Journey from $2 million to $4 billion

Ultimate Fighting Championship was once declared as ‘human version cock fight’ and was once rejected by most of the states of United States of America. Today it is not only accepted by the Athletic bodies of 50 states of United States of America but also viewed live in 152 countries, its recent installment UFC 200 was touted as biggest fight card in the history of the championship.

This 1993 born company was close to bankruptcy when the Casino operators Fertitta brothers bought the company for $2 million. Over the weekend the Fertitta brothers sold the company for $4 billion to group led by talent agency WME-IMG. The group includes major private equity firms Silver Lake, Kohlberg Kravis Roberts (KKR), as well as the private investment firms of Michael Dell. Thereby making it the largest sale in the history of sports business, beating the closest possible sale LA Dodgers for $2.1 billion in 2012. The sale value represents an annual return of 72% over a period of 15 years.

Last year company had an annual revenue of $600 million almost $80 million rise from previous year, UFC has made Conor ‘The Notorious’ Mcgregor and Ronda Rousey a house hold name across the world, thanks to broadcast in over 156 countries and territories, to nearly 1.1 billion television households worldwide, in 29 different languages. Its closest competitor in contact sports is World Wrestling Entertainment currently valued at $1.5 billion.

Sponsors portfolio now include Bud Light ($8 million per year), Reebok ($70 million over 6 years), Harley-Davidson (HOG), MetroPCS, EA Sports (EA, Tech30), Toyo Tires and FRAM auto filters.

Pay-per-view fees is the major source of revenue for the company, followed by gate receipt with average attendance of 70,000 to its marquee events, closely followed by sponsorship money. It also has a $700 million, seven-year broadcast rights deal with Fox (FOX), as well as an online subscription package for fans.

What is it that attracts fans to this gruesome sport? Mixed Martial Art in itself is something which has started to grow among the general audience especially the youth. I remember my room-mate Renan at Loughborough who was originally from Brasil used to stay up late to watch  the UFC marquee events, while I had no clue what the sport was all about. Increased understanding of the sports and impact of social media is surely some of the integral factor, especially when Ronda Rousey makes a vine videos out of her matches by defeating Cat Zingano in 14 seconds & Alexis Davis in 16 seconds (easy to upload).

I feel for a Championship that was born in America, its presence in 152 countries & territories tells a lot about wide emergence of the sport. Below was the scene in India where UFC 200 was live early morning, where special screening were organised in Hard Rock Cafe across India (photos from twitter).

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From a sport which was once consider to under pay its athlete, UFC has come a long way from that too where Brock Lesnar walked away with $2.5 million from his UFC 200 bout, hence attracting more athletes and former Olympians to pick up the sport.

This sale is basically puts a stamp that the Casino magnet brothers basically took a bloody combat sport and turned it into a modern day money minting widely accepted sport. Also it is always nice to see the story of ‘Entourage’ grow in real life through the real life Ari Gold in William Morris Endeavour’ co-CEO Ari Emanuel.

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