end of the day, the
university owns the controlling interests or the majority shareholder, and
so they're going to have the decision making abilities there.
Now with that, you know, they'd be stupid not to
listen to some of the expertise that A lot of
these sports. You know, the Ultra Capital has because they
have been in this in this realm. They you know,
they've managed the Dallas Cowboys, They've managed the Cleveland Browns,
They've managed some F one stuff, So they have understanding
of like what it takes to be able to whether
it be facility upgrades or sponsorship ideas on what to
do for athletes. You know, all of those things are
going to be taken into account. But at the end
of the day, the university itself has controlling interests, and
so I don't know how that's necessarily going to be
manifest through the board. I don't know if it's you know,
the four people or the whatever gets a majority share.
I would assume just simply because there's one member of
Ultra Capital on there and there's eight other members of
the board that are donors in the university. But there's
just a simple majority that way. But I think there's
there's enough insulation or mitigation that they feel like they
can they can still have the controlling interest while still
listening to kind of what these guys want to do
to help the brand.
Speaker 1: Josh Furlong KSL dot com uti utes insider here on
your Utah ESPN Radio Network.
Speaker 2: Josh is this.
Speaker 1: I was chatting with someone yesterday that as well familiar
with private equity, said, look like one of the reasons
why they're doing this is because the state legislator has,
like has legislature has cut funds to the state run
institutions and that may impact athletics and athletic departments.
Speaker 2: Have you seen that?
Speaker 1: Have you heard that why they're going down this path
there at the University of Utah.
Speaker 3: I mean, I think it's a compilation of things, right,
Whether it's one solitary thing, I don't think that's the case.
I think there's just a combination of factors here where one,
you know, the University of Utah suddenly has to throw
out twenty million dollars in cash for revenue share. You know,
that's money that you're not necessarily accounting for in the past.
You can't just suddenly make up twenty million dollars in
the budget without cutting certain things or different things that way.
So there's there's that component where you're trying to just
survive and make it work, and so you've got that,
but then it's also just trying to position Utah as
an institution for whatever the next realm of whether it
be realignment or you know, consolidation, that is right. I
know a lot of people will look at this and say, oh,
it's the big ten. They're trying to go for the
big ten. Maybe maybe, But I think it's really just
kind of trying to position themselves in a way where
if they don't answer the call right now, they face
the risk of just not being able to have the
funds to be able to operate. Do you then have
to cut you know, softball, Do you have to cut volleyball?
Do you have to cut certain sports that try to
stay afloat? And that's just not really something that the
university wants to do. So it's this is kind of
a bigger hitcher, so to speak, in terms of kind
of trying to maximize their potential while still preparing for
what that next round could be going to. There's still
no guarantee, right Like there's no guarantee that UTAH will
be caught up in you know, a Super League or
or whatever that may be. It's more just kind of
preparing for the institution right now, giving them the money
they need to operate, and then being able to have
capital in the future should they need it.
Speaker 1: Yeah, it's a crazy time in the college football world.
The landscape is ever changing, and I think it's phenomenal
that Utah is being so a great suv in this venture.
A lot of people like you that have reached out
to me and say, hey, well, how does this work.
You have a for profit entity that's taking the brand
of the University of Utah. You have you know, state
funds and taxis and student fees that kind of booy
up the athletic department typically along with their TV revenues
and other things like I don't see all the funnels
that go into a traditional athletic department, but I can't.
I don't know what the last fiscal you know, twenty
twenty three, what the revenue generated was within the Utah
Athletic Department, but I imagine it was anywhere from one hundred
and thirty to hundred and fifty million. Do you know
that number? By by chance? The last number that you
got for revenue generation for the US Department of Education
at the University of Utah.
Speaker 3: I have a spreadshoot with it all. I mean, if
I remember right before they had their Comcast issue last year,
the last year where they kind of got it all together.
It was somewhere I'm going to be totally way off,
but yeah, it's it's definitely over one hundred million and
trying to be it. But that's you know, taking into
account everything without taking in the expenditures and everything in
that way. So it's it's up there, but then you
have to take in everything else, and you know you're
you're you're operating before this Comcast piasco, they were operating
it anywhere between two to four million the surplus, So
it's it's different, right, I mean, it's it's hard to
know exactly what that's going to be. But then you know,
we haven't even seen the twenty million figure come into
that knowing that that's going to essentially be a huge
deficit for the program.
Speaker 2: Yep, yep, no doubt about it.
Speaker 1: It's uh, it's intriguing from a Title nine standpoint, right,
So it's like, if this is a for profit entity,
you know, how how are scholarships allocated?
Speaker 2: And how how is I guess.
Speaker 1: You know, how does that impact He's typically football subsidizes
all the other Olympic sports, right, so any revenue generated
within football and basketball, maybe the profit generating or the
profit retaining entities.
Speaker 2: You know, they subsidize the other Olympic sports. How is
that going to work out?
Speaker 3: Yeah, there shouldn't. There shouldn't be any change per se,
because they still have to have the you know, the
the regulations of the NCAA. If they try to change anything,
then they can't even be a member of the NCAAA.
So they've gone through a lot of these different things
to make sure that they're compliant, that they're withholding that.
You know, there's you know, at least based on the
way that they presented to that presented it, excuse me
to the board, there was no desire to at Olympic sports.
There's no desire to cut women sports. If anything, they
felt like just can bolster that more and give them
more support in that. So it's you know, they still
have to be compliant at all that they still have
to fill out that NCAA regulation form where you account
for all their funds and different things that way, and
so from my understanding, there shouldn't be any change with that.
But I'm sure they could divvy up a little bit
more money to certain areas. You know, there's always going
to be that Title nine component as part of this,
But I don't think the Title nine requirement requires that that.
You know, volleyball needs to get the exact same payment
that a football player does, right, So I think there's
that element of it. I think it's more just giving
the same access and an ability which won't change just
because they've got a for profit company.
Speaker 4: Yeah, Andrew Peterson here, I just have a question for
you concerning the basketball team, how this might affect them.
Speaker 2: I've always thought that Utah.
Speaker 4: Utah falling off in basketball has always felt a little
bit weird to me. Do you think this deal helps
Utah be able to invest in basketball, get competitive in
the Big twelve, and get back to where they used
to be as a really good basketball program.
Speaker 3: Yeah, I mean I think that has to be. Right, Like,
if you go sit here and you sign, let's just
assume it's five hundred million, Let's you know, if you
get that and you're not seeing a noticeable increase in
kind of being able to attract good talent, what's the point.
I mean, obviously there's a bigger point to that. Like,
I think we can all understand that, but I think
if you're not going out there and trying to attract
the top talent and trying to bring in guys that
are going to help your program. It feels like a waste.
Now there's more components that go into it than just
the people on the court. I mean, I think anybody
that's gone to the University of Utah basketball games realizes
it's a Stelle environment. Like there's just not engaging and
entertaining situation there. I mean, back in kind of the
good days of Larry Kristovac, you know, they had floor
court projections, they had you know, a lot of entertainment,
things were moving and just as a fun environment, whereas
now it's just kind of a Stelle product. And that's
on the court as well as the entertainment, And so
I think it's trying to upgrade a lot of those
types of things as well, where you're now bringing in
a partner that understands how to bring entertainment to people.
And if you can get that, I think then that
starts attracting people, right. I mean, I think bi used
done a phenomenal job of that of being able to
attract people because of a great product, but also because
it's just it's a show.
Speaker 4: Right.
Speaker 3: If you're a kid like my kids, love to go
to basketball games. If they go to that, they're going
to be excited beyond just what they get from what
they see on the court. I think it kind of
goes hand in hand in this situation. You've got to
be able to increase the entertainment value as a product,
but then you've got to do that in the in
house stuff as well. So you know this, you know,
if they don't do any of that, then yeah, this
is a major failure in that regard. And and you'd
have to wonder if if Utah is ever really going
to take basketball seriously at that point.
Speaker 1: Josh Furlong KSL dot com here on ESPN Thefan utah
Ute inside or writing for KSL dot com.
Speaker 2: Uh, you know, piggybacking off.
Speaker 1: The basketball conversation one of the biggest issues. I mean,
my wife's a ute. I've gone to many games at
the Huntsman Center. It's a really tough parking situation. It's
hard to get people there to the games. Obviously, When
do you think some sort of renovation, some sort of
move could happen for the arena and a change on
the venue or access to the venue, anything that that
could be executed on that front and how soon.
Speaker 3: Yeah, you know, I had some conversations with somebody other
day on that and they said, there's still really you know,
maybe they don't know the full plans, but they said,
there's still really no clear direction on when they're going
to break round, right, I think, you know, for some people,
they're still trying to determine a spot. I believe the
university already has a spot picked out, but whether that
happens sooner than later remains to be seen. I mean,
I know the university is undertaking a lot of different
changes to try to make sure a lot of that
stuff works. They want to create kind of like an
entertainment district where all of the athletics are kind of
in the same area. So the belief would be that
the new Hunts and Center, whatever it's called, would be
closer to rights Eco Stadium. You could create a whole
bunch of entertainment there and do that. So, you know,
I don't think we're we're going to see anything quick.
But at the same time, with this infusion of cash,
maybe that speeds things up a little bit, allows them
to kind of move forward and start breaking ground. But yeah,
I mean, like they're still they're still running the same
way with what they've got, and so I think you're
in the middle of trying to manage that while still
trying to, you know, prepare for the future and make
a better product. But you can only dump so much
cash into a product that's going to be raised in
a few a few years, you know what I mean.
So I think I think they're still kind of figuring
that part out, but I think you'll see probably that
move faster along now that they have the money.
Speaker 1: Yeah, Josh, is this the way of the future in
your opinion? Knowing what you know, learning what you've learned,
do you feel like you know a majority of athletic
departments around the country are going to go down this path?
Speaker 3: Yeah? I mean I think you know. Whether this is
the exact path that everybody will go remains to be seen.
But I think you're going to see a lot of this, right.
I think you'll have a lot more people intrigued because
Utah has signed the deal. I think somebody was waiting
to be the first, right Like, this is not like
Utah was the first to ever consider private equity, but
I think this is going to be the way that
you kind of have to fund college athletics, right, Uh,
there's probably better ways to do it, but barring collective
bargaining or barring you know, much more structure to be
able to equalize or or at least create, you know,
the structure essentially that you know, you're gonna have to
find these outside avenues to be able to increase revenue
and increase funds because it's just an arms rate that
it's either going to break or people are just going
to continue to find new ways to be able to
bring in money.
Speaker 1: So what are the risks, like, as you've asked questions,
what are the true risks here? And what are the
what's the potential fallout if there is if this is
a failed venture, we're not talking about We're talking about
bankruptcy of of of an entity that just reverts back
to its old ways within the within the school, you
know what I mean?
Speaker 2: Like, is there a bailout?
Speaker 1: Is it too big to fail type of deal like
the car industry or any other you know, big big business,
et cetera, that he's booed up by taxpayers?
Speaker 2: What's what's the risk here?
Speaker 3: See that's and that's where I'm still really curious kind
of what that is right. When they talk about exit strategy,
UTAH says that they own everything and they have the
controlling interest of that. So you know, if OTRO Capital
isn't you know, pulling their weight so to speak, or
things aren't going well, you know they can they can
remove them or whatever that may be. May mean obviously
they're going to have to pay them out, so at
the very least you're going to be in debt to
what you owe them, if that has to be an
early situation. But I don't know that there's necessarily I
don't want to call it a failure right because I
think there's obviously failure opportunities. But I think because you
have a donor base that is going to be buying
into this, it's more can it be sustainable?
Speaker 2: Right?
Speaker 3: Can this be something where you can continue to move
forward with it without just kind of middling along? Like
there has to be some sort of increase in revenue
to be able to make sure this works. And so
if you're just getting a bunch of cash, you're going
to be in debt to that COUMP you know, to
that you know firm, and can you get donors to
pay that out? Can you get different things that way.
I don't know that there's going to be some buyout, right,
I mean, I could be wrong, But at the same time,
I don't know the full capacity of that, you know,
with my limited financial understanding to know what the true
fallout would be in this situation, especially since they are
a minority order, especially since you know a majority of
that is coming from from the donors. So your guess
is as good as mine, you know. I wish I
was better equipped to answer that question, but I think
they feel like they've mitigated most of those risks with
the way they've written it. But yeah, I mean, if
this is a situation where you have to turn to
tax dollars and everything else, yeah, that's that's a big disaster,
and that's a that's a huge risk that now opens
the university up too much further scrutiny.
Speaker 1: What's the overall vibe right now with the football program,
with this deal getting done, going to a bowl game
in Vegas and having a what I want to say
it was a top forty or forty five class in
college football in the colleg football recruiting world, what's the
vibe right now?
Speaker 3: Yeah, I mean, I think it's positive. I think the
fact that you can bring back your two quarterbacks and
have them paired together, bringing back a core of the players,
or at least that's what we seek right now. I
think there's a positive vibe that Utah can continue this
trajectory moving forward to the next year. Their recruiting class,
they didn't need to go heavy because they have a
lot of freshmen that contributed this year, or at least
younger players, and so it's really just kind of capitalizing
on what they did this year and trying to move
forward for next year. So, you know, I'm really fascinated
to see if there's any Bowl opt outs. I would
assume there's at least one, considering Spencer Finals of a
first round pick potentially, you know, I have to believe
that at least the core of this team will play
together and play in Vegas and try to use that
as another jumping off point to next year. But that
remains to be seen. So I think overall the general
vibe is good. We're still waiting to hear on Kyle
Whittingham and his future, so I think that that has
some you know, it kind of limits exactly what the
full vibe can be. But I think there's still positivity
going into next year.
Speaker 1: Josh for a long ladies and gentlemen, best way to
support you what you do, how you do it, Josh
For all of our listeners.
Speaker 3: Yeah, you can just go to KSL dot com read
my stuff there, or you can come visit my Twitter
feed Jfer KSL chat with me that way, you know,
have a podcast, all those kinds of things. So any
and I'll appreciate it, but I appreciate being able to
come on your show and be able to talk about
these things.
Speaker 2: Yeah, it's a new wave, man.
Speaker 1: I think it's incredible that Utah was the first to
jump into it. It's something that everyone's been very flirtatious about.
It's kind of taking hold of the new cycle in
the off seasons, whether it's conference commissioners or.
Speaker 2: Athletic depormas eights discussing it.
Speaker 1: But Utah finding a way to be the first to
jump into it. Can't wait to watch out all it
all turns out. I'm sure we're gonna learn more about
it in the day and weeks. Agom, is there any
do you think there's any chance at the state legislature
sometime somehow tries to put a kibosh on this.
Speaker 3: I mean, I know there was you know, I can't
remember blanking on the legislator's name who kind of not
really upset on X about this. But my understanding is
is that UTAH has worked and with the legislature or
at least interested members of the party to be able
to have an understanding of what this is. So like, sure,
there's always a chance that the legislature can come in
and kind of usurp their power, but I think they've
had enough conversations going along. They're not doing this blindly, right, Like,
you're not going this far along signing private equity, doing
all these things without talking the NCAA, without talking to
the legislature, the governor those types of things. So, you know,
I think everything is kosher, Everything is okay. It's just
a matter of kind of finalizing everything.
Speaker 2: Can't wait to see what happens. Josh.
Speaker 1: Appreciate your brother great inside. As always, we'd invite everyone
to follow you on X and check out your podcast
as well as read all your content atksel dot com.
Speaker 2: Thanks so much, Josh, Thanks, I appreciate it all right.
There you have it, Josh.
Speaker 1: For long, Ladies and gentlemen, and that segment was brought
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I know you guys love movies. I like movies, You
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