With pending national legal settlements, athlete revenue-sharing, conference realignment, and ever-evolving TV contracts, a school’s finances have never been a bigger topic. Florida State hopes to get significant financial help with a new multi-media rights partnership.
The school announced this week that it will be signing a new 10-year contract with MMR firm Legends. The firm specializes in premium ticket sales, sponsorships, food & beverage, merchandise, and membership clubs.
Expanding an Existing Relationship
Florida State and Legends have an existing relationship. The firm currently handles premium seating, concessions, suites, clubs, and catering for FSU Athletics. It has been working on the fundraising for renovations to Doak Campbell Stadium. According to a statement released by both parties, the new agreement will have the school and Legends working together on multimedia rights, including areas like broadcasting, licensing, and sponsorships.
Under new NCAA guidelines, schools can sell sponsorships, including corporate logos, to their fields and courts. Naming rights have also become a bigger topic in recent years.
The proposed settlement in the anti-trust House v. NCAA lawsuit calls for college athletic programs to revenue share with its athletes up to a total of $22 million per year. That elevates the competitive bar when it comes to the need for money beyond booster donations.
New Needs For New Sources of Revenue
In an interview with Ben Portnoy of Sports Business Journal, Legends President of College Mike Behan stressed the need for colleges to raise their financial abilities to previously unseen levels. “We’re aware the stakes are so much higher right now,” he said. “Schools have to generate a heck of a lot more money. A lot of what’s historically been done, that may have worked in the past, but that’s really not what schools need going forward.”
Florida State is in a situation that is different than many other schools. In addition to the potential revenue sharing and other increases in financial responsibilities, The Seminoles are trying to exit the Atlantic Coast Conference.
The two sides are engaged in what will be a protracted and expensive legal battle over the media rights ownership for FSU home games, should the school leave the ACC. The contractual exit fee is pretty clear. It will cost Florida State approximately $140 million just to fulfill that part of the membership agreement.
However, any settlement between the two sides that ends the litigation and allows FSU to leave the conference with its media rights in hand would likely add another $350-$400 million on top of that. That’s generally the kind of money donors can come up with.
Other Options
The school has also been open about pursuing potential financial growth via partnerships with private equity firms. Generally, those firms require a seat at the management table, (the board of trustees or board of governors at a school for example), in exchange for the financial investment.
The current relationship between Legends and FSU includes the MMR firms managing premium seating for the $260 million renovation of Doak Campbell Stadium. Legends also expects to add a 10-person staff to handle new sponsorship sales opportunities for Florida State.
Legends is also currently working with Miami, Georgia Tech, and Notre Dame.
