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Pro Elite's 10Q Filing

Pro Elite filed its quarterly report, and it is not pretty.  There is a ton of information in the report, and I haven't read the entire thing, but here are the key issues.

They are actively seeking financing:  The only word that can really describe their financial situation is "desparate."  They need $3 million in financing, and that is just to get to the end of the year.  Investors are starting to realize after the failure of the IFL that investing in MMA can be disastrous.

They have lost unbelievable amounts of money:  Over a period of 6 months they lost nearly $25 million.  In the quarter leading up to June 30, 2008, they lost $18 million.  This was the quarter with their big show on CBS.  

CBS is barely paying them anything:  CBS and Showtime paid them $900,000 for their show in May, and they had to pay $500,000 in production costs to get it.  This is cheap programming for CBS, they are not really all that invested in it.

It gets worse than this:  This report only covers through June 30, 2008.  They surely lost a hell of a lot more on their July show.

To be frank, I think the situation is borderline hopeless for EliteXC.  They need serious funding to keep taking these losses, and the only way they can pull out of the hole they are in is to do amazing numbers in October...which would require spending a lot of money in advertising and bringing in big names.  Even if shows do a decent number, I do not see light at the end of the tunnel.  They will still be big money losers.

As far as Pay Per View goes, I don't see it being a success, even with Kimbo Slice and Gina Carano.  By the time they do it in 2009, a lot of the curiosity will be gone, but the even bigger issue is their lack of regular television.  They are only doing shows once every three months, it works on a free basis, but we're yet to see that model work on Pay Per View.  Even if it does, and the show does 300,000 buys, which I find unrealistic, they still are losing so much money so fast that it wouldn't make up for the losses.   

If they do go down,I don't think anyone should dance on their grave.  They took a good shot at it, but competing with the UFC may be impossible unless you get a dedicated billionaire willing to give up a significant portion of his fortune to fight them. 

Note:  Feel free to add anything you find in there of value to the comments and I'll edit it in.  Also correct anything if I'm mistaken, this is complicated and dense stuff.

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