It's cachet, not cash that wins championships
AUG 26, 2012 5:00a ET
MINNEAPOLIS — It's so easy to forget that this is a business.
When faces are painted and beers are sloshing, when people are bellowing at the tops of their lungs at a pack of teenagers as if their lives depended on it, this can seem like the furthest thing from a powerful, revenue-generating machine. At their core, though, that's what college sports are. They're built upon money, and now more than ever, they're built to make money.
They're big business, and in recent years it's becoming ever harder to forget that, with everything from conference realignment to greater exposure destroying the illusion that college sports exist only for a good time.
So step one is complete. We know this is a business, one that's been maligned and mishandled by everyone from USC to Penn State, each case of power and abuse chipping away at the shiny veneer that this is nothing more than amateur fun.
Step two, though, is blurrier, and in order to fully understand the nature of college's revenue sports, one must understand exactly what kind of business this is. College sports aren't like any other company. They're not-for-profit, but the difference goes beyond just that. In college sports, money does matter. Incomes matter, as does spending. But unlike the real world of business, in college sports, money does not necessarily equal success.
This goes beyond the scandals and the mistakes and their costs to programs. It goes down to the core of the business, where dollars spent do not necessarily mean success. Neither does income generated or even an athletics department that's in the black -- and though universities know that, it's all too easy for the public to forget.
"A lot of times, fans don't have time to analyze it all," University of Minnesota director of athletics Norwood Teague said of the finances of college athletics. "We tend to. We have to analyze it. It's a part of our business . . . If the fans have undue expectations for that, it's just a lack of not knowing the whole story behind a school."
When Teague was announced as Joel Maturi's successor in late April, he was touted largely for his fundraising skills at Virginia Commonwealth University, where he nearly doubled the athletic annual fund, campaigned for a $10 million basketball practice facility and saw the completion of a $4 renovation to the basketball arena. His skill set can be painted as a contrast to Maturi's, whose expertise came more in balancing budgets and reducing the athletic department's reliance on the university. The money is there, and the department is not in debt. Maturi made sure of it. Now, Teague has to go beyond the dollar signs.
Teague's task is made more difficult and pressing by the fact that the school's two main revenue sports, football and men's basketball, have struggled in recent years. The football team hasn't won 10 games since 2003 or appeared in a bowl game since 2009. The basketball team hasn't made the NCAA tournament since 2010 and hasn't advanced past the first round since 1997. Meanwhile, though, the hockey program has been consistently among the nation's best, so a precedent of success has been built at the school. Now, though, Teague must find a way to generate success in the sports that will bring the school both funds and a better reputation.
A glance at information from public universities shows what a complex financial puzzle most athletics directors face. For example, in 2010-11, the most recent year for which NCAA data is available, there was little correlation between money spent on football recruiting and a school's recruiting class, and this is nothing new. The public university that spent the most on football recruiting, Tennessee, finished with just the 13th-best class, according to Rivals.com, despite its $1.14 million investment. Alabama, which had the No. 1 recruiting class that year, did spend the second-most money, but Florida State, whose class was second-best, spent only $433,236 (25th-most among public schools).
After Alabama and Florida State, Texas, Georgia and LSU rounded out the top five public schools in terms of recruiting class ranking. They spent from $302,882 (LSU) to Alabama's $980,882, a wide range for such close results, and it's easy to see what these schools have in common is not a dollar amount but a cachet.
Players want to play there. Those schools have developed a reputation for success, which at some point was constructed upon donations and funding and loyalty but which has now spiraled into something much bigger and more abstract.
Those numbers are proof that this goes beyond just the simple accounting ledger. The Minnesota ledger shows that the Gophers football program was ranked 25th among the highest-income revenue sports programs (football and basketball) in 2010-11. Its surplus (revenue less expenses) totaled $14,888,989, which buffered a $78,924,683 expenses budget. That year, the athletic department's budget was balanced, but its spending totaled more than that of Nebraska, USC, Notre Dame, Texas A&M, UNC, Kansas, Duke, Michigan State, Missouri, Oklahoma State and Illinois, among others.
From that, it's easy to see that the big spenders don't necessarily win. Most of the major programs that spent less than Minnesota had more athletic success in their revenue sports, and there's so much that goes into winning beyond just investing in teams. Budgets will always grow -- because really, who wouldn't turn down the chance at more money? -- but there's plenty of finesse involved in coaxing success from that growth.
If some crazy NCAA scheme were to shuffle athletics funding and leave Minnesota with Tennessee's recruiting budget and Kansas State's $23 million athletic department net income, the school still wouldn't win the Rose Bowl or a basketball national championship. Not immediately, and not even three or four years down the line. It would help, no doubt, but in the world of college sports, money is more a symptom of winning than a path to doing so.
Money builds infrastructure. It constructs stadiums and erects practice facilities. It pays coaches. But in a world of college sports where money touches everyone and everything but the men on the field, money's power is limited. Players are bought not with dollar bills, but with reputations and name recognition and uniforms. They're bought with history. Teague has the latent seeds of that history at Minnesota. He's ready to shake hands and fundraise, but he won't be buying success. He and his coaches will be building the kind of reputation that might facilitate success, and though the money will help, it can't be held responsible.
"Now I will say this: the facilities are important," Teague said. "Fundraising is important. Operating budgets . . . are important, but the priceless part of what you do is if you have talented people, you can overcome a whole lot."
So Teague must build budgets, but he also must use money properly and build the right connections. That's why he is touted as a fundraiser, not an accountant. He's not there to count checks and balance ledgers but to create something bigger. The school must build a foundation from which it can build and somehow wedge itself into the rat race of recruiting and television contracts and bowl berths that might earn it a shot at being something better than mediocre.
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