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Gut Check

October 18, 2016

After nearly eight years on the staff of the National Federation of State High school Associations, I accepted the challenge of leading an effort by a private business to consolidate the insurance needs of high school athletic associations and to control their coverages and costs through a self-insuring pool. My assigned goal was to assemble at least half of the 50 states in this fund. The need was so great at that time for comprehensive general liability and directors and officers insurance tailored to the unique needs of state high school athletic associations, that the group was quickly assembled and launched.

My time leading this effort was brief. In spite of the program's immediate success and continued growth, I became uncomfortable. The discomfort was born and grew in the fact that while I was out meeting with states, decisions were being made back at the home office that I was not involved with or aware of. I began to feel used ... my credibility was bringing in business, but changes were being made without my input; and I feared for my reputation. After a year of this, I resigned the position. That was 1981.

Nine years later, the companies' CEO was terminated when it was discovered that he used the construction of a company headquarters office to build himself a new house at the same time, burying his home construction costs into the books of the companies' capital expenses. Seven years after that, the companies' founder and namesake went to jail for operating from 1984 until at least 1993 what was determined to have been a Ponzi-like scheme.

I listened to my gut which, long before my head, knew something was not right. In fact, my gut seemed on alert well before things went wrong. This has happened at other crossroads and dozens of less dramatic moments in my professional and personal lives.

In this time of increasingly complex and difficult decisions, both personal and professional, the gut may be a good guide for us all.

Cover Story Stats

September 12, 2017

Eight excerpts from the cover story of TIME Magazine, Aug. 24, 2017, “How Kids’ Sports Became a $15 Billion Industry” ...

  • The United States Specialty Sports Association, or USSSA, is a nonprofit with 501(c)(4) status, a designation for organizations that promote social welfare. According to its most recent available IRS filings, it generated $13.7 million in revenue in 2015, and the CEO received $831,200 in compensation. The group holds tournaments across the nation, and it ranks youth teams in basketball, baseball and softball. The softball rankings begin with teams age 6 and under. Baseball starts at age 4.

  • With the cost of higher education skyrocketing – and athletic department budgets swelling – NCAA schools now hand out $3 billion in scholarships a year. “That’s a lot of chum to throw into youth sports,” says Tom Farrey, executive director of the Aspen Institute’s Sports & Society program. “It makes the fish a little bit crazy.”

  • The odds are not in anyone’s favor. Only 2% of high school athletes go on to play at the top level of college sports, the NCAA’s Division I. For most, a savings account makes more sense than private coaching. “I’ve seen parents spend a couple of hundred thousand dollars pursuing a college scholarship,” says Travis Dorsch, founding director of the Families in Sport Lab at Utah State University. “They could have set it aside for the damn college.”

  • The Internet has emerged as a key middleman, equal parts sorting mechanism and hype machine. For virtually every sport, there is a site offering scouting reports and rankings. Want to know the top 15-and-under girls volleyball teams? PrepVolleyball.com has you covered (for a subscription starting at $37.95 per year). The basketball site middleschoolelite.com evaluates kids as young as 7 with no regard for hyperbole: a second-grader from Georgia is “a man among boys with his mind-set and skill set”; a third-grader from Ohio is “pro-bound.”

  • Children sense that the stakes are rising. In a 2016 study published in the journal Family Relations, Dorsch and his colleagues found that the more money families pour into youth sports, the more pressure their kids feel – and the less they enjoy and feel committed to their sport.

  • There are few better places to take the measure of the youth sports industrial complex than the Star, the gleaming, 91-acre, $1.5 billion new headquarters and practice facility of the Dallas Cowboys. Turn left upon entering the building and you’ll find the offices of Blue Star Sports, a firm that has raised more than $200 million since April 2016 to acquire 18 companies that do things like process payments for club teams, offer performance analytics for seventh-grade hoops games and provide digital social platforms for young athletes.
    Blue Star’s investors include Bain Capital; 32 Equity, the investment arm of the NFL; and Cowboys owner Jerry Jones, who leases Blue Star space in his headquarters. The company’s goal is to dominate all aspects of the youth sports market, and it uses an affiliation with the pros to help.

  • Across the US, the rise in travel teams has led to the kind of facilities arms race once reserved for big colleges and the pros. Cities and towns are using tax money to build or incentivize play-and-stay mega-complexes, betting that the influx of visitors will lift the local economy.

  • There are mounting concerns, however, over the consequences of such intensity, particularly at young ages. The average number of sports played by children ages 6 to 17 has dipped for three straight years, according to the Sports &Fitness Industry Association. In a study published in the May issue of American Journal of Sports Medicine, University of Wisconsin researchers found that young athletes who participated in their primary sport for more than eight months in a year were more likely to report overuse injuries. 

  • Intense specialization can also tax minds. According to the American Academy of Pediatrics, “burnout, anxiety, depression and attrition are increased in early specializers.” The group says delaying specialization in most cases until late adolescence increases the likelihood of athletic success.
    Devotion to a single sport may also be counterproductive to reaching that Holy Grail: the college scholarship. In a survey of 296 NCAA Division I male and female athletes, UCLA researchers discovered that 88% played an average of two to three sports as children.
    Other consequences are more immediate. As expensive travel teams replace community leagues, more kids are getting shut out of organized sports. Some 41% of children from households earning $100,000 or more have participated in team sports, according to the Sports & Fitness Industry Association. In households with income of $25,000 or less, participation is 19%.