WSJ:The Odd Economics of Stanford Football

[dcpony]

The Wall Street Journal
The Odd Economics of Stanford Football
With a Small Fan Base and Modest Revenue, The Cardinal Leans on Donors; $500,000 From a 26 Year Old

Fifth-ranked Stanford, once again in the mix for the Pac-12 title and maybe even more, pounded No. 3 Oregon, 26-20, on Thursday in one of this college-football season's biggest games, making the Cardinal the only team to slow down the Ducks the last two years. That makes this as good a time as any to ponder one of this sport's great mysteries: How is Stanford doing it?

There is no single reason for Stanford's rise from a pushover—one that supposedly couldn't compete because of its tough academic standards—to a powerhouse that wins because of them. The transformational 2007-to-2010 tenure of coach Jim Harbaugh, who has since gone on to the San Francisco 49ers, was clearly pivotal. So is the program's growing ability to convince elite high-school recruits of a Stanford degree's value.

But there is another critical factor behind the Cardinal's ascent: the way Stanford finances its football program.

Stanford isn't like other football powers. It can't generate as much cash from its fans, since it doesn't have nearly as many. Stanford Stadium seats about 50,000—half the size of some venues in the Southeastern and Big Ten conferences.

The school accounted for $9.7 million in football ticket sales on its 2012 annual report. The four teams ranked above Stanford in the latest Bowl Championship Series standings averaged $27 million, with Ohio State topping the list at $41 million. In merchandise sales, Stanford ranked 42nd this year on the Collegiate Licensing Company's list of top-selling schools, well behind not just Texas but also Texas Tech.

The normal revenues Stanford receives from football are so low, in fact, that its 36 varsity sports teams depend on something no other school has, or would dare rely so heavily on: an athletics-only endowment worth between $450 million and $500 million that pays out at 5.5% each year, people familiar with the matter said.

The way Stanford keeps up in the college-football arms race is to lean on private donations. As a result, almost everything the football program touches is endowed, from each of the school's 85 football scholarships to David Shaw's head-coaching position. Stanford's offensive coordinator is even known as the Andrew Luck Director of Offense in honor of an anonymous gift in 2012.

"Many have looked at Stanford to say: 'How can we make that happen at our place?'" said Stanford athletic director Bernard Muir.

CONTINUED:
http://online.wsj.com/news/article/SB10 ... #printMode

[feelthehorsepower]

The Wall Street Journal
The Odd Economics of Stanford Football
With a Small Fan Base and Modest Revenue, The Cardinal Leans on Donors; $500,000 From a 26 Year Old

Fifth-ranked Stanford, once again in the mix for the Pac-12 title and maybe even more, pounded No. 3 Oregon, 26-20, on Thursday in one of this college-football season's biggest games, making the Cardinal the only team to slow down the Ducks the last two years. That makes this as good a time as any to ponder one of this sport's great mysteries: How is Stanford doing it?

There is no single reason for Stanford's rise from a pushover—one that supposedly couldn't compete because of its tough academic standards—to a powerhouse that wins because of them. The transformational 2007-to-2010 tenure of coach Jim Harbaugh, who has since gone on to the San Francisco 49ers, was clearly pivotal. So is the program's growing ability to convince elite high-school recruits of a Stanford degree's value.

But there is another critical factor behind the Cardinal's ascent: the way Stanford finances its football program.

Stanford isn't like other football powers. It can't generate as much cash from its fans, since it doesn't have nearly as many. Stanford Stadium seats about 50,000—half the size of some venues in the Southeastern and Big Ten conferences.

The school accounted for $9.7 million in football ticket sales on its 2012 annual report. The four teams ranked above Stanford in the latest Bowl Championship Series standings averaged $27 million, with Ohio State topping the list at $41 million. In merchandise sales, Stanford ranked 42nd this year on the Collegiate Licensing Company's list of top-selling schools, well behind not just Texas but also Texas Tech.

The normal revenues Stanford receives from football are so low, in fact, that its 36 varsity sports teams depend on something no other school has, or would dare rely so heavily on: an athletics-only endowment worth between $450 million and $500 million that pays out at 5.5% each year, people familiar with the matter said.

The way Stanford keeps up in the college-football arms race is to lean on private donations. As a result, almost everything the football program touches is endowed, from each of the school's 85 football scholarships to David Shaw's head-coaching position. Stanford's offensive coordinator is even known as the Andrew Luck Director of Offense in honor of an anonymous gift in 2012.

"Many have looked at Stanford to say: 'How can we make that happen at our place?'" said Stanford athletic director Bernard Muir.

CONTINUED:
http://online.wsj.com/news/article/SB10 ... #printMode

Our academics should be one of our main pillars in recruiting kids, showing them the value of an SMU degree and going to the best school in Texas.

http://bizbeatblog.dallasnews.com/2013/ ... king.html/

[redpony]

Maybe it's time we start a Sports only endowment fund.

[blackoutpony]

Maybe it's time we start a Sports only endowment fund.

Someone send this to Hart and RGT

[dcpony]

Well, one of our former SWC compatriots likes the Stanford model. The piece notes Rice hired Joe Karlgaard as its AD. Up until Oct. Karlgaard led Stanford's athletic dept. fundraising.

[skurtn]

It's striking to think that having a subject-specific endowment fund is a "new" idea; yet it seems to be.

[redpony]

Our academics should be one of our main pillars in recruiting kids, showing them the value of an SMU degree and going to the best school in Texas.

http://bizbeatblog.dallasnews.com/2013/ ... king.html/

'

FTTP- like your enthusiasm.
We should hope to not only emulate their idea of 'sports only' endowments but also their academic standards. We are not close to their academics as well.

[SoCal_Pony]

I remember reading a story on Stanford some 15-20 years ago.

They were at a cross-roads on what role they wanted athletics to play at their school.

Mind you this is Stanford, arguably one of the top 10 schools in the world.

Their decision of course is now obvious. Play at the highest levels. I mentioned this to Turner years ago. Even Stanford understood the value of a successful FB program.

[redpony]

Does that tell you anything about RGT's interest and commitment to sports at SMU???

[ponyboy]

Did he rape your poodle or something?

[redpony]

I thought you were his 'boy' ! haha- No I am always pi$$ed that he did nothing to improve our sports programs until the CofC came along and literally pushed him into doing something. You might also want to check his rep at Ol Miss and what they thought about his commitment to athletics.

I have often wondered if he was related to K.Pye.