November 26, 2012 by Charlie Eisenhood in Livewire with 2 comments
I’m still processing the $125K share price for Major League Ultimate. Although the AUDL was certainly the first big outside investment into Ultimate, almost certainly no team spent in the six figures last season. Asking investors to front that kind of money for what is still an unproven business model is audacious.
To get a sense of scale, the MLU’s first year budget — $1.25 million — is more than half of USA Ultimate’s revenues from last year. But it pales in comparison to the start-up funds of other professional sports leagues like Major League Soccer and Major League Lacrosse. We will have a more in-depth look at how the organizations compare later this week.
But the point is this: this is the first time people are really putting money into Ultimate. Why does lacrosse get a major ESPN deal with just a fraction of the participants that Ultimate has? There’s money in lacrosse: affluent people play it, there’s tons of equipment you need to play, and it’s an East Coast prep school activity. Hence, there are lots of sponsors.
Ultimate may just now be reaching that point. We will likely look back on 2012 as an inflection point in the growth of the sport. Although the story may be superficially about the new professional leagues vs. USA Ultimate’s Triple Crown Tour, the real story will be all about the money.