“This is Spring Football, you should always be worried.” USFL Historian on XFL’s Fundraising Efforts

by Reid Johnson

On the August 12th episode of The Markcast, long-time contributor to the program USFL historian and OurSports Central owner Paul Reeths returned to break down the latest news of the XFL seeking investors prior to its 2023 season and how the XFL’s fundraising differs from the investments been seemed by spring football rival the USFL.

With the announcement that the XFL is seeking additional investor funds before the 3.0 version of the league has even played one down, I asked Paul Reeths if fans of the XFL and other alt-football leagues should be worried:

“This is spring sootball, you should always be worried.”

“The optics on it, if you do wanna put a spin there, maybe not terribly great.”

“It's very likely that they've been looking for a while, maybe they were even in discussions with someone and they haven't progressed to the degree that they thought they were going to.”

“The reasonable expectation I think was that they needed more money, and so therefore they would be looking for more money.”

FOX has come out and reported that the USFL not only broke even in year one of its spring football endeavor, but actually made money doing so. How was FOX Sports able to profit, when the XFL is already looking for additional funds:

“This past season (of the USFL) as frugal as it was, was still awfully expensive. So they can count in all kinds of ancillary benefits, which may or may not actually be tied into the USFL in order to make that look better and keep in mind that they’re trying to drum up additional funds. So they wanna make that investment look as good as possible.”

Even with the heavy, “we want football all year” mentality of die-hard spring and alt-football fans, there’s no denying that running ANY football league outside the NFL, not to mention an upstart spring football league is incredibly expensive. Why does Paul Reeths think there’s still so much desire for investors and upstarts to try their hands are launching their own spring football league, non-NFL alternative?

“The thing that keeps striking me is that there are these entities that are like, ‘Hey, you know what? This is not a half bad idea.’ This spring football thing yet it takes so much money to make it happen that everybody's looking for, outside help. There's something that they see in developing their own sports property with the rising rights with all the other sports properties, television rates, especially that they see that, want a piece of and that they think they can get a piece of.”

Reports have come out via XFL News Hub’s Mike Mitchell that the XFL is willing to give up 35%-45% of the XFL’s core business to investors in an attempt to raise the necessary $125 million in funds, should XFL fans be worried that Dany Garcia, The Rock, and Redbird Capital are giving up too much stake in their company so early?

“I think what Redbird capital, The Rock, Dany Garcia are looking at is controlling interest, and as long as you have a controlling interest in the league, which is more than 45%, you'll be able to dictate what happens.”

Mike Mitchell’s reporting is that the XFL, who is offering up a percentage of its company to outside investors, hasn’t yet begun shipping the idea of owning teams to individual investors, although they’ve had interest. Why are some people so willing to try their hand at owning an XFL franchise, while the USFL who spent the spring of 2022 auditioning its league to outside investors willing to use their resources to bring a USFL franchise to their local market has seemingly struck out so far?

“They're getting the interest from people wanting to own the teams and I think people can see track history with the XFL that they've been in the whole markets. Even though technically this version of the XFL hasn't kicked off yet, people do have an idea of what to expect in these XFL markets, that includes some folks with money. The USFL, you still have I think what a lot of people saw last year was The Spring League with team names attached to them with city names attached to them with some historical interest. I think that that did play well with a certain section of viewing public. I’m not sure that we saw that translate into the section of the public with real money.”

“Maybe it does speak to the presentation too, of the USFL. We had empty stadiums for three-quarters of the games, and I don't think you can get past that point with a lot of people. That does plant some doubt. ‘If I bring this thing into Houston, am I gonna have an empty stadium? If I bring this thing somewhere around New Jersey, am I gonna have an empty stadium?’ So what Fox may have done is planted those seeds of doubt with their empty stadium last year.”

Regardless of whether the XFL is able to acquire the additional funds they are looking for, Mike Mitchell has also reported that Redbird Capital is willing to continue to fund its endeavor should they not get the necessary investor funds, the existence of two competing alt-football leagues is only a plus for the players looking to gain the most they can from the hard work that comes along with preparing and competing in a spring football league.

“I'm sure that there have been so many different scenarios that have been brought up. You have to peg down your player pay. It certainly looks at this point that the XFL is going to pay significantly more than the USFL did this past season. So that, you know is that gonna have a domino effect as the USFL then going to say ‘Hey, we can't continue to pay 45 grand for quarterbacks, we have to step up our game?’”

Please check out Paul and my full chat on the August 12 episode of The Markcast, link below.