This is the second straight newsletter I’ll be writing to you about a Big 12 private equity or private capital deal. If that’s not a sign of the times of college athletics, I’m not sure what is. 

Right on the heels of Utah’s $500 million private equity deal, reports say the Big 12 is close to finalizing a $500 million, league-wide private capital deal with RedBird and Weatherford Capital.

Here’s the cleanest way to summarize what’s being reported: 

• The Big 12 gets access to a $500 million capital credit line, basically a credit card with a big limit and a discounted interest rate on what it uses.

• The conference is not giving up ownership or equity in the league or in member schools.

• RedBird and Weatherford will work with the Big 12 to grow revenue streams, including opportunities outside the traditional college sports lane.

According to Yahoo’s Ross Dellenger, each school would have the option to opt in and access up to $30 million from the credit line at a discounted rate. It’s optional.

Utah would have the option to participate as well, and it would be separate from the Utes’ recent private equity deal.

The Big 12 has been clear that this deal does not involve giving up equity or a stake in the conference. The fear with private equity (or anything adjacent to it) is that a short-term cash grab leads to programs or departments getting stripped down later. That is not what this structure is, at least as it’s being described.

Think of it as a borrowing tool. Schools can tap into the pool of money if they want, then pay it back over time. That’s fundamentally different from private equity, which is cash up front in exchange for an ownership stake.

The Big 12 has already worked with RedBird on sponsorship efforts that generated $145 million for the conference, and the idea here is to keep building new revenue streams, including some outside college sports.

That’s a key part of why you’re seeing private equity money circling the college sports space right now. These firms believe there’s more revenue to be unlocked than athletic departments can realistically capture on their own.

The Big 12 told Yahoo that a key part of the agreement is to drive commercial business, create new ventures, and invest in revenue-generating companies.

If you want a finance-world perspective, check out The Financial Times’ coverage of the deal.

Now that we’ve got the basics out of the way, here’s my take.

Everybody hates any kind of private equity or private capital involvement in college sports. In general terms, I do too. 

It’s ridiculous that athletics departments are in a place where this type of cash infusion is necessary, but decades of poor NCAA leadership have put them in this position. There is always inherent risk when borrowing money or giving up ownership. That’s been well documented. 

Unfortunately, I think some version of these deals may be necessary for a lot of Big 12 schools to survive this era. Utah president Taylor Randall nailed the core point: these deals carry risk, but doing nothing carries risk too.

Iowa State just lost the most successful coach in school history. Cyclone insiders quickly pointed to NIL realities as part of the reason Matt Campbell left for Penn State. And in May, ISU athletic director Jamie Pollard basically laid out the choice: compete at the highest level or become Northern Iowa.

Iowa State isn’t alone. Big 12 schools that don’t have oil money or Crumbl-cookie money still have to fund revenue sharing and competitive NIL above the rev share cap. If they don’t, they risk becoming Northern Iowa, Oregon State, or Washington State. 

Speaking of Wazzu, the Cougars have had their football coach poached in back-to-back years since they dropped out of a Power Four conference. They’re scheduling home-and-homes every season with Oregon State just to get by. 

That’s the risk of refusing private capital and private equity deals on principle.

Texas Tech can survive just fine without it, thanks to Cody Campbell and the Matador Club. BYU should have the financial juice to keep up. David Booth’s $300 million donation to Kansas might get the Jayhawks by. 

But the rest of the league is in a tough spot. Utah already embraced its position and became a private equity early adopter. I’m sure others across the country will follow. 

Asking for $30 million+ every year for a competitive football roster is going to fatigue donors at most Big 12 schools. It will stress athletics directors immensely. You could ask to be subsidized by the university, but fundamentally, would that make you feel much better than taking private capital cash? And how many universities can foot that kind of bill?

The next iteration of college football is coming in the early 2030s. Whether it’s two mega-conferences, a super league, or something close to it, the job right now is simple: stay competitive enough to be included, because getting left out could be permanent.

Desperate times call for desperate measures. 

The professionalization of college sports is here. If you hate that as a fan, I get it. I wouldn’t blame anyone for losing interest as things keep moving in this direction. That’s a personal decision you have to make for yourself. 

I’m simply here to spell out the reality of what college sports currently are and what it will take to survive—let alone thrive. 

My approach is to enjoy it as much as I can and be realistic about the path forward. I still believe in the Big 12 and its ability to navigate turbulent times.

I hope you’ll come along for the ride.

What You Need to Know

• One of the Big 12’s star quarterbacks is hitting the transfer portal. He could also end up in the NFL draft. 

• Kyle Whittingham stepped down as Utah’s head coach on Friday, ending a Hall of Fame run in Salt Lake City. Multiple reports indicate this isn’t really a retirement, and he’d like to coach again somewhere else. 

• The Utes officially named head-coach-in-waiting and defensive coordinator Morgan Scalley the new head coach on Saturday. Scalley has served as defensive coordinator for the last 10 years and has been on staff in some capacity at Utah for 20 straight seasons. 

• Michigan insiders have pegged Arizona State head coach Kenny Dillingham as one of the top targets for the Wolverines’ head coach opening. The AP reports that Michigan has reached out via a search firm. 

• Dillingham said during a press conference on Saturday that his agent has been working with Arizona State on an extension, but it isn’t finalized. He also got very emotional when asked about what ASU means to him. 

• There is still reason to monitor the situation. Here are my full thoughts on the odds that Dillingham winds up in Ann Arbor. 

• With Mike Gundy, Chris Klieman, Matt Campbell, and now Kyle Whittingham all out of the conference, we’re heading into a totally new era of Big 12 football. Does that mean Texas Tech and BYU are ready to run the league? Here’s what I think we’re heading toward.

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