Shane McMahon's Possible Role in the UFC
by Brent Brookhouse on Nov 23, 2009 6:50 PM EST
in MMA News
83 comments
Heavy.com was able to dig down into the Shane McMahon/UFC talks and exactly what his role would be for the promotion. Some of what they were able to gather from their sources was very interesting:
But five years after the initial explosion of popularity built by The Ultimate Fighter reality show, you don’t see a strong UFC brand in the marketplace. While you might expect a thriving brand of UFC t-shirts and hats to be sold in Wal-Marts nationwide, instead you find-almost nothing.
Here, more than anywhere else, is where the UFC can use McMahon’s help. Not only has he witnessed firsthand the WWE’s slow march to wrestling ubiquity, he has personally secured much of the company’s foreign business deals. McMahon has successfully made millions in the United Kingdom and German markets, even successfully taking the WWE into the heart of Western Europe, and can likely replicate that success for the UFC.
It does remain amazing to me that the UFC has yet to really crack the consumer market effectively. "UFC" is a household word (household acronym?) at this point and yet as my wife and I were out doing Christmas shopping this past weekend the only time I saw any strong MMA presence in any store was walking past a Spencer's Gifts and seeing a gigantic Tapout display.
If Shane McMahon can help get the UFC a bigger presense in stores such as Wal-Mart it would have to be considered a huge win. His potential to get such deals done far outweighs the cries we're going to hear from some MMA fans that his involvement would "ruin the legitimacy" of the sport.
Of course, money does remain a bit of an obstacle as it appears Shane wants to buy into the promotion rather than simply be an employee. We will have to continue to monitor the situation to see if this is a dealbreaker or if something can be worked out that is in the best interest of all involved.
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Shane will help the UFC
I don’t care what anyone says.
"Never underestimate the predictability of stupidity." - Bullet Tooth Tony
@deowade
trolls, this will be a very important topic for them.
by Phildo on Nov 23, 2009 6:21 PM EST up reply actions 1 recs
OMG!!!11!!1!@#$#@#@
He iz @ pro rasslin d00d!!!!1111…..MR. MiCk M@NN!!! aLL t3H fIghtZ r goNnA B3 FiX3d & WE’LL C KIrK ANGUL vs. STOn3 CoLD vs. HULK !!!STilL RuLzzz….NW04LiF3
Th3y eet St3r01dz 4 breakfast and wull uZ chAiRz $$$$ N Ch33t
Come on people is this what BE has come to?
by AfroSamurai on Nov 23, 2009 8:07 PM EST up reply actions 2 recs
I think you didn’t get the heavy dose of sarcasm laced in with the Interwebese.
"Never underestimate the predictability of stupidity." - Bullet Tooth Tony
@deowade
And he still got a rec..
Kuwabara Kuwabara
by J. B. Maddox on Nov 24, 2009 8:01 AM EST up reply actions
Forget that...
Who needs Shane in the UFC? It’s all about Fedor vs the Undertaker… Shane + Strikeforce FTW!
Right… I’m going to go hang myself in shame for that one… not hang my head… actually hang myself. Now where did I put that rope…
Typo
McMahon has successfully made millions in the United Kingdom and German markets, even successfully taking the UFC into the heart of Western Europe, and can likely replicate that success for the UFC./blockquote>
It should be “taking the WWE into the heart of Western Europe”
Why is my attempt at a quote so terrible?
I put the quoted text inside the blockquote brackets, then I typed my response after it. :(
You missed a
< which didn’t enclose your blockquote.
AWmusic - mp3 blog.
http://twitter.com/awmusicblog
Is his briefcase shaped like a folding chair?
Keep firing Assholes!
Freezing my nuts off in Canada.
by Ubernoober on Nov 23, 2009 6:12 PM EST reply actions 1 recs
No, but more often than not it’s strung from the rafters 15 feet above the ring, with the contract to a title fight inside.
We're just a million little gods causin' rain storms, turning every good thing to rust.
by Anthony Pace on Nov 23, 2009 6:18 PM EST up reply actions
I think so, I seem to recall some rumors of him trying to get the WWE interested in buying Pride before the UFC got it. I’m not sure how legit those rumors were, though.
He was too young during that point.
And Vince didn’t understand the concept of MMA when he was looking into buying it.
"Respond intelligently even to unintelligent treatment."
-Lao Tzu
People have issues remaining logical once they read WWF or WWE and the last name McMahon + UFC in the same paragraph.. Honestly Shane could really help ZUFFA in this manner, I’m not sure if selling him a bit of ZUFFA would be the right way to do it but you never know, with the issues pertaining to Station Casino’s and the Vegas failure of the Real Estate scene anything is possible…. I just await when people start saying that if Shane enters the MMA world how there are going to be nothing but fixed fights, blah blah blah…. This would be a purely business decision, I doubt that Dana would give any “control” of UFC to Shane, except perhaps endorsements deals and what not………
"I hate to advocate drugs, alcohol, violence or insanity, but they've always worked for me." ~ Hunter S. Thompson
Just some speculation.
If the UFC was looking to sign a deal to hold monthly events on TV would Shane be a good front man promoter for those? Such as how Dana is the front man doing all the press for UFC PPVs.
Just BE.
No.
Shane’s expertise is “Global Markets” and “New Media”. He’s never done or had interest in Booking.
We’re talking about a guy who had to jump through his da’s hoops just to listen to him.
"Respond intelligently even to unintelligent treatment."
-Lao Tzu
Employee fine...
What if he were to buy the UFC? Old Pancrase style cross over between pro wrestling and MMA?
Shane actually is a smart businessman. This helps the UFC in so many ways. The fact that he’s associated with pro wrestling means nothing.
Twitter: @FlyByKnite
I don’t like all those really old, tatted-up, pierced six-ways-to-Sunday people selling sex toys.
We're just a million little gods causin' rain storms, turning every good thing to rust.
by Anthony Pace on Nov 23, 2009 6:37 PM EST up reply actions
I think most reasonable with knowledge on this subject would agree Shane McMahon would help them on a business end. He’s also been a big MMA fan for quite some time while he’s been slowly frozen out of any hope of taking over his own family’s business, so I think it’s fair to say he is committed. A bigger question is if his business connections and experience would be worth selling a piece of the promotion for. And if so, how big a piece? 5%? Would that be fair? For maybe $50 million?
The idea that the Fertitta’s need 50m because of station is ridiculous… the BONDHOLDERS for station need money not the Fertitta’s. When assets get highly leveraged that’s a form of cashing out. Each brother was clearing over 100m per year in salary alone not to mention the other family members involved. The amount of liquid capital this family has is stupid crazy.
Second Zuffa doesnt need a nickel. Their are underwriters ready to cover every penny for every single event for around 2% return on capital.
Shane’s money has no value in the negotiations other than getting him to “buy-in” emotionally to securing his commitment or as an additional incentive to get him on board It’s his expertise and talent that is of value.
Is Zuffa a complete different entity than Station Casinos? I remember that news awhile back how Station Casinos wasn’t doing too hot in the economy. I haven’t really heard anything recently but I just wonder how/if they affect each other.
Its a completely different company and the fertittas held just 25% before it went dark.
They got most of their appreciated capital and earnings out and were playing with “house chips” before the economy imploded.
Anyway, the point is nobody needs 50m especially with the current perceived valuation that’s out there in the public (50m equaling 4-5%). Zuffa will be worth at least 5 times that in 5 years and at least 10 times that when the company hits maturity.
Really?
Seriously? $50-100 million means a lot. Their primary business is struggling. They are pulling lots of money out of Zuffa. You are telling me that they aren’t happy to grab $50 mil in today’s market?
I agree his talents are important. But there are others that bring those skills to the table and they don’t need a $50 million “buy-in” for a $250,000 a year job. That’s craziness. Anyway, I talk quite a bit about what Shane brings to the table in the article.
Thanks for your input. Your comments are always very valuable and interesting. If you want to do some freelancing, feel free to contact me..
by JonathanSnowden on Nov 23, 2009 11:09 PM EST up reply actions
They are pulling money out of Zuffa the in some of the same ways they pulled money out of Station. It’s not because they need money it’s because this is a way of eliminating risk to your equity, earnings and gains by paying low interest rates and having someone else shoulder the risk.
It’s like buying your stock at a very low price and it sky rockets… instead of selling you’re holdings to realize your gains you can simply place most of it on margin at low interest rates and take your money out while letting others take the risk.
The fertittas could sell and liquidate half their positions within 3 months using a 1.2b valuation. But they’re liquidating it anyway (slower) without giving away a single percentage point in the company.
I agree, you did illustrate what he brings very well in terms of skill and experience and nobody can argue that. My gripe was the his 50m being a reason… if anything it gets in the way as he’s in a position where like you said a 500k per year position wouldn’t motivate him and the trio are in a position where bringing in a 4 or 5% partner is not as appealing as simply hiring someone of his skill set and passion.
I would say nobody would bring the value he would bring to Zuffa. Every other “qualified” individual at best does a competent job while riding and depending on the UFC wave to make their “breakthroughs” (1+1 being 2) whereas he would actually engineer the breakthroughs and exponentially leverage Zuffa’s position and assets (1+1 being a potential 4).
But a guy with 50m bucks is not looking to play as a key executive behind the curtains doing his job. There’s a certain prestige that comes with running a successful sports Franchise which money cant buy so its tricky.
If Strikeforce and market dynamics were more ideal this would probably be a better fit.
I can see Shane becoming a UFC vice-president or something along those lines and working with Lorenzo in securing future investments in new areas.
I can’t really see him being in the direct fight promoting game, but I can see him negotiating and working through deals with skeptical cities and skeptical companies and gaining the UFC a lot of great backing.
Who cares where he came from, if he can do the UFC some good?
This is misguided.
The UFC will never be an especially strong clothing brand or licensor. Tapout fills that role for them, and the push from smaller clothing brands covers the rest of the market. The move out of specialty fight shops and in to mid tier retail is a huge leap for MMA brands, and the UFC doesn’t have a strong enough design team or reputation with apparel to win over retailers. Expect Tapout, Affliction, and Ecko to pave the way for Bad Boy, Silver Star, and Warrior in more mainstream channels. The UFC brand will follow the latter group but with smaller shipments and selection, then realize their clothing is only profitable at events when they don’t let anybody else sell merch in the venue.
What if I want a nice simple t-shirt that just says “UFC” and doesn’t look like Liberache vomited on it.
Keep firing Assholes!
Freezing my nuts off in Canada.
If that’s not good enough then MMA Warehouse will hook you up, or OTM, or Fight Gear Outlet. If you really want that and aren’t just playing devils advocate then congratulations, you’re part of a market too small to be sustainable in an incredibly competitive large retail setting. Web distribution and specialty fight stores is where the UFC brand will do best, outside of events themselves. And if they let sponsors sell in the venue, good fucking night. Fighters walk in tees would destroy the UFC branding, particularly main event winner or an underdog win. I doubt it’s worth their time and/or resources to create the push even to get good placement on a hat rack in Target.
then you are clearly
not an mma fan.
(i kid)
They don’t need to be a strong clothing brand, they just need to be making more money from clothing than they are now.
That's my point though.
They really can’t. It will grow with the promotions brand, but never be a major force in the market. You don’t buy a jersey that says NFL. You want a TO jersey, and TO doesn’t represent the NFL at all. Just like you’ll want a GSP walkout shirt, not a UFC shirt.
Additionally, to grow a UFC brand of shirts you would need to take market share
away from the Tapouts, etc…that sponsor alot of fighters and make them money. You would basically need to restrict them to wearing UFC apparel, which would be counter productive to your fighters making more money and being happier, better fighters.
Right, But...
How many people do you see that actually buy the walk out shirts? 90% of the MMA clothing that I see people wearing is Tapout. Not even specific fighter clothes, but just crazy Tapout shirts, or pants, or hats. I dont think the UFC would be marketing to you or me, but to the 14-18 year olds who watch the Ultimate Fighter, or UFC unleashed when they get a chance.
Personally, I think that if the UFC were able to design good enough clothing, and market it properly, they would destroy everyone, with an exception to Tapout, in sales.
But you can buy a buffalo bills shirt or a mets shirt, or a stone cold steve austin shirt, or a whoever shirt.
They don’t need to break into the market and become a major provider of shirts, they just need to sell some.
Of course you can buy those shirts. They just don’t sell nearly as well.
And if they want to break into major retail, both domestic and international, then yeah. They do need to become a pretty major provider. I can’t say enough how difficult it can be to get shelf space from a retailer. If they were to try to increase shirt sales, they’d have to license the brand out and make royalties from their licensee for the first few quarters. And they’d need to go with a large, well established licensee with existing connections at mid-tier retail, which would be a costly investment with poor ROI.
I disagree
I think shirts for specific teams sell just as well if not better than jerseys of specific players. Do you see more Yankees shirts or Jeter jerseys? More Red Sox shirts or Josh Beckett jerseys?
Don't think...
that they won’t put fighters in their own shirts to walk out with if they get a better foothold in the retail maket.
Editor - BloodyElbow.com - SBNation's mixed martial arts headquarters.
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by Brent Brookhouse on Nov 24, 2009 10:36 AM EST up reply actions
Good luck with that.
Every valuable fighter has existing contracts with other sponsors. The UFC can’t even force the sponsors to put an extra logo on to their shirts, since their contracts stipulate what percentage of the shirt they own and a move like that would force fighters to breach contract. Same deal with shorts.
Now with the UFC already charging sponsors for the right to be in the octagon, a push to force fighters into UFC branded shirts will drive out a ton of sponsorships. That cuts fighters pay. That cuts manager’s pay. That makes Strikeforce look real attractive, since the rates you can charge a sponsor for space on CBS will absolutely compensate for the potential drop in base pay.
That plan would drop the UFC brand strength as a promoter, which is all they have going into the apparel world. It would be a massive fuck up on their part, and they are smarter than that.
That makes Strikeforce look real attractive, since the rates you can charge a sponsor for space on CBS will absolutely compensate for the potential drop in base pay.
Til you take into account the fact that Zuffa could give every fighter in the UFC a 50% raise tomorrow and still clear nine figures this year.
Don't agree
WWE branded stuff was all over Wal Mart and Target when they were hot.
by JonathanSnowden on Nov 23, 2009 11:10 PM EST up reply actions
His point was the WWE never had a merchandising sponsor to the likes of Tapout, Affliction, etc to carry it’s banner.
“the UFC doesn’t have a strong enough design team or reputation with apparel to win over retailers”
This was his point, at least the one I was responding too. And the fact is, the WWE sold with a logo alone. A UFC shirt would sell too.
by JonathanSnowden on Nov 23, 2009 11:42 PM EST up reply actions
But the situations are hugely different.
The WWE had no other options, and used a TON of resources to secure the deals they got. UFC has specialty fight shops and gyms to carry their apparel.
WWE was selling shirts intending to represent all of pro wrestling, and were the only involved brand. UFC can try to represent all of MMA, but has to compete directly with brands that are well established in that specific field (Tapout), BJJ (Bad Boy), and fashion (Affliction).
WWE was the only sponsor of the athletes in their organization. UFC has about 40 other brands to contend with, all competing for market share. Not to mention that the UFC will not sponsor their own fighters and sure as fuck won’t sponsor any body elses. That’s a huge blow to the viability of the clothing brand in a non-monopolized market.
I don’t think so at all. I’m not talking about UFC putting out some kind of t-shirt that looks like someone randomly generated and placed a bunch of skulls and swords. I’m talking basic UFC branding in major retail outlets. Not specialty stores. 75% of the people interested in MMA casually will identify much more with the UFC brand and could care less about other fly by night t-shirt brands.
by JonathanSnowden on Nov 24, 2009 8:50 AM EST up reply actions
I don't think the Fertittas and Dana will want an outsider in their circle....
Right now, the UFC is a company ran by 3 good friends. At the end of the day they are the only ones who truly know what the UFC is worth and how much they make etc.
If things went sour with Shane he could potentially leave and spoil some of the secretes they keep. Also, would you want Shane opening up new markets? How hard has it been for the UFC to make people think they are a LEGIT sport, and not just entertainment.
It seems to me hiring Shane would be a step back image wise for the UFC.
I think Shane would be quite an asset for Zuffa in terms of merchandising and new media. As prior commenters have said, a “UFC” line isn’t really gonna outsell the likes of TapOut, but with someone like Shane on board they will certainly do better than they are at the moment.
Food for thought…
What if Zuffa went and bought out TapOut? Make them the exclusive clothing line of the UFC, use the UFC name to get the brand into Walmart’s and such, while keeping the TapOut show and using it for the UFC hype machine as well?
Obviously this is all loosely thought up, but it dosen’t seem to out of this world. I don’t think a deal like that would go down before 2010, but as the UFC continues to profit, they might see it as a worthwhile investment.
"You guys are jerking eachother off with some pseudo deep bullshit." - Kid Nate
I think Tapout has too much value elsewhere for the deal to make sense to them. Non-UFC fighters (Mousasi, Shields, Mayhem, Walker, Drysdale) do a lot for their credibility with the core, which is still a valuable part of their market. Plus, Tapout isn’t a large enough company to cover the needs of every fighter. They just don’t have the resources, and I doubt they have the inclination.
This idea would also slash into each athletes income from sponsors, which slashes managers income, which drives talent to all other corners of the market.
If it doesn’t work out with the ufc and Shane, I’m sure someone like Scott coker would be glad to partner up with Shane, sf doesn’t seem to know how to promote like a big time organization and someone like mcmahon could really help them take the next step
by kanodogg on Nov 23, 2009 9:12 PM EST via mobile reply actions
Why does the UFC need merch?
Noone buys NFL gear—they buy team gear and players jerseys. The UFC should just stay out of the merch business before they become another “Affliction”—a symbol of douchebags everywhere.
The path to my fixed purpose is laid with iron rails, whereon my soul is grooved to run. Towards thee I roll, thou all-destroying but unconquering BROCKLESNAR; to the last I grapple with thee.
If I recall correctly
Merchandising and various, non-event-related revenue streams are part of WWE’s success with its business model. It’s not as if somehow the WWE roster is magically healthy enough to perform all the time, whereas BJ Penn is the only current UFC champion not afflicted with some issue keeping him from fighting any time soon, and just look at what that’s done to the UFC’s main event scene going into 2009. (Plus of course, there’s moments like Rampage calling it quits.)
Team gear is NFL gear. Its ‘NFL Authentic.’ Same with baseball caps. If another company wants to use it, they have to be licensed. Its a huge cash cow.
So that is a solution, but a little logo on a sleeve is vastly different than a big UFC logo front and center. Fighters will gain and lose popularity, shirt styles too. Better to be out of the focus as a licenser.
Otherwise the UFC could turn into Zubaz and No Fear.
The path to my fixed purpose is laid with iron rails, whereon my soul is grooved to run. Towards thee I roll, thou all-destroying but unconquering BROCKLESNAR; to the last I grapple with thee.
This is a smart move.
There is only so far Dana can take the company. His skills are not in the marketing department, really. People who worry about this are fools. Just because his family owns the WWE doesn’t mean squat. Do people actually think MMA will become fake beacuse Shane gets involved? If Warner Bro. was called in to handle the marketing would people think ‘people are going to think the UFC is just a play/movie’? Of course not. Shane McMahon will bring some great ideas to the company.
I don’t see Shane (assuming he gets into UFC to begin with) replacing Dana. For better or for worse, Dana is UFC, the public face of the company, and to some extent, the sport.
At some point, in order for UFC to grow past a certain level, they will need a more PR-inclined frontman. However, Shane’s real strengths and expertise lie elsewhere and putting him out there as the face of the company runs the risk of bringing the “pro wrasslin’ / rigged matches / sports entertainment” stigma UFC would want to avoid.
The man might be able to help MMA get into some states it currently can’t and/or new markets around the world.
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