Private equity’s entry into college sports has been more of a tiptoe than a march, and as Week 0 of the college football season begins, PE players are still on the hunt for the right opportunities.

College sports is supposed to be the new frontier for private equity, and there’s more of a need for capital than ever, given that the new House v. NCAA settlement allows schools to share millions in revenue with players and offer extra scholarships. Yet it remains unclear exactly what form PE investment will take—and whether it will include any traditional equity at all. It’s very different from the major North American pro leagues, all of which allow some form of private-equity ownership after the NFL approved limited PE investment last summer.

David Gringer, a partner at law firm WilmerHale who focuses on antitrust issues in higher education and sports, tells Front Office Sports that part of the reason for private equity’s slow walk into college sports is that the “finances don’t make the same degree of sense” as they do on the pro side.

“It’s not like you’re going to buy 10% of the University of Alabama,” he says.

So far, the clearest path for investors has been lending. Most major PE firms now have credit arms, and those deals don’t create ownership stakes like in the NFL, where firms can buy in and later sell out. Instead, they’re structured as loans: investors provide financing, collect interest, and get repaid. 

The arrangements tend to carry less risk and fewer restrictions than equity, but also less reward, since lenders don’t share in the big upside of college sports’ commercial growth. Private-credit deals aren’t private equity’s Trojan horse; they are simply the sort of agreement that both sides—the investment firms and the schools—are most comfortable with for now.

We’ve already seen a version of this type of deal: A $500 million initiative from sports business consultancy Elevate, announced in June, brought institutional capital directly into college sports, and a number of deals have already been reached. The money came from PE firm Velocity Capital Management and the Texas Permanent School Fund. The initiative uses private-credit agreements—loans on a deal-by-deal basis with negotiated repayment terms.

At the time of its announcement, Elevate said it had already closed on eight-figure deals with two unidentified Power 4 schools, and up to six more were expected by football season.

Jonathan Marks, chief business officer for college at Elevate, told FOS in June that the goal for the initiative was to maximize revenue, which could mean using the institutional capital to upgrade stadiums and arenas to sell more premium seating, or converting little-used areas in them into club spaces for which schools can sell memberships.

“One reason college sports have become so attractive is the recurring cash flows,” says Josh Harlan, managing partner of Harlan Capital Partners. “Media rights, sponsorship, naming rights—these are multi-year contractual revenues.”

Harlan notes private credit is particularly efficient in smaller deals that might be overlooked by equity investors chasing larger opportunities. For now, this makes credit the simplest way for PE to gain exposure without taking on governance or control issues.

When it comes to the “equity” portion of private equity, investment in college sports has remained tentative. Theoretically, funds could invest in corporate structures holding revenue-generating athletic operations—something Clemson University and the University of Kentucky have both done—although questions remain about how well PE would mesh with the mission of higher education.

“PE can add a ton of value. It’s not just capital, it’s expertise,” says Brian Anderson, who co-leads the sports practice at law firm Sheppard Mullin. “These funds often have portfolios of companies they can leverage to help schools commercialize stadiums, [secure] naming rights, sponsorships, fan engagement—all the things pro teams already do.”

But, he cautioned, “PE likes control. They want governance rights, board seats, influence over how an entity operates. That’s where you can see conflict in college sports, especially with public institutions that have an educational mission.”

Last summer, the Big 12 was reportedly in talks with CVC Capital Partners to sell a 15% to 20% stake in the conference for $800 million to $1 billion. Other private-equity firms circled the rest of the nation’s top conferences.

“Having a capital resource as a partner makes a ton of sense,” Big 12 commissioner Brett Yormark said in July 2024 at his conference’s preseason football media days. “That’s really how you conduct good business, I really believe that. And if you see where private equity is kind of making a path into professional sports, at some point in time, it’s going to come here into college athletics.”

But more than a year later, no conference has made the leap, and top leaders continue to question the value of opening their doors to private equity. The only power conference still even pursuing private-equity deals currently is the Big Ten.

This summer, Front Office Sports asked each of the Power 4 commissioners about the status of PE talks. 

• “We’re well informed,” Yormark said in late May. “We know what’s going on in that world … and we’re just not ready to jump in just yet.”
• In July, SEC commissioner Greg Sankey said, “We have been probably two and a half, three years into visits with banks, with private equity, with venture capital. … That’s not been the right direction for us. We’ve not seen the concept that works.”
• ACC commissioner Jim Phillips said his schools are “very educated about it, and there just hasn’t been anything that really has made sense.”
• Though the Big Ten’s Tony Petitti was the only commissioner to confirm he was still actively considering deals, he also said any deal is “a long way from crystallizing.”

The collective trepidation is a big shift from this time last year, when the floodgates appeared ready to open.

“There continues to be some uncertainty on both sides of the table,” says KPMG U.S. industry sports leader Shawn Quill, who helps advise PE firms and universities. 

Quill cites several reasons for the slow movement around PE, such as concerns about the return on investment—both from firms about how much money they could make, and from conferences about the consequences of taking the up-front cash. There is also a need for more financially minded executives in athletic departments nationwide, Quill says, noting some departments are starting to hire their own chief commercial, operating, and financial officers. 

Then there is the fact that schools have been faced with sharing revenue with athletes for the first time following the House v. NCAA settlement, as well as changes around NIL (name, image, and likeness) deals. “I think that there are potentially more pressing issues at the moment for these universities.”

Scott Purdy, media industry leader for KPMG U.S., says the temporary nature of private-equity investments—firms typically want to make a profit and exit within a certain time-frame—complicates investing in a conference or athletic department. “There’s not yet a proven mechanism to get money in and get money out,” Purdy says. 

Overall, both Quill and Purdy are optimistic PE will eventually flood into college sports when the time is right, and the Power 4 conferences are keeping the doors open, too—if the price is right.

Phillips said the ACC still “occasionally” gets calls from PE firms, and Yormark called the Big 12’s PE search “a great exercise, and we’ll see what happens in the future.” Sankey said the SEC’s interest would be piqued “if there are opportunities for mutual benefit.”

“We’re still thinking about what that could mean in terms of how you would structure something,” Petitti said. “We’re doing work trying to figure out, if we were to build something, what’s the best way to build it?”

In June, sports consultancy firm Elevate and two unnamed schools inked the first athletic-department private-equity deals. But no firm has landed a deal since, as schools are largely hesitant to allow private equity into their individual athletic departments. 

Some are uncomfortable with bringing private capital into an educational setting, and they would prefer to opt for more traditional revenue streams. Others believe the money isn’t worth the risk of handing over control to private-equity business moguls or getting stuck owing money they can’t repay. (The hesitancy largely extends to the conference level, where the Big Ten is the only power league actively pursuing private-equity offers.)

For the richest power conference schools, the concept of allowing a private-equity firm to buy an ownership stake in an athletic department “doesn’t make any sense” at this point, one school source tells Front Office Sports. The source also notes the mission of a private-equity firm doesn’t align with that of a university, even a nine-figure athletic department. It’s a “small amount of money for an enormous amount of the control.”

Northwestern athletic director Mark Jackson told FOS his program has been “approached” with private-equity offers. “We’re not in a position to explore that right now, nor do we want to,” he says. “Fortunately, the way we’re resourced here—a lot to do with our connection to the Big Ten—puts us in a good position where there’s not a lot of need for us to look outside as an institution individually for outside funding.”

The wealthiest programs are also disinterested in the type of “private credit” deal that doesn’t give a firm an ownership stake, the source says.

In May 2024, RedBird Capital Partners and Weatherford Capital launched Collegiate Athletic Solutions (CAS), a private-equity venture that would infuse between $50 million and $200 million in capital to a given athletic department in exchange for a potential return on investment, rather than an ownership stake. If schools don’t make a certain amount of revenue from the investment, neither firm would expect a return. 

But a year later, CAS hasn’t announced any deals.

“I think the reason why people have been slow to do anything is they didn’t know 100% whether or not the House case was going to pass,” Weatherford Capital founder Drew Weatherford told FOS in July. “The likelihood of it passing [was] increasing—but it wasn’t a guarantee.” He explained that, as they waited, schools exhausted all avenues to find more traditional revenue streams, like state or institutional support.

The appeal likely increases for lesser-funded athletic departments looking for cash infusions to help them compete at a higher level. After all, with the top power conference schools raking in more than ever, and many Division I programs taking on costs associated with the House v. NCAA settlement, running a successful athletic department has never been more expensive. (Schools that opted in to the settlement will now cough up $20.5 million each for revenue-sharing with players, as well as extra scholarship money.)

Weatherford says there’s been renewed interest from schools across the board since the settlement was finalized, however, and that conversations are “underway.” He didn’t put a timeline on if or when a deal would materialize. He adds he’s spoken with athletic departments across D-I with various budgets. 

One school to keep an eye on: Boise State, which launched an athletic department arm partially aimed at exploring private capital. Athletic director Jeramiah Dickey told FOS in June that the Broncos were about six months out from some sort of private-capital investment. But he noted the deal may not be a traditional private-equity ownership stake structure, either. 

“Ultimately, I need to create more assets for my institution and state,” Dickey said. Because the athletic department doesn’t earn as much money as some others, “I have to get that much more creative, which means I have to take that much more risk—and appropriately so.”

Editors’ note: RedBird IMI, of which RedBird Capital Partners is a joint venture partner, is the majority owner of Front Office Sports.

—Colin Salao contributed reporting.