Guarding the Gate
February 24, 2012
More slowly than I would like, because it’s not a field in which I’ve had formal training or extensive practical experience, I’ve been learning about the world of startup companies and venture capitalists that discovered the sports world in the 1990s and have proliferated during the past decade.
Usually with their founder making the contact, many of these young companies have reached out to the MHSAA, hoping we will embrace and endorse or utilize their new product or service. Almost all owe their existence to the World Wide Web and to the passion of their founder, either for sports or for a concept they think solves some need of athletes, coaches or fans . . . or advertisers and sponsors.
And almost every one of these startups is looking for an exit; looking for a bigger fish to swallow them whole. And paying them handsomely for consuming the young guppy. A lucky few make what the industry calls the “Big Exit,” like a major network buying the startup for many millions of dollars.
We hear from many of these startups that the advertisers are clamoring for this or that they are promoting, but we usually see one of two things happen. Either the advertisers show so little interest that the startup fails, or what support the advertisers do provide goes to the venture capitalists and not to those providing the content.
As we screen the plethora of proposals to capitalize on high school sporting events in Michigan, we look for two kinds of assurances. First, that the suitor doesn’t have an exit strategy; and second, that the initiative will have direct benefit in terms of both money and message to those providing the content: i.e., schools.
Most of the initiatives we screen will assist schools with neither money nor message, and some of them would actually provide a message that is contrary to the mission of educational athletics.
So we’re guarding the gate, in both directions – controlling the entrance to the high school sports market in Michigan, as well as the escape of those who are in our market for a fast buck and quick exit, big or small.
Bottom Lines
May 19, 2017
The cost of everything in everyday life seems to rise every year. Everything, that is, except the bread and butter revenue source of the Michigan High School Athletic Association.
Next school year – 2017-18 – is the 14th straight year that ticket prices for the District level of MHSAA basketball and football tournaments have remained unchanged; and it’s the 15th consecutive year without increase at the Regional level of those tournaments. Five bucks.
Meanwhile, the cost of venues hosting some MHSAA championships is rising rapidly. Even if calendar conflicts were not evicting the MHSAA from Michigan State University’s Breslin Center, steeply increased expenses could have the same effect.
There was a time when universities across the U.S. wanted state high school association tournaments using their on-campus facilities. This was a public service as well as a marketing tool for those institutions.
Today these universities derive much more revenue from higher international student tuition than is paid by the in-state students who first come to the campus to play in or watch state high school championships. Even more important than tuition dollars are research grants, royalties and donations to what is now the big business of higher education.
Where campus athletic facilities are operated outside the athletic department it is even more evident that money trumps the mission of public service, at least as it relates to facility usage and secondary school athletic programs which, to be sure, are less important than the search for world peace and cancer cures by our universities.
People might believe it’s more appropriate for MHSAA events to be on college campuses than in commercial arenas; but frankly, it’s getting hard for us to see a difference. The bottom line drives them both.